Oppenheimer Senior Floating Rate Fund
Supplement dated January 18, 2000 to the
Prospectus dated September 7, 1999
The Prospectus is changed as follows:
1. The Supplement dated December 6, 1999, to the Prospectus is replaced by this
supplement.
2. The reference to "10,000,000 Shares" on the top of the front cover page is
deleted. All references in the Prospectus to the number of shares of the
Fund registered with the Securities and Exchange Commission are revised to
reflect the registration of an additional 10,000,000 shares each of Class
A, Class B and Class C, bringing the total shares registered to 10,100,000
Class A shares, 16,000,000 Class B shares and 13,900,000 Class C shares.
3. The table (and accompanying notes) on the front cover is replaced by the
following:
The Fund began the continuous offering of its shares on September 8,
1999. The Fund is authorized to issue an unlimited number of shares of
each class and to date has registered 10,100,000 Class A shares,
16,000,000 Class B shares and 13,900,000 Class C shares. Shares are
offered to the public at a price equal to the net asset value per
share. As of December 1, 1999, the net asset values per share of the
Fund's share classes were as follows: Class A: $9.98, Class B: $9.98,
and Class C: $9.99. The net asset values and therefore the offering
prices of each class of shares will fluctuate over the course of the
offering. Class A shares may be purchased without initial sales charge,
but only upon the automatic conversion of Class B shares 72 months
after their purchase or by exchange of Class A shares of certain other
Oppenheimer funds. Class B and Class C shares are offered without any
initial sales charge, but are each subject to an annual service fee, an
annual asset-based distribution fee and an early withdrawal charge.
Please refer to "How to Buy Shares" for details. The Fund intends to
invest the net proceeds of the offering of its shares in portfolio
securities as soon as is practicable after receipt of the proceeds. The
Fund's investment advisor, OppenheimerFunds, Inc. (the "Manager"), has
borne the offering expenses of the initial offering of 10,000,000
shares of the Fund. The offering expenses for subsequently-registered
and offered shares, estimated to be $99,000.00, will be borne by the
Fund, subject to any reimbursement of expenses by the Manager.
4. On page 4, a new footnote 5 is added to the column under "Class A Shares -
Early Withdrawal Charges" in the chart entitled "Shareholder Transaction
Expenses" as follows:
5. An Early Withdrawal Charge may apply to repurchases of Class A
shares that were purchased by exchange of class A shares of other
Oppenheimer funds that were still subject to the Class A contingent
deferred sales charge of those funds at the time of exchange. See "How
to Buy Shares - Class A Early Withdrawal Charge" for details.
Footnote 2 to the same chart is revised to read as follows:
2. Class A shares are not currently offered for direct purchase
except by exchange of Class A shares of certain other Oppenheimer
funds.
5. On page 4, footnote 2 to the Annual Expenses chart is revised to read as
follows:
The management fee is based upon a percentage of the Fund's average
annual net assets and is shown without giving effect to a voluntary
reduction by the Manager of 0.20% of the management fee annually. With
that fee waiver and reduction, the estimated management fee for each
class is 0.53% and Total Annual Expenses are estimated at 1.13% for
Class A and 1.63% for Class B and Class C. Additionally, the management
fee in the table does not reflect the Manager's voluntary agreement to
waive its entire management fee for the period from the commencement of
operations of the Fund on September 8, 1999 through March 31, 2000.
Each voluntary reduction or waiver may be withdrawn or amended at any
time.
<PAGE>
6. On page 5, the Examples depicting the effect of the Fund's estimated expenses
on a $1,000 investment in shares of each Class of the Fund are replaced by the
following examples, which show the effect of the estimated expenses in the
Annual Expenses chart without giving effect to the Manager's voluntary expense
waivers.
<TABLE>
<CAPTION>
-------------------------------------- --------------- -------------- -------------- ---------------
Assuming you do not tender shares
for repurchase by the Fund
<S> <C> <C> <C> <C>
1 Year 3 Years 5 Years 10 Years
-------------------------------------- --------------- -------------- -------------- ---------------
-------------------------------------- --------------- -------------- -------------- ---------------
Class A shares $14 $42 $73 $160
-------------------------------------- --------------- -------------- -------------- ---------------
-------------------------------------- --------------- -------------- -------------- ---------------
Class B shares $19 $58 $99 $190
-------------------------------------- --------------- -------------- -------------- ---------------
-------------------------------------- --------------- -------------- -------------- ---------------
Class C shares $19 $58 $99 $215
-------------------------------------- --------------- -------------- -------------- ---------------
-------------------------------------- --------------- -------------- -------------- ---------------
Assuming you tender your shares for
repurchase by the Fund on the last
day of the period and a Class B or
Class C Early Withdrawal Charge
applies 1 Year 3 Years 5 Years 10 Years
-------------------------------------- --------------- -------------- -------------- ---------------
-------------------------------------- --------------- -------------- -------------- ---------------
Class A shares $14 $42 $73 $160
-------------------------------------- --------------- -------------- -------------- ---------------
-------------------------------------- --------------- -------------- -------------- ---------------
Class B shares $49 $73 $109 $190
-------------------------------------- --------------- -------------- -------------- ---------------
-------------------------------------- --------------- -------------- -------------- ---------------
Class C shares $29 $58 $99 $215
-------------------------------------- --------------- -------------- -------------- ---------------
</TABLE>
7. On page 8, the last two sentences of the second paragraph in "How Can I Buy
Shares?" are revised to read as follows:
The Fund's Class A shares may not be purchased directly, except by
exchange of Class A shares of certain other Oppenheimer funds. Class A
shares are also available on the automatic conversion of Class B shares
of the Fund 72 months after those shares are purchased.
8. On page 8, an additional "bulleted" paragraph is added to the section "Are
There Any Sales Charges for Investing in the Fund?" as follows:
o If you acquire Class A shares of the Fund by exchange of Class A
shares of other Oppenheimer funds that were still subject to a
Class A contingent deferred sales charge at the time you exchanged
them, they will become subject to the Fund's Class A Early
Withdrawal Charge. If any of those Class A shares of the Fund are
repurchased within 18 months of the original purchase date of the
shares of the fund from which they were exchanged, they will be
subject to the Fund's Class A Early Withdrawal Charge of 1%
(explained in "Class A Early Withdrawal Charge" below).
9. On page 10, the second and third sentences of the first paragraph of the
section entitled "Borrowing" are replaced by the following:
The Fund may borrow if necessary to obtain short-term credit to allow
it to repurchase shares during Repurchase Offers, to manage cash flows
and to fund additional purchase commitments under Senior Loans. The
Fund may also borrow to acquire additional investments (a technique
known as "leverage"). To the extent that the costs of borrowing exceed
the return on the investments purchased with the borrowed amounts, the
Fund's returns will be adversely affected. Borrowing for leverage also
increases the risk of higher volatility of the net asset values of the
Fund's shares.
10. On page 29, the third sentence in the first paragraph of the section
entitled "Borrowing" is replaced by the following:
The Fund can also borrow money to finance share repurchases during
Repurchase Offers and to finance the purchase of additional investments
(a technique referred to as "leverage"). The Fund might borrow for
leverage to attempt to maintain the desired level of investment in
Senior Loans after accounting for anticipated cash flows from
prepayments of Senior Loans, the sale of Fund shares, cash outflows to
fulfill settlement obligations (including obligations under revolving
Senior Loans to fund additional loan commitments) and repurchases of
Fund shares. The Fund might also borrow to acquire additional
investments when the Manager believes that the interest payments and
costs associated with borrowing will not exceed the total return on the
investments acquired with those borrowings. However, the success of
that type of leverage strategy depends on the Manager's ability to
predict correctly interest rate and market movements, and there is no
assurance that a leveraging strategy will be successful. Unless the
income and appreciation, if any, on assets acquired with borrowed funds
exceed the costs of borrowing, the use of leverage will reduce the
Fund's investment performance compared with what it would have been
without leveraging.
The second sentence of the second paragraph of "Borrowing" on page 29
is deleted.
11. On page 31, the reference to "standardized yield" in "Explanation of
Performance Terminology" is deleted.
12. On page 32, in the section entitled "Advisory Fees," the last three
sentences are revised to read as follows:
The Manager has voluntarily agreed to reduce its management fee by
0.20% of average annual net assets, and additionally, for the period
from the commencement of the Fund's operations on September 8, 1999
through March 31, 2000, to voluntarily waive the management fee
entirely. Those waivers have the effect of reducing the Fund's overall
expenses, thereby increasing its yield. Either waiver may be amended or
withdrawn by the Manager at any time.
13. In the introductory paragraph of "How Do I Buy Shares?" on page 33, and in
"Class A Shares" on page 36, the description of the availability of Class A
shares is revised to read: "Class A shares are available upon automatic
conversion of Class B shares (please refer to "Automatic Conversion of Class B
Shares" below) and by exchange of Class A shares of certain other Oppenheimer
funds."
14. The section entitled "Are There Any Early Withdrawal Charge Waivers?" on
page 37 is revised by adding a new final sentence as follows:
The Class B and Class C Early Withdrawal Charges are waived in the case
of repurchases of shares owned by present and former officers,
directors, trustees and employees (and their "immediate families" as
that term is defined in Appendix B to the Statement of Additional
Information) of the Fund, the Manager and its affiliates, and
retirement plans established by them for their employees.
15. A new section is added on page 37 after "Are There Any Early Withdrawal
Charge Waivers?" as follows:
Class A Early Withdrawal Charge. Class A shares cannot be directly
purchased but may be acquired upon automatic conversion of Class B shares
(discussed below) or by exchange of Class A shares of certain other
Oppenheimer funds (as described in "How To Exchange Shares," below). Class
A shares of another Oppenheimer fund that were purchased subject to the
Class A contingent deferred sales charge of that fund and that are still
subject to that Class A contingent deferred sales charge at the time of
exchange will become subject to the Fund's Class A Early Withdrawal Charge.
If any of those Class A shares of the Fund that are subject to the
Class A Early Withdrawal Charge are repurchased within 18 months of the end
of the calendar month of the original purchase date of the exchanged
shares, an Early Withdrawal Charge may be deducted from the repurchase
proceeds. That Early Withdrawal Charge will be equal to 1.00% of the lesser
of (1) the aggregate net asset value of the repurchased shares calculated
at the Repurchase Pricing Date or (2) the original net asset value of the
repurchased shares. The Class A Early Withdrawal Charge will not exceed the
aggregate amount of the commissions the Distributor paid to your dealer on
all purchases of Class A shares of all other Oppenheimer funds you made
that were subject to Class A contingent deferred sales charges. In
determining whether an Early Withdrawal Charge is payable when any of your
Class A shares are repurchased, the Fund will first repurchase shares that
are not subject to the charge, including shares purchased by reinvestment
of dividends and capital gains distributions. Then the Fund will repurchase
other Class A shares in the order in which you purchased them by exchange.
The Early Withdrawal Charge is retained by the Distributor to help pay for
some of its distribution-related costs and expenses.
16. The second sentence of the footnote under the Class B Early Withdrawal
Charge table on page 38 is revised to read as follows:
In applying the Early Withdrawal Charge, all purchases are considered
to have been made on the first regular business day of the month during
which the purchase was made.
17. In the first "bulleted" paragraph entitled "Early Withdrawal Charges" under
"Special Considerations and Risks of Repurchases" on page 44, the following
sentence is added after the existing sentence in that section:
You may be subject to an Early Withdrawal Charge on Class A shares that
are repurchased if those shares were acquired by exchange of Class A
shares of another Oppenheimer fund that were originally purchased
subject to a Class A contingent deferred sales charge and are
repurchased within 18 months of the end of the calendar month of in
which the original purchase occurred.
18. In the second full paragraph of the section entitled "How to Exchange
Shares" on page 49, the fourth and fifth sentences are replaced by the
following:
Class A shares of this Fund may be acquired by exchange of Class A
shares of other Oppenheimer funds (except Class A shares of Oppenheimer
Cash Reserves and shares of Oppenheimer Money Market Fund, Inc.). If
any Class A shares of another Oppenheimer fund that are exchanged are
subject to the Class A contingent deferred sales charge of that fund at
the time of exchange, they will be subject to the Fund's Class A Early
Withdrawal Charge if they are repurchased prior to the end of the 18th
month after the end of the calendar month in which the exchanged Class
A shares were originally purchased.
January 18, 2000 PS0291.005
