Registration No. 333-44545
File No. 811-08613
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / X /
PRE-EFFECTIVE AMENDMENT NO. 2 / X /
POST-EFFECTIVE AMENDMENT NO. ___ / /
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT
COMPANY ACT OF 1940 / X /
AMENDMENT NO. 2 / /
OPPENHEIMER LARGE CAP GROWTH FUND
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(Exact Name of Registrant as Specified in Charter)
Two World Trade Center, New York, New York 10048-0203
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(Address of Principal Executive Offices)
212-323-0200
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(Registrant's Telephone Number)
ANDREW J. DONOHUE, ESQ.
OppenheimerFunds, Inc.
Two World Trade Center, New York, New York 10048-0203
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(Name and Address of Agent for Service)
APPROXIMATE DATE OF PROPOSED OFFERING: As soon as practicable after the
effective date of this Registration Statement and thereafter from day to day.
It is proposed that this filing will become effective:
/ / Immediately upon filing pursuant to paragraph (b)
/ / On __________________, pursuant to paragraph (b)
/ / 60 days after filing, pursuant to paragraph (a)(1)
/ / On _______, pursuant to paragraph (a)(1)
/ / 75 days after filing, pursuant to paragraph (a)(2)
/ / On _______, pursuant to paragraph (a)(2)
of Rule 485.
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The Registrant hereby amends the Registration Statement on such date or dates as
may be necessary to delay its effective date until the Registrant shall file a
further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to Section 8(a), shall
determine.
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FORM N-1A
OPPENHEIMER LARGE CAP GROWTH FUND
CROSS REFERENCE SHEET
PART A OF
FORM N-1A
ITEM NO. PROSPECTUS HEADING
1 Front Cover Page
2 Expenses; A Brief Overview of the Fund
3 *
4 Front Cover Page; Investment Objective and Policies
5 Expenses; How the Fund is Managed; Back Cover
5A *
6 How the Fund is Managed - Organization and History; Dividends,
Capital Gains and Taxes; The Transfer Agent
7 How to Buy Shares; How to Exchange Shares; Special Investor
Services; Service Plan for Class A Shares; Distribution and
Service Plan for Class B Shares;
Distribution and Service Plan for Class C Shares; How to Sell
Shares; Shareholder
Account Rules and Policies
8 Special Investor Services; How to Sell Shares; How to Exchange
Shares
9 *
PART B OF
FORM N-1A
ITEM NO. HEADING IN STATEMENT OF ADDITIONAL INFORMATION
10 Cover Page
11 Cover Page
12 *
13 Investment Objective and Policies; Other Investment Techniques
and Strategies; Additional Investment Restrictions
14 How the Fund is Managed; Trustees and Officers of the Fund
15 How the Fund is Managed - Major Shareholders
16 How the Fund is Managed; Distribution and Service Plans;
Additional Information About the Funds
17 Brokerage Policies of the Fund
18 Additional Information about the Fund
19 Your Investment Account; How to Buy Shares; How to Sell
Shares; How to Exchange Shares
20 Dividends, Capital Gains and Taxes
21 How the Fund is Managed; Additional Information About the Fund
- The Distributor; Distribution and Service Plans
22 *
23 Financial Statements
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*Not applicable or negative answer.
<PAGE>
OPPENHEIMER
LARGE CAP GROWTH FUND
PROSPECTUS DATED ______, 1998
Oppenheimer Large Cap Growth Fund is a mutual fund that seeks capital
appreciation as its investment objective. Current income is not an objective.
The Fund seeks its objective by investing predominantly in common stocks of
companies the Manager has selected from among those included in the Russell
1000(R) Growth Index. The Manager looks for companies that, in its opinion, have
above-average earnings prospects but are selling at below-normal valuations.
The Fund's common stock investments will emphasize stocks of large
capitalization issuers (those with a market capitalization in excess of $3
billion). The Fund's common stock holdings will generally have a dollar-weighted
average market capitalization between the median and the mean market
capitalization (currently between $3.2 billion and $9.5 billion, respectively)
of the companies included in the Russell 1000 Growth Index. The Russell 1000
Growth Index measures the performance of those Russell 1000 companies with
higher price-to-book ratios and higher forecasted growth values. The Russell
1000 Index measures the performance of the 1,000 largest U.S. companies based on
total market capitalization, and represents approximately 88% of the invested
U.S. equity market.
The Fund will generally invest 10% or less of its total assets in cash,
cash equivalents (such as commercial paper) or U.S. Government securities. The
Fund may use options and futures contracts for hedging purposes to seek to
reduce the risks of market fluctuations that affect the value of the securities
the Fund holds. THE FUND MAY BORROW MONEY FROM BANKS TO BUY SECURITIES, WHICH IS
A SPECULATIVE INVESTMENT METHOD KNOWN AS "LEVERAGE."
Please refer to "Investment Objective and Policies" for more information
about the types of securities the Fund invests in and refer to "Investment
Risks" for a discussion of the risks of investing in the Fund.
This Prospectus explains concisely what you should know before investing
in the Fund. Please read this Prospectus carefully and keep it for future
reference. You can find more detailed information about the Fund in the
________, 1998, Statement of Additional Information. For a free copy, call
OppenheimerFunds Services, the Fund's Transfer Agent, at 1-800-525-7048, or
write to the Transfer Agent at the address on the back cover. The Statement of
Additional Information has been filed with the Securities and Exchange
Commission and is incorporated into this Prospectus by reference (which means
that it is legally part of this Prospectus).
(OppenheimerFunds logo)
SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF ANY BANK, ARE NOT
GUARANTEED BY ANY BANK, ARE NOT INSURED BY THE F.D.I.C. OR ANY OTHER AGENCY, AND
INVOLVE INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF THE PRINCIPAL AMOUNT
INVESTED.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
1
<PAGE>
CONTENTS
ABOUT THE FUND
EXPENSES
A BRIEF OVERVIEW OF THE FUND
FINANCIAL HIGHLIGHTS
INVESTMENT OBJECTIVE AND POLICIES
INVESTMENT RISKS
INVESTMENT TECHNIQUES AND STRATEGIES
HOW THE FUND IS MANAGED
PERFORMANCE OF THE FUND
ABOUT YOUR ACCOUNT
HOW TO BUY SHARES
Class A Shares
Class B Shares
Class C Shares
Class Y Shares
SPECIAL INVESTOR SERVICES
AccountLink
Automatic Withdrawal and Exchange Plans
Reinvestment Privilege
Retirement Plans
HOW TO SELL SHARES
By Mail
By Telephone
HOW TO EXCHANGE SHARES
SHAREHOLDER ACCOUNT RULES AND POLICIES
DIVIDENDS, CAPITAL GAINS AND TAXES
APPENDIX A: SPECIAL SALES CHARGE ARRANGEMENTS FOR
FUND SHAREHOLDERS WHO WERE SHAREHOLDERS OF
THE FORMER QUEST FOR VALUE FUNDS
2
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ABOUT THE FUND
EXPENSES
The Fund pays a variety of expenses directly for management of its assets,
administration, distribution of its shares and other services, and 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 expenses directly, such as sales charges and account
charges. The following tables are provided to help you understand your direct
expenses of investing in the Fund and your share of the Fund's business
operating expenses that you will expect to bear indirectly.
o SHAREHOLDER TRANSACTION EXPENSES are charges you pay when you buy or
sell shares of the Fund. Please refer to "About Your Account" starting on page
__ for an explanation of how and when these charges apply.
CLASS A CLASS B CLASS C CLASS Y
SHARES SHARES SHARES SHARES
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Maximum Sales 5.75% None None None
Charge on
Purchases (as a %
of offering price)
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Maximum Deferred None(1) 5% in the first 1% if None
Sales Charge year, declining shares are
(as a % of the to 1% in the redeemed
lower of the sixth year and within 12
original offering eliminated months of
price or redemption thereafter(2) purchase(2)
proceeds)
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Maximum Sales None None None None
Charge on
Reinvested
Dividends
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Exchange Fee None None None None
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Redemption Fee None None None None
(1)If you invest $1 million or more ($500,000 or more for purchases by
"Retirement Plans," as defined in "Class A Contingent Deferred Sales Charge" on
page __) in Class A shares, you may have to pay a sales charge of up to 1% if
you sell your shares within 18 calendar months from the end of the calendar
month during which you purchased those shares. See "How to Buy Shares - Buying
Class A Shares," below.
(2)See "How to Buy Shares- Buying Class B Shares" and "How to Buy Shares Buying
Class C Shares," below for more information on the contingent deferred sales
charge.
o ANNUAL FUND OPERATING EXPENSES are paid out of the Fund's assets and
represent the Fund's expenses in operating its business. For example, the Fund
pays management fees to its investment adviser, OppenheimerFunds, Inc. (which is
referred to in this Prospectus as the "Manager"). The rates of the Manager's
fees are set forth in "How the Fund is Managed," below. The Fund has other
regular expenses for services, such as transfer agent fees, custodial fees paid
to the bank that holds its portfolio securities, audit fees and legal expenses.
ANNUAL FUND OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET ASSETS)
CLASS A CLASS B CLASS C CLASS Y
SHARES SHARES SHARES SHARES
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Management Fees 0.75% 0.75% 0.75% 0.75%
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12b-1 Plan Fees 0.25% 1.00% 1.00% None
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Other Expenses 0.52% 0.52% 0.52% 0.42%
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Total Fund Operating Expenses 1.52% 2.27% 2.27% 1.17%
The "12b-1 Plan Fees" for Class A shares are service fees (the maximum fee
is 0.25% of average annual net assets of that class). For Class B and Class C
shares, the 12b-1 Plan Fees are the service fees ( 0.25% of average annual net
assets of that class) and the asset-based sales charge of 0.75%. These Plans are
described in greater detail in "How to Buy Shares." Because the Fund is a new
fund and has no operating history, the rates for the management fees and the
12b-1 Plan fees are the maximum rates that can be charged. "Other Expenses" in
the table above are estimates based on the Manager's projections of those
expenses in the Fund's first fiscal year (which ends August 31, 1998).
o EXAMPLES. To try to show the effect of these expenses on an investment
over time, we have created the hypothetical examples shown below. Assume that
you make a $1,000 investment in each class of shares of the Fund, that the
Fund's annual return is 5%, and that its operating expenses for each class are
the ones shown in the Annual Fund Operating Expenses table above. If you were to
redeem your shares at the end of each period shown below, your investment would
incur the following expenses by the end of 1 year and 3 years:
1 YEAR 3 YEARS
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Class A Shares $72 $103
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Class B Shares $73 $101
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Class C Shares $33 $71
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Class Y Shares $12 $37
If you did not redeem your investment, it would incur the following
expenses:
1 YEAR 3 YEARS
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Class A Shares $72 $103
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Class B Shares $23 $71
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Class C Shares $23 $71
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Class Y Shares $12 $37
In the first example, expenses include the Class A initial sales charge and the
applicable Class B or Class C contingent deferred sales charge. In the second
example, Class A expenses include the initial sales charge, but Class B and
Class C expenses do not include contingent deferred sales charges. Because of
the effect of the asset-based sales charge and the contingent deferred sales
charge imposed on Class B and Class C shares, long-term holders of Class B and
Class C shares could pay more than the economic equivalent of the maximum
front-end sales charge allowed under applicable regulations. For Class B
shareholders, the automatic conversion of Class B shares to Class A shares is
designed to minimize the likelihood that this will occur. Please refer to "How
to Buy Shares - Buying Class B Shares" for more information.
THESE EXAMPLES SHOW THE EFFECT OF EXPENSES ON AN INVESTMENT, BUT ARE NOT
MEANT TO STATE OR PREDICT ACTUAL OR EXPECTED COSTS OR INVESTMENT RETURNS OF THE
FUND, ALL OF WHICH MAY BE MORE OR LESS THAN THOSE SHOWN.
A BRIEF OVERVIEW OF THE FUND
Some of the important facts about the Fund are summarized below, with references
to the section of this Prospectus where more complete information can be found.
You should carefully read the entire Prospectus before making a decision about
investing in the Fund. Keep the Prospectus for reference after you invest,
particularly for information about your account, such as how to sell or exchange
shares.
o WHAT IS THE FUND'S INVESTMENT OBJECTIVE? The Fund's investment
objective is to seek capital appreciation.
o WHAT DOES THE FUND INVEST IN? The Fund seeks its objective by investing
predominantly in common stocks of companies the Manager has selected from among
those included in the Russell 1000(R) Growth Index. The Manager looks for
companies that, in its opinion, have above-average earnings prospects but are
selling at below-normal valuations.
The Fund's common stock investments will emphasize stocks of large
capitalization issuers (those with a market capitalization in excess of $3
billion). The Fund's common stock holdings will generally have a dollar-weighted
average market capitalization between the median and the mean market
capitalization (currently between $3.2 billion and $9.5 billion, respectively)
of the companies included in the Russell 1000 Growth Index. The Russell 1000
Growth Index measures the performance of those Russell 1000 companies with
higher price-to-book ratios and higher forecasted growth values. The Russell
1000 Index measures the performance of the 1,000 largest U.S. companies based on
total market capitalization, and represents approximately
88% of the invested
U.S. equity market.
The Fund will generally invest 10% or less of its total assets in cash,
cash equivalents (such as commercial paper) or U.S. Government securities. The
Fund may also use options and futures contracts for hedging purposes to try to
manage investment risks. These investments are more fully explained in
"Investment Objective and Policies" starting on page __.
o WHO MANAGES THE FUND? The Fund's investment adviser (the "Manager") is
OppenheimerFunds, Inc., which (including a subsidiary) manages investment
company portfolios currently having over $85 billion in assets at March 31,
1998. The Manager is paid an advisory fee by the Fund, based on its net assets.
The Fund has a portfolio manager, Robert C. Doll, Jr., who is employed by the
Manager and is primarily responsible for the selection of the Fund's securities.
The Fund's Board of Trustees, elected by shareholders, oversees the investment
adviser and the portfolio manager. Please refer to "How the Fund is Managed,"
starting on page __ for more information about the Manager and its fees.
o HOW RISKY IS THE FUND? All investments carry risks to some degree. It is
important to remember that the Fund is designed for long-term investors. The
Fund's investments in stocks are subject to changes in their value from a number
of factors such as changes in general stock market movements. A change in value
of particular stocks may result from an event affecting the issuer, or changes
in interest rates that can affect stock prices. The Fund's investments in
foreign securities are subject to additional risks associated with investing
abroad, such as the effect of currency rate changes on stock values. These
changes affect the value of the Fund's investments and its share prices for each
class of its shares. In the Oppenheimer funds spectrum, the Fund is generally
considered more aggressive than the money market or growth and income funds
because it invests for capital appreciation in common stocks, emphasizing
"growth" stocks that tend to be more volatile than other investments. While the
Manager tries to reduce risks by diversifying investments, by carefully
researching securities before they are purchased for the portfolio, and in some
cases by using hedging techniques, there is no guarantee of success in achieving
the Fund's objectives and your shares may be worth more or less than their
original cost when you redeem them. Please refer to "Investment Risks" starting
on page __ for a more complete discussion of the Fund's investment risks.
o HOW CAN I BUY SHARES? You can buy shares through your dealer or
financial institution, or you can purchase shares directly through the
Distributor by completing an Application or by using an Automatic Investment
Plan under AccountLink. Please refer to "How to Buy Shares" on page __ for more
details. The procedures for purchasing, redeeming, exchanging or transferring
Class A, Class B and Class C shares (other than the time orders must be received
by the Distributor or Transfer Agent in Denver), and the special account
features available to purchasers of those other classes described elsewhere in
this Prospectus do not apply to Class Y shares. See "Buying Class Y Shares" on
page __ of this Prospectus.
o WILL I PAY A SALES CHARGE TO BUY SHARES? The Fund has four classes of
shares. Each class of shares has the same investment portfolio but different
expenses. Class A shares are offered with a front-end sales charge, starting at
5.75% and reduced for larger purchases. Class B shares are offered without a
front-end sales charge, but may be subject to a contingent deferred sales charge
starting at 5% and declining as shares are held longer if redeemed within 6
years of purchase. Class C shares are offered without a front-end sales charge,
but may be subject to a contingent deferred sales charge of 1% if redeemed
within 12 months of purchase. There is also an annual asset-based sales charge
on Class B shares and Class C shares. Class Y shares are offered at net asset
value without sales charge only to certain institutional investors. Please
review "How to Buy Shares" starting on page __ for more details, including a
discussion about factors you and your financial advisor should consider in
determining which class may be appropriate for you.
o HOW CAN I SELL MY SHARES? Shares can be redeemed by mail or by telephone
call to the Transfer Agent on any business day, or through your dealer. Please
refer to "How to Sell Shares" on page __. The Fund also offers exchange
privileges to other Oppenheimer funds, described in "How to Exchange Shares" on
page __.
INVESTMENT OBJECTIVE AND POLICIES
OBJECTIVE. The Fund invests its assets to seek capital appreciation for
shareholders. The Fund does not invest to seek current income to pay
shareholders.
INVESTMENT POLICIES AND STRATEGIES. The Fund seeks its investment objective by
investing at least 80% of its total assets in common stocks of companies the
Manager has selected from among those included in the Russell 1000(R) Growth
Index. The Manager looks for companies that, in its opinion, have above-average
earnings prospects but are selling at below-normal valuations. The Fund will
generally invest 10% or less of its total assets in cash, cash equivalents
(including commercial paper) or U.S. Government securities.
The Fund's common stock investments will emphasize stocks of large
capitalization issuers (issuers with a market capitalization in excess of $3
billion). The Fund's common stock portfolio holdings will generally have a
dollar-weighted average market capitalization between the median and the mean
market capitalization (currently between $3.2 billion and $9.5 billion,
respectively) of the companies included in the Russell 1000 Growth Index. The
Russell 1000 Growth Index measures the performance of those Russell 1000
companies with higher price-to-book ratios and higher forecasted growth values.
The Russell 1000 Index measures the performance of the 1,000 largest U.S.
companies based on total market capitalization, and represents approximately 88%
of the invested U.S. equity market.
The number of common stock issuers owned by the Fund will generally range
from 50 to 70. In seeking to outperform the Russell 1000 Growth Index, the Fund
will allocate its common stock investments among industry sectors in a manner
generally comparable to the sector weightings in the Russell 1000 Growth Index.
The Fund anticipates that its sector allocations, as a percentage of its common
stock investments, to larger capitalized sectors will generally be no more than
two times that sector's weighting in the Russell 1000 Growth Index, while its
sector allocations to smaller capitalized sectors will generally be no more than
three times that sector's weighting in the Russell 1000 Growth Index. "Larger"
or "smaller" capitalized sectors for this purpose will be determined by the
relative size of the sector within the Russell 1000 Growth Index, with any
sector representing approximately 10% or more of the index being considered as a
"larger" sector.
Notwithstanding the Fund's sector allocation guidelines, the Fund will not
invest 25% or more of its total assets in any one industry. For purposes of this
policy not to concentrate the Fund's assets in any one industry, the Fund has
adopted the industry classifications set forth in the Appendix to the Fund's
Statement of Additional Information.
While the Manager believes "growth companies" have favorable long-term
prospects, they normally retain a large part of their earnings for research,
development and investment in capital assets. Therefore, they tend not to
emphasize the payment of dividends. In selecting securities from its benchmark
universe for the Fund's portfolio, the Manager's security selection process uses
three quantitative filters as initial screens: earnings momentum, earnings
surprise, and below-normal valuation. After the initial screening is done, the
Manager relies on fundamental analysis, using both internal and external
research, in choosing among growth companies the Manager believes are
undervalued to construct the Fund's portfolio.
o SHORT-TERM DEBT SECURITIES. The Fund can hold cash, cash equivalents, or
U.S. Government securities, and anticipates that it will generally invest 10% or
less of its total assets in such securities. The Fund may invest in high
quality, short-term money market instruments such as U.S. Treasury and agency
obligations; commercial paper (short-term, unsecured, negotiable promissory
notes of a domestic or foreign company); short-term debt obligations of
corporate issuers; and certificates of deposit and bankers' acceptances (time
drafts drawn on commercial banks usually in connection with international
transactions) of domestic or foreign banks and savings and loan associations.
The issuers of foreign money market instruments purchased by the Fund must have
at least U.S. $1 billion of assets.
o CAN THE FUND'S INVESTMENT OBJECTIVE AND POLICIES CHANGE? The Fund has an
investment objective, described above, as well as investment policies it follows
to try to achieve its objective. Additionally, the Fund uses certain investment
techniques and strategies in carrying out those policies. The Fund's investment
policies and practices are not "fundamental" unless this Prospectus or the
Statement of Additional Information says that a particular policy is
"fundamental." The Fund's investment objective is a fundamental policy.
Fundamental policies are those that cannot be changed without the approval
of a "majority" of the Fund's outstanding voting shares. The term "majority" is
defined in the Investment Company Act to be a particular percentage of
outstanding voting shares (and this term is explained in the Statement of
Additional Information). The Fund's Board of Trustees may change non-fundamental
policies without shareholder approval, although significant changes will be
described in amendments to this Prospectus.
o PORTFOLIO TURNOVER. A change in the securities held by the Fund is
known as "portfolio turnover". Although the Fund may engage in short-term
trading to try to achieve its objective, its
annual portfolio turnover rate in the current year is not expected to exceed
100% or more. High turnover and short-term trading may cause the Fund to have
relatively larger commission expenses and transaction costs than funds that do
not engage in short-term trading, and result in the Fund's realization of
capital gains or losses for tax purposes.
INVESTMENT RISKS
All investments carry risks to some degree, whether they are risks that market
prices of the investment will fluctuate (this is known as "market risk") or that
the underlying issuer will experience financial difficulties and may default on
its obligations under a fixed-income investment to pay interest and repay
principal (this is referred to as "credit risk"). These general investment
risks, and the special risks of certain types of investments that the Fund may
hold are described below. They affect the value of the Fund's investments, its
investment performance, and the prices of its shares. These risks collectively
form the risk profile of the Fund.
Because of the types of securities the Fund invests in and the investment
techniques the Fund uses, the Fund is designed for investors who are investing
for the long term. It is not intended for investors seeking assured income or
preservation of capital. While the Manager tries to reduce risks by diversifying
investments, by carefully researching securities before they are purchased, and
in some cases by using hedging techniques, changes in overall market prices can
occur at any time, and because the income earned on securities is subject to
change, there is no assurance that the Fund will achieve its investment
objective. When you redeem your shares, they may be worth more or less than what
you paid for them.
o STOCK INVESTMENT RISKS. Because the Fund invests a substantial portion of
its assets in stocks, the value of the Fund's portfolio will be affected by
changes in the stock markets. At times, the stock markets can be volatile, and
stock prices can change substantially. This market risk will affect the Fund's
net asset values per share, which will fluctuate as the values of the Fund's
portfolio securities change. Not all stock prices change uniformly or at the
same time, not all stock markets move in the same direction at the same time and
other factors can affect a particular stock's prices (for example poor earnings
reports by an issuer, loss of major customers, major litigation against an
issuer and changes in government regulations affecting an industry). Not all of
these factors can be predicted. The Fund attempts to limit market risks by
diversifying its investments, that is, by not holding a substantial amount of
the stock of any one company, and by not investing too great a percentage of the
Fund's assets in any one company.
o INTEREST RATE RISKS. Debt securities are subject to changes in their
values due to changes in prevailing interest rates. When prevailing interest
rates fall, the value of already-issued debt securities generally rise. When
interest rates rise, the values of already-issued debt securities generally
decline. The magnitude of these fluctuations will often be greater for
longer-term debt securities than shorter-term debt securities. Changes in the
value of securities held by the Fund mean that the Fund's share prices can go up
or down when interest rates change because of the effect of the change on the
value of the Fund's portfolio of debt securities.
o FOREIGN SECURITIES HAVE SPECIAL RISKS. The Fund may invest up to 10% of
its total assets in securities issued or guaranteed by foreign companies or
foreign governments or their agencies, including securities of foreign issuers
that are represented by American depository receipts ("ADRs"). The Fund may buy
securities in any country, developed or underdeveloped. Investments in
securities of issuers in underdeveloped countries generally involve more risk
and may be considered highly speculative. While foreign securities 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 that U.S.
companies are subject to. 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. More information about the risks and potential
rewards of investing in foreign securities is contained in the Statement of
Additional Information.
o BORROWING FOR LEVERAGE. The Fund may borrow money from banks to buy
securities. The Fund will borrow only if it can do so without putting up assets
as security for a loan. This is a speculative investment method known as
"leverage." This investing technique may subject the Fund to greater risks and
costs than funds that do not borrow. These risks may include the possibility
that the Fund's net asset value per share will fluctuate more than funds that
don't borrow. As a matter of fundamental policy, borrowing for leverage is
subject to limits under the Investment Company Act, described in more detail in
"Borrowing for Leverage" in the Statement of Additional Information. Under the
Investment Company Act, the Fund can borrow only if it maintains a 300% ratio of
net assets to borrowing at all times.
o HEDGING INSTRUMENTS CAN BE VOLATILE INVESTMENTS AND MAY INVOLVE SPECIAL
RISKS. The use of options and futures for hedging purposes 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 positions were not correlated with its other
investments or if it could not close out a position because the market for the
future was illiquid. These risks are described in greater detail in the
Statement of Additional Information.
o YEAR 2000 RISKS. Because many computer software systems in use today
cannot distinguish the year 2000 from the year 1900, the markets for securities
in which the Fund invests could be detrimentally affected by computer failures
beginning January 1, 2000. Failures of computer systems used for securities
trading could result in settlement and liquidity problems for the Fund and other
investors. Data processing errors by corporate and government issuers of
securities could result in production problems and economic uncertainties, and
those issuers may incur substantial costs in attempting to prevent or fix such
errors, all of which could have a negative effect on the Fund's investment and
returns.
INVESTMENT TECHNIQUES AND STRATEGIES
The Fund may also use the investment techniques and strategies described below,
which involve certain risks. The Statement of Additional Information contains
more information about these practices, including limitations on their use that
are designed to reduce some of the risks.
o 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. Investments may be illiquid
because of the absence of an active trading market, making it difficult to value
them or dispose of them promptly at an acceptable price. A restricted security
is one that has a contractual restriction on its resale or which cannot be sold
publicly until it is registered under the Securities Act of 1933. The Fund
currently intends not to invest more than 10% of its net assets in illiquid or
restricted securities (the Board may increase that limit to 15%). The Manager
monitors holdings of illiquid securities on an ongoing basis to determine
whether to sell any holdings to maintain adequate liquidity.
The 10% restriction does not limit purchases of restricted securities that
are eligible for sale to qualified institutional purchasers pursuant to Rule
144A under the Securities Act of 1933, provided that 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 (for example, if
qualified institutional buyers become, for a time, uninterested in purchasing
the security), the Fund's holding of that security may be deemed to be illiquid
and the level of Fund illiquidity could increase.
o LOANS OF PORTFOLIO SECURITIES. To raise cash for liquidity purposes,
the Fund may lend its portfolio securities to brokers, dealers and other
types of financial institutions approved by the
Board of Trustees. The Fund must receive collateral for a loan. After any loan,
the value of the securities loaned must not exceed 25% of the value 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 presently does not intend to make loans of portfolio securities that
will exceed 5% of the value of the Fund's total assets in the coming year.
o REPURCHASE AGREEMENTS. The Fund may enter into repurchase agreements. In
a repurchase transaction, the Fund buys a security and simultaneously sells it
to the vendor for delivery at a future date. Repurchase agreements are used
primarily for cash purposes. There is no limit on the amount of the Fund's net
assets that may be subject to repurchase agreements of seven days or less.
Repurchase agreements must be fully collateralized. 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 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 (the Board may increase that limit to 15%).
o HEDGING. The Fund may purchase and sell certain kinds of put and call
options, futures contracts, and forward contracts. These are all referred to as
"hedging instruments." The Fund does not use hedging instruments for speculative
purposes, does not engage extensively in hedging, and has limits on the use of
hedging instruments, described below. See "Other Investment Techniques and
Strategies" in the Statement of Additional Information for further details.
The Fund may buy and sell options, futures and forward contracts for a
number of purposes. It may do so to try to manage its exposure to the
possibility that the prices on its portfolio securities may decline, or to
establish a position in the equity securities market as a temporary substitute
for purchasing individual securities. Some of these strategies, such as selling
futures, buying puts and writing covered calls, hedge the Fund's portfolio
against price fluctuations. Other hedging strategies, such as buying futures and
call options, tend to increase the Fund's exposure to the securities market.
Forward contracts are used to try to manage foreign currency risks on the Fund's
foreign investments. Foreign currency options are used to try to protect against
declines in the dollar value of foreign securities the Fund owns, or to protect
against an increase in the dollar cost of buying foreign securities. Writing
covered call options may also provide income to the Fund to distribute to
shareholders, for liquidity purposes or for defensive reasons.
o FUTURES. The Fund may buy and sell futures contracts that relate to (1)
stock indices (these are referred to as Stock Index Futures), (2) interest rates
(Interest Rate Futures), and (3) other securities indexes (Financial Futures).
All of these Futures are described in the Statement of Additional Information.
o PUT AND CALL OPTIONS. The Fund may buy and sell exchange-traded and
over-the-counter put and call options, including index options, securities
options, currency options, and options on the other types of futures described
in "Futures," above. A call or put may be purchased 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.
If the Fund sells (that is, writes) 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 other types of written calls, the Fund must segregate
liquid assets to enable it 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 may buy puts whether or not it holds the underlying investment in
the portfolio. If the Fund writes a put, the put must be covered by segregated
liquid assets. The Fund will not write puts if more than 25% of the Fund's net
assets would have to be segregated to cover put options.
o 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 try 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 foreign currency. The Fund limits its net exposure under forward
contracts in a particular foreign currency to the amount of its assets
denominated in that currency or denominated in a closely-correlated currency.
OTHER INVESTMENT RESTRICTIONS. The Fund has other investment restrictions
which are fundamental policies. Under these fundamental policies, the Fund
cannot do any of the following:
o The Fund cannot, as to 75% of its total assets, invest in the securities
of any one issuer (other than the U.S. Government or its agencies or
instrumentalities) if immediately thereafter (a) more than 5% of the Fund's
total assets would be invested in securities of that issuer, or (b) the Fund
would then own more than 10% of that issuer's voting securities.
o The Fund cannot concentrate investments in any particular industry;
therefore the Fund will not purchase the securities of companies in any one
industry if, thereafter, 25% or more of the value of the Fund's assets would
consist of securities of companies in that industry.
Unless the Prospectus states that a percentage restriction applies
continuously, it applies only at the time the Fund makes an investment, and 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. Other investment
restrictions are listed in "Investment Restrictions" in the Statement of
Additional Information.
HOW THE FUND IS MANAGED
ORGANIZATION AND HISTORY. The Fund was organized in 1998 as a Massachusetts
business trust. The Fund is an open-end management investment company.
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. "Trustees and Officers
of the Fund" in the Statement of Additional Information names the Trustees and
the officers of the Fund and provides more information about them. Although the
Fund will not normally hold annual meetings of its shareholders, it may hold
shareholder meetings from time to time on important matters, and shareholders
have the right to call a meeting to remove a Trustee or to take other action
described in the Fund's Declaration of Trust.
The Board of Trustees has the power, without shareholder approval, to
divide unissued shares of the Fund into two or more classes. The Board has done
so, and the Fund currently has four classes of shares, Class A, Class B, Class C
and Class Y. All classes invest in the same investment portfolio. Only certain
institutional investors may elect to purchase Class Y shares. Each class has its
own dividends and distributions and pays certain expenses which may be different
from the other classes. Each class may have a different net asset value.
Therefore, each share has one vote at shareholder meetings, with fractional
shares voting proportionally in matters submitted to the vote of shareholders.
Shares of each class may have separate voting rights on matters in which
interests of one class are different from interests of another class, and shares
of a particular class vote as a class on matters that affect that class alone.
Shares are freely transferrable.
THE MANAGER AND ITS AFFILIATES. The Fund is managed by the Manager,
OppenheimerFunds, Inc., which is responsible for selecting the Fund's
investments and handles its day-to-day business. The Manager carries out its
duties, subject to the policies established by the Board of Trustees, under an
Investment Advisory Agreement which states the Manager's responsibilities. The
Agreement sets forth the fees paid by the Fund to the Manager, and describes the
expenses that the Fund is responsible for paying to conduct its business.
The Manager has operated as an investment adviser since 1959. The Manager
(including subsidiaries) currently manages investment companies, including other
Oppenheimer funds, with assets of more than $75 billion as of December 31, 1997,
and with more than 3.5 million shareholder accounts. The Manager is owned by
Oppenheimer Acquisition Corp., a holding company that is owned in part by senior
officers of the Manager and controlled by Massachusetts Mutual Life Insurance
Company.
The management services provided to the Fund by the Manager, and the
services provided by the Distributor and the Transfer Agent to shareholders,
depend on the smooth functioning of their computer systems. Many computer
software systems in use today cannot distinguish the year 2000 from the year
1900 because of the way dates are encoded and calculated. That failure could
have a negative impact on handling securities trades, pricing and account
services. The Manager, the Distributor and Transfer Agent have been actively
working on necessary changes to their computer systems to deal with the year
2000 and expect that their systems will be adapted in time for that event,
although there cannot be assurance of success. Additionally, because the
services they provide depend on the interaction of their computer systems with
the computer systems of brokers, information services and other parties, any
failure on the part of the computer systems of those third parties to deal with
the year 2000 may also have a negative effect on the services provided to the
Fund.
o PORTFOLIO MANAGER. The Portfolio Manager of the Fund is Robert C. Doll,
Jr. Mr. Doll is an Executive Vice President and Director of Equity Investments
of the Manager and has been the person principally responsible for the
day-to-day management of Oppenheimer Growth Fund since September, 1987.
o FEES AND EXPENSES. Under the Investment Advisory Agreement, the Fund
pays the Manager a monthly fee at the following annual rates, which decline on
additional assets as the Fund grows: 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; 0.58%
of the next $1.0 billion; and 0.56% of average annual net assets in excess of
$2.5 billion.
The Fund pays expenses related to its daily operations, such as custodian
fees, Trustees' fees, transfer agency fees, legal 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 value of shares, and
therefore are indirectly borne by shareholders through their investment. More
information about the Investment Advisory Agreement and the other expenses paid
by the Fund is contained in the Statement of Additional Information.
There is also information about the Fund's brokerage policies and
practices in "Brokerage Policies of the Fund" in the Statement of Additional
Information. That section discusses how brokers and dealers are selected for the
Fund's portfolio transactions. When deciding which brokers to use, the Manager
is permitted by the Investment Advisory Agreement to consider whether brokers
have sold shares of the Fund or any other funds for which the Manager serves as
investment adviser.
o 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 the shares of the other
"Oppenheimer funds" managed by the Manager and is sub-distributor for funds
managed by a subsidiary of the Manager.
o THE TRANSFER AGENT. The Fund's Transfer Agent is OppenheimerFunds
Services, a division of the Manager, which acts as the shareholder servicing
agent for the Fund on an "at-cost" basis. It also acts as the shareholder
servicing agent for other Oppenheimer funds. Shareholders should direct
inquiries about their account to the Transfer Agent at the address and toll-free
numbers shown below in this Prospectus and on the back cover.
PERFORMANCE OF THE FUND
EXPLANATION OF PERFORMANCE TERMINOLOGY. The Fund uses the term "total return" to
illustrate its performance. The performance of each class of shares is shown
separately, because the performance of each class of shares will usually be
different as a result of the different kinds of expenses each class bears. These
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
(which will vary if dividends are received in cash or shares are sold or
purchased). The Fund's performance information may help you see how well your
investment has done over time and to compare market indexes.
It is important to understand that the Fund's total returns represent past
performance and should not be considered to be predictions of future returns or
performance. More detailed information about how total returns are calculated is
contained in the Statement of Additional Information, which also contains
information about other ways to measure and compare the Fund's performance. The
Fund's investment performance will vary over time, depending on market
conditions, the composition of the portfolio, expenses and which class of shares
you purchase.
o TOTAL RETURNS. There are different types of "total returns" used 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.
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
the Fund's actual year-by-year performance.
When total returns are quoted for Class A shares, normally the current
maximum initial sales charge has been deducted. When total returns are shown for
Class B or Class C shares, normally the contingent deferred sales charge that
applies to the period for which total return is shown has been deducted.
However, total returns may also be quoted "at net asset value," without
considering the effect of either the front-end or the appropriate contingent
deferred sales charge, as applicable, and those returns would be less if sales
charges were deducted.
ABOUT YOUR ACCOUNT
HOW TO BUY SHARES
CLASSES OF SHARES. The Fund offers investors four different classes of shares.
Three classes, Class A, Class B and Class C, are available to non-institutional
investors. The fourth class, Class Y, is offered only to certain institutional
investors. The different classes of shares represent investments in the same
portfolio of securities but are subject to different expenses and will likely
have different share prices.
o CLASS A SHARES. If you buy Class A shares, you may pay an initial sales
charge on investments up to $1 million (up to $500,000 for purchases by
"Retirement Plans," as defined in "Class A Contingent Deferred Sales Charge" on
page __). If you purchase Class A shares as part of an investment of at least $1
million ($500,000 for Retirement Plans) in shares of one or more Oppenheimer
funds, you will not pay an initial sales charge, but if you sell any of those
shares within
18 months of buying them, you may pay a contingent deferred sales charge,
described below. The amount of that sales charge will vary depending on the
amount you invested. Sales charge rates are
described in "Buying Class A Shares," below.
o CLASS B SHARES. If you buy Class B shares, you pay no sales charge at
the time of purchase, but if you sell your shares within six years of buying
them, you will normally pay a contingent deferred sales charge. That sales
charge varies depending on how long you own your shares as described in "Buying
Class B Shares" below.
o CLASS C SHARES. If you buy Class C shares, you pay no sales charge at
the time of purchase, but if you sell your shares within 12 months of buying
them, you will normally pay a contingent deferred sales charge of 1% as
described in "Buying Class C Shares" below.
o CLASS Y SHARES. Class Y shares are offered only to certain institutional
investors that have special agreements with the Distributor. As of the date of
this Prospectus, it is anticipated that Massachusetts Mutual Life Insurance
Company (an affiliate of the Distributor and the Manager) will act as Class Y
Sponsor for any outstanding Class Y shares of the Fund.
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
better suited to your needs depends on a number of factors which you should
discuss with your financial advisor. 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 most important
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.
In the following discussion, to help provide you and your financial
advisor with a framework in which to choose a class, we have made some
assumptions using a hypothetical investment in the Fund. We assumed you are an
individual investor, and therefore ineligible to purchase Class Y shares. We
used the sales charge rates that apply to Class A, Class B and Class C shares
and considered the effect of the annual asset-based sales charge on Class B and
Class C expenses (which, like all expenses, will affect your investment return).
For the sake of comparison, we have assumed that there is a 10% rate of
appreciation in the investment each year. Of course, the actual performance of
your investment cannot be predicted and will vary, based on the Fund's actual
investment returns and the operating expenses borne by each class of shares, and
which class of shares you invest in. The factors discussed below are not
intended to be investment advice or recommendations, because each investor's
financial considerations are different. The discussion below of the factors to
consider in purchasing a particular class of shares assumes that you will
purchase only ONE class of shares and not a combination of shares of different
classes.
o 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 (which reduces the amount of
your investment dollars used to buy shares for your account), compared to the
effect over time of higher class-based expenses on shares of Class B or Class C
shares for which no initial sales charge is paid.
o INVESTING FOR THE SHORTER TERM. If you have a short-term investment
horizon (that is, you plan to hold your shares for not more than six years), you
should probably consider purchasing Class A or Class C shares rather than Class
B shares, because of the effect of the Class B contingent deferred sales charge
if you redeem within 7 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 the more you invest and the more 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. For example,
Class A shares might be more advantageous than Class C (as well as Class B)
shares for investments of more than $100,000 expected to be held for 5 or 6
years (or more). For investments over $250,000 expected to be held 4 to 6 years
(or more), Class A shares may become more advantageous than Class C (and B)
shares. If investing $500,000 or more, Class A shares may be more advantageous
as your investment horizon approaches 3 years or more.
And for most investors who invest $1 million or more, in most cases Class
A shares will be the most advantageous choice, no matter how long you intend to
hold your shares. For that reason, the Distributor normally will not accept
purchase orders of $500,000 or more of Class B shares or $1 million or more of
Class C shares from a single investor. Of course, these examples are based on
approximations of the effect of current sales charges and expenses on a
hypothetical investment over time, using the assumed annual performance return
stated above, and therefore should not be relied on as rigid guidelines.
o INVESTING FOR THE LONGER TERM. If you are investing 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 an appropriate consideration, if you
plan to invest less than $100,000. If you plan to invest more than $100,000 over
the long term, Class A shares will likely be more advantageous than Class B
shares or Class C shares, as discussed above, because of the effect of the
expected lower expenses for Class A shares and the reduced initial sales charges
available for larger investments in Class A shares under the Fund's Right of
Accumulation.
Of course, these examples are based on approximations of the effect of
current sales charges and expenses on a hypothetical investment over time, using
the assumed annual performance return stated above, and therefore, you should
analyze your options carefully.
o ARE THERE DIFFERENCES IN ACCOUNT FEATURES THAT MATTER TO YOU? Because
some account features may not be available for Class B or Class C shareholders,
you should carefully review how you plan to use your investment account before
deciding which class of shares is better for you. For example, share
certificates are not available for Class B or Class C shares and if you are
considering using your shares as collateral for a loan, that may be a factor to
consider. Additionally, the dividends payable to Class B and Class C
shareholders will be reduced by the additional expenses borne solely by those
classes, such as the asset-based sales charges described below and in the
Statement of Additional Information.
o HOW DOES IT AFFECT PAYMENTS TO MY BROKER? A salesperson, such as a
broker, or any other person who is entitled to receive compensation for selling
Fund shares may receive different compensation for selling one class of shares
than for selling another class. It is important that investors understand that
the purposes of the Class B and Class C contingent deferred sales charge and
asset-based sales charges is the same as the purpose of the front-end sales
charge on sales of Class A shares: to compensate the Distributor for commissions
it pays to dealers and financial institutions for selling shares. The
Distributor may pay additional periodic 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 MUCH MUST YOU INVEST? You can open a Fund account with a minimum initial
investment of $1,000 and make additional investments at any time with as little
as $25. There are reduced minimum investments under special investment plans.
o With Asset Builder Plans, Automatic Exchange Plans, 403(b)(7) custodial
plans and military allotment plans, you can make initial and subsequent
investments of as little as $25; and subsequent purchases of at least $25 can be
made by telephone through AccountLink.
o Under pension and profit-sharing and 401(k) plans and Individual
Retirement Accounts (IRAs), you can make an initial investment of as little as
$250 (if your IRA is established under an Asset Builder Plan, the $25 minimum
applies), and subsequent investments may be as little as $25.
o There is no minimum investment requirement if you are buying shares by
reinvesting dividends or distributions 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 by reinvesting distributions
from unit investment trusts that have made arrangements with the Distributor.
o HOW ARE SHARES PURCHASED? You can buy shares several ways -- through any
dealer, broker or financial institution that has a sales agreement with the
Distributor, or directly through the Distributor, or automatically from your
bank account through an Asset Builder Plan under the OppenheimerFunds
AccountLink service. The Distributor may appoint certain servicing agents as the
Distributor's agent to accept purchase and redemption orders. WHEN YOU BUY
SHARES, BE SURE TO SPECIFY CLASS A, CLASS B OR CLASS C SHARES. IF YOU DO NOT
CHOOSE, YOUR INVESTMENT WILL BE MADE IN CLASS A SHARES.
o BUYING SHARES THROUGH YOUR DEALER. Your dealer will place your order
with the Distributor on your behalf.
o BUYING SHARES THROUGH THE DISTRIBUTOR. Complete an OppenheimerFunds New
Account Application and return it with a check payable to "OppenheimerFunds
Distributor, Inc." Mail it to P.O. Box 5270, Denver, Colorado 80217. If you
don't list a dealer on the application, the Distributor will act as your agent
in buying the shares. However, it is recommended that you discuss your
investment first with a financial advisor, to be sure that it is appropriate for
you.
o PAYMENT BY FEDERAL FUNDS WIRE. Shares may be purchased by Federal
Funds wire. The minimum investment is $2,500. You must FIRST call the
Distributor's Wire Department at 1-800-525-7041 to notify the Distributor of
the wire, and receive further instructions.
o BUYING SHARES THROUGH OPPENHEIMERFUNDS ACCOUNTLINK. You can use
AccountLink to link your Fund account with an account at a U.S. bank or other
financial institution that is an Automated Clearing House (ACH) member. You can
then transmit funds electronically to PURCHASE SHARES, TO HAVE THE TRANSFER
AGENT SEND REDEMPTION PROCEEDS, AND TO TRANSMIT DIVIDENDS AND DISTRIBUTIONS.
Shares are purchased for your account on AccountLink on the regular
business day the Distributor is instructed by you to initiate the ACH transfer
to buy shares. You can provide those instructions automatically, under an Asset
Builder Plan, described below, or by telephone instructions using
OppenheimerFunds PhoneLink, also described below. You should request AccountLink
privileges on the application or dealer settlement instructions used to
establish your account. Please refer to "AccountLink" below for more details.
o ASSET BUILDER PLANS. You may purchase shares of the Fund (and up to four
other Oppenheimer funds) automatically each month from your account at a bank or
other financial institution under an Asset Builder Plan with AccountLink.
Details are on the Application and in the Statement of Additional Information.
o AT WHAT PRICE ARE SHARES SOLD? Shares are sold at the public offering
price based on the net asset value (and any initial sales charge that applies)
that is next determined after the Distributor receives the purchase order in
Denver, Colorado , or the order is received and transmitted to the Distributor
by an entity authorized by the Fund to accept purchase or redemption orders. The
Fund has authorized the Distributor, certain broker-dealers and agents or
intermediaries designated by the Distributor or those broker-dealers to accept
orders. In most cases, to enable you to receive that day's offering price, the
Distributor or an authorized entity must receive your order by the time of day
The New York Stock Exchange closes, which is normally 4:00 P.M., New York time,
but may be earlier on some days (all references to time in this Prospectus mean
"New York time"). The net asset value of each class of shares is determined as
of that time on each day The New York Stock Exchange is open (which is a
"regular business day"). If you buy shares through a dealer, normally your order
must be transmitted to the Distributor so that it is received before the
Distributor's close of business that day, which is normally 5:00 P.M. THE
DISTRIBUTOR, IN ITS SOLE DISCRETION, MAY REJECT ANY PURCHASE ORDER FOR THE
FUND'S SHARES.
SPECIAL SALES CHARGE ARRANGEMENTS FOR CERTAIN PERSONS. Appendix A to this
Prospectus sets forth conditions for the waiver of, or exemption from, sales
charges or the special sales charge rates that apply to purchases of shares of
the Fund (including purchases by exchange) by a person who was a shareholder of
one of the Former Quest for Value Funds (as defined in that Appendix).
BUYING 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 some cases, reduced sales charges
may be available, as described below. 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 and allocated to your dealer as commission. The
current sales charge rates and commissions paid to dealers and brokers are as
follows:
FRONT-END SALES FRONT-END SALES
CHARGE AS A CHARGE AS A COMMISSION AS
PERCENTAGE OF PERCENTAGE OF PERCENTAGE OF
AMOUNT OF PURCHASE OFFERING PRICE AMOUNT INVESTED OFFERING PRICE
- ------------------------------------------------------------------------------
Less than $25,000 5.75% 6.10% 4.75%
- ------------------------------------------------------------------------------
$25,000 or more but
less than $50,000 5.50% 5.82% 4.75%
- ------------------------------------------------------------------------------
$50,000 or more but
less than $100,000 4.75% 4.99% 4.00%
- ------------------------------------------------------------------------------
$100,000 or more but
less than $250,000 3.75% 3.90% 3.00%
- ------------------------------------------------------------------------------
$250,000 or more but
less than $500,000 2.50% 2.56% 2.00%
- ------------------------------------------------------------------------------
$500,000 or more but
less than $1 million 2.00% 2.04% 1.60%
The Distributor reserves the right to reallow the entire commission to dealers.
If that occurs, the dealer may be considered an "underwriter" under Federal
securities laws.
o 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 in the following cases:
o Purchases aggregating $1 million or more.
o Purchases by a retirement plan qualified under sections 401(a) or 401(k)
of the Internal Revenue Code, by a non-qualified deferred compensation plan (not
including Section 457 plans), employee benefit plan, group retirement plan (see
"How to Buy Shares Retirement Plans" in the Statement of Additional Information
for further details), an employee's 403(b)(7) custodial plan account, SEP IRA,
SARSEP, or SIMPLE plan (all of these plans are collectively referred to as
"Retirement Plans"); that: (1) buys shares costing $500,000 or more or (2) has,
at the time of purchase, 100 or more eligible participants, or (3) certifies
that it projects to have annual plan purchases of $200,000 or more.
o Purchases by an OppenheimerFunds 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 these 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 by a retirement plan qualified under Section 401(a) or 401 (k)
if the retirement plan has total plan assets of $500,000 or more.
The Distributor pays dealers of record commissions on those purchases in
an amount equal to (i) 1.0% for non-Retirement Plan accounts, and (ii) for
Retirement Plan accounts, 1.0% of the first $2.5 million, plus 0.50% of the next
$2.5 million, plus 0.25% of purchases over $5 million, calculated on a calendar
year basis. That commission will be paid only on those purchases that were not
previously subject to a front-end sales charge and dealer commission. No sales
commission will be paid to the dealer, broker or financial institution on sales
of Class A shares purchased with the redemption proceeds of shares of a 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 addition of
the Oppenheimer funds as an investment option to the Retirement Plan.
If you redeem any Class A shares subject to the contingent deferred sales
charge described above within 18 months of the end 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 may be equal to 1.0% of the lesser of (1) the aggregate net
asset value of the redeemed shares (not including shares purchased by
reinvestment of dividends or capital gains distributions) or (2) the original
offering price (which is the original net asset value) of the redeemed shares.
However, the Class A contingent deferred sales charge will not exceed the
aggregate amount of the commissions the Distributor paid to your dealer on all
Class A shares of all Oppenheimer funds you purchased subject to the Class A
contingent deferred sales charge.
In determining whether a contingent deferred sales charge is payable, the
Fund will first redeem shares that are not subject to the sales charge,
including shares purchased by reinvestment of dividends and capital gains, and
then will redeem other shares in the order that you purchased them. The Class A
contingent deferred sales charge is waived in certain cases described in
"Waivers of Class A Sales Charges" below.
No Class A contingent deferred sales charge is charged on exchanges of
shares under the Fund's Exchange privilege (described below). However, if the
shares acquired by exchange are redeemed within 18 months of the end of the
calendar month of the purchase of the exchanged shares, the contingent deferred
sales charge will apply.
REDUCED SALES CHARGES FOR CLASS A SHARE PURCHASES. You may be eligible to buy
Class A shares at reduced sales charge rates in one or more of the following
ways:
o RIGHT OF ACCUMULATION. To qualify for the lower sales charge rates that
apply to larger purchases of Class A shares, you and your spouse can add
together Class A and Class B shares you purchase for your individual accounts,
or jointly, or for trust or custodial accounts on behalf of your children who
are minors. A fiduciary can count all shares purchased for a trust, estate or
other fiduciary account (including one or more employee benefit plans of the
same employer) that has multiple accounts.
Additionally, you can add together current purchases of Class A and Class
B shares of the Fund and other Oppenheimer funds to reduce the sales charge rate
that applies to current purchases of Class A shares. You can also include Class
A and Class B shares of Oppenheimer funds you previously purchased subject to an
initial or contingent deferred sales charge to reduce the sales charge rate for
current purchases of Class A shares, provided that you still hold your
investment in one of the Oppenheimer funds. The Distributor will add the value,
at current offering price, of the shares you previously purchased and currently
own to the value of current purchases to determine the sales charge rate that
applies. The Oppenheimer funds are listed in "Reduced Sales Charges" in the
Statement of Additional Information, or a list can be obtained from the
Distributor. The reduced sales charge will apply only to current purchases and
must be requested when you buy your shares.
o LETTER OF INTENT. Under a Letter of Intent, if you purchase Class A or
Class A and Class B shares of the Fund and other Oppenheimer funds during a
13-month period, you can reduce the sales charge rate that applies to your
purchases of Class A shares. The total amount of your intended purchases of both
Class A and Class B shares will determine the reduced sales charge rate for the
Class A shares purchased during that period. This can include purchases made up
to 90 days before the date of the Letter. More information is contained in the
Application and in "Reduced Sales Charges" in the Statement of Additional
Information.
o WAIVERS OF CLASS A SALES CHARGES. The Class A sales charges are not
imposed in the circumstances described below. There is an explanation of this
policy in "Reduced Sales Charges" in the Statement of Additional Information. In
order to receive a waiver of the Class A contingent deferred sales charge, you
must notify the Transfer Agent which conditions apply.
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:
o the Manager or its affiliates;
o present or former officers, directors, trustees and employees (and their
"immediate families" as defined in "Reduced Sales Charges" in the Statement of
Additional Information) of the Fund, the Manager and its affiliates, and
retirement plans established by them for their employees;
o registered management investment companies, or separate accounts of
insurance companies having an agreement with the Manager or the Distributor for
that purpose;
o 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;
o 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 are identified 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);
o dealers, brokers, banks or registered investment advisers 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 or adviser for the purchase or sale of shares of the Fund);
o (1) 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, (2) Retirement Plans and deferred compensation
plans and trusts used to fund those Plans (including, for example, plans
qualified or created under sections 401(a), 403(b) or 457 of the Internal
Revenue Code), and "rabbi trusts" that buy shares for their own accounts, in
each case if those purchases are made through a broker or agent or other
financial intermediary that has made special arrangements with the Distributor
for those purchases; and (3) clients of such 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);
o 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;
o accounts for which Oppenheimer Capital is the investment adviser (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;
o any unit investment trust that has entered into an appropriate
agreement with the Distributor;
o 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 A
shares of that Fund due to the termination of the Class B and TRAC-2000 program
on November 24, 1995; or
o qualified retirement plans 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, provided that such arrangements were
consummated and share purchases commenced by December 31, 1996.
WAIVERS OF INITIAL AND CONTINGENT DEFERRED SALES CHARGES IN CERTAIN
TRANSACTIONS. Class A shares issued or purchased in the following transactions
are not subject to Class A sales charges:
o shares issued in plans of reorganization, such as mergers, asset
acquisitions and exchange offers, to which the Fund is a party;
o shares purchased by the reinvestment of loan repayments by a participant
in a retirement plan for which the Manager or its affiliates acts as sponsor;
o shares purchased by the reinvestment of dividends or other distributions
reinvested from the Fund or other Oppenheimer funds (other than Oppenheimer Cash
Reserves) or unit investment trusts for which reinvestment arrangements have
been made with the
Distributor;
o shares purchased and paid for with the proceeds of shares redeemed in
the past 30 days from a mutual fund (other than a fund managed by the Manager or
any of its subsidiaries) on which an initial sales charge or contingent deferred
sales charge was paid (this waiver also applies to shares purchased by exchange
of shares of Oppenheimer Money Market Fund, Inc. that were purchased and paid
for in this manner); this waiver must be requested when the purchase order is
placed for your shares of the Fund, and the Distributor may require evidence of
your qualification for this waiver; or
o shares purchased with the proceeds of maturing principal of units of any
Qualified Unit Investment Liquid Trust Series.
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:
o to make Automatic Withdrawal Plan payments that are limited annually to
no more than 12% of the original account value;
o involuntary redemptions of shares by operation of law or involuntary
redemptions of small accounts (see "Shareholder Account Rules and Policies,"
below);
o for distributions from a TRAC-2000 401(k) plan sponsored by the
Distributor due to termination of the TRAC-2000 program;
o 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; (5) under a Qualified Domestic Relations Order, as
defined in the Internal Revenue Code; (6) to meet the minimum distribution
requirements of the Internal Revenue Code; (7) to establish "substantially equal
periodic payments" as described in Section 72(t) of the Internal Revenue Code;
(8) for retirement distributions or loans to participants or beneficiaries; (9)
separation from service; (10) participant-directed redemptions to purchase
shares of a mutual fund (other than a fund managed by the Manager or its
subsidiary) 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; or (11) plan termination or "in-service
distributions", if the redemption proceeds are rolled over directly to an
OppenheimerFunds IRA;
o for distributions from Retirement Plans having 500 or more eligible
participants, except distributions due to termination of all of the Oppenheimer
funds of as an investment option under the Plan; or
o for distributions from 401(k) plans sponsored by broker-dealers that
have entered into a special agreement with the Distributor allowing this waiver.
o SERVICE PLAN FOR CLASS A SHARES. The Fund has adopted a Service Plan for
Class A shares to reimburse the Distributor for a portion of its costs incurred
in connection with the personal service and maintenance of shareholder accounts
that hold Class A shares. Reimbursement is made quarterly at of an annual rate
that may not exceed 0.25% of the average annual net assets of Class A shares of
the Fund. The Distributor uses all of those fees to compensate dealers, brokers,
banks and other financial institutions quarterly for providing personal service
and maintenance of accounts of their customers that hold Class A shares and to
reimburse itself (if the Fund's Board of Trustees authorizes such
reimbursements, which it has not yet done) for its other expenditures under the
Plan.
Services to be provided 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. Payments are made by the
Distributor quarterly at of an annual rate not to exceed 0.25% of the average
annual net assets of Class A shares held in accounts of the dealer or its
customers. The payments under the Plan increase the annual expenses of Class A
shares. For more details, please refer to "Distribution and Service Plans" in
the Statement of Additional Information.
BUYING CLASS B SHARES. Class B shares are sold at net asset value per share
without of an initial sales charge. However, if Class B shares are redeemed
within six years of their purchase, a contingent deferred sales charge will be
deducted from the redemption proceeds. That sales charge will not apply to
shares purchased by the reinvestment of dividends or capital gains
distributions. The 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 offering price (which is the original net asset value). The contingent
deferred sales charge is not imposed on the amount of your account value
represented by of an increase in net asset value over the initial purchase
price. The Class B contingent deferred sales charge is paid to the Distributor
to reimburse its expenses of providing distribution-related services to the Fund
in connection with the sale of Class B shares.
To determine whether the 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 over six years, and (3) shares held the longest during the 6-year period.
The contingent deferred sales charge is not imposed in the circumstances
described in "Waivers of Class B and Class C Sales Charges" below.
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:
CONTINGENT DEFERRED SALES CHARGE
YEARS SINCE BEGINNING OF MONTH IN ON REDEMPTIONS IN THAT YEAR
WHICH PURCHASE ORDER WAS ACCEPTED (AS % OF AMOUNT SUBJECT TO CHARGE)
- ------------------------------------------------------------------------------
0 - 1 5.0%
- ------------------------------------------------------------------------------
1 - 2 4.0%
- ------------------------------------------------------------------------------
2 - 3 3.0%
- ------------------------------------------------------------------------------
3 - 4 3.0%
- ------------------------------------------------------------------------------
4 - 5 2.0%
- ------------------------------------------------------------------------------
5 - 6 1.0%
- ------------------------------------------------------------------------------
6 and following None
In the table, a "year" is a 12-month period. All purchases are considered to
have been made on the first regular business day of the month in which the
purchase was made.
o AUTOMATIC CONVERSION OF CLASS B SHARES. 72 months after you purchase
Class B shares, those shares will automatically convert to Class A shares. 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 Class B shares
convert, any other Class B shares that were acquired by the reinvestment of
dividends and distributions on the converted shares will also convert to Class A
shares. The conversion feature is subject to the continued availability of a tax
ruling described in "Alternative Sales Arrangements - Class A, Class B and Class
C Shares" in the Statement of Additional Information.
o DISTRIBUTION AND SERVICE PLAN FOR CLASS B SHARES. The Fund has adopted a
Distribution and Service Plan for Class B shares to compensate the Distributor
for distributing Class B shares and servicing accounts. This Plan is described
below under "Buying Class C Shares - Distribution and Service Plans for Class B
and Class C Shares".
o WAIVERS OF CLASS B SALES CHARGES. The Class B contingent deferred sales
charge will not apply to shares purchased in certain types of transactions, nor
will it apply to shares redeemed in certain circumstances, as described below
under "Waivers of Class B and Class C Sales Charges."
BUYING CLASS C SHARES. Class C shares are sold at net asset value per share
without assessment of an initial sales charge. However, if the Class C shares
are redeemed within 12 months of their purchase, a contingent deferred sales
charge of 1.0% will be deducted from the redemption proceeds. That sales charge
will not apply to shares purchased by the reinvestment of dividends or capital
gains distributions. The 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 offering price (which is the original net asset value). The
contingent deferred sales charge is not imposed on the amount of your account
value represented by the increase in net asset value over the initial purchase
price. 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.
To determine whether the 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 over 12 months, and (3) shares held the longest during the 12-month period.
O WAIVERS OF CLASS B AND CLASS C SALES CHARGES. The Class B and Class C
contingent deferred sales charges will not be applied to shares purchased in
certain types of transactions nor will it apply to Class B and Class C shares
redeemed in certain circumstances as described below. The reasons for this
policy are discussed in "Reduced Sales Charges" in the Statement of Additional
Information. In order to receive a waiver of the Class B or Class C contingent
deferred sales charge, you must notify the Transfer Agent which conditions
apply.
WAIVERS FOR REDEMPTIONS OF SHARES IN CERTAIN CASES. The Class B and Class
C contingent deferred sales charges will be waived for redemptions of shares in
the following cases:
o distributions to participants or beneficiaries from Retirement Plans, if
the distributions are made (a) under an Automatic Withdrawal Plan after the
participant reaches age 59-1/2, as long as the payments are no more than 10% of
the account value annually (measured from the date the Transfer Agent receives
the request), or (b) following the death or disability (as defined in the
Internal Revenue Code) of the participant or beneficiary (the death or
disability must have occurred after the account was established);
o redemptions from accounts other than Retirement Plans following the
death or disability of the last surviving shareholder, including a trustee of a
"grantor" trust or revocable living trust for which the trustee is also sole
beneficiary (the death or disability must have occurred after the account was
established, and for disability you must provide evidence of a determination of
disability by the Social Security Administration);
o returns of excess contributions to Retirement Plans;
o to make distributions from retirement plans that qualify as
"substantially equal periodic payments" under Section 72(t) of the Internal
Revenue Code, provided the distributions do not exceed 10% of the account value
annually, measured from the date the Transfer Agent receives the request;
o shares redeemed involuntarily, as described in "Shareholder Account
Rules and Policies";
o distributions from OppenheimerFunds prototype 401(k) plans and from
certain Massachusetts Mutual Life Insurance Company prototype 401(k) plans (1)
for hardship withdrawals; (2) under a Qualified Domestic Relations Order, as
defined in the Internal Revenue Code; (3) to meet minimum distribution
requirements as defined in the Internal Revenue Code; (4) to make "substantially
equal periodic payments" as described in Section 72(t) of the Internal Revenue
Code; (5) for separation from service; or (6) for loans to participants or
beneficiaries; or
o distributions from 401(k) plans sponsored by broker-dealers that have
entered into a special agreement with the Distributor allowing this waiver.
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:
o shares sold to the Manager or its affiliates;
o 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; or
o shares issued in plans of reorganization to which the Fund is a party.
DISTRIBUTION AND SERVICE PLANS FOR CLASS B AND CLASS C SHARES. The Fund has
adopted Distribution and Service Plans for Class B and Class C shares to
reimburse and compensate the Distributor, respectively, for distributing Class B
and Class C shares and servicing accounts. Under the Plans, the Fund pays the
Distributor an annual "asset-based sales charge" of 0.75% per year on Class B
shares and on Class C shares. The Distributor also receives a service fee of up
to 0.25% per year under the Class B Plan, and receives a service fee of 0.25%
per year under the Class C Plan.
Under each Plan, both 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. The asset-based sales charge and service
fees increase Class B expenses by up to 1.00%, and increase Class C expenses by
1.00%, of the net assets per year of that class.
The Distributor uses the service fees to compensate dealers for providing
personal services for accounts that hold Class B or Class C shares. Those
services are similar to those provided under the Class A Service Plan, described
above. The Distributor pays the 0.25% service fees to dealers in advance for the
first year after Class B or Class C shares have been sold by the dealer and
retains the service fee paid by the Fund in that year. After the shares have
been held for a year, the Distributor pays the service fees to dealers on a
quarterly basis.
The asset-based sales charge allows investors to buy Class B or Class C
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
charges to the Distributor for its services rendered in distributing Class B and
Class C shares. Those payments are at a fixed rate that is not related to the
Distributor's expenses. The services rendered by the Distributor include paying
and financing the payment of sales commissions, service fees and other costs of
distributing and selling Class B and Class C shares.
The Distributor currently pays sales commissions 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 4.00% of the
purchase price. The Distributor retains the Class B asset-based sales charge.
The Distributor may pay the Class B service fee and the asset-based sales charge
to the dealer quarterly in lieu of paying the sales commission and service fee
advance at the time of purchase.
The Distributor currently pays sales commissions of 0.75% of the purchase
price to dealers from its own resources at the time of sale of Class C shares.
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 1.00% of the
purchase price. The Distributor plans to pay the asset-based sales charge as of
an ongoing commission to the dealer on Class C shares that have been outstanding
for a year or more. The Distributor may pay the Class C service fee and
asset-based sales charge to the dealer quarterly in lieu of paying the sales
commission and service fee advance at the time of purchase.
The Distributor's actual expenses in selling Class B and Class C shares
may be more than the payments it receives from contingent deferred sales charges
collected on redeemed shares and from the Fund under the Distribution and
Service Plans for Class B and Class C shares. If the Fund terminates either
Plan, the Board of Trustees may allow the Fund to continue payments of the
asset-based sales charge to the Distributor for distributing shares before the
Plan was terminated.
BUYING CLASS Y SHARES. Class Y Shares are sold at net asset value per share
without sales charge directly to certain institutional investors that have
special agreements with the Distributor for this purpose. The intent of these
agreements is to allow tax-qualified institutional investors to invest
indirectly (through separate accounts) in Class Y shares and to allow other
institutional investors to invest directly in Class Y shares. Individual
investors are not permitted to invest directly in Class Y shares. As of the date
of this Prospectus, it is anticipated that Massachusetts Mutual Life Insurance
Company (an affiliate of the Manager and the Distributor) will act as Class Y
Sponsor for any outstanding class Y shares of the Fund.
While Class Y shares are not subject to initial or contingent deferred
sales charges or asset-based sales charges, an institutional investor buying the
shares for its customers' accounts may impose charges on those accounts. The
procedures for purchasing, redeeming, exchanging or transferring the Fund's
other classes of shares (other than the time those orders must be received by
the Distributor or Transfer Agent in Denver), and the special account features
available to purchasers of those other classes of shares described elsewhere in
this Prospectus do not apply to Class Y shares. Instructions for purchasing,
redeeming, exchanging or transferring Class Y shares must be submitted by the
institutional investor, not by its customers for whose benefit the shares are
held.
SPECIAL INVESTOR SERVICES
ACCOUNTLINK. OppenheimerFunds AccountLink links your Fund account to your
account at your bank or other financial institution to enable you to send money
electronically between those accounts to perform a number of types of account
transactions. These include purchases of shares by telephone (either through a
service representative or by PhoneLink, described below), automatic investments
under Asset Builder Plans, and sending dividends and distributions or Automatic
Withdrawal Plan payments directly to your bank account. Please call the Transfer
Agent for more information.
AccountLink privileges should be requested on your dealer's settlement
instructions if you buy your shares through your dealer. After your account is
established, you can request AccountLink privileges by sending
signature-guaranteed instructions to the Transfer Agent. AccountLink privileges
will apply to each shareholder listed in the registration on your account as
well as to your dealer representative of record unless and until the Transfer
Agent receives written instructions terminating or changing those privileges.
After you establish AccountLink for your account, any change of bank account
information must be made by signature-guaranteed instructions to the Transfer
Agent signed by all shareholders who own the account.
o USING ACCOUNTLINK TO BUY SHARES. Purchases may be made by telephone only
after your account has been established. To purchase shares in amounts up to
$250,000 through a telephone representative, call the Distributor at
1-800-852-8457. The purchase payment will be debited from your bank account.
o PHONELINK. PhoneLink is the OppenheimerFunds automated telephone system
that enables shareholders to perform a number of account transactions
automatically using a touch-tone phone. PhoneLink may be used on
already-established Fund accounts after you obtain a Personal Identification
Number (PIN), by calling the special PhoneLink number:
1-800-533-3310.
o PURCHASING SHARES. You may purchase shares in amounts up to $100,000 by
phone, by calling 1-800-533-3310. You must have established AccountLink
privileges to link your bank account with the Fund, to pay for these purchases.
o EXCHANGING SHARES. With the OppenheimerFunds Exchange Privilege,
described below, you can exchange shares automatically by phone from your Fund
account to another Oppenheimer fund account you have already established by
calling the special PhoneLink number. Please refer to "How to Exchange Shares,"
below, for details.
o 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.
SHAREHOLDER TRANSACTIONS BY FAX. Requests for certain account transactions may
be sent to the Transfer Agent by fax (telecopier). Please call 1-800-525-7048
for information about which transactions are included. Transaction requests
submitted by fax are subject to the same rules and restrictions as written and
telephone requests described in this Prospectus.
OPPENHEIMERFUNDS INTERNET WEB SITE. Information about the Fund, including your
account balance, daily share prices, market and Fund portfolio information, may
be obtained by visiting the OppenheimerFunds Internet Web Site, at the following
Internet address: http://www.oppenheimerfunds.com. Additionally, certain account
transactions may be requested by any shareholder listed in the registration on
an account as well as by the dealer representative of record through a special
section of that Web Site. To access that section of the Web Site you must first
obtain a personal identification number ("PIN") by calling OppenheimerFunds
PhoneLink at 1-800-533-3310. If you do not wish to have Internet account
transactions capability for your account, please call our customer service
representatives at 1-800-525-7048. To find out more information about Internet
transactions and procedures, please visit the Web Site.
AUTOMATIC WITHDRAWAL AND EXCHANGE PLANS. The Fund has several plans that enable
you to sell shares automatically or exchange them to another Oppenheimer fund
account on a regular basis:
o AUTOMATIC WITHDRAWAL PLANS. If your Fund account is worth $5,000 or more,
you can establish an Automatic Withdrawal Plan to receive payments of at least
$50 on a monthly, quarterly, semi-annual or annual basis. The checks may be sent
to you or sent automatically to your bank account on AccountLink. You may even
set up certain types of withdrawals of up to $1,500 per month by telephone. You
should consult the Statement of Additional Information for more details.
o AUTOMATIC EXCHANGE PLANS. You can authorize the Transfer Agent to
exchange automatically an amount you establish in advance for shares of up to
five other Oppenheimer funds on a monthly, quarterly, semi-annual or annual
basis under an Automatic Exchange Plan. The minimum purchase for each other
Oppenheimer funds account is $25. These exchanges are subject to the terms of
the exchange privilege, described below.
REINVESTMENT PRIVILEGE. If you redeem some or all of your Class A or Class B
shares of the Fund, you have up to 6 months to reinvest all or part of the
redemption proceeds in Class A shares of the Fund or of other Oppenheimer funds
without paying a sales charge. This privilege applies to Class A shares that you
purchased subject to an initial sales charge and to Class A or Class B shares on
which you paid a contingent deferred sales charge when you redeemed them. This
privilege does not apply to Class C shares. You must be sure to ask the
Distributor for this privilege when you send your payment. Please consult the
Statement of Additional Information for more details.
RETIREMENT PLANS. Fund shares are available as an investment for your retirement
plans. If you participate in a plan sponsored by your employer, the plan trustee
or administrator must make the purchase of shares for your retirement plan
account. The Distributor offers a number of different retirement plans that can
be used by individuals and employers:
o INDIVIDUAL RETIREMENT ACCOUNTS including rollover IRAs, for individuals
and their spouses and SIMPLE IRAs offered by employers
o 403(B)(7) CUSTODIAL PLANS for employees of eligible tax-exempt
organizations, such as schools, hospitals and charitable organizations
o SEP-IRAS (Simplified Employee Pension Plans) for small business owners
or people with income from self-employment, including SAR-SEP IRAs
o PENSION AND PROFIT-SHARING PLANS for self-employed persons and other
employers
o 401(K) PROTOTYPE RETIREMENT PLANS for businesses
Please call the Distributor for the OppenheimerFunds plan documents, which
contain important information and applications.
HOW TO SELL SHARES
You can arrange to take money out of your account by selling (redeeming) 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 and accepted by the
Transfer Agent. The Fund offers you a number of ways to sell your shares: in
writing or by telephone. You can also set up Automatic Withdrawal Plans to
redeem shares on a regular basis, as described above. 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, PLEASE CALL THE TRANSFER AGENT FIRST, AT 1-800-525-7048, FOR ASSISTANCE.
o RETIREMENT ACCOUNTS. To sell shares in an OppenheimerFunds retirement
account in your name, call the Transfer Agent for a distribution request form.
There are special income tax withholding requirements for distributions from
retirement plans and you must submit a withholding form with your request to
avoid delay. If your retirement plan account is held for you by your employer,
you must arrange for the distribution request to be sent by the plan
administrator or trustee. There are additional details in the Statement of
Additional Information.
o CERTAIN REQUESTS REQUIRE A SIGNATURE GUARANTEE. To protect you and the
Fund from fraud, certain redemption requests must be in writing and must include
a signature guarantee in the following situations (there may be other situations
also requiring a signature guarantee):
o You wish to redeem more than $50,000 worth of shares 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 redeemed by someone other than the owners (such as an
Executor)
o WHERE CAN I HAVE MY SIGNATURE GUARANTEED? The Transfer Agent will accept
a guarantee of your signature by a number of financial institutions, including:
a U.S. bank, trust company, credit union or savings association, or by a foreign
bank that has a U.S. correspondent bank, or by a U.S. registered dealer or
broker in securities, municipal securities or government securities, or by a
U.S. national securities exchange, a registered securities association or a
clearing agency. IF YOU ARE SIGNING AS A FIDUCIARY OR ON BEHALF OF A
CORPORATION, PARTNERSHIP OR OTHER BUSINESS, YOU MUST ALSO INCLUDE YOUR TITLE IN
THE SIGNATURE.
SELLING SHARES BY MAIL. Write a "letter of instructions" 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 requirements or documents requested by the Transfer Agent to
assure proper authorization of the person asking to sell 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
SELLING SHARES BY TELEPHONE. You and your dealer representative of record may
also sell your shares by telephone. To receive the redemption price on a regular
business day, your call must be received by the Transfer Agent by the close of
The New York Stock Exchange that day, which is normally 4:00 P.M. but may be
earlier on some days. YOU MAY NOT REDEEM SHARES HELD IN AN OPPENHEIMERFUNDS
RETIREMENT PLAN OR UNDER A SHARE CERTIFICATE BY TELEPHONE.
o To redeem shares through a service representative, call 1-800-852-8457
o To redeem shares automatically on PhoneLink, call 1-800-533-3310
Whichever method you use, you may have a check sent to the address on the
account statement, or, if you have linked your Fund account to your bank account
on AccountLink, you may have the proceeds wired to that bank account.
o TELEPHONE REDEMPTIONS PAID BY CHECK. Up to $50,000 may be redeemed by
telephone, in any 7-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.
o TELEPHONE REDEMPTIONS THROUGH ACCOUNTLINK OR 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.
SELLING 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. Please call your dealer for more
information about this procedure. Please refer to "Special Arrangements For
Repurchase of Shares From Dealers and Brokers" in the Statement of Additional
Information for more details.
HOW TO EXCHANGE SHARES
Shares of the Fund may be exchanged for shares of certain Oppenheimer
funds at net asset value per share at the time of exchange, without sales
charge. To exchange shares, you must meet several conditions:
o Shares of the fund selected for exchange must be available for sale
in your state of residence
o The prospectuses of this Fund and the fund whose shares you want to
buy must offer the exchange privilege
o You must hold the shares you buy when you establish your account for at
least 7 days before you can exchange them; after the account is open 7 days, you
can exchange shares every regular business day
o You must meet the minimum purchase requirements for the fund you
purchase by exchange
o BEFORE EXCHANGING INTO A FUND, YOU SHOULD OBTAIN AND READ ITS
PROSPECTUS
SHARES OF A PARTICULAR CLASS OF THE FUND MAY BE EXCHANGED ONLY FOR SHARES
OF THE SAME CLASS IN THE OTHER OPPENHEIMER FUNDS. For example, you can exchange
Class A shares of this Fund only for Class A shares of another fund. At present,
Oppenheimer Money Market Fund, Inc. offers only one class of shares, which are
considered to be "Class A" shares for this purpose. In some cases, sales charges
may be imposed on exchange transactions. Please refer to "How to Exchange
Shares" in the Statement of Additional Information for more details.
Exchanges may be requested in writing or by telephone:
o WRITTEN EXCHANGE REQUESTS. Submit an OppenheimerFunds Exchange Request
form, signed by all owners of the account. Send it to the Transfer Agent at the
addresses listed in "How to Sell Shares."
o TELEPHONE EXCHANGE REQUESTS. Telephone exchange requests may be made
either by calling a service representative at 1-800-852-8457 or by using
PhoneLink for automated exchanges, by calling 1-800-533-3310. Telephone
exchanges may be made only between accounts that are registered with the same
name(s) and address. Shares held under certificates may not be exchanged by
telephone.
You can find a list of Oppenheimer funds currently available for exchanges
in the Statement of Additional Information or obtain one by calling a service
representative at 1-800-525-7048. That list can change from time to time.
There are certain exchange policies you should be aware of:
o Shares are normally redeemed from one fund and purchased from the other
fund in the exchange transaction on the same regular business day on which the
Transfer Agent receives an exchange request that is in proper form by the close
of The New York Stock Exchange that day, which is normally 4:00 P.M. but may be
earlier on some days. However, either fund may delay the purchase of shares of
the fund you are exchanging into up to seven days if it determines it would be
disadvantaged by a same day transfer of the proceeds to buy shares. For example,
the receipt of multiple exchange requests from a dealer in a "market-timing"
strategy might require the sale of portfolio securities at a time or price
disadvantageous to the Fund.
o Because excessive trading can hurt fund performance and harm
shareholders, the Fund reserves the right to refuse any exchange request that
will disadvantage it, or to refuse multiple exchange requests submitted by a
shareholder or dealer.
o The Fund may amend, suspend or terminate the exchange privilege at any
time. Although the Fund will attempt to provide you notice whenever it is
reasonably able to do so, it may impose these changes at any time.
o For tax purposes, exchanges of shares involve a redemption of the shares
of the Fund you own and a purchase of the shares of the other fund, which may
result in a capital gain or loss. for more information about taxes affecting
exchanges, please refer to "How to Exchange Shares" in the Statement of
Additional Information.
o If the Transfer Agent cannot exchange all the shares you request because
of a restriction cited above, only the shares eligible for exchange will be
exchanged.
SHAREHOLDER ACCOUNT RULES AND POLICIES
o NET ASSET VALUE PER SHARE is determined for each class of shares as of
the close of The New York Stock Exchange, which is normally 4:00 P.M. but may be
earlier on some days, on each day the Exchange is open 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 Fund's Board of Trustees has established
procedures to value the Fund's securities to determine net asset value. In
general, securities values are based on market value. There are special
procedures for valuing illiquid and restricted securities and obligations for
which market values cannot be readily obtained. These procedures are described
more completely in the Statement of Additional Information.
o 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.
o TELEPHONE TRANSACTION PRIVILEGES for purchases, redemptions or exchanges
may be modified, suspended or terminated by the Fund at any time. 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 and until
the Transfer Agent receives cancellation instructions from an owner of the
account.
o 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. If the Transfer Agent does not use
reasonable procedures it may be liable for losses due to unauthorized
transactions, but otherwise neither the Transfer Agent nor the Fund will be
liable for losses or expenses arising out of telephone instructions reasonably
believed to be genuine. If you are unable to reach the Transfer Agent during
periods of unusual market activity, you may not be able to complete a telephone
transaction and should consider placing your order by mail.
o 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.
o DEALERS THAT CAN 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.
o THE REDEMPTION PRICE FOR SHARES WILL VARY from day to day because the
values of the securities in the Fund's portfolio fluctuate, and the redemption
price, which is the net asset value per share, will normally be different for
Class A, Class B, Class C and Class Y shares. Therefore, the redemption value of
your shares may be more or less than their original cost.
o PAYMENT FOR REDEEMED SHARES is made ordinarily in cash and forwarded by
check or through AccountLink (as elected by the shareholder under the redemption
procedures described above) within 7 days after the Transfer Agent receives
redemption instructions in proper form, except under unusual circumstances
determined by the Securities and Exchange Commission delaying or suspending such
payments. For accounts registered in the name of a broker-dealer, payment will
be forwarded within 3 business days. THE TRANSFER AGENT MAY DELAY FORWARDING A
CHECK OR PROCESSING A PAYMENT VIA ACCOUNTLINK FOR RECENTLY PURCHASED SHARES, BUT
ONLY UNTIL THE PURCHASE PAYMENT HAS CLEARED. THAT DELAY MAY BE AS MUCH AS 10
DAYS FROM THE DATE THE SHARES WERE PURCHASED. THAT DELAY MAY BE AVOIDED IF YOU
PURCHASE SHARES BY FEDERAL FUNDS WIRE, CERTIFIED CHECK OR ARRANGE TO HAVE YOUR
BANK PROVIDE TELEPHONE OR WRITTEN ASSURANCE TO THE TRANSFER AGENT THAT YOUR
PURCHASE PAYMENT HAS CLEARED.
o 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, and in some cases involuntary redemptions
may be made to repay the Distributor for losses from the cancellation of share
purchase orders.
o UNDER UNUSUAL CIRCUMSTANCES, shares of the Fund may be redeemed "in
kind," which means that the redemption proceeds will be paid with securities
from the Fund's portfolio. Please refer to "How to Sell Shares" in the Statement
of Additional Information for more details.
o "BACKUP WITHHOLDING" of Federal income tax may be applied at the rate of
31% from taxable dividends, distributions and redemption proceeds (including
exchanges) if you fail to furnish the Fund a correct and properly certified
Social Security or Employer Identification Number when you sign your
application, or if you underreport your income to the Internal Revenue Service.
o THE FUND DOES NOT CHARGE A REDEMPTION FEE, but if your dealer or broker
handles your redemption, they may charge a fee. That fee can be avoided by
redeeming your Fund shares directly through the Transfer Agent. Under the
circumstances described in "How To Buy Shares," you may be subject to a
contingent deferred sales charges when redeeming certain Class A, Class B and
Class C shares.
o TO AVOID SENDING DUPLICATE COPIES OF MATERIALS TO HOUSEHOLDS, the Fund
will mail only one copy of each annual and semi-annual report to shareholders
having the same last name and address on the Fund's records. However, each
shareholder may call the Transfer Agent at 1-800-525-7048 to ask that copies of
those materials be sent personally to that shareholder.
DIVIDENDS, CAPITAL GAINS AND TAXES
DIVIDENDS. The Fund declares dividends separately for Class A, Class B, Class C
and Class Y shares from net investment income on an annual basis and normally
pays those dividends to shareholders in December, but the Board of Trustees can
change that date. The Board may also cause the Fund to declare dividends after
the close of the Fund's fiscal year (which ends October 31st). Because the Fund
does not have an objective of seeking current income, the amounts of dividends
it pays, if any, will likely be small. Also, dividends paid on Class A and Class
Y shares generally are expected to be higher than for Class B and Class C shares
because expenses allocable to Class B and Class C shares will generally be
higher.
CAPITAL GAINS. The Fund may make distributions annually in December out of any
net short-term or long-term capital gains, and the Fund may make supplemental
distributions of dividends and capital gains following the end of its fiscal
year. Long-term capital gains will be separately identified in the tax
information the Fund sends you after the end of the year. Short-term capital
gains are treated as dividends for tax purposes. There can be no assurance that
the Fund will pay any capital gains distributions in a particular year.
DISTRIBUTION OPTIONS. When you open your account, specify on your application
how you want to receive your distributions. For OppenheimerFunds retirement
accounts, all distributions are reinvested. For other accounts, you have four
options:
o REINVEST ALL DISTRIBUTIONS IN THE FUND. You can elect to reinvest all
dividends and long-term capital gains distributions in additional shares of
the Fund.
o REINVEST LONG-TERM CAPITAL GAINS ONLY. You can elect to reinvest
long-term capital gains in the Fund while receiving dividends by check or have
them sent to your bank account on AccountLink.
o RECEIVE ALL DISTRIBUTIONS IN CASH. You can elect to receive a check
for all dividends and long-term capital gains distributions or have them sent
to your bank on AccountLink.
o REINVEST YOUR DISTRIBUTIONS IN ANOTHER OPPENHEIMER FUND ACCOUNT. You can
reinvest all distributions in the same class of shares of another Oppenheimer
Fund account you have established.
TAXES. If your account is not a tax-deferred retirement account, you should be
aware of the following tax implications of investing in the Fund. The Fund's
distributions from long-term capital gains are taxable to shareholders as
long-term capital gains, no matter how long you held your shares. Dividends paid
by the Fund from short-term capital gains and net investment income are taxable
as ordinary income. These dividends and distributions are subject to Federal
income tax and may be subject to state or local taxes. Your distributions are
taxable as described above, whether you reinvest them in additional shares or
take them in cash. Corporate shareholders may be entitled to the corporate
dividends received deduction for some portion of the Fund's distributions
treated as ordinary income, subject to applicable limitations under the Internal
Revenue Code. Every year the Fund will send you and the IRS a statement showing
the aggregate amount of each taxable distribution you received in the previous
year. So that the Fund will not have to pay taxes on the amounts it distributes
to shareholders as dividends and capital gains, the Fund intends to manage its
investments so that it will qualify as a "regulated investment company" under
the Internal Revenue Code, although it reserves the right not to qualify in a
particular year.
o "BUYING A DIVIDEND": 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, respectively.
o TAXES ON TRANSACTIONS: Share redemptions, including redemptions for
exchanges, are subject to capital gains tax. Generally speaking, 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.
o RETURNS OF CAPITAL: 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. A non-taxable return of
capital may reduce your tax basis in your Fund shares.
This information is only a summary of certain federal tax information
about your investment. More information is contained in the Statement of
Additional Information, and in addition you should consult with your tax adviser
about the effect of an investment in the Fund on your particular tax situation.
3
<PAGE>
APPENDIX A
SPECIAL SALES CHARGE ARRANGEMENTS FOR SHAREHOLDERS OF THE FUND WHO
WERE SHAREHOLDERS OF THE FORMER QUEST FOR VALUE FUNDS
The initial and contingent sales charge rates and waivers for Class A, Class B
and Class C shares of the Fund described elsewhere in this Prospectus are
modified as described below for those shareholders of (i) Oppenheimer Quest for
Value Fund, Inc., Oppenheimer Quest for Value Growth & Income Fund, Oppenheimer
Quest Opportunity Value Fund, Oppenheimer Quest Small Cap Value Fund and
Oppenheimer Quest Global Value Fund, Inc. on November 24, 1995, when
OppenheimerFunds, Inc. became the investment adviser to those funds, and (ii)
Quest for Value U.S. Government Income Fund, Quest for Value Investment Quality
Income Fund, Quest for Global Income Fund, Quest for Value New York Tax-Exempt
Fund, Quest for Value National Tax-Exempt Fund and Quest for Value California
Tax-Exempt Fund when those funds merged into various Oppenheimer funds on
November 24, 1995. The funds listed above are referred to in this Prospectus as
the "Former Quest for Value Funds." The waivers of initial and contingent
deferred sales charges described in this Appendix apply to shares of the Fund
(i) acquired by such shareholder pursuant to an exchange of shares of one of the
Oppenheimer funds that was one of the Former Quest for Value Funds or (ii)
purchased by such shareholder by exchange of shares of other Oppenheimer funds
that were acquired pursuant to the merger of any of the Former Quest for Value
Funds into an Oppenheimer fund on November 24, 1995.
CLASS A SALES CHARGES
o REDUCED CLASS A INITIAL SALES CHARGE RATES FOR CERTAIN FORMER QUEST
SHAREHOLDERS
o PURCHASES BY GROUPS, ASSOCIATIONS AND CERTAIN QUALIFIED RETIREMENT PLANS. The
following table sets forth the initial sales charge rates for Class A shares
purchased by a "Qualified Retirement Plan" through a single broker, dealer or
financial institution, or by members of "Associations" formed for any purpose
other than the purchase of securities if that Qualified Retirement Plan or 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. For this purpose only, a "Qualified Retirement Plan" includes
any 401(k) plan, 403(b) plan, and SEP/IRA or IRA plan for employees of a single
employer.
FRONT-END SALES FRONT-END SALES
NUMBER OF CHARGE AS A CHARGE AS A COMMISSION AS
ELIGIBLE EMPLOYEES PERCENTAGE OF PERCENTAGE OF PERCENTAGE OF
OR MEMBERS OFFERING PRICE AMOUNT INVESTED OFFERING PRICE
- ------------------------------------------------------------------------------
9 or fewer 2.50% 2.56% 2.00%
- ------------------------------------------------------------------------------
At least 10 but not
more than 49 2.00% 2.04% 1.60%
For purchases by Qualified Retirement plans and 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 on pages __ and __ of this Prospectus.
Purchases made under this arrangement qualify for the lower of the sales
charge rate in the table based on the number of eligible employees in a
Qualified Retirement Plan or members of an Association or the sales charge rate
that applies under the Rights of Accumulation described above in the Prospectus.
In addition, purchases by 401(k) plans that are Qualified Retirement Plans
qualify for the waiver of the Class A initial sales charge if they qualified to
purchase shares of any of the Former Quest For Value Funds by virtue of
projected contributions or investments of $1 million or more each year.
Individuals who qualify under this arrangement for reduced sales charge rates as
members of Associations, or as eligible employees in Qualified Retirement Plans
also may purchase shares for their individual or custodial accounts at these
reduced sales charge rates, upon request to the Fund's Distributor.
O WAIVER OF CLASS A SALES CHARGES FOR CERTAIN SHAREHOLDERS
Class A shares of the Fund purchased by the following investors are not
subject to any Class A initial or contingent deferred sales charges:
o Shareholders of the Fund 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 of the Fund who acquired shares of any Former Quest for
Value Fund by merger of any of the portfolios of the Unified Funds.
O 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 of the Fund purchased by the following investors who were
shareholders of any Former Quest for Value Fund:
o Investors who purchased Class A shares from a dealer that is not 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.
o Participants in Qualified Retirement Plans that purchased shares of any
of the Former Quest For Value Funds pursuant to a special "strategic alliance"
with the distributor of those funds. The Fund's Distributor will pay a
commission to the dealer for purchases of Fund shares as described above in
"Class A Contingent Deferred Sales Charge."
CLASS A, CLASS B AND CLASS C CONTINGENT DEFERRED SALES CHARGE WAIVERS
O 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, B or C shares of the Fund acquired by 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, if those
shares were purchased prior to March 6, 1995: in connection with (i)
distributions to participants or beneficiaries of plans qualified under Section
401(a) of the Internal Revenue Code or from custodial accounts under Section
403(b)(7) of the Code, Individual Retirement Accounts, deferred compensation
plans under Section 457 of the Code, and other employee benefit plans, and
returns of excess contributions made to each type of plan, (ii) withdrawals
under an automatic withdrawal plan holding only either Class B or C shares if
the annual withdrawal does not exceed 10% of the initial value of the account,
and (iii) 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.
O 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, B or C shares of the
Fund acquired by 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, if those shares were purchased on or after March 6,
1995, but prior to November 24, 1995: (1) distributions to participants or
beneficiaries from Individual Retirement Accounts under Section 408(a) of the
Internal Revenue Code or retirement plans under Section 401(a), 401(k), 403(b)
and 457 of the Code, if those distributions are made either (a) to an individual
participant as a result of separation from service or (b) following the death or
disability (as defined in the Code) of the participant or beneficiary; (2)
returns of excess contributions to such retirement plans; (3) redemptions other
than from retirement plans following the death or disability of the
shareholder(s) (as evidenced by a determination of total disability by the U.S.
Social Security Administration); (4) withdrawals under an automatic withdrawal
plan (but only for Class B or C shares) where the annual withdrawals do not
exceed 10% of the initial value of the account; and (5) 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, B or C shares of the Fund described in this
section if within 90 days after that redemption, the proceeds are invested in
the same class of shares in this Fund or another Oppenheimer fund.
A-1
<PAGE>
OPPENHEIMER LARGE CAP GROWTH FUND
Two World Trade Center
New York, New York 10048-0203
1-800-525-7048
INVESTMENT ADVISER
OppenheimerFunds, Inc.
Two World Trade Center
New York, New York 10048-0203
DISTRIBUTOR
OppenheimerFunds Distributor, Inc.
Two World Trade Center
New York, New York 10048-0203
TRANSFER AGENT AND SHAREHOLDER SERVICING AGENT
OppenheimerFunds Services
P.O. Box 5270
Denver, Colorado 80217
1-800-525-7048
OPPENHEIMERFUNDS INTERNET WEB SITE
http://www.oppenheimerfunds.com
CUSTODIAN OF PORTFOLIO SECURITIES
The Bank of New York
One Wall Street
New York, New York 10015
INDEPENDENT AUDITORS
KPMG Peat Marwick LLP
707 Seventeenth Street
Denver, Colorado 80202
LEGAL COUNSEL
Gordon Altman Butowsky Weitzen Shalov & Wein
114 West 47th Street
New York, New York 10036
NO DEALER, BROKER, SALESPERSON OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE
ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN
THIS PROSPECTUS OR THE STATEMENT OF ADDITIONAL INFORMATION AND, IF GIVEN OR
MADE, SUCH INFORMATION AND REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING
BEEN AUTHORIZED BY THE FUND, OPPENHEIMERFUNDS, INC., OPPENHEIMERFUNDS
DISTRIBUTOR, INC. OR ANY AFFILIATE THEREOF. THIS PROSPECTUS DOES NOT CONSTITUTE
AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES
OFFERED HEREBY IN ANY STATE TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH AN
OFFER IN SUCH STATE.
PR0775.001.____ * Printed on recycled paper
A-2
<PAGE>
OPPENHEIMER LARGE CAP GROWTH FUND
Two World Trade Center, New York, New York 10048-0203
1-800-525-7048
STATEMENT OF ADDITIONAL INFORMATION DATED _______, 1998
This Statement of Additional Information of Oppenheimer Large Cap Growth
Fund is not a Prospectus. This document contains additional information about
the Fund and supplements information in the Prospectus dated ___________, 1998.
It should be read together with the Prospectus, which may be obtained by writing
to the Fund's Transfer Agent, OppenheimerFunds Services, at P.O. Box 5270,
Denver, Colorado 80217 or by calling the Transfer Agent at the toll-free number
shown above.
CONTENTS
PAGE
ABOUT THE FUND
Investment Objective and Policies.......................................
Investment Policies and Strategies......................................
Other Investment Techniques and Strategies..............................
Other Investment Restrictions...........................................
How the Fund is Managed ................................................
Organization and History................................................
Trustees and Officers of the Fund.......................................
The Manager and Its Affiliates..........................................
Brokerage Policies of the Fund..........................................
Performance of the Fund.................................................
Distribution and Service Plans..........................................
ABOUT YOUR ACCOUNT
How To Buy Shares.......................................................
How To Sell Shares......................................................
How To Exchange Shares..................................................
Dividends, Capital Gains and Taxes......................................
Additional Information About the Fund...................................
FINANCIAL INFORMATION ABOUT THE FUND
Independent Auditors' Report............................................
Statement of Assets and Liabilities.....................................
Appendix: Industry Classifications...................................... A-1
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ABOUT THE FUND
INVESTMENT OBJECTIVE AND POLICIES
INVESTMENT POLICIES AND STRATEGIES. The investment objective and policies of the
Fund are described in the Prospectus. Set forth below is supplemental
information about those policies and the types of securities in which the Fund
may invest, as well as the strategies the Fund may use to try to achieve its
objective. Certain capitalized terms used in this Statement of Additional
Information have the same meanings as those terms have in the Prospectus.
In selecting securities for the Fund's portfolio, the Fund's investment
advisor, OppenheimerFunds, Inc. referred to as (the "Manager"), evaluates the
merits of securities primarily through the exercise of its own investment
analysis. This may include, among other things, evaluation of the history of the
issuer's operations, prospects for the industry of which the issuer is part, the
issuer's financial condition, the issuer's pending product developments and
developments by competitors, the effect of general market and economic
conditions on the issuer's business, and legislative proposals or new laws that
might affect the issuer. Current income is not a consideration in the selection
of portfolio securities for the Fund, whether for appreciation, defensive or
liquidity purposes. The fact that a security has a low yield or does not pay
current income will not be an adverse factor in selecting securities to try to
achieve the Fund's investment objective of capital appreciation unless the
Manager believes that the lack of yield might adversely affect appreciation
possibilities.
The portion of the Fund's assets allocated to securities and methods
selected for capital appreciation will depend upon the judgment of the Manager
as to the future movement of the equity securities markets. If the Manager
believes that economic conditions favor a rising market, the Fund will emphasize
securities and investment methods selected for high capital growth. If the
Manager believes that a market decline is likely, defensive securities and
investment methods will be emphasized.
O FOREIGN SECURITIES. As noted in the Prospectus, the Fund may invest in
securities (which may be denominated in U.S. dollars or non-U.S. currencies)
issued or guaranteed by foreign corporations, certain supranational entities
(described below) and foreign governments or their agencies or instrumentalities
and in securities issued by U.S. corporations denominated in non-U.S.
currencies. The types of foreign debt obligations and other securities in which
the Fund may invest are the same types of debt and equity securities identified
above. Foreign securities are subject however, to additional risks not
associated with domestic securities, as discussed below. These additional risks
may be more pronounced as to investments in securities issued by emerging market
countries or by companies located in emerging market countries.
"Foreign securities" include equity and debt securities of companies
organized under the laws of countries other than the United States and debt
securities of foreign governments that are 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
considered "foreign securities" for the purpose of the Fund's investment
allocations.
Investing in foreign securities offer potential benefits not available
from investing solely in securities of domestic issuers, including 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. In buying foreign securities, the Fund may convert U.S. dollars into
foreign currency, but only to effect securities transactions on foreign
securities exchanges and not to hold such currency as an investment. If the
Fund's portfolio securities are held abroad, the sub-custodians or depositories
holding them must be approved by the Fund's Board of Trustees to the extent that
approval is required under applicable rules of the Securities and Exchange
Commission.
o RISKS OF FOREIGN INVESTING. Investing in foreign securities involves
special additional risks and considerations not typically associated with
investing in securities of issuers traded in the U.S. These include: reduction
of income by foreign taxes; fluctuation in value of foreign portfolio
investments due to changes in currency rates and control regulations (e.g.,
currency blockage); transaction charges for currency exchange; lack of public
information about foreign issuers; lack of uniform accounting, auditing and
financial reporting standards comparable to those applicable to domestic
issuers; less volume on foreign exchanges than on U.S. exchanges; greater
volatility and less liquidity on foreign markets than in the U.S.; less
regulation of foreign issuers, stock exchanges and brokers than in the U.S.;
greater difficulties in commencing lawsuits against foreign issuers; higher
brokerage commission rates than in the U.S.; increased risks of delays in
settlement of portfolio transactions or loss of certificates for portfolio
securities because of the lesser speed and reliability of mail service between
the U.S. and foreign countries than within the U.S.; possibilities in some
countries of expropriation or nationalization of assets, confiscatory taxation,
political, financial or social instability or adverse diplomatic developments;
and differences (which may be favorable or unfavorable) between the U.S. economy
and foreign economies. From time to time, 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. If the Fund's securities are held abroad, the countries in which
such securities may be held and the sub-custodians holding them must be approved
by the Fund's Board of Trustees under applicable SEC rules.
o BORROWING FOR LEVERAGE. From time to time, the Fund may increase its
ownership of securities by borrowing from banks on an unsecured basis and
investing the borrowed funds, subject to the restrictions stated in the
Prospectus. Any such borrowing will be made only from banks, and, pursuant to
the requirements of the Investment Company Act of 1940, will only be made 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, when computed in that manner,
should fail to meet the 300% asset coverage requirement, the Fund is required
within three days to reduce its bank debt to the extent necessary to meet that
requirement. To do so, the Fund may have to sell a portion of its investments at
a time when independent investment judgment would not dictate such sale.
Interest on money borrowed is an expense the Fund would not otherwise incur, so
that during periods of substantial borrowings, its expenses may increase more
than funds that do not borrow.
OTHER INVESTMENT TECHNIQUES AND STRATEGIES
o ILLIQUID AND RESTRICTED SECURITIES. To enable the Fund to sell restricted
securities not registered under the Securities Act of 1933, the Fund may have to
cause those securities to be registered. The expenses of registration of
restricted securities may be negotiated by the Fund with the issuer at the time
such securities are purchased by the Fund, if such registration is required
before such securities may be sold publicly. When registration must be arranged
because the Fund wishes to sell the security, a considerable period may elapse
between the time the decision is made to sell the securities and the time the
Fund would be permitted to sell them. The Fund would bear the risks of any
downward price fluctuation during that period. The Fund may also acquire,
through private placements, securities having contractual restrictions on their
resale, which might limit the Fund's ability to dispose of such securities and
might lower the amount realizable upon the sale of such securities. Illiquid
securities include repurchase agreements maturing in more than seven days, or
certain participation interests in other than those with puts exercisable within
seven days.
The Fund has percentage 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 pursuant to Rule 144A under the Securities Act of 1933,
provided that those securities have been determined to be liquid by the Board of
Trustees of the Fund or 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 holding
of that security may be deemed to be illiquid.
o LOANS OF PORTFOLIO SECURITIES. The Fund may lend its portfolio securities
subject to the restrictions stated in the Prospectus. Repurchase transactions
are not considered "loans" for the purpose of the Fund's limit on the percentage
of its assets that can be loaned. Under applicable regulatory requirements
(which are subject to change), the loan collateral on each business day must at
least equal the value of the loaned securities and must consist of cash, bank
letters of credit or securities of the U.S. Government (or its agencies or
instrumentalities). 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. Such terms and the issuing bank must be satisfactory to the
Fund. In a portfolio securities lending transaction, the Fund receives from the
borrower an amount equal to the interest paid or the dividends declared on the
loaned securities during the term of the loan as well as the interest on the
collateral securities, less any finders', administrative or other fees the Fund
pays in connection with the loan. 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.
o REPURCHASE AGREEMENTS. The Fund may acquire securities subject to
repurchase agreements for liquidity purposes to meet anticipated redemptions, or
pending the investment of the proceeds from sales of Fund shares, or pending the
settlement of purchases of portfolio securities. In a repurchase transaction,
the Fund acquires a security from, and simultaneously resells it to, an approved
vendor. An "approved vendor" is a U.S. commercial bank or the U.S. branch of a
foreign bank or a broker-dealer which has been designated a primary dealer in
government securities which must meet credit requirements set by the Fund's
Board of Trustees from time to time. The repurchase 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. The majority of these
transactions run from day to day, and delivery pursuant to the resale typically
will occur within one to five days of the purchase. Repurchase agreements are
considered "loans" under the Investment Company Act, 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. Additionally, the Manager will impose creditworthiness requirements
to confirm that the vendor is financially sound and will continuously monitor
the collateral's value.
o HEDGING WITH OPTIONS AND FUTURES CONTRACTS. The Fund may use hedging
instruments for the purposes described in the Prospectus. When hedging to
attempt to protect against declines in the market value of the Fund's portfolio,
or 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 may (i) sell Financial Futures, (ii) buy puts on
such Futures or securities, or (iii) write covered calls on securities held by
it or on Futures. When hedging to establish a position in the equities market as
a temporary substitute for the purchase of individual equity securities, the
Fund may (i) buy Futures or (ii) buy calls on such Futures or on securities.
Normally, the Fund would then purchase the equity securities and terminate the
hedging portion.
The Fund's strategy of hedging with options and Futures will be incidental
to the Fund's investment activities in the underlying cash market. In the
future, the Fund may employ hedging instruments and strategies that are not
presently contemplated but which may be developed, to the extent such investment
methods are consistent with the Fund's investment objective, and are legally
permissible and disclosed in the Prospectus. Additional information about the
hedging instruments the Fund may use is provided below.
o WRITING COVERED CALL OPTIONS. When the Fund writes a call on an
investment, it receives a premium and agrees to sell the callable investment to
a purchaser of a corresponding call on the same investment during the call
period (usually not more than 9 months) at a fixed exercise price (which may
differ from the market price of the underlying investment), regardless of market
price changes during the call period. The Fund retains the risk of loss if the
price of the underlying security declines during the call period, which may be
offset to some extent by the premium.
To terminate its obligation on a call it has written, the Fund may
purchase a corresponding call in a "closing purchase transaction." A profit or
loss will be realized, depending upon whether the net of the amount of the
option transaction costs and the premium received on the call the Fund has
written is more or less than the price of the call the Fund subsequently
purchases. A profit may also be realized if the call lapses unexercised, because
the Fund retains the underlying investment and the premium received. Those
profits are considered short-term capital gains for Federal income tax purposes,
and when distributed by the Fund are taxable as ordinary income.
An option position may be closed out only on a market that provides
secondary trading for option of the same series, and there is no assurance that
a liquid secondary market will exist for a particular option. If the Fund could
not effect a closing purchase transaction due to lack of a market, it would have
to hold the callable investments until the call lapsed or was exercised.
The Fund may also write calls on Futures without owning a futures contract
or deliverable securities, provided that at the time the call is written, the
Fund covers the call by segregating in escrow an equivalent dollar amount of
deliverable securities or liquid assets. The Fund will segregate additional
liquid assets if the value of the escrowed assets drops below 100% of the
obligation under the Future. In no circumstances would an exercise notice
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.
o WRITING PUT OPTIONS. A put option on an investment 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. Writing a put covered
by segregated liquid assets equal to the exercise price of the put has the same
economic effect to the Fund as writing a covered call. The premium the Fund
receives from writing a put option represents a profit, as long as the price of
the underlying investment remains above the exercise price. However, the Fund
has also assumed the obligation during the option period to buy the underlying
investment from the buyer of the put at the exercise price, even though the
value of the investment may fall below the exercise price. If the put expires
unexercised, the Fund (as the writer of the put) realizes a gain in the amount
of the premium less transaction costs. If the put is exercised, the Fund must
fulfill its obligation to purchase the underlying investment at the exercise
price, which will usually exceed the market value of the investment at that
time. In that case, the Fund may incur a loss, 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 incurred.
When writing put options on securities or on foreign currencies, 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 foregoes the opportunity of
investing the segregated assets or writing calls against those assets. As long
as the obligation of the Fund as the put writer continues, it may be assigned an
exercise notice by the broker-dealer through whom such option was sold,
requiring the Fund to take delivery of the underlying security against payment
of 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.
This obligation terminates upon expiration of the put, or such earlier time at
which the Fund effects a closing purchase transaction by purchasing a put of the
same series as that previously sold. Once the Fund has been assigned an exercise
notice, it is thereafter not allowed to effect a closing purchase transaction.
The Fund may effect a closing purchase transaction to realize a profit on
an outstanding put option it has written or to prevent an underlying security
from being put. Furthermore, effecting such a closing purchase transaction will
permit the Fund to write another put option to the extent that the exercise
price thereof is secured by the deposited assets, or to utilize the proceeds
from the sale of such assets for other investments by the Fund. The Fund will
realize a profit or loss from a closing purchase transaction if the cost of the
transaction is less or more than the premium received from writing the option.
As above for writing covered calls, any and all such profits described herein
from writing puts are considered short-term gains for Federal tax purposes, and
when distributed by the Fund, are taxable as ordinary income.
o PURCHASING CALLS AND PUTS. When the Fund purchases a call (other than in
a closing purchase transaction), it pays a premium and, except as to calls on
financial indices or Financial Futures, 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. When the Fund purchases a call on a
financial index or Financial Future, settlement is in cash rather than by
delivery of the underlying investment to the Fund. The Fund benefits only if the
call is sold 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 and the call is exercised. If the call is not
exercised or sold (whether or not at a profit), it will become worthless at its
expiration date and the Fund will lose its premium payment and the right to
purchase the underlying investment.
When the Fund purchases a put, it pays a premium and, except as to puts on
financial indices, has the right to sell the underlying investment to a seller
of a corresponding put on the same investment during the put period at a fixed
exercise price. Buying a put on an investment the Fund owns enables the Fund 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, and the Fund will lose its premium payment and
the right to sell the underlying investment. The put may, however, be sold prior
to expiration (whether or not at a profit).
Buying a put on an index or on Futures it does not own permits the Fund
either to resell the put or, if applicable, to buy the underlying investment and
sell it at the exercise price. The resale price of the put will vary inversely
with 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. In the
event of a decline in price of the underlying investment, the Fund could
exercise or sell the put at a profit to attempt to offset some or all of its
loss on its portfolio securities. When the Fund purchases a put on an index or a
Future not held by it, the put protects the Fund to the extent that the prices
of the underlying Futures move in a similar pattern to the prices of the
securities in the Fund's portfolio.
o FUTURES. The Fund may buy and sell futures contracts related to
financial indices, including stock indices (a "Financial Future"), or to debt
securities ("Interest Rate Futures"). A financial index assigns relative values
to the securities included in the index and fluctuates with the changes in the
market value of those securities. Financial indices cannot be purchased or sold
directly. The contracts obligate the seller to deliver, and the purchaser to
take, cash to settle the futures transaction or to enter into an offsetting
contract. No physical delivery of the securities underlying the index is made on
settling the futures obligation. No monetary amount is paid or received by a
Fund on the purchase or sale of a Financial Future. An Interest Rate Future
obligates the seller to deliver and the purchaser to rake a specific type of
debt security or cash to settle the futures transaction, or to enter into an
offsetting contract.
Upon entering into a Futures transaction, the Fund will be required to
deposit an initial margin payment in cash or U.S. Treasury bills with the
futures commission merchant (the "futures broker"). The initial margin payment
will be deposited with the Fund's Custodian 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 to
reflect changes in its market value, subsequent margin payments, called
variation margin, will be paid to or by the futures broker on a daily basis.
Prior to expiration of the Future, if the Fund elects to close out its position
by taking an opposite position, a final determination of variation margin is
made, additional cash is required to be paid by or released to the Fund, and any
loss or gain is then realized for tax purposes. Although Financial Futures and
Interest Rate Futures by their terms call for settlement by delivery of cash or
securities, respectively, in most cases the obligation is fulfilled by entering
into an offsetting position. All futures transactions are effected through a
clearinghouse associated with the exchange on which the contracts are traded.
o REGULATORY ASPECTS OF HEDGING INSTRUMENTS. The Fund is required to
operate within certain guidelines and restrictions with respect to its use of
Futures and options on Futures established by the Commodity Futures Trading
Commission ("CFTC"). In particular the Fund is exempted from registration with
the CFTC as a "commodity pool operator" if the Fund complies with the
requirements of Rule 4.5 adopted by the CFTC. The Rule does not limit the
percentage of the Fund's assets that may be used for Futures margin and related
options premiums for a bona fide hedging position. However, under the Rule the
Fund must limit its aggregate initial futures margin and related option premiums
to no more than 5% of the Fund's total assets for hedging strategies that are
not considered bona fide hedging strategies under the Rule. Under the Rule, the
Fund also must use short Futures and Futures options positions solely for "BONA
FIDE hedging purposes" within the meaning and intent of the applicable
provisions of the Commodity Exchange Act.
Transactions in options by the Fund are subject to limitations established
by each of the exchanges governing the maximum number of options which may be
written or held by a single investor or group of investors acting in concert,
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 futures brokers. Thus, the number of options which the
Fund may write or hold may be affected by options written or held by other
entities, including other investment companies having the same or an affiliated
investment adviser. Position limits also apply to Futures. An exchange may order
the liquidation of positions found to be in violation of those limits and may
impose certain other sanctions. Due to requirements under the Investment Company
Act of 1940 (the "Investment Company Act"), when the Fund purchases a Stock
Index Future, the Fund will maintain in a segregated account or accounts with
its Custodian, liquid assets marketable short-term (maturing in one year or
less) debt instruments in an amount equal to the market value of the securities
underlying such Future, less the margin deposit applicable to it.
o TAX ASPECTS OF COVERED CALLS AND HEDGING INSTRUMENTS. The Fund intends
to qualify as a "regulated investment company" under the Internal Revenue Code
(although it reserves the right not to qualify). 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 the Fund's shares are held in a
retirement account or the shareholder is otherwise exempt from tax).
o RISKS OF HEDGING WITH FUTURES. In addition to the risks associated with
respect to hedging that are discussed in the Prospectus and above, there is a
risk in using short hedging by selling Futures to attempt to protect declines in
the values of the fund's securities. the risk is that the prices of the Futures
will correlate imperfectly with the behavior of the cash (i.e., market value)
prices of the Fund's securities. The ordinary spreads between prices in the cash
and futures markets are subject to distortions due to differences in the natures
of those markets. First, all participants in the futures markets are subject to
margin deposit and maintenance requirements. Rather than meeting additional
margin deposit requirements, investors may close out futures contracts through
off-setting transactions which could distort the normal relationship between the
cash and futures markets. Second, the liquidity of the futures markets 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 markets could be reduced, thus producing distortion.
Third, from the point of view of speculators, the deposit requirements in the
futures markets are less onerous than margin requirements in the securities
markets. Therefore, increased participation by speculators in the futures
markets may cause temporary price distortions.
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
securities being hedged and movements in the price of the Hedging Instruments,
the Fund may use Hedging Instruments in a greater dollar amount than the dollar
amount of securities being hedged if the historical volatility of the prices of
such securities being hedged is more than the historical volatility of the
applicable index. It is also possible that where the Fund has used Hedging
Instruments in a short hedge, the market may advance and the value of securities
held in the Fund's portfolio may decline. If this occurred, the Fund would lose
money on the Hedging Instruments and also experience a decline in value in its
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.
If the Fund uses hedging instruments to establish a position in the
equities markets as a temporary substitute for the purchase of individual equity
securities (long hedging) by buying Futures, it is possible that the market may
decline. If the Fund then concludes not to invest in equity securities at that
time because of concerns as to a possible further market decline 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 equity securities purchased.
OTHER INVESTMENT RESTRICTIONS
The Fund's most significant investment restrictions are set forth in the
Prospectus. The following are fundamental policies, and together with the Fund's
fundamental policies described in the Prospectus, cannot be changed without the
vote of a "majority" of the Fund's outstanding voting securities. Such a
"majority" vote is defined in the Investment Company Act as the vote of the
holders of the lesser of: (i) 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 (ii) more than 50% of the outstanding shares.
Under these additional restrictions, the Fund cannot do any of the
following:
o The Fund cannot lend money, but the Fund can engage in repurchase
transactions and may invest in all or a portion of an issue of bonds,
debentures, commercial paper, or other similar corporate obligations.
o The Fund cannot underwrite securities of other companies, except insofar
as it might be deemed to be an underwriter for purposes of the Securities Act of
1933 in the resale of any securities held in its own portfolio.
o The Fund cannot invest in real estate or interests in real estate, but
may purchase readily marketable securities of companies holding real estate or
interests therein.
o The Fund cannot issue "senior securities," but this does not prohibit it
from borrowing money subject to the provisions set forth in the Prospectus,
including the section titled "Borrowing for Leverage," or from entering into
margin, collateral or escrow arrangements permitted by its other investment
policies.
o The Fund cannot invest in physical commodities or commodity contracts;
however, the Fund may (i) buy and sell hedging instruments permitted by any of
its other investment policies, and (ii) buy and sell options, futures,
securities or other instruments backed by, or the investment return from which
is linked to changes in the price of, physical commodities.
NON-FUNDAMENTAL INVESTMENT RESTRICTIONS. The following operating policies of the
Fund are not fundamental policies and, as such, may be changed by vote of a
majority of the Fund's Board of Trustees without shareholder approval. These
additional restrictions provide that the Fund cannot:
o The Fund cannot invest for the primary purpose of acquiring control or
management thereof.
o The Fund cannot invest in or hold securities of any issuer if those
officers and trustees or directors of the Fund or its adviser owning
individually more than 1/2 of 1% of the securities of such issuer together own
more than 5% of the securities of such issuer.
o The Fund cannot purchase securities on margin; however, the Fund may
make margin deposits in connection with any of its investments.
o The Fund cannot mortgage, hypothecate or pledge any of its assets;
escrow, collateral or margin arrangements involved with any of its investments
are not considered to involve a mortgage, hypothecation or pledge.
For purposes of the Fund's policy not to concentrate its assets as
described under the second investment restriction in "Other Investment
Restrictions" in the Prospectus, the Fund has adopted the industry
classifications set forth in Appendix A to this Statement of Additional
Information. This is not a fundamental policy.
HOW THE FUND IS MANAGED
ORGANIZATION AND HISTORY. As a Massachusetts business trust, the Fund is not
required to hold, and does not plan to hold, regular annual meetings of
shareholders. The Fund will hold meetings when required to do so by the
Investment Company Act or other applicable law, or when a shareholder meeting is
called by the Trustees or upon proper request of the shareholders.
Shareholders have the
right, upon the declaration in writing or vote of two-thirds of the outstanding
shares of the Fund, to remove a Trustee. 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. In addition, if the Trustees
receive a request from at least 10 shareholders (who have been shareholders for
at least six months) holding shares of the Fund valued at $25,000 or more or
holding at least 1% of the Fund's outstanding shares, whichever is less, 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, or the Trustees may take such other
action as set forth under Section 16(c) of the Investment Company Act.
The Fund's Declaration of Trust contains an express disclaimer of
shareholder or Trustee liability for the Fund's obligations, and provides for
indemnification and reimbursement of expenses out of its property for any
shareholder held personally liable for its obligations. The Declaration of Trust
also provides that the Fund shall, upon request, assume the defense of any claim
made against any shareholder for any act or obligation of the Fund and satisfy
any judgment thereon. Thus, while Massachusetts law permits a shareholder of a
business trust (such as the Fund) to be held personally liable as a "partner"
under certain circumstances, the risk of a Fund shareholder incurring financial
loss on account of shareholder liability is limited to the relatively remote
circumstances in which the Fund would be unable to meet its obligations
described above. Any person doing business with the Trust, and any shareholder
of the Trust, agrees under the Trust's Declaration of Trust to look solely to
the assets of the Trust for satisfaction of any claim or demand which may arise
out of any dealings with the Trust, and the Trustees shall have no personal
liability to any such person, to the extent permitted by law.
TRUSTEES AND OFFICERS OF THE FUND. The Fund's Trustees and officers and their
principal occupations and business affiliations during the past five years are
listed below. The address of each Trustee and officer is Two World Trade Center,
New York, New York 10048-0203, unless another address is listed below. Ms.
Macaskill is not a director of Oppenheimer Money Market Fund, Inc. All of the
Trustees are also trustees or directors of Oppenheimer Global Fund, Oppenheimer
Capital Appreciation Fund, Oppenheimer Discovery Fund, Oppenheimer Enterprise
Fund, Oppenheimer Global Growth & Income Fund, Oppenheimer Gold & Special
Minerals Fund, Oppenheimer International Growth Fund, Oppenheimer International
Small Company Fund, Oppenheimer Municipal Bond Fund, Oppenheimer New York
Municipal Fund, Oppenheimer California Municipal Fund, Oppenheimer Multi-State
Municipal Trust, Oppenheimer Mid-Cap Fund, Oppenheimer Multiple Strategies Fund,
Oppenheimer Series Fund, Inc., Oppenheimer U.S. Government Trust, Oppenheimer
Multi-Sector Income Trust and Oppenheimer World Bond Fund (collectively the "New
York-based Oppenheimer funds"). Messrs. Spiro, Bishop, Bowen, Donohue, Farrar
and Zack, respectively, hold the same offices with the other New York-based
Oppenheimer funds as with the Fund. As of the date of this Statement of
Additional Information, the Manager owned all of the outstanding shares of the
Fund as its initial shareholder and no Trustee or officer of the Fund owned of
record or beneficially any shares of the Fund.
LEON LEVY, CHAIRMAN OF THE BOARD OF TRUSTEES; AGE: 72
31 West 52nd Street, New York, NY 10019
General Partner of Odyssey Partners, L.P. (investment partnership)(since
1982) and Chairman of Avatar Holdings, Inc. (real estate development).
ROBERT G. GALLI, TRUSTEE; AGE: 64
19750 Beach Road, Jupiter Island, FL 33469
Formerly he held the following positions: Vice Chairman of OppenheimerFunds,
Inc. (the "Manager") (October 1995 to December 1997), Vice President (June 1990
to March 1994) and Counsel of Oppenheimer Acquisition Corp. ("OAC"), the
Manager's parent holding company; Executive Vice President (December 1977 to
October 1995), General Counsel and a director (December 1975 to October 1993) of
the Manager; Executive Vice President and a director of OppenheimerFunds
Distributor, Inc. (the "Distributor") (July 1978 to October 1993); Executive
Vice President and a director of HarbourView Asset Management Corporation
("HarbourView") (April 1986 to October 1995), an investment adviser subsidiary
of the Manager; Vice President and a director (October 1988 to October 1993) and
Secretary (March 1981 to September 1988) of Centennial Asset Management
Corporation ("Centennial"), an investment adviser subsidiary of the Manager; A
director (November 1989 to October 1993) and Executive Vice President (November
1989 to January 1990) of Shareholder Financial Services, Inc. ("SFSI"), a
transfer agent subsidiary of the Manager; a director of Shareholder Services,
Inc. ("SSI") (August 1984 to October 1993), a transfer agent subsidiary of the
Manager; an officer of other Oppenheimer funds.
BENJAMIN LIPSTEIN, TRUSTEE; AGE: 75
591 Breezy Hill Road, Hillsdale, N.Y. 12529
Professor Emeritus of Marketing, Stern Graduate School of Business
Administration, New York University.
BRIDGET A. MACASKILL, PRESIDENT AND TRUSTEE; Age: 49
President (since June 1991), Chief Executive Officer (since September 1995) and
a Director (since December 1994) of the Manager; President and director (since
June 1991) of HarbourView; Chairman and a director of SSI (since August 1994),
and SFSI (September 1995); President (since September 1995) and a director
(since October 1990) of OAC; President (since September 1995) and a director
(since November 1989) of Oppenheimer Partnership Holdings, Inc., a holding
company subsidiary of the Manager; a director of Oppenheimer Real Asset
Management, Inc. (since July 1996); President and a director (since October
1997) of OppenheimerFunds International Ltd., an offshore fund manager
subsidiary of the Manager ("OFIL") and Oppenheimer Millennium Funds plc (since
October 1997); President and a director or trustee of other Oppenheimer funds; a
director of the NASDAQ Stock Market, Inc. and of Hillsdown Holdings plc (a U.K.
food company); formerly an Executive Vice President of the Manager.
ELIZABETH B. MOYNIHAN, TRUSTEE; AGE: 68
801 Pennsylvania Avenue, N.W., Washington, D.C. 20004
Author and architectural historian; a trustee of the Freer Gallery of Art
(Smithsonian Institution), the Institute of Fine Arts (New York University),
National Building Museum; a member of the Trustees Council, Preservation League
of New York State, and of the Indo-U.S. Sub-Commission on Education and Culture.
KENNETH A. RANDALL, TRUSTEE; AGE: 70
6 Whittaker's Mill, Williamsburg, Virginia 23185
A director of Dominion Resources, Inc. (electric utility holding company),
Dominion Energy, Inc. (electric power and oil & gas producer), Texas
Cogeneration Company (cogeneration company), Prime Retail, Inc. (real estate
investment trust); formerly President and Chief Executive Officer of The
Conference Board, Inc. (international economic and business research) and a
director of Lumbermens Mutual Casualty Company, American Motorists Insurance
Company and American Manufacturers Mutual Insurance Company.
EDWARD V. REGAN, TRUSTEE; AGE: 67
40 Park Avenue, New York, New York 10016
Chairman of Municipal Assistance Corporation for the City of New York; Senior
Fellow of Jerome Levy Economics Institute, Bard College; a member of the U.S.
Competitiveness Policy Council; a director of River Bank America (real estate
manager); Trustee, Financial Accounting Foundation (FASB and GASB); formerly New
York State Comptroller and trustee, New York State and Local Retirement Fund.
RUSSELL S. REYNOLDS, JR., TRUSTEE; AGE: 66
8 Sound Shore Drive, Greenwich, Connecticut 06830
Founder Chairman of Russell Reynolds Associates, Inc. (executive recruiting);
Chairman of Directorship Inc. (corporate governance consulting); a director of
Professional Staff Limited (U.K.); a trustee of Mystic Seaport Museum,
International House and Greenwich Historical Society.
DONALD W. SPIRO, VICE CHAIRMAN AND TRUSTEE; Age: 72
Chairman Emeritus (since August 1991) and a director (since January 1969) of the
Manager; formerly Chairman of the Manager and the Distributor.
PAULINE TRIGERE, TRUSTEE; AGE: 85
498 Seventh Avenue, New York, New York 10018
Chairman and Chief Executive Officer of Trigere, Inc. (design and sale of
women's fashions).
CLAYTON K. YEUTTER, TRUSTEE; AGE: 67
1325 Merrie Ridge Road, McLean, Virginia 22101
Of Counsel, Hogan & Hartson (a law firm); a director of B.A.T. Industries, Ltd.
(tobacco and financial services), Caterpillar, Inc. (machinery), ConAgra, Inc.
(food and agricultural products), Farmers Insurance Company (insurance), FMC
Corp. (chemicals and machinery) and Texas Instruments, Inc. (electronics);
formerly (in descending chronological order), Counsellor to the President (Bush)
for Domestic Policy, Chairman of the Republican National Committee, Secretary of
the U.S. Department of Agriculture, and U.S. Trade Representative.
- --------
*Trustee who is an "interested person" of the Fund.
#Not a Director of Oppenheimer Money Market Fund, Inc.
*Trustee who is an "interested person" of the Fund.
ROBERT C. DOLL, JR., VICE PRESIDENT AND PORTFOLIO MANAGER; AGE: 43
Executive Vice President and Director of the Manager (since January 1993);
Executive Vice President of HarbourView (since January 1993); Vice President and
a director of OAC (since September 1995); an officer of other Oppenheimer funds.
ANDREW J. DONOHUE, SECRETARY; AGE: 47
Executive Vice President (since January 1993), General Counsel (since October
1991) and a Director (since September 1995) of the Manager; Executive Vice
President and General Counsel (since September 1993), and a director (since
January 1992) of the Distributor; Executive Vice President, General Counsel and
a director of HarbourView, SSI, SFSI and Oppenheimer Partnership Holdings, Inc.
(since September 1995) and MultiSource Services, Inc. (a broker-dealer) (since
December 1995); President and a director of Centennial (since September 1995);
President, General Counsel and a director of Oppenheimer Real Asset Management,
Inc. (since July 1996); General Counsel (since May 1996) and Secretary (since
April 1997) of OAC; A director of OFIL and Oppenheimer Millennium Funds plc
(since October 1997); an officer of other Oppenheimer funds.
GEORGE C. BOWEN, TREASURER; AGE: 61
6803 South Tucson Way, Englewood, Colorado 80112
Senior Vice President (since September 1987) and Treasurer (since March 1985) of
the Manager; Vice President (since June 1983) and Treasurer (since March 1985)
of the Distributor; Vice President (since October 1989) and Treasurer (since
April 1986) of HarbourView; Senior Vice President (since February 1992),
Treasurer (since July 1991)and a director (since December 1991) of Centennial;
President, Treasurer and a director of Centennial Capital Corporation (since
June 1989); Vice President and Treasurer (since August 1978) and Secretary
(since April 1981) of SSI; Vice President, Treasurer and Secretary of SFSI
(since November 1989); Treasurer of OAC (since June 1990); Treasurer of
Oppenheimer Partnership Holdings, Inc. (since November 1989); Vice President and
Treasurer of Oppenheimer Real Asset Management, Inc. (since July 1996); Chief
Executive Officer, Treasurer and a director of MultiSource Services, Inc., a
broker-dealer (since December 1995); an officer of other Oppenheimer funds.
ROBERT G. ZACK, ASSISTANT SECRETARY; AGE: 49
Senior Vice President (since May 1985) and Associate General Counsel (since May
1981) of the Manager, Assistant Secretary of SSI (since May 1985), and SFSI
(since November 1989); Assistant Secretary of Oppenheimer Millennium Funds plc
(since October 1997); an officer of other Oppenheimer funds.
ROBERT J. BISHOP, ASSISTANT TREASURER; AGE: 39
6803 South Tucson Way, Englewood, Colorado 80112
Vice President of the Manager/Mutual Fund Accounting (since May 1996); an
officer of other Oppenheimer funds; formerly an Assistant Vice President of the
Manager/Mutual Fund Accounting (April 1994-May 1996), and a Fund Controller for
the Manager.
SCOTT T. FARRAR, ASSISTANT TREASURER; AGE: 32
6803 South Tucson Way, Englewood, Colorado 80112
Vice President of the Manager/Mutual Fund Accounting (since May 1996); Assistant
Treasurer of Oppenheimer Millennium Funds plc (since October 1997); an officer
of other Oppenheimer funds; formerly an Assistant Vice President of the
Manager/Mutual Fund Accounting (April 1994-May 1996), and a Fund Controller for
the Manager.
o REMUNERATION OF TRUSTEES. The officers of the Fund and certain Trustees
of the Fund (Ms. Macaskill, and Mr. Spiro) who are affiliated with the receive
no salary or fee from the Fund. Mr. Galli received no salary or fee from any
Oppenheimer fund prior to January 1, 1998. The remaining Trustees of the Fund
are expected to receive the compensation shown below from the Fund with respect
to the Fund's fiscal year ending August 31, 1998. Compensation is also shown
below as to compensation received as a director, trustee, or member of a
committee of the Board of all other New York-based funds during calendar-year
1997.
Retirement Total
Aggregate Benefits Compensation
Compensation Accrued as From All Other
From Part of Fund New York-based
Name and Position the Fund Expenses OppenheimerFunds(1)
Robert G. Galli $164 $164 $0
Study Committee
Member and Trustee
Leon Levy, $266 $266 $158,500
Chairman of the Board
and Trustee
Benjamin Lipstein, $216 $216 $137,000
Study Committee
Chairman, Audit
Committee Member
and Trustee(2)
Elizabeth B. Moyni $164 $164 $96,500
Study Committee
Member and Trustee
Kenneth A. Randall, $148 $148 $88,500
Audit Committee
Chairman and Trustee
Edward V. Regan, $148 $148 $87,500
Proxy Committee
Chairman, Audit
Committee Member
and Trustee
Russell S. Reynold Jr. $110 $110 $65,500
Proxy Committee
Member and Trustee
Pauline Trigere, $98 $98 $58,500
Trustee
Clayton K. Yeutter, $110 $110 $55,500
Proxy Committee
Member and Trustee
- ----------------------
(1)For the 1997 calendar year.
DEFERRED COMPENSATION PLAN. The Board of Trustees has adopted a Deferred
Compensation Plan for disinterested Trustees that enables Trustees to elect to
defer receipt of all or a portion of the annual fees they are entitled to
receive from the Fund. Under the plan, the compensation deferred by a Trustee is
periodically adjusted as though an equivalent amount had been invested in shares
of one or more Oppenheimer funds selected by the Trustee. The amount paid to the
Trustees under the plan will be determined based upon the performance of the
selected funds. Deferral of Trustees' fees under the plan will not materially
affect the Fund's assets, liabilities or net income per share. The plan will not
materially affect the Fund's assets, liabilities or net income per share. The
plan will not obligate the Fund to retain the services of any Trustee or to pay
any particular level of compensation to any Trustee. Pursuant to any Order
issued by the Securities and Exchange Commission, the Fund may, without
shareholder approval and notwithstanding its fundamental policy restricting
investment in other open-end investment companies, as described above on page
__, invest in the funds selected by the Trustee under the plan for the limited
purpose of determining the value of the Trustee's deferred fee account.
The Fund has adopted a retirement plan that provides for payment to a
retired Trustee of up to 80% of the average compensation paid during that
Trustee's five years of service in which the highest compensation was received.
A Trustee must serve in that capacity for any of the New York- based Oppenheimer
funds for at least 15 years to be eligible for the maximum payment. Because each
Trustee's retirement benefits will depend on the amount of the Trustee's future
compensation and length of service, the amount of those benefits cannot be
determined at this time, nor can the Fund estimate the number of years of
credited service that will be used to determine those benefits.
o MAJOR SHAREHOLDERS. As of the date of this Statement of Additional
Information, the Manager was the sole initial shareholder of the Fund's Class
A, Class B, Class C and Class Y shares.
THE MANAGER AND ITS AFFILIATES. The Manager is wholly-owned by Oppenheimer
Acquisition Corp. ("OAC"), a holding company controlled by Massachusetts
Mutual Life Insurance Company.
OAC is also owned in part by certain of the Manager's directors and officers,
some of whom also serve as officers of the Fund, and one of whom (Ms. Macaskill)
serves as a Trustee of the Fund.
The Manager and the Fund 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. Compliance with the Code of Ethics is carefully monitored and
strictly enforced by the Manager.
o PORTFOLIO MANAGEMENT. The Portfolio Manager of the Fund is Robert Doll,
Jr., who is principally responsible for the day-to-day management of the Fund's
portfolio. Mr. Doll's background is described in the Prospectus under "Portfolio
Manager." Other members of the Manager's Equity Portfolio Department,
particularly Jane Putnam, provide the Portfolio Manager with counsel and support
in managing the Fund's portfolio.
o THE INVESTMENT ADVISORY AGREEMENT. The Investment Advisory Agreement
between the Manager and the Fund requires the Manager, at its expense, to
provide the Fund with adequate office space, facilities and equipment, and to
provide and supervise the activities of all administrative and clerical
personnel required to provide effective corporate administration for the Fund,
including 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.
Expenses not expressly assumed by the Manager under the Investment
Advisory Agreement or by the Distributor under the General Distributors
Agreement are paid by the Fund. The Investment Advisory Agreement lists examples
of expenses paid by the Fund, the major categories of which 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 Investment Advisory Agreement contains no expense limitation. However,
because of state regulations limiting fund expenses that previously applied, the
Manager had voluntarily undertaken that the Fund's total expenses in any fiscal
year (including the investment advisory fee but exclusive of taxes, interest,
brokerage commissions, distribution plan payments and any extraordinary
non-recurring expenses, including litigation) would not exceed the most
stringent state regulatory limitation applicable to the Fund. Due to changes in
federal securities laws, such state regulations no longer apply and the
Manager's undertaking is therefore inapplicable and has been withdrawn. During
the Fund's last fiscal year, the Fund's expenses did not exceed the most
stringent state regulatory limit and the voluntary undertaking was not invoked.
The Advisory Agreement provides that in the absence of willful
misfeasance, bad faith or gross negligence in the performance of its duties, or
reckless disregard for its obligations and duties under the advisory agreement,
the Manager is not liable for any loss resulting from a good faith error or
omission on its part with respect to any of its duties thereunder. The advisory
agreement permits the Manager to act as investment adviser 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 adviser or general
distributor. If the Manager shall no longer act as investment adviser to the
Fund, the right of the Fund to use the name "Oppenheimer" as part of its name
may be withdrawn.
o 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 Class A, Class B, Class C and Class Y shares but
is not obligated to sell a specific number of shares. Expenses normally
attributable to sales, including advertising and the cost of printing and
mailing prospectuses (other than those furnished to existing shareholders), are
borne by the Distributor. For additional information about distribution of the
Fund's shares and the expenses connected with such activities, please refer to
"Distribution and Service Plans," below.
o THE TRANSFER AGENT. OppenheimerFunds Services, the Fund's Transfer Agent,
is responsible for maintaining the Fund's shareholder registry and shareholder
accounting records, and for shareholder servicing and administrative functions.
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 ("brokers") to effect the Fund's portfolio
transactions. In doing so, 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, as may, in its best judgment based on all
relevant factors, implement the policy of the Fund to obtain, at reasonable
expense, the "best execution" (prompt and reliable execution at the most
favorable price obtainable) of such transactions. The Manager need not seek
competitive commission bidding but is expected to minimize the commissions paid
to the extent consistent with the interest and policies of the Fund as
established by its Board of Trustees.
Under the Advisory Agreement, the Manager is authorized to select brokers
that provide brokerage and/or research services for the Fund and/or the other
accounts over which the Manager or its affiliates have investment discretion.
The commissions paid to such brokers may be higher than another qualified broker
would have charged if a good faith determination is made by the Manager that the
commission is fair and reasonable in relation to the services provided. Subject
to the foregoing considerations, the Manager may also consider sales of shares
of the Fund and other investment companies managed by the Manager or its
affiliates as a factor in the selection of brokers for the Fund's portfolio
transactions.
DESCRIPTION OF BROKERAGE PRACTICES FOLLOWED BY THE MANAGER. Subject to the
provisions of the Advisory Agreement and the procedures and rules described
above, allocations of brokerage are generally made by the Manager's portfolio
traders based upon recommendations from the Manager's portfolio managers. In
certain instances, portfolio managers may directly place trades and allocate
brokerage, also subject to the provisions of the advisory agreement and the
procedures and rules described above. In either case, brokerage is allocated
under the supervision of the Manager's executive officers. Transactions in
securities other than those for which an exchange is the primary market are
generally done with principals or market makers. Brokerage commissions are paid
primarily for effecting transactions in listed securities and/or for certain
fixed-income agency transactions in the secondary market, and are otherwise paid
only if it appears likely that a better price or execution can be obtained. When
the Fund engages in an option transaction, ordinarily the same broker will be
used for the purchase or sale of the option and any transaction in the
securities to which the option relates. When possible, concurrent orders to
purchase or sell the same security by more than one of the accounts managed by
the Manager or its affiliates are combined. The transactions effected pursuant
to such combined orders are averaged as to price and allocated in accordance
with the purchase or sale orders actually placed for each account.
Most purchases of money market instruments and debt obligations are
principal transactions at net prices. Instead of using a broker for those
transactions, the Fund normally deals directly with the selling or purchasing
principal or market maker unless it determines that a better price or execution
can be obtained by using a broker. Purchases of these securities from
underwriters include a commission or concession paid by the issuer to the
underwriter. Purchases from dealers include a spread between the bid and asked
price. The Fund seeks to obtain prompt execution of these orders at the most
favorable net price.
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, and
investment research received for the commissions of those other accounts may be
useful both to the Fund and one or more of such other accounts. Such research,
which may be supplied by a third party at the instance of a broker, includes
information and analyses on particular companies and industries as well as
market or economic trends and portfolio strategy, receipt of market quotations
for portfolio evaluations, information systems, computer hardware and similar
products and services. If a research service also assists the Manager in a
non-research capacity (such as bookkeeping or other administrative functions),
then only the percentage or component that provides assistance to the Manager in
the investment decision-making process may be paid for in commission dollars.
The Board of Trustees has permitted the Manager to use concessions on
fixed-price offerings to obtain research, in the same manner as is permitted for
agency transactions. The Board has also permitted the Manager to use stated
commissions on secondary fixed-income agency trades to obtain research where the
broker has represented 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 research services provided by brokers broaden the scope and supplement
the research activities of the Manager, by making available additional views for
consideration and comparisons, and by enabling the Manager to obtain market
information for the valuation of securities held in the Fund's portfolio or
being considered for purchase. The Board of Trustees, including the
"independent" Trustees of the Fund (those Trustees of the Fund who are not
"interested persons" as defined in the Investment Company Act, and who have no
direct or indirect financial interest in the operation of the Investment
Advisory Agreement or the Distribution and Service Plans described below)
annually reviews information furnished by the Manager as to the commissions paid
to brokers furnishing such services so that the Board may ascertain whether the
amount of such commissions was reasonably related to the value or benefit of
such services.
PERFORMANCE OF THE FUND
TOTAL RETURN INFORMATION. As described in the Prospectus, from time to time the
"average annual total return," "cumulative total return," "average annual total
return at net asset value" and "total return at net asset value" of an
investment in a class of shares of the Fund may be advertised. An explanation of
how these total returns are calculated for each class and the components of
those calculations is set forth below.
The Fund's advertisements of its performance data must, under applicable
rules of the Securities and Exchange Commission, include the average annual
total returns for each advertised class of shares of the Fund for the 1-, 5-,
and 10-year periods (or the life of the class, if less) ending as of the most
recently-ended calendar quarter prior to the publication of the advertisement.
This 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 such information as a basis for comparison with other
investments. An investment in the Fund is not insured; its returns and share
prices are not guaranteed and normally will fluctuate on a daily basis. When
redeemed, an investor's shares may be worth more or less than their original
cost. Returns for any given past period are not a prediction or representation
by the Fund of future returns. The returns of each class of shares of the Fund
are affected by portfolio quality, the type of investments the Fund holds and
its operating expenses allocated to the particular class.
o AVERAGE ANNUAL TOTAL RETURNS. 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") to achieve an Ending Redeemable Value ("ERV") of
that investment, according to the following formula:
1/n
(ERV)
(---) -1 = Average Annual Total Return
( P )
o CUMULATIVE TOTAL RETURNS. 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
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") (unless the return is shown at net asset value, as
described below). In calculating total returns for Class B shares, the payment
of the contingent deferred sales charge, (5% for the first year, 4% for the
second year, 3% for the third and fourth years, 2% for the fifth year, 1% for
the sixth year and none thereafter) is applied to the investment result for the
period shown. For Class C shares, the 1.0% contingent deferred sales charge is
applied to the investment result for the one-year period (or less). Total
returns also assume that all dividends and capital gains distributions during
the period are reinvested at net asset value per share, and that the investment
is redeemed at the end of the period.
o TOTAL RETURNS AT NET ASSET VALUE. From time to time the Fund may also
quote an average annual total return at net asset value or a cumulative total
return at net asset value for Class A, Class B, Class C or 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.
Total return information may be useful to investors in reviewing the
performance of the Fund's Class A, Class B, Class C or Class Y shares. However,
when comparing total return of an investment in Class A, Class B, Class C or
Class Y shares of the Fund with that of other alternatives, investors should
understand that as the Fund is an equity fund seeking capital appreciation, its
shares are subject to greater market risks and volatility than shares of funds
having other investment objectives and that the Fund is designed for investors
who are willing to accept greater risk of loss in the hopes of realizing greater
gains.
OTHER PERFORMANCE COMPARISONS. From time to time the Fund may publish the star
rankings of the performance of its Class A, Class B, Class C or Class Y shares
by Morningstar, Inc., an independent mutual fund monitoring service. Morningstar
ranks mutual funds in broad investment categories, domestic stock funds,
international stock funds, taxable bond funds and municipal bond funds, based on
risk-adjusted total investment returns. The Fund is ranked among domestic stock
funds. Investment return measures a fund's or class's one, three, five and
ten-year average annual total returns (depending on the inception of the fund or
class) in excess of 90-day U.S. Treasury bill returns after considering the
fund's sales charges and expenses. Risk measures a fund's or class's performance
below 90-day U.S. Treasury bill returns. Risk and investment return are combined
to produce star rankings reflecting performance relative to the average fund in
the fund's category. Five stars is the "highest ranking (top 10%), four stars is
"above average" (next 22.5%), three stars is "average" '(next 35%), two stars is
"below average" (next 22.5%) and one star is "lowest" (bottom 10%). The current
star ranking is the fund's or class's 3-year ranking or its combined 3- and
5-year ranking (weighted 60%/40%, respectively), or its combined 3-, 5- and
10-year ranking (weighted 40%, 30% and 30%, respectively), depending on the
inception of the fund or class. Rankings are subject to change monthly.
The Fund may also compare its performance to that of other funds in its
Morningstar Category. In addition to its star rankings, Morningstar also
categorizes and compares a fund's 3-year performance based on Morningstar's
classification of the fund's investments style, rather than how a fund defines
its investment objective. Morningstar's four broad categories (domestic equity,
international equity, municipal bond and taxable bond) are each further
subdivided into categories based on types of investments and investment styles.
Those comparisons by Morningstar are based on the same risk and return
measurements as its star rankings but do not consider the effect of sales
charges.
From time to time, the Fund's Manager may publish rankings or ratings of
the Manager (or Transfer Agent) or 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/investor
services by third parties may compare the Oppenheimer funds services to those of
other mutual fund families selected by the rating or ranking services, and may
be based upon the opinions of the rating or ranking service itself, using its
own research or judgment, or based upon surveys of investors, brokers,
shareholders or others.
DISTRIBUTION AND SERVICE PLANS
The Fund has adopted a Service Plan for Class A shares and Distribution and
Service Plans for Class B and Class C shares of the Fund under Rule 12b-1 of the
Investment Company Act, pursuant to which the Fund makes payments to the
Distributor in connection with the distribution and/or servicing of the shares
of that class, as described in the Prospectus. Each Plan has been approved by a
vote of (i) the Board of Trustees of the Fund, including a majority of the
Independent Trustees, cast in person at a meeting called for the purpose of
voting on that Plan, and (ii) the holders of a "majority" (as defined in the
Investment Company Act) of the shares of each class. For the Distribution and
Service Plans for Class B and Class C shares, that vote was cast by the Manager
as the sole initial holder of Class B and Class C shares of the Fund.
In addition, under the Plans the Manager and the Distributor, in their
sole discretion, from time to time may use their own resources (which, in the
case of the Manager, may include profits from the advisory fee it receives from
the Fund) to make payments to brokers, dealers or other financial institutions
(each is referred to as a "Recipient" under the Plans) for distribution and
administrative services they perform, at no cost to the Fund. The Distributor
and the Manager may, in their sole discretion, increase or decrease the amount
of payments they make from their own resources to Recipients.
Unless terminated as described below, each Plan continues in effect from
year to year but only as long as its continuance is specifically approved at
least annually by the Fund's Board of Trustees and its Independent Trustees by a
vote cast in person at a meeting called for the purpose of voting on such
continuance. Each 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.
None of the Plans may be amended to increase materially the amount of payments
to be made unless such amendment is approved by shareholders of the Class
affected by the amendment. In addition, because Class B shares automatically
convert into Class A shares after six years, the Fund is required to obtain the
approval of Class B as well as Class A shareholders for a proposed amendment to
the Class A plan that would materially increase payments under the plan. Such
approval must be by a "majority" of the Class A and Class B shares (as defined
in the Investment Company Act) voting separately by class. All material
amendments must be approved by the Independent Trustees.
While the Plans are in effect, the Treasurer of the Fund shall provide
separate written reports to the Fund's Board of Trustees at least quarterly for
its review, detailing the amount of all payments made pursuant to each Plan, the
purpose for which payments were made and the identity of each Recipient that
received any payment. The reports for the Class B and Class C Plans shall also
include the distribution costs for that quarter, and such costs for previous
fiscal periods that have been carried forward, as explained in the Prospectus
and below. Those reports, including the allocations on which they are based,
will be subject to the review and approval of the Independent Trustees in the
exercise of their fiduciary duty. Each Plan further provides 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 such
selection and nomination if the final decision on selection or nomination is
approved by a majority of the Independent Trustees.
Under the Plans, no payment will be made to any Recipient in any quarter
if the aggregate net asset value of all Fund shares held by the Recipient for
itself and its customers does not exceed a minimum amount, if any, that may be
determined from time to time by a majority of the Fund's Independent Trustees.
Initially, the Board of Trustees has set the fee at the maximum rate and set no
minimum amount of assets to qualify for payment.
Any unreimbursed expenses incurred by the Distributor with respect to
Class A shares for any fiscal year may not be recovered in subsequent years.
Payments received by the Distributor under the Class A Plan will not be used to
pay any interest expense, carrying charge, or other financial costs, or
allocation of overhead by the Distributor.
The Class B and Class C plans allow the service fee payment to be paid by
the Distributor to Recipients in advance for the first year such shares are
outstanding, and thereafter on a quarterly basis, as described in the
Prospectus. The advance payment is based on the net asset value of shares sold.
An exchange of shares does not entitle the Recipient to an advance service fee
payment. In the event shares are redeemed during the first year that the shares
are outstanding, the Recipient will be obligated to repay a pro rata portion of
the advance payment for those shares to the Distributor.
Although the Class B and Class C Plans permit the Distributor to retain
both the asset-based sales charges and the service fee on such shares, or to pay
Recipients the service fee on a quarterly basis without payment in advance, the
Distributor intends to pay the service fee to Recipients in the manner described
above. A minimum holding period may be established from time to time under the
Class B and the Class C Plans by the Board. Initially, the Board has set no
minimum holding period. All payments under the Class B Plan and the Class C
Plans are subject to the limitations imposed by the Rules of Fair Practice of
the National Association of Securities Dealers, Inc. on payments of asset-based
sales charges and service fees. The Distributor anticipates that it will take a
number of years for it to recoup (from the Fund's payments to the Distributor
under the Class B or Class C Plan and from the contingent deferred sales charges
collected on redeemed Class B or Class C shares) the sales commissions paid to
authorized dealers or brokers.
ABOUT YOUR ACCOUNT
HOW TO BUY SHARES
ALTERNATIVE SALES ARRANGEMENTS - CLASS A, CLASS B AND CLASS C SHARES. The
availability of three classes of shares permits an investor to choose the method
of purchasing shares that is more beneficial to the investor depending on the
amount of the purchase, the length of time the investor expects to hold shares
and other relevant circumstances. Investors should understand that the purpose
and function of the deferred sales charge and asset-based sales charge with
respect to Class B and Class C shares are the same as those of the initial sales
charge with respect to Class A shares. Any salesperson or other person entitled
to receive compensation for selling Fund shares may receive different
compensation with respect to one class of shares than the other. The Distributor
normally will not accept any order for $500,000 or more of Class B shares or any
order for $1 million or more of Class C shares on behalf of a single investor
(not including dealer "street name" or omnibus accounts) because generally it
will be more advantageous for that investor to purchase Class A shares of the
Fund instead. A fourth class of shares may be purchased only by certain
institutional investors at net asset value per share (the "Class Y shares").
The three classes of shares each represent an interest in the same
portfolio investments of the Fund. However, each class has different shareholder
privileges and features. The net income attributable to Class B and Class C
shares and the dividends payable on Class B and Class C shares will be reduced
by incremental expenses borne solely by that class, including the asset-based
sales charge to which Class B and Class C shares are subject.
The conversion of Class B shares to Class A shares after six years is
subject to the continuing availability of a private letter ruling from the
Internal Revenue Service, or an opinion of counsel or tax adviser, to the effect
that the conversion of Class B shares does not constitute a taxable event for
the holder under Federal income tax law. If such a revenue ruling or opinion is
no longer available, the automatic conversion feature may be suspended, in which
event no further conversions of Class B shares would occur while such 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 holder, and absent such exchange, Class B shares might continue to
be subject to the asset-based sales charge for longer than six years.
The methodology for calculating the net asset value, dividends and
distributions of the Fund's Class A, Class B, Class C and Class Y shares
recognizes two types of expenses. General expenses that do not pertain
specifically to any one class are allocated pro rata to the shares of each
class, based on the percentage of the net assets of such class to the Fund's
total assets, and then equally to each outstanding share within a given class.
Such general expenses include (i) management fees, (ii) legal, bookkeeping and
audit fees, (iii) printing and mailing costs of shareholder reports,
Prospectuses, Statements of Additional Information and other materials for
current shareholders, (iv) fees to Independent Trustees, (v) custodian expenses,
(vi) share issuance costs, (vii) organization and start-up costs, (viii)
interest, taxes and brokerage commissions, and (ix) non-recurring expenses, such
as litigation costs. Other expenses that are directly attributable to a class
are allocated equally to each outstanding share within that class. Such expenses
include (i) Distribution Plan fees, (ii) incremental transfer and shareholder
servicing agent fees and expenses, (iii) registration fees and (iv) shareholder
meeting expenses, to the extent that such expenses pertain to a specific class
rather than to the Fund as a whole.
DETERMINATION OF NET ASSET VALUES PER SHARE. The net asset values per share of
Class A, Class B, Class C and Class Y shares of the Fund are determined as of
the close of business of The New York Stock Exchange (the "NYSE") on each day
that the NYSE is open, by dividing 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., but may close earlier on some other days (for example, in
case of weather emergencies or days falling before a holiday). 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. The Fund may invest a portion of
its assets in foreign securities primarily listed on foreign exchanges which may
trade on Saturdays or customary U.S. business holidays on which the NYSE is
closed. Because the Fund's price and net asset value 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.
The Fund's Board of Trustees has established procedures for the valuation
of the Fund's securities, generally as follows:
(i) equity securities traded on a U.S. securities exchange or on the
Automated Quotation System ("NASDAQ") of the Nasdaq Stock Market, Inc. for
which last sale information is regularly reported are valued at the last
reported sale price on the principal exchange for such security or NASDAQ
that day (the "Valuation Date") or, in the absence of sales that day, 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, the closing "bid" price on the Valuation Date;
(ii) equity securities traded on a foreign securities exchange are valued
generally at the last sales price available to the pricing service
approved by the Fund's Board of Trustees or to the Manager as reported by
the principal exchange on which the security is traded at its last trading
session on or immediately preceding the Valuation Date, or, if
unavailable, at the mean between "bid" and "asked" prices obtained from
the principal exchange or two active market makers in the security on the
basis of reasonable inquiry;
(iii) a non-money market fund will value (x) debt instruments that had a
maturity of more than 397 days when issued, (y) debt instruments that had
a maturity of 397 days or less when
issued and have a remaining maturity in excess of 60 days, and (z)
non-money market type debt instruments that had a maturity of 397 days or
less when issued and have a remaining maturity of sixty days or less, at
the mean between "bid" and "asked" prices determined by a pricing service
approved by the Fund's Board of Trustees or, if unavailable, obtained by
the Manager from two active market makers in the security on the basis of
reasonable inquiry;
(iv) money market-type debt securities held by a non-money market fund
that had a maturity of less than 397 days when issued and have a remaining
maturity of 60 days or less, and debt instruments held by a money market
fund that have a remaining maturity of 397 days or less, shall be valued
at cost, adjusted for amortization of premiums and accretion of discount;
and
(v) 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 active market makers willing to
give quotes (see (ii) and (iii) above), the 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)
provided that the Manager is satisfied that the firm rendering the quotes is
reliable and that the quotes reflect the current market value.
The Manager may use pricing services approved by the Board of Trustees to
price U.S. Government securities or corporate debt securities for which last
sale information is not generally available. The pricing service, when valuing
such securities, may use "matrix" comparisons to the prices for comparable
instruments on the basis of quality, yield, maturity and other special factors
involved. The Manager will monitor the accuracy of the pricing services, which
may include comparing prices used for portfolio evaluation to actual sales
prices of selected securities.
ACCOUNTLINK. When shares are purchased through AccountLink, each purchase must
be at least $25.00. Shares will be purchased on the regular business day the
Distributor is instructed to initiate the Automated Clearing House transfer to
buy shares. Dividends will begin to accrue on such shares on the day the Fund
receives Federal Funds for the purchase through the ACH system before the close
of The New York Stock Exchange that day, which is normally three days after the
ACH transfer is initiated. The Exchange normally closes at 4:00 P.M., but may
close earlier on certain days. If Federal Funds are received on a business day
after the close of the Exchange, the shares will be purchased and dividends will
begin to accrue on the next regular business day. The proceeds of ACH transfers
are normally received by the Fund 3 days after the transfers are initiated. 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 Letter
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 the Prospectus
because the Distributor incurs little or no selling expenses. The term
"immediate family" refers to one's spouse, children, grandchildren,
grandparents, parents, parents-in-law, brothers and sisters, sons- and
daughters-in-law, siblings, a sibling's spouse, a spouse's siblings, aunts,
uncles, nieces and nephews. Relation by virtue of a remarriage (step-children,
step-parents, etc.) are included.
o THE OPPENHEIMER FUNDS. The Oppenheimer funds are those mutual funds
for which the Distributor acts as the distributor or the sub-distributor and
include the following:
Oppenheimer Bond Fund
Oppenheimer California Municipal Fund
Oppenheimer Capital Appreciation Fund
Oppenheimer Champion Income Fund
Oppenheimer Convertible Securities Fund
Oppenheimer Developing Markets Fund
Oppenheimer Discovery Fund
Oppenheimer Disciplined Value Fund
Oppenheimer Disciplined Allocation Fund
Oppenheimer Enterprise Fund
Oppenheimer Equity Income Fund
Oppenheimer Florida Municipal Fund
Oppenheimer Global Fund
Oppenheimer Global Growth & Income Fund
Oppenheimer Gold & Special Minerals Fund
Oppenheimer Growth Fund
Oppenheimer High Yield Fund
Oppenheimer Intermediate Municipal Fund
Oppenheimer Insured Municipal Fund
Oppenheimer International Bond Fund
Oppenheimer International Growth Fund
Oppenheimer International Small Company Fund
Limited Term New York Municipal Fund
Oppenheimer Limited-Term Government Fund
Oppenheimer Main Street California Municipal Fund
Oppenheimer Main Street Income & Growth Fund
Oppenheimer Mid-Cap Fund
Oppenheimer Multiple Strategies Fund
Oppenheimer Municipal Bond Fund
Oppenheimer New Jersey Municipal Fund
Oppenheimer New York Municipal Fund
Panorama Series Fund, Inc.
Oppenheimer Pennsylvania Municipal Fund
Oppenheimer Quest Capital Value Fund, Inc.
Oppenheimer Quest Global Value Fund, Inc.
Oppenheimer Quest Balanced Value Fund
Oppenheimer Quest Opportunity Value Fund
Oppenheimer Quest Small Cap Value Fund
Oppenheimer Quest Value Fund, Inc.
Oppenheimer Real Asset Fund
Rochester Fund Municipals
Oppenheimer Series Fund, Inc.
Oppenheimer Strategic Income Fund
Oppenheimer Total Return Fund, Inc.
Oppenheimer U.S. Government Trust
Oppenheimer World Bond Fund
and the following "Money Market Funds:"
Centennial America Fund, L.P.
Centennial California Tax Exempt Trust
Centennial Government Trust
Centennial Money Market Trust
Centennial New York Tax Exempt Trust
Centennial Tax Exempt Trust
Oppenheimer Cash Reserves
Oppenheimer Money Market Fund, Inc.
-2-
<PAGE>
There is an initial sales charge on the purchase of Class A shares of each
of the Oppenheimer funds except Money Market Funds (under certain circumstances
described herein, redemption proceeds of Money Market Fund shares may be subject
to a contingent deferred sales charge).
o LETTERS OF INTENT. A Letter of Intent (referred to as a "Letter") is an
investor's statement in writing to the Distributor of the intention to purchase
Class A shares of the Fund or Class A and Class B shares of the Fund and other
Oppenheimer funds during a 13-month period (the "Letter of Intent period"),
which may, at the investor's request, 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, when added to the investor's
holdings of shares of those funds, will equal or exceed the amount specified in
the Letter. Purchases made by reinvestment of dividends or distributions of
capital gains and purchases made at net asset value without sales charge do not
count toward satisfying the amount of the Letter. A Letter enables an investor
to count the Class A and Class B shares purchased under the Letter to obtain the
reduced sales charge rate on purchases of Class A shares of the Fund (and other
Oppenheimer funds) that applies under the Right of Accumulation to current
purchases of Class A shares. Each purchase under the Letter will be made at the
public offering price applicable to a single lump-sum purchase of shares in the
intended purchase amount, as described in the Prospectus.
In submitting a Letter, the investor makes no commitment to purchase
shares, but if the investor's purchases of shares within the Letter of Intent
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, as set forth in "Terms of Escrow," below
(as those terms may be amended 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 such Letter of Intent, and if such
terms are amended, as they may be from time to time by the Fund, that those
amendments will apply automatically to existing Letters of Intent.
For purchases of shares of the Fund and other Oppenheimer funds by
OppenheimerFunds prototype 401(k) plans under a Letter of Intent, the Transfer
Agent will not hold shares in escrow. If the intended purchase amount under the
Letter entered into by an OppenheimerFunds prototype 401(k) plan is not
purchased by the plan by the end of the Letter of Intent period, there will be
no adjustment of commissions paid to the broker-dealer or financial institution
of record for accounts held in the name of that plan.
If the total eligible purchases made during the Letter of Intent period do
not equal or exceed the intended purchase amount, the commissions 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
purchases. If total eligible purchases during the Letter of Intent period exceed
the intended purchase amount and exceed the amount needed to qualify for the
next sales charge rate reduction set forth in the applicable prospectus, the
sales charges paid will be adjusted to the lower rate, but only if and when the
dealer returns to the Distributor the excess of the amount of commissions
allowed or paid to the dealer over the amount of commissions that apply to the
actual amount of purchases. The excess commissions 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.
In determining the total amount of purchases made under a Letter, shares
redeemed by the investor prior to the termination of the Letter of Intent period
will be deducted. It is the responsibility of the dealer of record and/or the
investor to advise the Distributor about the Letter in placing any purchase
orders for the investor during the Letter of Intent period. All of such
purchases must be made through the Distributor.
o 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 public 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 intended purchase amount specified under the Letter is completed
within the thirteen-month Letter of Intent period, the escrowed shares will be
promptly released to the investor.
3. If, at the end of the thirteen-month Letter of Intent 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. Such sales charge adjustment will
apply to any shares redeemed prior to the completion of the Letter. If such
difference in sales charges is not paid within twenty days after a request from
the Distributor or the dealer, the Distributor will, within sixty days of the
expiration of the Letter, redeem the number of escrowed shares necessary to
realize such difference in sales charges. Full and fractional shares remaining
after such redemption will be released from escrow. If a request is received to
redeem escrowed shares prior to the payment of such additional sales charge, the
sales charge will be withheld from the redemption proceeds.
4. By signing the Letter, the investor irrevocably constitutes and
appoints the Transfer Agent as attorney-in-fact to surrender for redemption any
or all escrowed shares.
5. The shares eligible for purchase under the Letter (or the holding of
which may be counted toward completion of a Letter) include (a) Class A shares
sold with a front-end sales charge or subject to a Class A contingent deferred
sales charge, (b) Class B shares of other Oppenheimer funds acquired subject to
a contingent deferred sales charge, and (c) Class A or B shares acquired in
exchange for either (i) 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 (ii) Class B shares of one of the other Oppenheimer funds that were
acquired subject to a contingent deferred sales charge.
6. Shares held in escrow hereunder will automatically be exchanged for
shares of another fund to which an exchange is requested, as described in the
section of the Prospectus entitled "How to Exchange Shares," and the escrow will
be transferred to that other fund.
ASSET BUILDER PLANS. To establish an Asset Builder Plan from a bank account, a
check (minimum $25) for the initial purchase must accompany the Application.
Shares purchased by Asset Builder Plan payments from bank accounts are subject
to the redemption restrictions for recent purchases described in "How To Sell
Shares," in the Prospectus. Asset Builder Plans also enable shareholders of the
Fund to use those accounts for monthly automatic purchases of shares of up to
four other Oppenheimer funds. If you make payments from your bank account to
purchase shares of the Fund, your bank account will be automatically debited
normally four to five business days prior to the investment dates selected in
the Account Application. Neither the Distributor, the Transfer Agent nor the
Fund shall be responsible for any delays in purchasing shares resulting from
delays in ACH transmission.
There is a front-end sales charge on the purchase of certain Oppenheimer
funds, or a contingent deferred sales charge may apply to shares purchased by
Asset Builder payments. An application should be obtained from the Distributor,
completed and returned, and a prospectus of the selected fund(s) should be
obtained from the Distributor or your financial advisor before initiating Asset
Builder payments. The amount of the Asset Builder investment may be changed or
the automatic investments may be terminated at any time by writing to the
Transfer Agent. A reasonable period (approximately 15 days) is required after
the Transfer Agent's receipt of such instructions to implement them. The Fund
reserves the right to amend, suspend, or discontinue offering such plans at any
time without prior notice.
CANCELLATION OF PURCHASE ORDERS. Cancellation of purchase orders for the Fund's
shares (for example, when a purchase check is returned to the Fund unpaid)
causes a loss to be incurred when the net asset value 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.
RETIREMENT PLANS. In describing certain types of employee benefit plans that may
purchase Class A shares without being subject to the Class A contingent differed
sales charge, the term "employee benefit plan" means any plan or arrangement,
whether or not "qualified" under the Internal Revenue Code, including, medical
savings accounts, payroll deduction plans or similar plans in which Class A
shares are purchased by a fiduciary or other person for the account of
participants who are employees of a single employer or of affiliated employers,
if the Fund account is registered in the name of the fiduciary or other person
for the benefit of participants in the plan.
The term "group retirement plan" means any qualified or non-qualified
retirement plan (including 457 plans, SEPs, SARSEPs, 403(b) plans other than
public school 403(b) plans, and SIMPLE plans) for employees of a corporation or
a 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 or association has made special arrangements with the
Distributor and all members of the group or association participating in or who
are eligible to participate in the plan(s) purchase Class A shares of the Fund
through a single investment dealer, broker or other financial institution
designated by the group. "Group retirement plan" also includes qualified
retirement plans and non-qualified deferred compensation plans and IRAs that
purchase Class A shares of the Fund through a single investment dealer, broker,
or other financial institution, if that broker-dealer has made special
arrangements with the Distributor enabling those plans to purchase Class A
shares of the Fund at net asset value but subject to a contingent deferred sales
charge.
In addition to the discussion in the Prospectus relating to the ability of
Retirement Plans to purchase Class A shares at net asset value in certain
circumstances, there is no initial sales charge on purchases of Class A shares
of any one or more of the Oppenheimer funds by a Retirement Plan in the
following cases:
(i) the recordkeeping for the Retirement Plan is performed on a daily
valuation basis by Merrill Lynch Pierce Fenner & Smith, Inc. ("Merrill
Lynch") and, on the date the plan sponsor signs the Merrill Lynch
recordkeeping service agreement, the Retirement Plan has $3 million or
more in assets invested in mutual funds other than those advised or
managed by Merrill Lynch Asset Management, L.P. ("MLAM") that are made
available pursuant to a Service Agreement between Merrill Lynch and the
mutual fund's principal underwriter or distributor and in funds advised or
managed by MLAM (collectively, the "Applicable Investments"); or
(ii) the recordkeeping for the Retirement Plan is performed on a daily
valuation basis by an independent 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 Merrill Lynch record
keeping service agreement, the Plan must have $3 million or more in
assets, excluding assets held in money market funds, invested in
Applicable Investments; or
(iii) the Plan has 500 or more eligible employees, as determined by the
Merrill Lynch plan conversion manager on the date the plan sponsor signs
the Merrill Lynch record keeping
service agreement.
If a Retirement Plan's records are maintained on a daily valuation basis
by Merrill Lynch or an independent record keeper under a contract or alliance
arrangement with Merrill Lynch, and if on the date the plan sponsor signs the
Merrill Lynch record keeping service agreement the Retirement Plan has less than
$3 million in assets, excluding money market funds, invested in Applicable
Investments, then the Retirement Plan may purchase only Class B shares of one or
more of the Oppenheimer funds. Otherwise, the Retirement Plan will be permitted
to purchase Class A shares of one or more of the Oppenheimer funds. Any of those
Retirement Plans that currently invest in Class B shares of the Fund will have
their Class B shares be converted to Class A shares of the Fund once the Plan's
Applicable Investments have reached $5 million.
Any redemptions of shares of the Fund 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 that are currently
invested in Class B shares of the Fund shall not be subject to the Class B CDSC.
HOW TO SELL SHARES
Information on how to sell shares of the Fund is stated in the Prospectus.
The information below supplements the terms and conditions for redemptions set
forth in the Prospectus.
o 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 $500 or such lesser
amount as the Board may fix. The Board of Trustees will not cause the
involuntary redemption of shares in an account if the aggregate net asset value
of the shares has fallen below the stated minimum solely as a result of market
fluctuations. Should the Board elect to exercise this right, it may also fix, in
accordance with the Investment Company Act, the requirements for any notice to
be given to the shareholders in question (not less than 30 days), or the Board
may set requirements for granting permission to the shareholder to increase the
investment, and set other terms and conditions so that the shares would not be
involuntarily redeemed.
o PAYMENTS "IN KIND". The Prospectus states that payment for shares
tendered for redemption is ordinarily made in cash. However, 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
securities from the portfolio of the Fund, in lieu of cash, in conformity with
applicable rules of the Securities and Exchange Commission. The Fund has elected
to be governed by Rule 18f-1 under the Investment Company Act, pursuant to which
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 method of
valuing securities used to make redemptions in kind will be the same as the
method the Fund uses to value its portfolio securities described above under
"Determination of Net Asset Values Per Share" and that valuation will be made as
of the time the redemption price is determined.
REINVESTMENT PRIVILEGE. Within six months of a redemption, a shareholder may
reinvest all or part of the redemption proceeds of (i) Class A shares that you
purchased subject to an initial sales charge, or (ii) 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 below, at the net asset value next computed after the
Transfer Agent receives the reinvestment order. The shareholder must ask the
Distributor for that privilege at the time of reinvestment. 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. 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.
TRANSFERS OF SHARES. Shares are not subject to the payment of a contingent
deferred sales charge of either class at the time of transfer to the name of
another person or entity (whether the transfer occurs by absolute assignment,
gift or bequest, not involving, directly or indirectly, a public sale). The
transferred shares will remain subject to the contingent deferred sales charge,
calculated as if the transferee shareholder had acquired the transferred shares
in the same manner and at the same time as the transferring shareholder. If less
than all shares held in an account are transferred, and some but not all shares
in the account would be subject to a contingent deferred sales charge if
redeemed at the time of transfer, the priorities described in the Prospectus
under "How to Buy Shares" for the imposition of the Class B or Class C
contingent deferred sales charge will be followed in determining the order in
which shares are transferred.
DISTRIBUTIONS FROM RETIREMENT PLANS. Requests for distributions from
OppenheimerFunds- sponsored IRAs, SEP-IRAs, SAR-SEPs, 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: (i) state the reason
for the distribution; (ii) state the owner's awareness of tax penalties if the
distribution is premature; and (iii) conform to the requirements of the plan and
the Fund's other redemption requirements. Participants (other than self-employed
persons maintaining a plan account in their own name) in
OppenheimerFunds-sponsored prototype pension, profit-sharing, or 401(k) plans
may not directly redeem or exchange shares held for their account under those
plans. The employer or plan administrator 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 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, the
Trustee 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. The shareholder should contact the
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
the order placed by the dealer or broker, except that if the Distributor
receives a repurchase order from a dealer or broker after the close of The New
York Stock Exchange on a regular business day, it will be processed at that
day's net asset value if the order was received by the dealer or broker from its
customer prior to the time the Exchange closed (normally, that is 4:00 P.M., but
may be earlier some days) and the order was 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, with the signature(s) of the registered owners guaranteed on the
redemption documents 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
(minimum $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 and sent
to the address of record for the account (and if the address has not 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 OppenheimerFunds
New Account Application or signature-guaranteed instructions. Shares are
normally redeemed pursuant to an Automatic Withdrawal Plan three business days
before the 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 and reserves the right to amend, suspend or discontinue offering
such plans at any time without prior notice. Because of the sales charge
assessed on Class A share purchases, shareholders should not make regular
additional Class A share purchases while participating in an Automatic
Withdrawal Plan. Class B and Class C shareholders should not establish
withdrawal plans that would require the redemption of shares held less than 6
years or 12 months, respectively, because of the imposition of the Class B or
Class C contingent deferred sales charge on such withdrawals (except where the
Class B or Class C contingent deferred sales charge is waived as described in
the Prospectus under "Waivers of Class B and Class C Sales Charges").
By requesting an Automatic Withdrawal or Exchange Plan, the shareholder
agrees to the terms and conditions applicable to such plans, as stated below as
well as the Prospectus. These provisions may be amended from time to time by the
Fund and/or the Distributor. When adopted, such amendments will automatically
apply to existing Plans.
o AUTOMATIC EXCHANGE PLANS. Shareholders can authorize the Transfer Agent
(on the OppenheimerFunds Application or signature-guaranteed instructions) 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 $25. 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.
o AUTOMATIC WITHDRAWAL PLANS. Fund shares will be redeemed as necessary to
meet withdrawal payments. Shares acquired without a sales charge will be
redeemed first and 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
withdrawal plans should not be considered as a yield or income on your
investment.
The Transfer Agent will administer the investor's Automatic Withdrawal
Plan (the "Plan") as agent for the investor (the "Planholder") who executed the
Plan authorization and application submitted to the Transfer Agent. The Transfer
Agent shall incur no liability to the Planholder for any action taken or omitted
by the Transfer Agent in good faith to administer the Plan. 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.
Redemptions of shares needed to make withdrawal payments will be made at
the net asset value per share determined on the redemption date. Checks or
AccountLink payments of the proceeds of Plan withdrawals will normally be
transmitted three business days prior to the date selected for receipt of the
payment (receipt of payment on the date selected cannot be guaranteed),
according to the choice specified in writing by the Planholder.
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 in 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 (in proper form in accordance with
the requirements of the then-current Prospectus of the Fund) to redeem all, or
any part of, the shares held under the Plan. In that case, the Transfer Agent
will redeem the number of shares requested at the net asset value per share in
effect in accordance with the Fund's usual redemption procedures and will mail a
check for the proceeds to the Planholder.
The Plan may be terminated at any time by the Planholder by writing to the
Transfer Agent. A Plan may also be terminated at any time by the Transfer Agent
upon receiving directions to that effect from the Fund. The Transfer Agent will
also terminate a Plan upon receipt of evidence satisfactory to it of the death
or legal incapacity of the Planholder. Upon termination of a Plan by the
Transfer Agent or the Fund, shares that have not been redeemed from the account
will be held in uncertificated form in the name of the Planholder, and the
account will continue as a dividend- reinvestment, uncertificated account unless
and until proper instructions are received from the Planholder or his or her
executor or guardian, or other authorized person.
To use shares held under the Plan as collateral for a debt, the Planholder
may request issuance of a portion of the shares in certificated form. Upon
written request from the Planholder, the Transfer Agent will determine the
number of shares for which a certificate may be issued without causing the
withdrawal checks to stop because of exhaustion of uncertificated shares needed
to continue payments. However, should such uncertificated shares become
exhausted, Plan withdrawals will terminate.
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. All of the Oppenheimer funds offer Class A, B and C shares except
Oppenheimer Money Market Fund, Inc., Centennial Money Market Trust, Centennial
Tax Exempt Trust, Centennial Government Trust, Centennial New York Tax Exempt
Trust, Centennial California Tax Exempt Trust and Centennial America Fund, L.P.
which only offer Class A shares, and Oppenheimer Main Street California
Municipal Fund, which only offers Class A and Class B shares (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). A current list showing which funds
offer which class can be obtained by calling the Distributor at 1-800-525-7048.
For accounts established on or before March 8, 1996 holding Class M shares
of Oppenheimer
Convertible Securities Fund, Class M shares can be exchanged only for Class A
shares of other Oppenheimer funds. Exchanges to Class M shares of Oppenheimer
Convertible Securities Fund are permitted from Class A shares of Oppenheimer
Money Market Fund, Inc. or Oppenheimer Cash Reserves that were acquired by
exchange from Class M shares. Otherwise no exchanges of any class of any
Oppenheimer fund into Class M shares are permitted.
Class A shares of Oppenheimer funds may be exchanged at net asset value
for shares of any Money Market Fund. 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 (or, if applicable, may be
used to purchase shares of Oppenheimer funds subject to a contingent deferred
sales charge). However, shares of Oppenheimer Money Market Fund, Inc. purchased
with the redemption proceeds of shares of other mutual funds (other than funds
managed by the Manager or its subsidiaries) redeemed within the 30 days prior to
that purchase may subsequently be exchanged for shares of other Oppenheimer
funds without being subject to an initial or contingent deferred sales charge,
whichever is applicable. To qualify for that privilege, the investor or the
investor's dealer must notify the Distributor of eligibility for this privilege
at the time the shares of Oppenheimer Money Market Fund, Inc. are purchased,
and, if requested, must supply proof of entitlement to this privilege.
Shares of this Fund acquired by reinvestment of dividends or distributions
from any other of the Oppenheimer funds (except Oppenheimer Cash Reserves) 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.
No contingent deferred sales charge is imposed on exchanges of shares of
any class purchased subject to a contingent deferred sales charge. However, if
you redeem Class A shares of the Fund that were acquired by exchange of Class A
shares of other Oppenheimer funds purchased subject to a Class A contingent
deferred sales charge within 18 months of the end of the calendar month of the
purchase of the exchanged Class A shares, the Class A contingent deferred sales
charge is imposed on the redeemed shares (see "Class A Contingent Deferred Sales
Charge" in the Prospectus). The Class B contingent deferred sales charge is
imposed on Class B shares acquired by exchange if they are redeemed within six
years of the initial purchase of the exchanged Class B shares. 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.
When Class B or Class C 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 or Class C contingent deferred sales charge will be followed in
determining the order in which the shares are exchanged. Shareholders should
take into account the effect of any exchange on the applicability and rate of
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 WHETHER THEY INTEND TO EXCHANGE CLASS A, CLASS B OR CLASS C
SHARES.
When exchanging shares by telephone, a shareholder must either have an
existing account in, or obtain and acknowledge receipt of a prospectus of, the
fund to which the exchange is to be made. For full or partial exchanges of an
account made by telephone, any special account features such as Asset Builder
Plans, Automatic Withdrawal Plans and retirement plan contributions will be
switched to the new account unless the Transfer Agent is instructed otherwise.
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.
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 different Oppenheimer funds available for exchange have different
investment objectives, policies and risks, and a shareholder should assure that
the Fund selected is appropriate for his or her investment and should be aware
of the tax consequences of an exchange. For federal income tax purposes, an
exchange transaction is treated as a redemption of shares of one fund and a
purchase of shares of another. "Reinvestment Privilege," above, discusses some
of the tax consequences of reinvestment of redemption proceeds in such cases.
The Fund, the Distributor, and the Transfer Agent are unable to provide
investment, tax or legal advice to a shareholder in connection with an exchange
request or any other investment transaction.
DIVIDENDS, CAPITAL GAINS AND TAXES
DIVIDENDS AND DISTRIBUTIONS. Dividends will be payable on shares of record held
at the time of the previous determination of net asset value, or as otherwise
described in "How to Buy Shares." Daily dividends on newly purchased shares will
not be declared or paid until such time as Federal Funds (funds credited to a
member bank's account at the Federal Reserve Bank) are available from the
purchase payment for such shares. Normally, purchase checks received from
investors are converted to Federal Funds on the next business day. Dividends
will be declared on shares repurchased by a dealer or broker for three business
days following the trade date (i.e., to and including the day prior to
settlement of the repurchase). If all shares in an account are redeemed, all
dividends accrued on shares of the same class in the account will be paid
together with the redemption proceeds.
Dividends, distributions and the 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.,
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.
The amount of a class's distributions may vary from time to time depending
on market conditions, the composition of a Fund's portfolio, and expenses borne
by the Fund or borne separately by a class, as described in "Alternative Sales
Arrangements -- Class A, Class B and Class C shares" above. Dividends are
calculated in the same manner, at the same time and on the same day for shares
of each class. However, dividends on Class B and Class C shares are expected to
be lower than dividends on Class A and Class Y shares as a result of the
asset-based sales charges on Class B and Class C shares, and will also differ in
amount as a consequence of any difference in net asset value between the
classes.
TAX STATUS OF THE FUND'S DIVIDENDS AND DISTRIBUTIONS. The Federal tax treatment
of the Fund's dividends and capital gains distributions is explained in the
Prospectus under the caption "Dividends, Capital Gains and Taxes." Special
provisions of the Internal Revenue Code govern the eligibility of the Fund's
dividends for the dividends-received deduction for corporate shareholders.
Corporate shareholders may be entitled to the corporate dividends received
deduction for some portion of the Fund's distributions treated as ordinary
income, subject to applicable limitations under the Internal Revenue Code.
Long-term capital gains distributions are not eligible for the deduction. In
addition, the amount of dividends paid by the Fund which may qualify for the
deduction is limited to the aggregate amount of qualifying dividends that the
Fund derives from its 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.
If the Fund qualifies as a "regulated investment company" under the
Internal Revenue Code, it will not be liable for Federal income taxes on amounts
paid by it as dividends and distributions. The Fund qualified as a regulated
investment company in its last fiscal year and intends to qualify in future
years, but reserves the right not to qualify. The Internal Revenue Code contains
a number of complex tests relating to qualification which the Fund might not
meet in a particular year. If it does not qualify, the Fund will be treated for
tax purposes as an ordinary corporation and will receive no tax deduction for
payments of dividends and distributions made to shareholders.
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, or
else the Fund must pay an excise tax on the amounts not distributed. While it is
presently anticipated that the Fund will meet those requirements, the Fund's
Board of Trustees and the Manager might determine in a particular year that it
would be in the best interest 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.
DIVIDEND REINVESTMENT IN ANOTHER FUND. Shareholders of the Fund may elect to
reinvest all dividends and/or capital gains distributions in shares of the same
class of any of the other Oppenheimer funds listed in "Reduced Sales Charges,"
above, at net asset value without sales charge. To elect this option, a
shareholder must notify the Transfer Agent in writing and either have an
existing account in the fund selected for reinvestment or must obtain a
prospectus for that fund and an application from the Distributor to establish an
account. The investment will be made at the net asset value per share in effect
at the close of business on the payable date of the dividend or distribution.
Dividends and/or distributions from certain of the Oppenheimer funds may be
invested in shares of this Fund on the same basis.
ADDITIONAL INFORMATION ABOUT THE FUND
THE CUSTODIAN. The Bank of New York is the Custodian of the Fund's assets. The
Custodian's responsibilities include safeguarding and controlling the Fund's
portfolio securities, collecting income on the portfolio securities and handling
the delivery of such securities to and from the Fund. The Manager has
represented to the Fund that the banking relationships between the Manager and
the Custodian have been and will continue to be unrelated to and unaffected by
the relationship between the Fund and the Custodian. It will be 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.
INDEPENDENT AUDITORS. The independent auditors of the Fund audit the Fund's
financial statements and perform other related audit services. They also act as
auditors for certain other funds advised by the Manager and its affiliates.
-3-
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Board of Trustees and Shareholder
Oppenheimer Large Cap Growth Fund:
We have audited the accompanying statement of assets and liabilities of
Oppenheimer Large Cap Growth Fund as of May 12, 1998. This financial statement
is the responsibility of the Fund's management. Our responsibility is to express
an opinion on this financial statement based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. Our procedures include
confirmation of cash in bank 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 audit provides a reasonable basis for our
opinion.
In our opinion, the statement of assets and liabilities referred to above
presents fairly, in all material respects, the financial position of Oppenheimer
Large Cap Growth Fund as of May 12, 1998 in conformity with generally accepted
accounting principles.
/s/ KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
Denver, Colorado
May 29, 1998
<PAGE>
Oppenheimer LargeCap Growth Fund
Statement of Assets and Liabilities
May 12, 1998
ASSETS: Composite Class A Class Y
--------- ------- -------
Cash $101,000 $100,000 $1,000
Deferred Organization Costs - Note 3 16,177
--------
Total Assets 117,177
LIABILITIES - Payable to OppenheimerFunds, Inc. --------
- Note 3 $16,177
--------
Net Assets $101,000
========
NET ASSETS - Applicable to 10,000 Class A shares
and 100 Class Y shares of beneficial interest
outstanding $101,000 $100,000 $1,000
NET ASSET VALUE PER SHARE (net assets divided
by 10,000 and 100 shares of beneficial interest
for Class A and Class Y respectively.) $10.00 $10.00
MAXIMUM OFFERING PRICE PER SHARE (net asset
value plus sales charge of 5.75% of offering price
for Class A shares) $10.61 $10.00
Notes:
1. Oppenheimer LargeCap Growth Fund (the "Fund"), a diversified, open-end
management investment company, was formed on January 14, 1998, and has had
no operations through May 12, 1998 other than those relating to
organizational matters and the sale and issuance of 10,000 Class A shares
and 100 Class Y shares of beneficial interest to OppenheimerFunds, Inc.
(OFI)
2. On August 7, 1997 the Fund's Board approved an Investment Advisory
Agreement with OFI, a Service Plan and Agreement for Class A shares of the
Fund with OppenheimerFunds Distributor, Inc. (OFDI) and a General
Distributor's Agreement with OFDI as explained in the Fund's Prospectus and
Statement of Additional Information.
3. OFI will advance all organizational and start-up costs of the Fund. Such
expenses will be capitalized and amortized over a five-year period from the
date operations commence. On the first day that total assets exceed $5
million, the Fund will reimburse OFI for all start-up expenses. In the
event that all or part of OFI's initial investment in shares of the Fund is
withdrawn during the amortization period, by any holder thereof, the
redemption proceeds will be reduced by the ratio that the number of shares
redeemed bears to the number of initial shares outstanding at the time of
such redemption.
4. The Fund intends to comply in its initial fiscal year and thereafter with
provisions of the Internal Revenue Code applicable to regulated investment
companies and as such, will not be subject to federal income taxes on
otherwise taxable income (including net realized capital gains) distributed
to shareholders.
<PAGE>
APPENDIX
CORPORATE INDUSTRY CLASSIFICATIONS
Aerospace/Defense
Air Transportation
Auto Parts Distribution
Automotive
Bank Holding Companies
Banks
Beverages
Broadcasting
Broker-Dealers
Building Materials
Cable Television
Chemicals
Commercial Finance
Computer Hardware
Computer Software
Conglomerates
Consumer Finance
Containers
Convenience Stores
Department Stores
Diversified Financial
Diversified Media
Drug Stores
Drug Wholesalers
Durable Household Goods
Education
Electric Utilities
Electrical Equipment
Electronics
Energy Services & Producers
Entertainment/Film
Environmental
Food
Gas Utilities
Gold
Health Care/Drugs
Health Care/Supplies & Services
Homebuilders/Real Estate
Hotel/Gaming
Industrial Services
Information Technology
Insurance
Leasing & Factoring
Leisure
Manufacturing
Metals/Mining
Nondurable Household Goods
Oil - Integrated
Paper
Publishing/Printing
Railroads
Restaurants
Savings & Loans
Shipping
Special Purpose Financial
Specialty Retailing
Steel
Supermarkets
Telecommunications - Technology
Telephone - Utility
Textile/Apparel
Tobacco
Toys
Trucking
Wireless Services
<PAGE>
INVESTMENT ADVISER
OppenheimerFunds, Inc.
Two World Trade Center
New York, New York 10048
DISTRIBUTOR
OppenheimerFunds Distributor, Inc.
Two World Trade Center
New York, New York 10048
TRANSFER AND SHAREHOLDER SERVICING AGENT
OppenheimerFunds Services
P.O. Box 5270
Denver, Colorado 80217
1-800-525-7048
CUSTODIAN OF PORTFOLIO SECURITIES
The Bank of New York
One Wall Street
New York, NY 10015
INDEPENDENT AUDITORS
KPMG Peat Marwick LLP
707 Seventeenth Street
Denver, Colorado 80202
LEGAL COUNSEL
Gordon Altman Butowsky Weitzen
Shalov & Wein
114 West 47th Street
New York, New York 10036
PX0775
<PAGE>
OPPENHEIMER LARGE CAP GROWTH FUND
FORM N-1A
PART C
OTHER INFORMATION
ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements
(1) Financial Highlights (see Part A, Prospectus): Not applicable.
(2) Report of Independent Auditors (see Part B, Statement of Additional
Information): Filed herewith.
(3) Statement of Investments (see Part B): Not applicable.
(4) Statement of Assets and Liabilities (see Part B): Filed herewith.
(5) Statement of Operations (see Part B): Not applicable.
(6) Statement of Changes in Net Assets(see Part B): Not applicable
(7) Notes to Financial Statements (see Part B): Not applicable.
(b) EXHIBITS
(1) (i) Declaration of Trust dated as of 1/14/98: Previously filed with
Registrant's Registration Statement, 1/20/98, and incorporated herein by
reference.
(ii) Amended and Restated Declaration of Trust dated as of 4/27/98:
Previously filed with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement, 5/6/98, and incorporated herein by reference.
(2) Amended and Restated By-Laws dated as of 6/4/98: Filed herewith.
(3) Not applicable.
(4) (i) Specimen Share Certificate for Registrant's Class A Shares:
Previously filed with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement, 5/6/98, and incorporated herein by reference.
(ii) Specimen Share Certificate for Registrant's Class B Shares:
Previously filed with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement, 5/6/98, and incorporated herein by reference.
(iii)Specimen Share Certificate for Registrant's Class C Shares:
Previously filed with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement, 5/6/98, and incorporated herein by reference.
(iv) Specimen Share Certificate for Registrant's Class Y Shares:
Previously filed with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement, 5/6/98, and incorporated herein by reference.
(5) Investment Advisory Agreement: Previously filed with Pre-Effective
Amendment No. 1 to Registrant's Registration Statement, 5/6/98, and
incorporated herein by reference.
(6) (i) General Distributor's Agreement: Previously filed with
Pre-Effective Amendment No. 1 to Registrant's Registration Statement, 5/6/98,
and incorporated herein by reference.
(ii) Form of Oppenheimer Funds Distributor, Inc. Dealer Agreement: Filed
with Post- Effective Amendment No. 14 to the Registration Statement of
Oppenheimer Main Street Funds, Inc. (Reg. No. 33-17850), 9/30/94, and
incorporated herein by reference.
(iii)Form of Oppenheimer Funds Distributor, Inc. Broker Agreement: Filed
with Post- Effective Amendment No. 14 to the Registration Statement of
Oppenheimer Main Street Funds, Inc. (Reg. No. 33-17850), 9/30/94, and
incorporated herein by reference.
(iv) Form of Oppenheimer Funds Distributor, Inc. Agency Agreement: Filed
with Post- Effective Amendment No. 14 to the Registration Statement of
Oppenheimer Main Street Funds, Inc. (Reg. No. 33-17850), 9/30/94, and
incorporated herein by reference.
(v) Broker Agreement between Oppenheimer Fund Management, Inc. and
Newbridge Securities dated 10/1/86: Filed with Post-Effective Amendment No. 25
to the Registration Statement of Oppenheimer Growth Fund (Reg. No. 2-45272),
11/1/86, refiled with Post-Effective Amendment No. 45 to the Registration
Statement of Oppenheimer Growth Fund (Reg. No. 2-45272), 8/22/94, pursuant to
Item 102 of Regulation S-T, and incorporated herein by reference.
(7) Retirement Plan for Non-Interested Trustees dated 6/7/90: Filed with
Post-Effective Amendment No. 97 of Oppenheimer Fund (Reg. No. 2-14586), 8/30/90,
refiled with Post-Effective Amendment No. 45 of Oppenheimer Growth Fund (Reg.
No. 2-45272), 8/22/94, pursuant to Item 102 of Regulation S-T, and incorporated
herein by reference.
(8) (i) Custodian Agreement between Registrant and The Bank of New York:
Previously filed with Pre-Effective Amendment No. 1 to Registrant's Registration
Statement, 5/6/98, and incorporated herein by reference.
(ii) Form of Foreign Custody Manager Agreement dated October 9, 1997: Filed
with Pre-Effective Amendment No. 2 to the Registration Statement of Oppenheimer
World Bond Fund (Reg. No. 333-48973), 4/23/98, and incorporated herein by
reference.
(9) Not applicable.
(10)Opinion and Consent of Counsel: Filed herewith.
(11)Independent Auditors' Consent: Filed herewith.
(12)Not applicable.
(13)Investment Letter from OppenheimerFunds, Inc. to Registrant: Filed
herewith.
(14)(i) Form of prototype Standardized and Non-Standardized Profit-Sharing
Plan and Money Purchase Pension Plan for self-employed persons and corporations:
Filed with Post- Effective Amendment No. 3 to the Registration Statement of
Oppenheimer Global Growth & Income Fund (Reg. No. 33-23799), 1/31/92, and
refiled with Post-Effective Amendment No. 7 to the Registration Statement of
Oppenheimer Global Growth & Income Fund (Reg. No. 33-23799), 12/1/94, pursuant
to Item 102 of Regulation S-T, and incorporated herein by reference.
(ii) Form of Individual Retirement Account Plan (IRA) Agreement: Filed with
Post- Effective Amendment No. 21 to the Registration Statement of Oppenheimer
U.S. Government Trust (File No. 2-76645), 8/25/93, and incorporated herein by
reference.
(iii)Form of Tax Sheltered Retirement Plan and Custody Agreement for
employees of public schools and tax-exempt organizations: Filed with
Post-Effective Amendment No. 47 of the Registration Statement of Oppenheimer
Growth Fund (Reg. No. 2-45272), 10/21/94, and incorporated herein by reference.
(iv) Form of Simplified Employee Pension IRA: Previously filed with
Post-Effective Amendment No. 42 to the Registration Statement of Oppenheimer
Strategic Income & Growth Fund (File No. 33-47378), 9/28/95, and incorporated
herein by reference.
(v) Form of SAR-SEP Simplified Employee Pension IRA: Previously filed with
Post- Effective Amendment No. 7 to the Registration Statement for Oppenheimer
Strategic Income & Growth Fund (File No. 33-47378), 9/28/95, and incorporated
herein by reference.
(vi) Form of Prototype 401(k) plan: Filed with Post-Effective Amendment No.
7 to the Registration Statement of Oppenheimer Strategic Income & Growth Fund
(Reg. No. 33-47378), 9/28/95, and incorporated herein by reference.
(15)(i) Class A Service Plan and Agreement for Class A shares pursuant to
Rule 12b-1: Previously filed with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement, 5/6/98, and incorporated herein by reference.
(ii) Class B Service Plan and Agreement for Class A shares pursuant to
Rule 12b-1: Previously filed with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement, 5/6/98, and incorporated herein by reference.
(iii)Class C Service Plan and Agreement for Class A shares pursuant to Rule
12b-1: Previously filed with Pre-Effective Amendment No. 1 to Registrant's
Registration Statement, 5/6/98, and incorporated herein by reference.
(16)Performance Data Computation Schedule: Not applicable.
(17)(i) Financial Data Schedule for Class A Shares: Not applicable.
(ii) Financial Data Schedule for Class B Shares: Not applicable.
(iii)Financial Data Schedule for Class C Shares: Not applicable.
(iv) Financial Data Schedule for Class Y Shares: Not applicable.
(18)OppenheimerFunds Multiple Class Plan under Rule 18f-3 dated 3/18/96:
Previously filed with the Registration Statement of Oppenheimer MidCap Fund
(Reg. No. 333-31533), 7/18/97, and incorporated herein by reference.
-- Power of Attorney and Certified Board Resolutions: Previously filed
with Registrant's Registration Statement, 1/20/98, and incorporated herein
by reference.
-- Powers of Attorney signed by Registrant's Trustees: Previously filed
with Registrant's Registration Statement, 1/20/98, and incorporated herein by
reference.
ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT
None.
ITEM 26. NUMBER OF HOLDERS OF SECURITIES
Number of Record
Holders as of the
date of this
TITLE OF CLASS REGISTRATION STATEMENT
Class A shares of beneficial interest 1
Class B shares of beneficial interest -
Class C shares of beneficial interest -
Class Y shares of beneficial interest 1
ITEM 27. INDEMNIFICATION
Reference is made to paragraphs (c) through (g) of Section 12 of Article
SEVENTH of Registrant's Declaration of Trust filed as Exhibit (b)(1) to the
Registration Statement and incorporated herein by reference.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to trustees, officers and controlling persons of
Registrant pursuant to the foregoing provisions or otherwise, Registrant has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act of
1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by Registrant
of expenses incurred or paid by a trustee, officer or controlling person of
Registrant in the successful defense of any action, suit or proceeding) is
asserted by such trustee, officer or controlling person, Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
ITEM 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER
(a) OppenheimerFunds, Inc. is the investment adviser of the Registrant; it and
certain subsidiaries and affiliates act in the same capacity to other registered
investment companies as described in Parts A and B hereof and listed in Item
28(b) below.
(b) There is set forth below information as to any other business, profession,
vocation or employment of a substantial nature in which each officer and
director of OppenheimerFunds, Inc. is, or at any time during the past two fiscal
years has been, engaged for his/her own account or in the capacity of director,
officer, employee, partner or trustee.
NAME AND CURRENT POSITION WITH OTHER BUSINESS AND CONNECTIONS
OPPENHEIMERFUNDS, INC.("OFI") DURING THE PAST TWO YEARS
Charles E. Albers,
Senior Vice President An officer and/or portfolio manager of
certain Oppenheimer funds (since April
1998); a Chartered Financial Analyst;
formerly, a Vice President and
portfolio manager for Guardian Investor
Services, the investment management
subsidiary of The Guardian Life Insurance
Company (since 1972).
Mark J.P. Anson,
Vice President Vice President of Oppenheimer Real
Asset Management, Inc. ("ORAMI");
formerly, Vice
President of Equity Derivatives at
Salomon Brothers, Inc.
Peter M. Antos,
Senior Vice President An officer and/or portfolio manager of
certain Oppenheimer funds; a Chartered
Financial Analyst; Senior Vice President
of HarbourView Asset Management
Corporation ("HarbourView"); prior to
March, 1996 he was the senior equity
portfolio manager for the Panorama
Series Fund, Inc. (the "Company") and
other mutual funds and pension funds
managed by G.R. Phelps & Co. Inc. ("G.R.
Phelps"), the Company's former investment
adviser, which was a subsidiary of
Connecticut Mutual Life Insurance Company;
was also responsible for managing the
common stock department and common stock
investments of Connecticut Mutual Life
Insurance Co.
Lawrence Apolito,
Vice President None.
Victor Babin,
Senior Vice President None.
Bruce Bartlett,
Vice President An officer and/or portfolio manager of
certain Oppenheimer funds. Formerly, a
Vice President and Senior Portfolio
Manager at First of America Investment
Corp.
Kathleen Beichert,
Vice President None.
Rajeev Bhaman,
Vice President Formerly, Vice President (January 1992
- February, 1996) of Asian Equities for
Barclays de Zoete
Wedd, Inc.
Robert J. Bishop,
Vice President Vice President of Mutual Fund
Accounting (since May 1996); an officer
of other Oppenheimer funds; formerly, an
Assistant Vice President of
OFI/Mutual Fund Accounting (April
1994-May 1996), and a Fund Controller for
OFI.
John R. Blomfield,
Vice President Formerly, Senior Product Manager
(November, 1996 - August, 1997) of
International Home Foods and American
Home Products (March, 1994-October, 1996).
George C. Bowen,
Senior Vice President & Treasurer Vice President (since June 1983) and
Treasurer (since March 1985) of
OppenheimerFunds Distributor, Inc. (the
"Distributor"); Vice President
(since October 1989) and Treasurer
(since April 1986) of HarbourView;
Senior Vice President (since February
1992), Treasurer (since July 1991) and
a director (since December 1991) of
Centennial; President, Treasurer and a
director of Centennial Capital Corporation
(since June 1989); Vice President and
Treasurer (since August 1978)
and Secretary (since April 1981) of
Shareholder Services, Inc. ("SSI"); Vice
President, Treasurer and Secretary of
Shareholder Financial Services, Inc.
("SFSI") (since November 1989);
Treasurer of Oppenheimer Acquisition
Corp. ("OAC")(since June 1990); Treasurer
of Oppenheimer Partnership Holdings, Inc.
since November 1989); Vice President and
Treasurer of ORAMI (since July 1996);
Chief Executive Officer, Treasurer and a
director of MultiSource Services,
Inc., a broker-dealer (since December
1995); an officer of other Oppenheimer
funds.
Scott Brooks,
Vice President None.
Susan Burton,
Assistant Vice President None.
Adele Campbell,
Assistant Vice President & Assistant
Treasurer: Rochester Division Formerly, Assistant Vice President of
Rochester Fund Services, Inc.
Michael Carbuto,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds; Vice
President of Centennial.
John Cardillo,
Assistant Vice President None.
Ruxandra Chivu,
Assistant Vice President None.
H.D. Digby Clements,
Assistant Vice President:
Rochester Division None.
O. Leonard Darling,
Executive Vice President Trustee (1993 - present) of Awhtolia
College -Greece.
William DeJianne,
Assistant Vice President None.
Robert A. Densen,
Senior Vice President None.
Sheri Devereux,
Assistant Vice President None.
Craig P. Dinsell
Senior Vice President Formerly, Senior Vice President of Human
Resources for Fidelity Investments-Retail
Division (January, 1995 - January, 1996),
Fidelity Investments FMR Co. (January,
1996 - June, 1997) and Fidelity
Investments FTPG (June, 1997 -
January, 1998).
Robert Doll, Jr.,
Executive Vice President
& Director An officer and/or portfolio manager of
certain Oppenheimer funds.
John Doney,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Andrew J. Donohue,
Executive Vice President,
General Counsel and Director Executive Vice President (since
September 1993), and a director (since
January 1992) of the Distributor;
Executive Vice President, General
Counsel and a director of HarbourView,
SSI, SFSI and Oppenheimer Partnership
Holdings, Inc. since (September 1995) and
MultiSource Services, Inc. (a broker-
dealer) (since December 1995); President
and a director of Centennial (since
September 1995); President and a director
of ORAMI (since July 1996); General
Counsel (since May 1996) and Secretary
(since April 1997) of OAC; Vice
President of OppenheimerFunds
International, Ltd. ("OFIL") and
Oppenheimer Millennium Funds plc
(since October 1997); an officer of
other Oppenheimer funds.
Patrick Dougherty,
Assistant Vice President None.
Bruce Dunbar,
Vice President None.
George Evans,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Edward Everett,
Assistant Vice President None.
Leslie A. Falconio,
Assistant Vice President None.
Scott Farrar,
Vice President Assistant Treasurer of Oppenheimer
Millennium Funds plc (since October
1997); an officer of other Oppenheimer
funds; formerly, an Assistant Vice
President of OFI/Mutual Fund Accounting
(April 1994-May 1996), and a Fund
Controller for OFI.
Katherine P. Feld,
Vice President and Secretary Vice President and Secretary of the
Distributor; Secretary of HarbourView,
MultiSource and Centennial; Secretary,
Vice President and Director
of Centennial Capital Corporation; Vice
President and Secretary of ORAMI.
Ronald H. Fielding,
Senior Vice President; Chairman:
Rochester Division An officer, Director and/or portfolio
manager of certain Oppenheimer funds;
Presently he holds the following other
positions: Director (since 1995) of
ICI Mutual Insurance Company; Governor
(since 1994) of St. John's College;
Director (since 1994 -present) of
International Museum of Photography at
George Eastman House. Formerly, he held
the following positions: formerly,
Chairman of the Board and Director of
Rochester Fund Distributors, Inc.
("RFD"); President and Director of
Fielding Management Company, Inc. ("FMC");
President and Director of Rochester
Capital Advisors, Inc. ("RCAI"); Managing
Partner of Rochester Capital Advisors,
L.P., President and Director of Rochester
Fund Services, Inc. ("RFS"); President
and Director of Rochester Tax Managed
Fund, Inc.; Director (1993 - 1997) of
VehiCare Corp.; Director (1993 -1996)
of VoiceMode.
John Fortuna,
Vice President None.
Patricia Foster,
Vice President Formerly, she held the following
positions: An officer of certain former
Rochester funds (May, 1993 - January,
1996); Secretary of Rochester
Capital Advisors, Inc. and General
Counsel (June, 1993 - January 1996) of
Rochester Capital Advisors, L.P.
Jennifer Foxson,
Assistant Vice President None.
Linda Gardner,
Vice President None.
Alan Gilston,
Vice President Formerly, Vice President (1987-1997)
for Schroder Capital Management
International.
Jill Glazerman,
Assistant Vice President None.
Mikhail Goldverg
Assistant Vice President None.
Jeremy Griffiths,
Chief Financial Officer Currently a Member and
Fellow of the Institute of Chartered
Accountants; formerly, an accountant for
Arthur Young (London, U.K.).
Robert Grill,
Vice President Formerly, Marketing Vice President for
Bankers Trust Company (1993-1996);
Steering Committee Member, Subcommittee
Chairman for American
Savings Education Council (1995-1996).
Caryn Halbrecht,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Glenna Hale,
Vice President Formerly, Vice President (1994-1997) of
Retirement Plans Services for
OppenheimerFunds Services.
Robert Haley
Assistant Vice President Formerly, Vice President of
Information Services for Bankers Trust
Company (January, 1991 -November, 1997).
Elaine T. Hamann,
Vice President Formerly, Vice President (September,
1989 -January, 1997) of Bankers Trust
Company.
Thomas B. Hayes,
Vice President None.
Barbara Hennigar,
Executive Vice President and
Chief Executive Officer of
OppenheimerFunds Services,
a division of the Manager President and Director of SFSI;
President and Chief executive Officer
of SSI.
Dorothy Hirshman,
Assistant Vice President None.
Alan Hoden,
Vice President None.
Merryl Hoffman,
Vice President None.
Nicholas Horsley,
Vice President Formerly, a Senior Vice President and
Portfolio Manager for Warburg, Pincus
Counsellors, Inc. (1993-1997), Co-manager
of Warburg, Pincus Emerging Markets Fund
(12/94 - 10/97),
Co-manager Warburg, Pincus Institutional
Emerging Markets Fund - Emerging Markets
Portfolio (8/96 -10/97), Warburg Pincus
Japan OTC Fund, Associate Portfolio
Manager of Warburg Pincus International
Equity Fund, Warburg Pincus Institutional
Fund -Intermediate Equity Portfolio, and
Warburg Pincus EAFE Fund.
Scott T. Huebl,
Assistant Vice President None.
Richard Hymes,
Assistant Vice President None.
Jane Ingalls,
Vice President None.
Frank Jennings,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Thomas W. Keffer,
Senior Vice President None.
Avram Kornberg,
Vice President None.
Joseph Krist,
Assistant Vice President None.
Michael Levine,
Assistant Vice President None.
Shanquan Li,
Vice President None.
Stephen F. Libera,
Vice President An officer and/or portfolio manager for
certain Oppenheimer funds; a Chartered
Financial Analyst; a Vice President of
HarbourView; prior to March 1996, the
senior bond portfolio manager for
Panorama Series Fund Inc., other mutual
funds and pension accounts managed by
G.R. Phelps; also responsible for
managing the public fixed-income
securities department at Connecticut
Mutual Life Insurance Co.
Mitchell J. Lindauer,
Vice President None.
David Mabry,
Assistant Vice President None.
Steve Macchia,
Assistant Vice President None.
Bridget Macaskill,
President, Chief Executive Officer
and Director Chief Executive Officer (since
September 1995); President and director
(since June 1991) of HarbourView;
Chairman and a director of SSI
(since August 1994), and SFSI
(September 1995); President (since
September 1995) and a director
(since October 1990) of OAC;
President (since September 1995) and a
director (since November 1989) of
Oppenheimer Partnership Holdings, Inc.,
a holding company subsidiary of OFI; a
director of ORAMI (since July 1996);
President and a director (since October
1997) of OFIL, an offshore fund
manager subsidiary of OFI and
Oppenheimer Millennium Funds plc (since
October 1997); President and a director
of other Oppenheimer funds; a director of
the NASDAQ Stock Market, Inc. and of
Hillsdown Holdings plc (a U.K. food
company); formerly, an Executive Vice
President of OFI.
Wesley Mayer,
Vice President Formerly, Vice President (January, 1995
- June, 1996) of Manufacturers Life
Insurance Company.
Loretta McCarthy,
Executive Vice President None.
Kelley A. McCarthy-Kane
Assistant Vice President Formerly, Product Manager, Assistant
Vice President (June 1995- October,
1997) of Merrill Lynch Pierce Fenner &
Smith.
Beth Michnowski,
Assistant Vice President Formerly, Senior Marketing Manager
(May, 1996 -June, 1997) and Director of
Product Marketing (August, 1992 - May,
1996) with Fidelity Investments.
Lisa Migan,
Assistant Vice President None.
Denis R. Molleur,
Vice President None.
Nikolaos Monoyios,
Vice President A Vice President and/or portfolio
manager of certain Oppenheimer funds
(since April 1998); a Certified Financial
Analyst; formerly, a Vice
President and portfolio manager for
Guardian Investor Services, the management
subsidiary of The Guardian Life Insurance
Company (since 1979).
Linda Moore,
Vice President Formerly, Marketing Manager (July 1995-
November 1996) for Chase Investment
Services Corp.
Kenneth Nadler,
Vice President None.
David Negri,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Barbara Niederbrach,
Assistant Vice President None.
Robert A. Nowaczyk,
Vice President None.
Richard M. O'Shaugnessy,
Assistant Vice President:
Rochester Division None.
Gina M. Palmieri,
Assistant Vice President None.
Robert E. Patterson,
Senior Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
James Phillips
Assistant Vice President None.
Caitlin Pincus, Formerly, Manager (June, 1995 -
Vice President December, 1997) of McKinsey & Co.
John Pirie,
Assistant Vice President Formerly, a Vice President with Cohane
Rafferty Securities, Inc.
Jane Putnam,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Michael Quinn,
Assistant Vice President Formerly, Assistant Vice
President (April, 1995 -January, 1998) of
Van Kampen American Capital.
Russell Read,
Senior Vice President Vice President of Oppenheimer Real
Asset Management, Inc. (since March,
1995).
Thomas Reedy,
Vice President An officer and/or portfolio manager of
certain Oppenheimer funds; formerly, a
Securities Analyst for the Manager.
Adam Rochlin,
Vice President None.
Michael S. Rosen,
Vice President; President,
Rochester Division An officer and/or portfolio
manager of certain Oppenheimer funds.
Richard H. Rubinstein,
Senior Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Lawrence Rudnick,
Assistant Vice President None.
James Ruff,
Executive Vice President None.
Valerie Sanders,
Vice President None.
Scott Scharer
Assistant Vice President None.
Ellen Schoenfeld,
Assistant Vice President None.
Stephanie Seminara,
Vice President None.
Richard Soper,
Vice President None.
Stuart J. Speckman
Vice President Formerly, Vice President and Wholesaler
for Prudential Securities (December,
1990 - July, 1997).
Nancy Sperte,
Executive Vice President None.
Donald W. Spiro,
Chairman Emeritus and Director Vice Chairman and Trustee of the New
York-based Oppenheimer Funds; formerly,
Chairman of the Manager and the
Distributor.
Richard A. Stein,
Vice President: Rochester Division Assistant Vice President (since 1995)
of Rochester Capitol Advisors, L.P.
Arthur Steinmetz,
Senior Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Ralph Stellmacher,
Senior Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
John Stoma,
Senior Vice President, Director
Retirement Plans None.
Michael C. Strathearn,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds; a
Chartered Financial Analyst; a Vice
President of HarbourView.
James C. Swain,
Vice Chairman of the Board Chairman, CEO and Trustee, Director or
Managing Partner of the Denver-based
Oppenheimer Funds; President and a
Director of Centennial; formerly,
President and Director of OAMC, and
Chairman of the Board of SSI.
James Tobin,
Vice President None.
Jay Tracey,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Gary Tyc,
Vice President, Assistant
Secretary and Assistant Treasurer Assistant Treasurer of the Distributor
and SFSI.
Ashwin Vasan,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Dorothy Warmack,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Jerry Webman,
Senior Vice President Director of New York-based tax-exempt
fixed income Oppenheimer funds.
Christine Wells,
Vice President None.
Joseph Welsh,
Assistant Vice President None.
Kenneth B. White,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds; a
Chartered Financial Analyst; Vice
President of HarbourView.
William L. Wilby,
Senior Vice President An officer and/or portfolio manager of
certain Oppenheimer funds; Vice
President of HarbourView.
Carol Wolf,
Vice President An officer and/or portfolio manager of
certain Oppenheimer funds; Vice
President of Centennial; Vice President,
Finance and Accounting; Point of
Contact: Finance Supporters of Children;
Member of the Oncology Advisory Board of
the Childrens Hospital.
Caleb Wong,
Assistant Vice President None.
Jill Zachman,
Assistant Vice President:
Rochester Division None.
Robert G. Zack,
Senior Vice President and
Assistant Secretary, Associate
General Counsel Assistant Secretary of SSI (since May
1985), and SFSI (since November 1989);
Assistant Secretary of Oppenheimer
Millennium Funds plc (since
October 1997); an officer of other
Oppenheimer funds.
Arthur J. Zimmer,
Senior Vice President An officer and/or portfolio
manager of certain Oppenheimer funds; Vice
President of Centennial.
The Oppenheimer Funds include the New York-based Oppenheimer Funds, the
Denver-based Oppenheimer Funds and the Oppenheimer/Quest Rochester Funds, as
set forth below:
NEW YORK-BASED OPPENHEIMER FUNDS
Oppenheimer California Municipal Fund
Oppenheimer Capital Appreciation Fund
Oppenheimer Developing Markets Fund
Oppenheimer Discovery Fund
Oppenheimer Enterprise Fund
Oppenheimer Global Fund
Oppenheimer Global Growth & Income Fund
Oppenheimer Gold & Special Minerals Fund
Oppenheimer Growth Fund
Oppenheimer International Growth Fund
Oppenheimer International Small Company Fund
Oppenheimer MidCap Fund
Oppenheimer Money Market Fund, Inc.
Oppenheimer Multi-Sector Income Trust
Oppenheimer Multi-State Municipal Trust
Oppenheimer Multiple Strategies Fund
Oppenheimer Municipal Bond Fund
Oppenheimer New York Municipal Fund
Oppenheimer Series Fund, Inc.
Oppenheimer U.S. Government Trust
Oppenheimer World Bond Fund
QUEST/ROCHESTER FUNDS
Limited Term New York Municipal Fund
Oppenheimer Convertible Securities Fund
Oppenheimer Quest Capital Value Fund, Inc.
Oppenheimer Quest For Value Funds
Oppenheimer Quest Global Value Fund, Inc.
Oppenheimer Quest Value Fund, Inc.
Rochester Fund Municipals
DENVER-BASED OPPENHEIMER FUNDS
Centennial America Fund, L.P.
Centennial California Tax Exempt Trust
Centennial Government Trust
Centennial Money Market Trust
Centennial New York Tax Exempt Trust
Centennial Tax Exempt Trust
Oppenheimer Cash Reserves
Oppenheimer Champion Income Fund
Oppenheimer Equity Income Fund
Oppenheimer High Yield Fund
Oppenheimer Integrity Funds
Oppenheimer International Bond Fund
Oppenheimer Limited-Term Government Fund
Oppenheimer Main Street Funds, Inc.
Oppenheimer Municipal Fund
Oppenheimer Real Asset Fund
Oppenheimer Strategic Income Fund
Oppenheimer Total Return Fund, Inc.
Oppenheimer Variable Account Funds
Panorama Series Fund, Inc.
The New York Tax-Exempt Income Fund, Inc.
The address of OppenheimerFunds, Inc., the New York-based Oppenheimer
Funds, the Quest Funds, OppenheimerFunds Distributor, Inc., HarbourView Asset
Management Corp., Oppenheimer Partnership Holdings, Inc., and Oppenheimer
Acquisition Corp. is Two World Trade Center, New York, New York 10048-0203.
The address of the Denver-based Oppenheimer Funds, Shareholder Financial
Services, Inc., Shareholder Services, Inc., OppenheimerFunds Services,
Centennial Asset Management Corporation, Centennial Capital Corp., MultiSource
Services, Inc. and Oppenheimer Real Asset Management, Inc. is 6803 South Tucson
Way, Englewood, Colorado 80112.
The address of the Rochester-based funds is 350 Linden Oaks, Rochester, New
York 14625- 2807.
ITEM 29. PRINCIPAL UNDERWRITER
(a) OppenheimerFunds Distributor, Inc. is the Distributor of the Registrant's
shares. It is also the Distributor of each of the other registered open-end
investment companies for which OppenheimerFunds, Inc. is the investment adviser,
as described in Part A and B of this Registration Statement and listed in Item
28(b) above.
(b) The directors and officers of the Registrant's principal underwriter are:
NAME & PRINCIPAL POSITIONS & OFFICES POSITIONS & OFFICES
BUSINESS ADDRESS WITH UNDERWRITER WITH REGISTRANT
George C. Bowen(1) Vice President and Vice President and
Treasurer Treasurer of the
Oppenheimer funds.
Julie Bowers Vice President None
21 Dreamwold Road
Scituate, MA 02066
Peter W. Brennan Vice President None
1940 Cotswold Drive
Orlando, FL 32825
Maryann Bruce(2) Senior Vice President; None
Director: Financial
Institution Division
Robert Coli Vice President None
12 White Tail Lane
Bedminster, NJ 07921
Ronald T. Collins Vice President None
710-3 E. Ponce de Leon Ave.
Decatur, GA 30030
William Coughlin Vice President None
542 West Surf - #2N
Chicago, IL 60657
Mary Crooks(1)
Rhonda Dixon-Gunner(1) Assistant Vice President None
Andrew John Donohue(2) Executive Vice Secretary of the
President & Director Oppenheimer funds.
Wendy H. Ehrlich Vice President None
4 Craig Street
Jericho, NY 11753
Kent Elwell Vice President None
41 Craig Place
Cranford, NJ 07016
Todd Ermenio Vice President None
11011 South Darlington
Tulsa, OK 74137
John Ewalt Vice President None
2301 Overview Dr. NE
Tacoma, WA 98422
George Fahey Vice President None
412 Commons Way
Doylestown, PA 18901
Katherine P. Feld(2) Vice President None
& Secretary
Mark Ferro Vice President None
43 Market Street
Breezy Point, NY 11697
Ronald H. Fielding(3) Vice President None
Ronald R. Foster Senior Vice President None
11339 Avant Lane
Cincinnati, OH 45249
Patricia Gadecki Vice President None
950 First St., S.
Suite 204
Winter Haven, FL 33880
Luiggino Galleto Vice President None
10239 Rougemont Lane
Charlotte, NC 28277
L. Daniel Garrity Vice President None
2120 Brookhaven View, N.E.
Atlanta, GA 30319
Mark Giles Vice President None
5506 Bryn Mawr
Dallas, TX 75209
Ralph Grant(2) Vice President/National None
Sales Manager
C. Webb Heidinger Vice President None
28 Cable Road
Rye, NH 03870
Byron Ingram(2) Assistant Vice President None
Mark D. Johnson Vice President None
409 Sundowner Ridge Court
Wildwood, MO 63011
Michael Keogh(2) Vice President None
Richard Klein Vice President None
4820 Fremont Avenue So.
Minneapolis, MN 55409
Daniel Krause Vice President None
560 Beacon Hill Drive
Orange Village, OH 44022
Ilene Kutno(2) Assistant Vice President None
Todd Lawson Vice President None
3333 E. Bayaud Avenue
Unit 714
Denver, CO 80209
Wayne A. LeBlang Senior Vice President None
23 Fox Trail
Lincolnshire, IL 60069
Dawn Lind Vice President None
7 Maize Court
Melville, NY 11747
James Loehle Vice President None
30 John Street
Cranford, NJ 07016
Todd Marion Vice President None
39 Coleman Avenue
Chatham, N.J. 07928
LuAnn Mascia(2) Assistant Vice President None
Marie Masters Vice President None
520 E. 76th Street
New York, NY 10021
John McDonough Vice President None
6010 Ocean Front Avenue
Virginia Beach, VA 23451
Tanya Mrva(2) Assistant Vice President None
Laura Mulhall(2) Senior Vice President None
Charles Murray Vice President None
18 Spring Lake Drive
Far Hills, NJ 07931
Wendy Murray Vice President None
32 Carolin Road
Upper Montclair, NJ 07043
Denise-Marke Nakamura Vice President None
2870 White Ridge Place, #24
Thousand Oaks, CA 91362
Chad V. Noel Vice President None
60 Myrtle Beach Drive
Henderson, NV 89014
Joseph Norton Vice President None
2518 Fillmore Street
San Francisco, CA 94115
Kevin Parchinski Vice President None
8409 West 116th Terrace
Overland Park, KS 66210
Gayle Pereira Vice President None
2707 Via Arboleda
San Clemente, CA 92672
Charles K. Pettit Vice President None
22 Fall Meadow Dr.
Pittsford, NY 14534
Daniel Phillips Vice President None
60 Glasgow Cir.
Danville, CA 94526
Bill Presutti Vice President None
1777 Larimer St. #807
Denver, CO 80202
Steve Puckett Vice President None
2555 N. Clark, #209
Chicago, IL 60614
Elaine Puleo(2) Vice President None
Minnie Ra Vice President None
100 Delores Street, #203
Carmel, CA 93923
Michael Raso Vice President None
16 N. Chatsworth Ave.
Apt. 301
Larchmont, NY 10538
John C. Reinhardt(3) Vice President None
Douglas Rentschler Vice President None
867 Pemberton
Grosse Pointe Park, MI 48230
Ian Robertson Vice President None
4204 Summit Wa
Marietta, GA 30066
Michael S. Rosen(3) Vice President None
Kenneth Rosenson Vice President None
28214 Rey de Copas Lane
Malibu, CA 90265
James Ruff(2) President None
Timothy Schoeffler Vice President None
1717 Fox Hall Road
Washington, DC 77479
Michael Sciortino Vice President None
785 Beau Chene Drive
Mandeville, LA 70471
Robert Shore Vice President None
26 Baroness Lane
Laguna Niguel, CA 92677
Brian Summe Vice President None
239 N. Colony Drive
Edgewood, KY 41017
Andrew Sweeny Vice President None
5967 Bayberry Drive
Cincinnati, OH 45242
George Sweeney Vice President None
5 Smokehouse Lane
Hummelstown, PA 17036
Scott McGregor Tatum Vice President None
7123 Cornelia Lane
Dallas, TX 75214
David G. Thomas Vice President None
8116 Arlingon Blvd. #123
Falls Church, VA 22042
Philip St. John Trimble Vice President None
201 Summerfield
Northbrook, IL 60062
Sarah Turpin Vice President None
2201 Wolf Street, #5202
Dallas, TX 75201
Gary Paul Tyc(1) Assistant Treasurer None
Mark Stephen Vandehey(1) Vice President None
Marjorie Williams Vice President None
6930 East Ranch Road
Cave Creek, AZ 85331
(1) 6803 South Tucson Way, Englewood, Colorado 80112
(2) Two World Trade Center, New York, NY 10048-0203
(3) 350 Linden Oaks, Rochester, NY 14625-2807
(c) Not applicable.
ITEM 30. LOCATION OF ACCOUNTS AND RECORDS
The accounts, books and other documents required to be maintained by Registrant
pursuant to Section 31(a) of the Investment Company Act of 1940 and rules
promulgated thereunder are in the possession of OppenheimerFunds, Inc. at its
offices at 6803 South Tucson Way, Englewood, Colorado 80112.
ITEM 31. MANAGEMENT SERVICES
Not applicable.
ITEM 32. UNDERTAKINGS
(a) Not applicable.
(b) Not applicable.
C-1
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and/or the Investment
Company Act of 1940, the Registrant certifies that it meets all the requirements
for effectiveness of this Registration Statement pursuant to Rule 485(b) under
the Securities Act of 1933 and has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of New York and State of New York on the 16th day of June, 1998.
OPPENHEIMER LARGE CAP GROWTH FUND
/s/ Bridget A. Macaskill
By:_______________________________*
Bridget A. Macaskill, President
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following persons in the capacities on
the dates
indicated:
SIGNATURES TITLE DATE
/s/ Leon Levy Chairman of the June 16, 1998
______________________* Board of Trustees
Leon Levy
President,
/s/ Bridget A. Macaskill Principal Executive June 16, 1998
______________________* Officer and Trustee
Bridget A. Macaskill
/s/ George Bowen Treasurer & Principal June 16, 1998
______________________* Financial & Accounting
George Bowen Officer
/s/ Robert G. Galli Trustee June 16, 1998
______________________*
Robert G. Galli
/s/ Benjamin Lipstein Trustee June 16, 1998
______________________*
Benjamin Lipstein
/s/ Elizabeth Moynihan Trustee June 16, 1998
______________________*
Elizabeth B. Moynihan
/s/ Kenneth A. Randall Trustee June 16, 1998
______________________*
Kenneth A. Randall
/s/ Edward V. Regan Trustee June 16, 1998
______________________*
Edward V. Regan
/s/ Russell S. Reynolds, Jr. Trustee June 16, 1998
______________________*
Russell S. Reynolds, Jr.
/s/ Donald W. Spiro Trustee June 16, 1998
______________________*
Donald W. Spiro
/a/ Pauline Trigere Trustee June 16, 1998
______________________*
Pauline Trigere
/s/ Clayton K. Yeutter Trustee June 16, 1998
______________________*
Clayton K. Yeutter
/s/ Robert G. Zack
*By:_________________________________
Robert G. Zack, Attorney-in-Fact
<PAGE>
OPPENHEIMER LARGE CAP GROWTH FUND
REGISTRATION NO. 333-44545
PRE-EFFECTIVE AMENDMENT #2
EXHIBIT INDEX
FORM N-1A
ITEM NO. DESCRIPTION
24(b)(2) Amended and Restated By-Laws dated as of June 4, 1998
24(b)(10) Opinion of Counsel
24(b)(11) Independent Auditors' Consent
24(b)(13) Investment Letter from OppenheimerFunds, Inc. to
Registrant
OPPENHEIMER LARGE CAP GROWTH FUND
(THE "TRUST")
BY-LAWS
AMENDED AND RESTATED AS
OF JUNE 4, 1998
ARTICLE I
SHAREHOLDERS
SECTION 1. PLACE OF MEETING. All meetings of the Shareholders (which terms
as used herein shall, together with all other terms defined in the Amended and
Restated Declaration of Trust dated April 27, 1998, as amended from time to
time, have the same meaning as in the Declaration of Trust) shall be held at the
principal office of the Trust or at such other place as may from time to time be
designated by the Board of Trustees and stated in the notice of meting.
SECTION 2. SHAREHOLDER MEETINGS. Meetings of the Shareholders for any
purpose or purposes may be called by the Chairman of the Board of Trustees, if
any, or by the President or by the Board of Trustees and shall be called by the
Secretary upon receipt of the request in writing signed by Shareholders holding
not less than one third in amount of the entire number of Shares issued and
outstanding and entitled to vote thereat. Such request shall state the purpose
or purposes of the proposed meeting. In addition, meetings of the Shareholders
shall be called by the Board of Trustees upon receipt of the request in writing
signed by Shareholders that hold in the aggregate not less than ten percent in
amount of the entire number of Shares issued and outstanding and entitled to
vote thereat, stating that the purpose of the proposed meeting is the removal of
a Trustee.
SECTION 3. NOTICE OF MEETINGS OF SHAREHOLDERS. Not less than ten days' and
not more than 120 days' written or printed notice of every meeting of
Shareholders, stating the time and place thereof (and the general nature of the
business proposed to be transacted at any special or extraordinary meeting),
shall be given to each Shareholder entitled to vote thereat either by mail or by
presenting it to him personally or by leaving it at his residence or usual place
of business. If mailed, such notice shall be deemed to be given when deposited
in the United States mail addressed to the Shareholder at his post office
address as it appears on the records of the Trust, with postage thereon prepaid.
No notice of the time, place or purpose of any meeting of Shareholders
need be given to any Shareholder who attends in person or by proxy or to any
Shareholder who, in writing executed and filed with the records of the meeting,
either before or after the holding thereof, waives such notice.
SECTION 4. RECORD DATES. The Board of Trustees may fix, in advance, a
date, not exceeding 120 days and not less than ten days preceding the date of
any meeting of Shareholders, and not exceeding 120 days preceding any dividend
payment date or any date for the allotment of rights, as a record date for the
determination of the Shareholders entitled to notice of and to vote at such
meeting, or entitled to receive such dividend or rights, as the case may be; and
only Shareholders of record on such date shall be entitled to notice of and to
vote at such meeting or to receive such dividends or rights, as the case may be.
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<PAGE>
SECTION 5. ACCESS TO SHAREHOLDER LIST. The Board of Trustees shall make
available a list of the names and addresses of all shareholders as recorded on
the books of the Trust, upon receipt of the request in writing signed by not
less than ten Shareholders of the Trust (who have been such for at least six
months) holding in the aggregate the lesser of (i) Shares valued at $25,000 or
more at current offering price (as defined in the Trust's Prospectus), or (ii)
one percent in amount of the entire number of shares of the Trust issued and
outstanding; such request must state that such Shareholders wish to communicate
with other Shareholders with a view to obtaining signatures to a request for a
meeting pursuant to Section 2 of Article I of these By-Laws and accompanied by a
form of communication to the Shareholders. The Board of Trustees may, in its
discretion, satisfy its obligation under this Section 5 by either making
available the Shareholder List to such Shareholders at the principal offices of
the Trust, or at the offices of the Trust's transfer agent, during regular
business hours, or by mailing a copy of such Shareholders' proposed
communication and form of request, at their expense, to all other Shareholders.
SECTION 6. QUORUM, ADJOURNMENT OF MEETINGS. The presence in person or by
proxy of the holders of record of more than 50% of the Shares of the stock of
the Trust issued and outstanding and entitled to vote thereat, shall constitute
a quorum at all meetings of the Shareholders. If at any meeting of the
Shareholders there shall be less than a quorum present, the Shareholders present
at such meeting may, without further notice, adjourn the same from time to time
until a quorum shall attend, but no business shall be transacted at any such
adjourned meeting except such as might have been lawfully transacted had the
meeting not been adjourned. This Section 6 may be altered, amended or repealed
only upon the affirmative vote of the holders of the majority of all the Shares
of the Trust at the time outstanding and entitled to vote.
SECTION 7. VOTING AND INSPECTORS. At all meetings of Shareholders, every
Shareholder of record entitled to vote thereat shall be entitled to one vote for
each Share of the Trust standing in his name on the books of the Trust (and such
Shareholders of record holding fractional shares shall have proportionate voting
rights as provided in the Declaration of Trust) on the date for the
determination of Shareholders entitled to vote at such meeting, either in person
or by proxy appointed by instrument in writing subscribed by such Shareholder or
his duly authorized attorney-in-fact. No proxy which is dated more than three
months before the meeting shall be accepted unless such proxy shall, on its
face, name a longer period for which it is to remain in force.
All elections of Trustees shall be had by a plurality of the votes cast
and all questions shall be decided by a majority of the votes cast, in each case
at a duly constituted meeting, except as otherwise provided in the Declaration
of Trust or in these By-Laws or by specific statutory provision superseding the
restrictions and limitations contained in the Declaration of Trust or in these
ByLaws.
At any election of Trustees, the Board of Trustees prior thereto may, or,
if they have not so acted, the Chairman of the meeting may, and upon the request
of the holders of ten per cent (10%) of the Shares entitled to vote at such
election shall, appoint two inspectors of election who shall first subscribe an
oath or affirmation to execute faithfully the duties of inspectors at such
election with strict impartiality and according to the best of their ability,
and shall after the election make a certificate of the result of the vote taken.
No candidate for the office of Trustee shall be appointed
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<PAGE>
such Inspector.
The Chairman of the meeting may cause a vote by ballot to be taken upon
any election or matter, and such vote shall be taken upon the request of the
holders of ten per cent (10%) of the Shares entitled to vote on such election or
matter.
SECTION 8. CONDUCT OF SHAREHOLDERS' MEETINGS. The meetings of the
Shareholders shall be presided over by the Chairman of the Board of Trustees, if
any, or if he shall not be present, by the President, or if he shall not be
present, by a Vice-President, or if none of them is present, by a chairman to be
elected at the meeting. The Secretary of the Trust, if present, shall act as
Secretary of such meetings, or if he is not present, an Assistant Secretary
shall so act; if neither the Secretary nor an Assistant Secretary is present,
then the meeting shall elect its secretary.
SECTION 9. CONCERNING VALIDITY OF PROXIES, BALLOTS, ETC. At every meeting
of the Shareholders, all proxies shall be received and taken in charge of and
all ballots shall be received and canvassed by the secretary of the meeting, who
shall decide all questions touching the qualification of voters, the validity of
the proxies, and the acceptance or rejection of votes, unless inspectors of
election shall have been appointed as provided in Section 7, in which event such
inspectors of election shall decide all such questions.
ARTICLE II
BOARD OF TRUSTEES
SECTION 1. NUMBER AND TENURE OF OFFICE. The business and property of the
Trust shall be conducted and managed by a Board of Trustees consisting of the
number of initial Trustees, which number may be increased or decreased as
provided in Section 2 of this Article. Each Trustee shall, except as otherwise
provided herein, hold office until the meeting of Shareholders of the Trust next
succeeding his election or until his successor is duly elected and qualifies.
Trustees need not be Shareholders.
SECTION 2. INCREASE OR DECREASE IN NUMBER OF TRUSTEES. The Board of
Trustees, by the vote of a majority of the entire Board, may increase the number
of Trustees to a number not exceeding fifteen, and may elect Trustees to fill
the vacancies created by any such increase in the number of Trustees until the
next annual meeting or until their successors are duly elected and qualify; the
Board of Trustees, by the vote of a majority of the entire Board, may likewise
decrease the number of Trustees to a number not less than three but the tenure
of office of any Trustee shall not be affected by any such decrease. Vacancies
occurring other than by reason of any such increase shall be filled as provided
for a Massachusetts business trust. In the event that after the proxy material
has been printed for a meeting of Shareholders at which Trustees are to be
elected and any one or more nominees named in such proxy material dies or become
incapacitated, the authorized number of Trustees shall be automatically reduced
by the number of such nominees, unless the Board of Trustees prior to the
meeting shall otherwise determine.
SECTION 3. REMOVAL, RESIGNATION AND RETIREMENT. A Trustee at any time
may be removed
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<PAGE>
either with or without cause by resolution duly adopted by the affirmative votes
of the holders of two-thirds of the outstanding Shares of the Trust, present in
person or by proxy at any meeting of Shareholders at which such vote may be
taken, provided that a quorum is present. Any Trustee at any time may be removed
for cause by resolution duly adopted at any meeting of the Board of Trustees
provided that notice thereof is contained in the notice of such meeting and that
such resolution is adopted by the vote of at least two thirds of the Trustees
whose removal is not proposed. As used herein, "for cause" shall mean any cause
which under Massachusetts law would permit the removal of a Trustee of a
business trust.
Any Trustee may resign or retire as Trustee by written instrument signed
by him and delivered to the other Trustees or to any officer of the Trust, and
such resignation or retirement shall take effect upon such delivery or upon such
later date as is specified in such instrument and shall be effective as to the
Trust and each Series of the Trust hereunder. Notwithstanding the foregoing, any
and all Trustees shall be subject to the provisions with respect to mandatory
retirement set forth in the Trust's Retirement Plan for Non-Interested Trustees
or Directors adopted by the Trust, as the same may be amended from time to time.
SECTION 4. PLACE OF MEETING. The Trustees may hold their meetings, have
one or more offices, and keep the books of the Trust outside Massachusetts, at
any office or offices of the Trust or at any other place as they may from time
to time by resolution determine, or, in the case of meetings, as shall be
specified or fixed in the respective notices or waivers of notice thereof.
SECTION 5. REGULAR MEETINGS. Regular meetings of the Board of Trustees
shall be held at such time and on such notice, if any, as the Trustees may from
time to time determine. One such regular meeting during each fiscal year of the
Trust shall be designated an annual meeting of the Board of Trustees.
SECTION 6. SPECIAL MEETINGS. Special meetings of the Board of Trustees may
be held from time to time upon call of the Chairman of the Board of Trustees, if
any, the President or two or more of the Trustees, by oral or telegraphic or
written notice duly served on or sent or mailed to each Trustee not less than
one day before such meeting. No notice need be given to any Trustee who attends
in person, or to any Trustee who in writing executed and filed with the records
of the meeting either before or after the holding thereof waives such notice.
Such notice or waiver of notice need not state the purpose or purposes of such
meeting.
SECTION 7. QUORUM. One-third of the Trustees then in office shall
constitute a quorum for the transaction of business, provided that a quorum
shall in no case be less than two Trustees. If at any meeting of the Board there
shall be less than a quorum present (in person or by open telephone line, to the
extent permitted by the Investment Company Act of 1940 (the "1940 Act")), a
majority of those present may adjourn the meeting from time to time until a
quorum shall have been obtained. The act of the majority of the Trustees present
at any meeting at which there is a quorum shall be the act of the Board, except
as may be otherwise specifically provided by statute, by the Declaration of
Trust, by these By-Laws or by any contract or agreement to which the Trust is a
party.
SECTION 8. EXECUTIVE COMMITTEE. The Board of Trustees may, by the
affirmative vote of a
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<PAGE>
majority of the entire Board, elect from the Trustees an Executive Committee to
consist of such number of Trustees (not less than three) as the Board may from
time to time determine. The Board of Trustees by such affirmative vote shall
have power at any time to change the members of such Committee and may fill
vacancies in the Committee by election from the Trustees. When the Board of
Trustees is not in session, the Executive Committee shall have and may exercise
any or all of the powers of the Board of Trustees in the management of the
business and affairs of the Trust (including the power to authorize the seal of
the Trust to be affixed to all papers which may require it) except as provided
by law or by any contract or agreement to which the Trust is a party and except
the power to increase or decrease the size of, or fill vacancies on, the Board,
to remove or appoint executive officers or to dissolve or change the permanent
membership of the Executive Committee, and the power to make or amend the
By-Laws of the Trust. The Executive Committee may fix its own rules of
procedure, and may meet when and as provided by such rules or by resolution of
the Board of Trustees, but in every case the presence of a majority shall be
necessary to constitute a quorum. In the absence of any member of the Executive
Committee, the members thereof present at any meeting, whether or not they
constitute a quorum, may appoint a member of the Board of Trustees to act in the
place of such absent member.
SECTION 9. OTHER COMMITTEES. The Board of Trustees, by the affirmative
vote of a majority of the entire Board, may appoint other committees which shall
in each case consist of such number of members (not less than two) and shall
have and may exercise, to the extent permitted by law, such powers as the Board
may determine in the resolution appointing them. A majority of all members of
any such committee may determine its action, and fix the time and place of its
meetings, unless the Board of Trustees shall otherwise provide. The Board of
Trustees shall have power at any time to change the members and, to the extent
permitted by law, powers of any such committee, to fill vacancies, and to
discharge any such committee.
SECTION 10. INFORMAL ACTION BY AND TELEPHONE MEETINGS OF TRUSTEES AND
COMMITTEES. Any action required or permitted to be taken at any meeting of the
Board of Trustees or any committee thereof may be taken without a meeting, if a
written consent to such action is signed by all members of the Board, or of such
committee, as the case may be. Trustees or members of the Board of Trustees may
participate in a meeting by means of a conference telephone or similar
communications equipment; such participation shall, except as otherwise required
by the 1940 Act, have the same effect as presence in person.
SECTION 11. COMPENSATION OF TRUSTEES. Trustees shall be entitled to
receive such compensation from the Trust for their services as may from time to
time be voted by the Board of Trustees.
SECTION 12. DIVIDENDS. Dividends or distributions payable on the Shares of
any Series may, but need not be, declared by specific resolution of the Board as
to each dividend or distribution; in lieu of such specific resolutions, the
Board may, by general resolution, determine the method of computation thereof,
the method of determining the Shareholders of the Series to which they are
payable and the methods of determining whether and to which Shareholders they
are to be paid in cash or in additional Shares.
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<PAGE>
ARTICLE III
OFFICERS
SECTION 1. EXECUTIVE OFFICERS. The executive officers of the Trust may
include a Chairman of the Board of Trustees, and shall include a President, one
or more Vice Presidents (the number thereof to be determined by the Board of
Trustees), a Secretary and a Treasurer. The Chairman of the Board of Trustees,
if any, shall be selected from among the Trustees. The Board of Trustees or the
Executive Committee may also in its discretion appoint Assistant Secretaries,
Assistant Treasurers, and other officers, agents and employees, who shall have
such authority and perform such duties as the Board or the Executive Committee
may determine. The Board of Trustees may fill any vacancy which may occur in any
office. Any two offices, except those of President and Vice President, may be
held by the same person, but no officer shall execute, acknowledge or verify any
instrument in more than one capacity, if such instrument is required by law or
these By-Laws to be executed, acknowledged or verified by two or more officers.
SECTION 2. TERM OF OFFICE. The term of office of all officers shall be
until their respective successors are chosen and qualify; however, any officer
may be removed from office at any time with or without cause by the vote of a
majority of the entire Board of Trustees.
SECTION 3. POWERS AND DUTIES. The officers of the Trust shall have such
powers and duties as generally pertain to their respective offices, as well as
such powers and duties as may from time to time be conferred by the Board of
Trustees or the Executive Committee.
ARTICLE IV
SHARES
SECTION 1. CERTIFICATES OF SHARES. Each Shareholder of any Series of the
Trust may be issued a certificate or certificates for his Shares of that Series,
in such form as the Board of Trustees may from time to time prescribe, but only
if and to the extent and on the conditions described by the Board.
SECTION 2. TRANSFER OF SHARES. Shares of any Series shall be transferable
on the books of the Trust by the holder thereof in person or by his duly
authorized attorney or legal representative, upon surrender and cancellation of
certificates, if any, for the same number of Shares of that Series, duly
endorsed or accompanied by proper instruments of assignment and transfer, with
such proof of the authenticity of the signature as the Trust or its agent may
reasonably require; in the case of shares not represented by certificates, the
same or similar requirements may be imposed by the Board of Trustees.
SECTION 3. SHARE LEDGERS. The share ledgers of the Trust, containing the
name and address of the Shareholders of each Series and the number of shares of
that Series, held by them respectively, shall be kept at the principal offices
of the Trust or, if the Trust employs a transfer agent, at the offices of the
transfer agent of the Trust.
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<PAGE>
SECTION 4. LOST, STOLEN OR DESTROYED CERTIFICATES. The Board of Trustees
may determine the conditions upon which a new certificate may be issued in place
of a certificate which is alleged to have been lost, stolen or destroyed; and
may, in their discretion, require the owner of such certificate or his legal
representative to give bond, with sufficient surety to the Trust and the
transfer agent, if any, to indemnify it and such transfer agent against any and
all loss or claims which may arise by reason of the issue of a new certificate
in the place of the one so lost, stolen or destroyed.
ARTICLE V
SEAL
The Board of Trustees shall provide a suitable seal of the Trust, in such
form and bearing such inscriptions as it may determine.
ARTICLE VI
FISCAL YEAR
The fiscal year of the Trust shall be fixed by the Board of Trustees.
ARTICLE VII
AMENDMENT OF BY-LAWS
The By-Laws of the Trust may be altered, amended, added to or repealed by
the Shareholders or by majority vote of the entire Board of Trustees, but any
such alteration, amendment, addition or repeal of the By-Laws by action of the
Board of Trustees may be altered or repealed by the Shareholders.
orgzn\775bylaw.698
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GORDON ALTMAN BUTOWSKY WEITZEN SHALOV & WEIN
114 WEST 47TH STREET NEW YORK, N.Y. 10036-1510
TELEPHONE (212) 626-0800 TELECOPIER (212) 626-0799
May 18, 1998
Oppenheimer Large Cap Growth Fund
Two World Trade Center
New York, New York 10048-0669
Ladies and Gentlemen:
This opinion is being furnished to Oppenheimer Large Cap Growth Fund, a
Massachusetts business trust (the "Fund"), in connection with the Registration
Statement on Form N-1A (the "Registration Statement") under the Securities Act
of 1933, as amended (the "1933 Act") and the Investment Company Act of 1940, as
amended, filed by the Fund. As counsel for the Fund, we have examined such
statutes, regulations, corporate records and other documents and reviewed such
questions of law that we deemed necessary or appropriate for the purposes of
this opinion.
As to matters of Massachusetts law contained in this opinion, we have
relied upon the opinion of Pepe Hazard LLP dated May 18, 1998.
Based upon the foregoing, we are of the opinion that the Class A, Class B
and Class C shares to be issued as described in the Registration Statement have
been duly authorized and, assuming receipt of the consideration to be paid
therefor, upon delivery as provided in the Registration Statement, will be
legally and validly issued, fully paid and non-assessable (except for the
potential liability of shareholders described in the Fund's Statement of
Additional Information under the caption "About the Fund - How the Fund is
Managed Organization and History").
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to us in the Registration Statement.
We do not thereby admit that we are within the category of persons whose consent
is required under Section 7 of the 1933 Act or the rules and regulations of the
Securities and Exchange Commission thereunder.
Very truly yours,
/s/ Gordon Altman Butowsky
Weitzen Shalov & Wein
A PARTNERSHIP WHICH INCLUDES A PROFESSIONAL CORPORATION
INDEPENDENT AUDITORS' CONSENT
To The Board of Trustees of
Oppenheimer Large Cap Growth Fund:
We consent to the use in the Pre-effective Amendment No. 2 to the Registration
Statement of Oppenheimer Large Cap Growth Fund of our report dated May 12, 1998
appearing in the Statement of Additional Information, which is a part of such
Registration Statement.
/s/ KPMG PEAT MARWICK LLP
---------------------------
KPMG Peat Marwick LLP
Denver, Colorado
June 5, 1998
May 12, 1998
The Board of Trustees
Oppenheimer Large Cap Growth Fund
Two World Trade Center
New York, New York 10048-0203
To the Board of Trustees:
OppenheimerFunds, Inc. ("OFI") herewith purchases 10,000 Class A shares
and 100 Class Y shares of Oppenheimer Large Cap Growth Fund (the "Fund") at a
net asset value per share of $10.00 for each such class, for an aggregate
purchase price of $101,000.
In connection with such purchase, OFI represents that such purchase is
made for investment purposes by OFI without any present intention of redeeming
or selling such shares. OFI will advance all organizational and start-up costs
of the Fund. Such expenses will be amortized over a five-year period from the
date operations commence. On the first day that total assets exceed $5 million,
the Fund will reimburse OFI for all start-up expenses. In the event that all or
part of OFI's initial investment in shares of the Fund is withdrawn during the
amortization period, by any holder thereof, the redemption proceeds will be
reduced by the proportionate amount of the unamortized organization costs
represented by the ratio that the number of shares redeemed bears to the number
of initial shares outstanding at the time of such redemption.
Very truly yours,
OppenheimerFunds, Inc.
/s/ Robert G. Zack
Robert G. Zack
Senior Vice President &
Assistant Secretary
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