SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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/ / Preliminary proxy statement
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OPPENHEIMER HIGH YIELD FUND
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(Name of Registrant as Specified in Its Charter)
OPPENHEIMER HIGH YIELD FUND
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
/ X / No fee required.
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0-11.
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calculated and state how it was determined):
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INTERNAL USE ONLY
TELEPHONE SCRIPT FOR
SHAREHOLDER MEETING
OPPENHEIMER HIGH YIELD FUND
Original meeting date: 9/14/00
Adjourned meeting date: 10/16/00 (10:00 a.m.)
There are six proposals shareholders are being asked to vote on. Proposal
No. 3 consists of seven (7) sub-proposals. The Fund's Board of Trustees
recommends a vote in favor of electing each of the nominees as trustee and
FOR each of the proposals and sub-proposals.
Proposal No. 1: Election of Trustees.
Current law provides that the Fund's Board may fill vacancies on the Board of
Trustees or appoint new Trustees only if, immediately thereafter, at least two
thirds of the Trustees will have been elected by shareholders. Currently, four
of the Fund's ten Trustees have not been elected by shareholders. Because the
Fund has not had a shareholder meeting for some time, the percentage of trustees
of the Fund that have been elected by shareholders is less than two-thirds, and
thus no additional trustees/directors may be added to the Board of the Fund
unless first elected by shareholders. Therefore, shareholders are being asked to
elect trustees.
Proposal No. 2: Ratification of Auditors Selection.
The Fund is not required to hold annual shareholder meetings and does not hold
such meetings. However, when a shareholder meeting is held, the Fund's selection
of independent auditors must be submitted for ratification or rejection by
shareholders at that meeting. Because the Fund is holding a shareholder meeting,
shareholders are being asked to ratify the Fund's selection of independent
auditors.
Proposal No. 3: Elimination of Certain Fundamental Investment Restrictions.
This proposal consists of seven (7) sub-proposals.
***Summary of impact of the elimination of certain fundamental investment
restrictions:
Because of recent regulatory changes, certain investment restrictions are no
longer applicable to the Fund. Certain other investment restrictions adopted by
the Fund are more restrictive than currently required, and other investment
restrictions adopted by the Fund reflect outdated industry conditions and
practices. The Fund's Manager considers many of these restrictions unnecessary
or unwarranted.
The Fund's Board finds that the proposed elimination of certain fundamental
investment restrictions of the Fund is in the best interests of shareholders.
The proposed changes are intended to provide the Fund with greater flexibility
to respond to future market developments and to increase future investment
opportunities.
The proposed changes are not expected to materially change the current risk
profile of an investment in the Fund.
The elimination of a fundamental policy does not mean that the Fund's current
principal investment policies and strategies will change. If the Fund's Manager
decides to materially change the Fund's investment policies and strategies, such
a change will be described in the Fund's prospectus.
Sub-Proposal No. 3.A.: Eliminating Restriction on Investing in Unseasoned
Issuers.
The Fund is currently subject to a fundamental investment restriction limiting
its investment in securities of issuers that have been in operation less than
three years (so-called "unseasoned issuers").
This restriction was originally adopted to address a state imposed limitation
that is no longer applicable to the Fund. Elimination of this restriction could
increase the Fund's flexibility when choosing investments in the future.
Sub-Proposal No. 3.B.: Eliminating Restriction on Investing for Purpose of
Acquiring Control.
It is proposed that the Fund's current fundamental investment restriction
prohibiting it from investing in portfolio companies for the purpose of
acquiring control be eliminated. The Fund has no intention of investing for the
purpose of acquiring control of a company, and elimination of the restriction is
not expected to have a significant impact on the Fund's investment practices or
management.
The restriction is unnecessary and may reduce possible investment opportunities
because a mutual fund might be considered to be investing for control if it
purchases a large percentage of the securities of a single issuer. Eliminating
this restriction also will give the Fund greater flexibility in exercising its
rights as a shareholder of the portfolio companies it invests in, to try to
protect its interests and those of its shareholders.
Sub-Proposal No. 3.C.: Eliminating Restriction on Purchasing Securities in
which Officers and Trustees of the Fund have an Interest.
The Fund is currently subject to a fundamental investment restriction
prohibiting it from purchasing the securities of an issuer if the officers of
the Fund or the Manager individually own 1/2 of 1% of such securities and
together own more than 5% of such securities. This restriction was originally
adopted to address a state imposed limitation that is no longer applicable.
Elimination of this restriction could increase the Fund's flexibility when
choosing investments in the future.
Sub-Proposal No. 3.D.: Eliminating Prohibition on Margin Purchases and Short
Sales.
It is proposed that the Fund's current fundamental investment restriction
prohibiting it from purchasing securities on margin or engaging in short sales
be eliminated. The existing restriction is not required to be a fundamental
investment restriction.
Elimination of this restriction is unlikely to affect the management of the
Fund. The 1940 Act prohibitions on margin purchases and short sales will
continue to apply to the Fund.
Sub-Proposal No. 3.E.: Eliminating Restriction on Investing in
Mineral-Related Programs or Leases.
The Fund is currently subject to a fundamental restriction prohibiting it from
investing in oil, gas or mineral-related programs or leases. This restriction
was originally adopted to address a state imposed limitation that is no longer
applicable to the Fund. Elimination of this restriction could increase the
Fund's flexibility when choosing investments in the future.
The Fund will continue to be prohibited from purchasing commodities or commodity
contracts.
Sub-Proposal No. 3.F.: Eliminating Limits on Investing in Other Investment
Companies.
The purpose of this proposal is to provide the Fund with the maximum flexibility
permitted by law to pursue its investment objective. As a result of recent
regulatory changes, investment companies are permitted to enter into fund of
funds arrangements, whereby a mutual fund can invest in a number of other mutual
funds.
While the Fund does not currently anticipate participating in a fund of funds
arrangement, elimination of the Fund's current fundamental investment
restriction regarding investing in other investment companies is necessary to
permit the Fund to enter into a fund of funds arrangement in the future.
Sub-Proposal No. 3.G.: Eliminating Restriction on Investing in Rights and
Warrants.
It is proposed that the Fund's fundamental investment restriction limiting its
ability to invest in rights and warrants be eliminated. This was a
state-law-mandated restriction that no longer applies to the Fund.
This restriction no longer applies to the Fund, and the Board believes that its
elimination could increase the Fund's flexibility when choosing investments in
the future.
PROPOSAL 4: TO APPROVE AMENDMENTS TO CERTAIN FUNDAMENTAL INVESTMENT
RESTRICTIONS OF THE FUND
Proposal 4 is composed of four separate proposed changes to the Fund's current
investment policies. The changes are necessary to permit the Fund to lend money
to, and borrow money from, other Oppenheimer mutual funds and to pledge its
assets as collateral for the loan. Permitting the Fund to borrow money from
other Oppenheimer funds would afford the Fund the flexibility to use the most
cost-effective alternative to satisfy its borrowing requirements. The reason for
lending money to an affiliated fund is that the lending fund may be able to
obtain a higher rate of return than it could from interest rates on alternative
short-term investments. To assure that the Fund is not disadvantaged by
borrowing money from or lending money to another Oppenheimer fund, certain
safeguards will be implemented.
PROPOSAL 5: TO AUTHORIZE THE TRUSTEES TO ADOPT AN AMENDED AND
RESTATED DECLARATION OF TRUST
The Board of Trustees has approved and recommends that the shareholders of the
Fund authorize them to adopt and execute an Amended and Restated Declaration of
Trust. The New Declaration of Trust is a more modern form of trust instrument
for a Massachusetts business trust, such as the Fund, and going forward, will be
used as the standard Declaration of Trust for all new OppenheimerFunds organized
as Massachusetts business trusts.
Adoption of the New Declaration of Trust will not result in any changes in the
Fund's Trustees or officers or in the investment policies and shareholder
services described in the Fund's current prospectus.
The New Declaration of Trust amends the Current Declaration of Trust in a number
of significant ways. The proxy statement summarizes some of the more significant
amendments to the Current Declaration of Trust effected by the New Declaration
of Trust.
PROPOSAL 6: TO APPROVE THE FUND'S CLASS B 12b-1 PLAN
Under the Fund's current Class B 12b-1 plan the Fund's Class B shares currently
pay to the Fund's Distributor up to 0.25% of average annual net assets as a
service fee and up to 0.75% of average annual net assets as an asset-based sales
charge. The current plan is intended to reimburse the Fund's Distributor for
certain types of expenses incurred in distributing Fund shares. The proposed
Class B 12b-1 plan is similar to the current 12b-1 plan as to the amount of
payments the Fund makes to the Distributor on an annual basis. The difference
between the current Class B 12b-1 plan and the proposed plan is that over time,
the Fund's payments under the 12b-1 plan may exceed the amount which the Fund
might pay under the current plan. The length of time over which the Fund's
payments will continue under the proposed plan is not limited by any
reimbursement factor (as is the case under the current Class B 12b-1 Plan), and
the Fund's payments may continue for a longer period of time than under the
current plan, thus potentially increasing the amount of plan payments which, in
turn, may reduce the dividends and total return on the Fund's Class B shares.
The Board approved the replacement of the current Class B 12b-1 plan with the
proposed Class B 12b-1 plan because the Distributor may not receive full
reimbursement for its distribution-related expenses under the current plan in
certain circumstances. The Board determined that the proposed Class B 12b-1 plan
is in the best interests of the Fund and that its adoption has a reasonable
likelihood of benefiting the Fund and its Class B shareholders.
FOR ANY OTHER QUESTIONS, PLEASE CONTACT JEFFREY BURNS (3-5089), PHIL MASTERSON
(8-2486), KATE IVES (8-3331) OR DENIS MOLLEUR (3-0560).
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