CONNECTICUT MUTUAL INVESTMENT ACCOUNTS INC, 497, 1996-05-06

CONNECTICUT MUTUAL INVESTMENT ACCOUNTS INC
497, 1996-05-06

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<PAGE>
OPPENHEIMER

Disciplined Allocation Fund

PROSPECTUS DATED MAY 1, 1996

Oppenheimer Disciplined Allocation Fund is a mutual fund that seeks to maximize
total investment return (including both capital appreciation and income)
principally by allocating its assets among stocks, corporate bonds, U.S.
Government securities and money market instruments according to changing market
conditions. This allocation process utilizes quantitative asset allocation
tools, which measure the relationship among these asset categories, in
combination with the judgment of the portfolio managers concerning current
market dynamics. The Fund's investments are not restricted to any specific type
of security and the Fund may use "hedging" instruments to seek to reduce the
risks of market fluctuations that affect the value of the securities the Fund
holds.

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 May 1,
1996 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 ("SEC") and is
incorporated into this Prospectus by reference (which means that it is legally
part of this Prospectus).

[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 OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
<PAGE>
CONTENTS

<TABLE>
<S> <C>
ABOUT THE FUND

3 EXPENSES

5 A BRIEF OVERVIEW OF THE FUND

7 FINANCIAL HIGHLIGHTS

11 INVESTMENT OBJECTIVE AND POLICIES

13 INVESTMENT RISKS

15 INVESTMENT TECHNIQUES AND STRATEGIES

24 HOW THE FUND IS MANAGED

26 PERFORMANCE OF THE FUND

ABOUT YOUR ACCOUNT

28 HOW TO BUY SHARES
Class A Shares
Class B Shares
Class C Shares

41 SPECIAL INVESTOR SERVICES
AccountLink
Automatic Withdrawal and Exchange Plans
Reinvestment Privilege
Retirement Plans

43 HOW TO SELL SHARES
By Mail
By Telephone

45 HOW TO EXCHANGE SHARES

47 SHAREHOLDER ACCOUNT RULES AND POLICIES

49 DIVIDENDS, CAPITAL GAINS AND TAXES

A-1 APPENDIX A: DESCRIPTION OF SECURITIES RATINGS

B-1 APPENDIX B: CREDIT QUALITY DISTRIBUTION

C-1 APPENDIX C: SPECIAL SALES CHARGE ARRANGEMENTS
</TABLE>

<PAGE>
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
transaction charges. The following tables are provided to help you understand
your direct expenses of investing in the Fund and the share of a Fund's business
operating expenses that you will bear indirectly. The numbers below are based on
the Fund's expenses during its fiscal year ended December 31, 1995.

/ / 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
28 for an explanation of how and when these charges apply.

<TABLE>
<S> <C> <C> <C>
CLASS A CLASS B CLASS C
SHARES SHARES SHARES
- - ------------------------------------------------------------------------------------
Maximum Sales Charge on 5.75% None None
Purchases (as a % of offering
price)
- - -----------------------------------------------------------------------------------------
Sales Charge on Reinvested None None None
Dividends
- - -----------------------------------------------------------------------------------------
Deferred Sale Charge (as a % None(1) 5% in the first 1% if shares are
of the lower of the original year, declining to redeemed within 12
purchase price or redemption 1% in the sixth months of
proceeds) year and purchase(2)
eliminated
thereafter(2)
- - -----------------------------------------------------------------------------------------
Exchange Fee None None None
- - -----------------------------------------------------------------------------------------
Redemption Fee None(3) None(3) None(3)
</TABLE>

(1)If you invest $1 million or more ($500,000 or more for purchases by
OppenheimerFunds prototype 401(k) plans) 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 "Buying Class C Shares"
below, for more information on the contingent deferred sales charges.
(3)There is a $10 transaction fee for redemption proceeds paid by Federal Funds
wire, but not for redemptions paid by check or ACH transfer through AccountLink.
/ / 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

<PAGE>
pays management fees to its investment advisor, 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 the Fund's portfolio securities, audit fees and legal
expenses. Those expenses are detailed in the Fund's Financial Statements in the
Statement of Additional Information.

ANNUAL FUND OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET ASSETS):

<TABLE>
<S> <C> <C> <C>
CLASS A CLASS B CLASS C
SHARES SHARES SHARES
- - ------------------------------------------------------------------------------------
Management Fees 0.625% 0.625% 0.625%
- - ---------------------------------------------------------------------------------------
12b-1 Plan Fees 0.25% 1.00% 1.00%
- - ---------------------------------------------------------------------------------------
Other Expenses 0.295% 0.295% 0.295%
- - ---------------------------------------------------------------------------------------
Total Fund Operating Expenses 1.17% 1.92% 1.92%
</TABLE>

The "12b-1 Distribution Plan Fees" for Class A shares are the service fees
(which can be up to a maximum of 0.25% of average annual net assets of that
class). For Class B and Class C shares, 12b-1 Plan Fees include the service fees
(which can be up to a maximum of 0.25%) and an annual asset-based sales charge
of 0.75%. These plans are described in greater detail in "How to Buy Shares."

/ / 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, and 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

<PAGE>
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, 3, 5 and 10
years:

<TABLE>
<S> <C> <C> <C> <C>
1 YEAR 3 YEARS 5 YEARS 10 YEARS*
- - ------------------------------------------------------------------------------------
Class A Shares $69 $93 $118 $191
- - -----------------------------------------------------------------------------------------
Class B Shares $70 $90 $124 $187
- - -----------------------------------------------------------------------------------------
Class C Shares $30 $60 $104 $224
</TABLE>

If you did not redeem your investment, it would incur the following
expenses:

<TABLE>
<S> <C> <C> <C> <C>
1 YEAR 3 YEARS 5 YEARS 10 YEARS*
- - ------------------------------------------------------------------------------------
Class A Shares $69 $93 $118 $191
- - -----------------------------------------------------------------------------------------
Class B Shares $20 $60 $104 $205
- - -----------------------------------------------------------------------------------------
Class C Shares $20 $60 $104 $224
</TABLE>

*The Class B expenses in years 7 through 10 are based on the Class A expenses
shown above, because the Fund automatically converts your Class B shares into
Class A shares after 6 years. Because of the effect of the asset-based sales
charge and the contingent deferred sales charge on Class B and Class C shares,
long-term Class B and Class C shareholders could pay the economic equivalent of
more than the maximum front-end sales charge allowed under applicable
regulations. For Class B shareholders, the automatic conversion of Class B
shares into 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, WHICH MAY BE MORE OR LESS THAN THE AMOUNTS SHOWN.

A BRIEF OVERVIEW OF THE FUND

/ / WHAT IS THE FUND'S INVESTMENT OBJECTIVE? The Fund's investment objective
is to seek to maximize total investment return (including capital appreciation
and income) by allocating its assets among stocks, corporate bonds, U.S.
Government securities and money market instrument according to changing market
conditions.

<PAGE>

/ / WHAT DOES THE FUND INVEST IN? The Fund allocates its assets among
stocks, corporate bonds, U.S. Government securities and money market
instruments. The Fund may invest in debt securities and preferred stocks rated
below investment grade (commonly called "junk bonds") and may invest to a
limited degree in securities of foreign issuers. The Fund may write covered
calls and use certain types of "hedging instruments" and "derivative
investments" to try to manage investment risks. These investments are more fully
explained in "Investment Objective and Policies" starting on page 11.

/ / WHO MANAGES THE FUND? The Fund's investment advisor is OppenheimerFunds,
Inc., which (including a subsidiary) advises investment company portfolios
having over $50 billion in assets at March 31, 1996. The Manager is paid an
advisory fee by the Fund, based on its net assets. The Fund's Board of
Directors, elected by shareholders, oversees the investment advisor and the
portfolio managers. The Fund has a team of portfolio managers, who are employed
by the Manager. Peter Antos is the senior portfolio manager primarily
responsible for the selection of the Fund's securities and is assisted by Steven
F. Libera, Michael C. Strathearn, Kenneth B. White and Arthur Zimmer. Please
refer to "How the Fund is Managed," starting on page 24 for more information
about the Manager and its fees.

/ / HOW RISKY IS THE FUND? All investments carry risks to some degree. The
Fund's investments in stocks and bonds are subject to changes in their value
from a number of factors such as changes in general bond and stock market
movements. The change in value of a particular stock or bond may result from an
event affecting the issuer, or changes in interest rates that can affect bond
prices. These changes affect the value of the Fund's investments and its share
prices for each class of its shares. In addition, there are certain risks
associated with the lower quality debt securities and foreign securities the
Fund may purchase and the hedging strategies the Manager may utilize.

In the Oppenheimer funds spectrum the Fund is more aggressive than most
growth and income funds but less so than aggressive growth funds. While the
Manager tries to reduce risks by diversifying investments, by 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 objective. Your shares may be worth more or less than their original cost
when you redeem them. Please refer to "Investment Risks" starting on page 13 for
a more complete discussion of the Fund's investment risks.

/ / 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" beginning on page 28
for more details.

/ / WILL I PAY A SALES CHARGE TO BUY SHARES? The Fund has three 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 and Class C shares are offered

<PAGE>

without front-end sales charges, but may be subject to a contingent deferred
sales charge if redeemed within 6 years or 12 months, respectively, of purchase.
There is also an annual asset-based sales charge on Class B and Class C shares.
Please review "How To Buy Shares" starting on page 28 for more details,
including a discussion about factors you and your financial advisor should
consider in determining which class may be appropriate for you.

/ / 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 43. The Fund also offers exchange
privileges to other Oppenheimer funds, described in "How to Exchange Shares" on
page 45.

/ / HOW HAS THE FUND PERFORMED? The Fund measures its performance by quoting
its average annual total returns and cumulative total returns, which measure
historical performance. Those returns can be compared to the total returns (over
similar periods) of other funds. Of course, other funds may have different
objectives, investments, and levels of risk. Please remember that past
performance does not guarantee future results.

FINANCIAL HIGHLIGHTS

The tables on the following pages present selected audited financial information
about the Fund, including per share data and expense ratios and other data based
on the Fund's average net assets. This information has been audited by Arthur
Andersen LLP, the Fund's independent auditors, whose report on the Fund's
financial statements for the fiscal year ended December 31, 1995, is included in
the Statement of Additional Information. Class B shares have been offered since
October 1, 1995. Class C shares were not publicly offered during the periods
shown. Additional information about the performance of the Fund is contained in
its 1995 Annual Report, which may be obtained without charge by calling the Fund
at the telephone number or writing to the Fund's address on the back cover.

<PAGE>
FINANCIAL HIGHLIGHTS*

<TABLE>
<CAPTION>
CLASS A SHARES
----------------------------------------------
YEARS ENDED DECEMBER 31,
----------------------------------------------
1995 1994 1993 1992
<S> <C> <C> <C> <C>
- - --------------------------------------------------------------------
PER SHARE OPERATING
DATA:
Net asset value,
beginning of
period............ $ 13.44 $ 14.54 $ 13.81 $ 14.02
- - --------------------------------------------------------------------
Income (loss) from
investment
operations:
Net investment
income (loss)..... .60 .55 .48 .50
Net realized and
unrealized gain
(loss) on
investments,
options written
and foreign
currency
transactions...... 2.59 (.86) 1.70 .86
- - --------------------------------------------------------------------
Total income (loss)
from investment
operations........ 3.19 (.31) 2.18 1.36
- - --------------------------------------------------------------------
Dividends and
distributions to
shareholders:
Dividends from net
investment
income............ (.60) (.55) (.48) (.50)
Distributions from
net realized gain
on investments and
foreign currency
transactions...... (.57) (.24) (.97) (1.07)
- - --------------------------------------------------------------------
Total dividends and
distributions to
shareholders...... (1.17) (.79) (1.45) (1.57)
- - --------------------------------------------------------------------
Net asset value, end
of period......... $ 15.46 $ 13.44 $ 14.54 $ 13.81
- - --------------------------------------------------------------------
TOTAL RETURN, AT NET
ASSET VALUE(A).... 23.95% (2.11)% 15.89% 9.90%
- - --------------------------------------------------------------------
RATIOS/SUPPLEMENTAL
DATA:
Net assets, end of
period (in
thousands)........ $ 218,099 $ 177,904 $ 171,205 $ 109,701
- - --------------------------------------------------------------------
Ratios to average
net assets:
Net investment
income (loss)..... 4.00% 3.80% 3.40% 3.61%
Expenses............ 1.17% .96% 1.02% 1.11%
- - --------------------------------------------------------------------
Portfolio turnover
rate.............. 55.20% 115.01% 155.16% 177.85%
- - --------------------------------------------------------------------
</TABLE>

* G.R. Phelps & Co. managed the Fund during these periods.
(a)Annual total returns do not include the effect of sales charges.

<PAGE>

<TABLE>
<CAPTION>
1991 1990 1989 1988 1987 1986
<S> <C> <C> <C> <C> <C> <C>
- - --------------------------------------------------------------------------------------------
PER SHARE OPERATING
DATA:
Net asset value,
beginning of
period............ $ 11.94 $ 12.69 $ 11.51 $ 10.91 $ 11.87 $ 10.91
- - --------------------------------------------------------------------------------------------
Income (loss) from
investment
operations:
Net investment
income (loss)..... .54 .66 .76 .53 .38 .31
Net realized and
unrealized gain
(loss) on
investments,
options written
and foreign
currency
transactions...... 2.79 (.68) 1.81 .60 .13 .99
- - --------------------------------------------------------------------------------------------
Total income (loss)
from investment
operations........ 3.33 (.02) 2.57 1.13 .51 1.30
- - --------------------------------------------------------------------------------------------
Dividends and
distributions to
shareholders:
Dividends from net
investment
income............ (.54) (.66) (.76) (.53) (.38) (.30)
Distributions from
net realized gain
on investments and
foreign currency
transactions...... (.71) (.07) (.63) -- (1.09) (.04)
- - --------------------------------------------------------------------------------------------
Total dividends and
distributions to
shareholders...... (1.25) (.73) (1.39) (.53) (1.47) (.34)
- - --------------------------------------------------------------------------------------------
Net asset value, end
of period......... $ 14.02 $ 11.94 $ 12.69 $ 11.51 $ 10.91 $ 11.87
- - --------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET
ASSET VALUE(A).... 28.21% (0.21)% 22.61% 10.40% 3.92% 11.88%
- - --------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL
DATA:
Net assets, end of
period (in
thousands)........ $ 86,455 $ 66,382 $ 65,071 $ 54,253 $ 44,770 $ 35,382
- - --------------------------------------------------------------------------------------------
Ratios to average
net assets:
Net investment
income (loss)..... 4.02% 5.31% 5.90% 4.61% 3.15% 3.22%
Expenses............ 1.20% 1.24% 1.20% 1.11% 1.08% 1.26%
- - --------------------------------------------------------------------------------------------
Portfolio turnover
rate.............. 122.40% 115.45% 149.22% 223.62% 197.79% 143.32%
- - --------------------------------------------------------------------------------------------
</TABLE>

<PAGE>
FINANCIAL HIGHLIGHTS* (CONT'D)

<TABLE>
<CAPTION>
CLASS B SHARES(C)
PERIOD ENDED
DECEMBER 31, 1995
<S> <C>
- - -----------------------------------------------------------------------------------------
PER SHARE OPERATING DATA:
Net asset value, beginning of period................................ $ 15.48
- - -----------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss)........................................ .07
Net realized and unrealized gain (loss) on investments, options
written and foreign currency transactions.......................... .70
- - -----------------------------------------------------------------------------------------
Total income (loss) from investment operations...................... .77
- - -----------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income................................ (.07)
Distributions from net realized gain on investments and foreign
currency transactions.............................................. (.52)
- - -----------------------------------------------------------------------------------------
Total dividends and distributions to shareholders................... (.59)
- - -----------------------------------------------------------------------------------------
Net asset value, end of period...................................... $ 15.66
- - -----------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE(B)................................. 4.93%
- - -----------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands)............................ $ 650
- - -----------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss)........................................ .73%(a)
Expenses............................................................ 1.92%(a)
- - -----------------------------------------------------------------------------------------
Portfolio turnover rate............................................. 55.20%
- - -----------------------------------------------------------------------------------------
</TABLE>

* G.R. Phelps & Co. managed the Fund during this period.
(a)Annualized.
(b)Total returns do not include the effect of sales charges.
(c)For the period from October 1, 1995 (inception) through December 31, 1995.

10
<PAGE>
INVESTMENT OBJECTIVE AND POLICIES

OBJECTIVE. The Fund seeks to maximize total investment return (including capital
appreciation and income) by allocating its assets among stocks, corporate bonds,
U.S. Government securities and money market instruments according to changing
market conditions.

INVESTMENT POLICIES AND STRATEGIES. In deciding whether the Fund should invest
in stocks, bonds or money market instruments, the Manager utilizes quantitative
asset allocation tools, which measure the relationship among these asset
categories, in combination with the judgment of the Manager concerning current
market dynamics. Allocating assets among different types of investments allows
the Fund to take advantage of opportunities in different segments of the
securities markets, but also subjects the Fund to the risks of those market
segments.

In selecting stocks for the Fund's portfolio, the Manager searches for out-
of-favor stocks with low price-earnings ratios (for example, below the price-
earnings ratio of the S&P 500 Index). When an out-of-favor company demonstrates
better earnings than what most analysts were expecting, this is referred to as a
favorable earnings surprise. This may cause investors and analysts to
re-evaluate the company's earnings expectations and price-earnings multiple,
which in turn may cause the company's stock to increase in value. The Fund may
invest in a variety of equity securities including foreign and domestic common
stocks, preferred securities, convertible securities and warrants, which are
further described below.

The Fund may invest in a variety of bonds and other debt securities
including corporate debt obligations, U.S. Government securities, municipal
obligations, mortgage-backed and asset-backed securities, adjustable rate
securities, stripped securities, custodial receipts for Treasury certificates,
zero coupon bonds, equipment trust certificates, loan participation notes,
structured notes and money market instruments. The Fund's debt securities are
expected to have a portfolio maturity of 6 to 12 years. At least 25% of the
Fund's total assets will be invested in fixed income senior securities.
Otherwise, the Fund is not required to invest a fixed amount in any asset class,
and the amounts invested in each class will vary over time.

The Fund may invest up to 20% of its total assets in the aggregate in debt
securities and preferred stocks rated below investment grade (commonly called
"junk bonds") and unrated securities determined by the Manager to be of
comparable credit quality. However, the Manager does not intend to invest more
than 5% of the Fund's assets in below investment grade securities in the current
year. These securities are subject to special risks, described below. The Fund
will not invest in securities rated below B at the time of purchase. Unrated
debt securities will not exceed 10% of the Fund's total assets. Appendix A
contains a description of the rating categories of certain national rating
organizations.

<PAGE>

The Fund may invest up to 20% of its total assets in mortgage dollar rolls.
The Fund may also invest up to 5% of its total assets in inverse floating rate
instruments, which are a type of derivative security. Consistent with the
foregoing policies, the Fund may invest to a limited degree in securities of
foreign issuers. All of these types of securities are described below.

When market conditions are unstable, the Fund may invest substantial amounts
of its assets in short-term debt securities, such as money market instruments
and U.S. Government securities, for temporary defensive purposes. The Fund's
portfolio managers may employ special investment techniques in selecting
investments for the Fund. These are also described below. Additional Information
about them may be found under the same headings in the Statement of Additional
Information.

/ / 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 investment 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 not a fundamental policy.
Shareholders of the Fund will be given 30 days' advance written notice of a
change to the Fund's investment objective.

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 Directors may change
non-fundamental policies without shareholder approval, although significant
changes will be described in amendments to this Prospectus.

/ / PORTFOLIO TURNOVER. A change in the securities held by the Fund is known
as "portfolio turnover." The Fund ordinarily does not engage in short-term
trading to try to achieve its objective. As a result, the Fund's portfolio
turnover is not currently expected to be more than 150% a year. The "Financial
Highlights," above, show the Fund's portfolio turnover rates during past fiscal
years.

Portfolio turnover affects brokerage costs, dealer markups and other
transaction costs, and results in the Fund's realization of capital gains or
losses for tax purposes. It may also affect the ability of the Fund to qualify
as a "regulated investment company" under the Internal Revenue Code and avoid
being taxed on amounts distributed as dividends and capital gains to
shareholders. The Fund qualified in its last fiscal year and intends to do so in
the current and future years, although it reserves the right not to qualify.

<PAGE>

INVESTMENT RISKS

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.

/ / 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.
Also, the Fund does not concentrate its investments in any one industry or group
of industries.

/ / FOREIGN SECURITIES HAVE SPECIAL RISKS. 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

<PAGE>

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.

/ / 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.

/ / SPECIAL RISKS OF INVESTING IN LOWER-GRADE SECURITIES. The Fund can
invest in high-yield, below investment grade debt securities (including both
rated and unrated securities). These "lower-grade" securities are commonly known
as "junk bonds." All corporate debt securities (whether foreign or domestic) are
subject to some degree of credit risk. High yield, lower-grade securities,
whether rated or unrated, often have speculative characteristics and special
risks that make them riskier investments than investment grade securities. They
may be subject to greater market fluctuations and risk of loss of income and
principal than lower yielding, investment grade securities. There may be less of
a market for them and therefore they may be harder to sell at an acceptable
price. There is a relatively greater possibility that the issuer's earnings may
be insufficient to make the payments of interest due on the bonds. The issuer's
low creditworthiness may increase the potential for its insolvency. For foreign
lower-grade debt securities, these risks are in addition to the risks of
investing in foreign securities, described above. These risks mean that the Fund
may not achieve the expected income from lower-grade securities, and that the
Fund's net asset value per share may be affected by declines in value of these
securities.

/ / HEDGING INSTRUMENTS CAN BE VOLATILE INVESTMENTS AND MAY INVOLVE SPECIAL
RISKS. The use of hedging instruments requires special skills and knowledge of
investment techniques that are different from what is required for normal
portfolio management. If the Manager uses a hedging instrument at the wrong time
or judges market conditions incorrectly, hedging strategies may reduce the
Fund's return. The Fund could also experience losses if the prices of its
futures and options positions were not correlated with its other investments or
if it could not close out a position because of an illiquid market for the
future or option.

<PAGE>

the call price. The use of Forward Contracts may reduce the gain that would
otherwise result from a change in the relationship between the U.S. dollar and a
foreign currency. Interest rate swaps are subject to the risk that the other
party will fail to meet its obligations (or that the underlying issuer will fail
to pay on time), as well as interest rate risks. The Fund could be obligated to
pay more under its swap agreements than it received under them, as a result of
interest rate changes. These risks are described in greater detail in the
Statement of Additional Information.

/ / THERE ARE SPECIAL RISKS IN INVESTING IN DERIVATIVE INVESTMENTS. The Fund
can invest in a number of different kinds of "derivative" investments. In
general, a "derivative investment" is a specially designed investment whose
performance is linked to the performance of another investment or security, such
as an option, future, index, currency or commodity. The company issuing the
instrument may fail to pay the amount due on the maturity of the instrument.
Also, the underlying investment or security might not perform the way the
Manager expected it to perform. Markets, underlying securities and indices may
move in a direction not anticipated by the Manager. Performance of derivative
investments may also be influenced by interest rate and stock market changes in
the U.S. and abroad. All of this can mean that the Fund will realize less
principal or income from the investment than expected. Certain derivative
investments held by the Fund may be illiquid. Please refer to "Illiquid and
Restricted Securities."

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 detailed information about these practices, including limitations on their
use that may help to reduce some of the risks.

/ / CONVERTIBLE SECURITIES. Convertible securities are bonds, preferred
stocks and other securities that normally pay a fixed rate of interest or
dividend and give the owner the option to convert the security into common
stock. While the value of convertible securities depends in part on interest
rate changes and the credit quality of the issuer, the price will also change
based on the price of the underlying stock. While convertible securities
generally have less potential for gain than common stock, their income provides
a cushion against the

<PAGE>

stock price's declines. They generally pay less income than non-convertible
bonds. The Manager generally analyzes these investments from the perspective of
the growth potential of the underlying stock and treats them as "equity
substitutes."

/ / FOREIGN SECURITIES. Consistent with its investment objective and
policies, the Fund may purchase equity securities issued by foreign companies
and debt securities issued or guaranteed by foreign governments or their
agencies. The Fund may purchase securities in any country, developed or
underdeveloped. Investments in securities of issuers in underdeveloped countries
or countries that have emerging markets generally may offer greater potential
for gain but involve more risk and may be considered highly speculative. As a
matter of fundamental policy, the Fund may not invest more than 10% of its total
assets in foreign securities, except that the Fund may invest up to 25% of its
total assets in foreign equity and debt securities that are (i) issued, assumed
or guaranteed by foreign governments or their political subdivisions or
instrumentalities, (ii) assumed or guaranteed by domestic issuers, including
Eurodollar securities, or (iii) issued, assumed or guaranteed by foreign issuers
having a class of securities listed for trading on The New York Stock Exchange.
The Fund will hold foreign currency only in connection with the purchase or sale
of foreign securities. The special risks of investing in foreign securities are
described in "Investment Risks" above.

/ / ADRS, EDRS AND GDRS. ADRs are receipts issued by a U.S. bank or trust
company which evidence ownership of underlying securities of foreign companies.
ADRs are traded on domestic exchanges or in the U.S. over-the-counter market and
generally are in registered form. If ADRs are bought through banks that do not
have a contractual relationship with the foreign issuer of the security
underlying the ADR to issue and service the ADR, there is a risk that the Fund
will not learn of corporate actions affecting the issuer in a timely manner.
EDRs and GDRs are receipts evidencing an arrangement with a non-U.S. bank
similar to that for ADRs and are designed for use in non-U.S. securities
markets. EDRs and GDRs are not necessarily quoted in the same currency as the
underlying security.

/ / LOWER-GRADE DEBT SECURITIES. "Lower-grade" securities generally offer
higher income potential than investment grade securities. "Lower-grade"
securities have a rating below "BBB" by Standard & Poor's Ratings Group
("Standard & Poor's") or "Baa" by Moody's Investors Services, Inc. ("Moody's")
or similar ratings by other domestic or foreign rating organizations, or they
are not rated by a nationally-recognized rating organization but the Manager
judges them to be comparable to lower-rated securities. The Fund will not
purchase securities rated below B by Moody's or Standard & Poor's. The Fund may
retain securities whose ratings fall below B after purchase unless and until the
Manager determines that disposing of such securities is in the best interests of
the Fund. Appendix B provides a summary of ratings assigned to the Fund's debt
holdings as of the end of its last fiscal year. These

<PAGE>

percentages are historical and do not necessarily indicate the current or
predict future debt holdings of the Fund. Lower-grade debt securities are
subject to special risks described in "Investment Risks," above.

/ / U.S. GOVERNMENT SECURITIES. U.S. Government Securities include debt
securities issued or guaranteed by the U.S. Government or its agencies and
instrumentalities. Certain U.S. Government Securities, including U.S. Treasury
bills, notes and bonds, and mortgage participation certificates guaranteed by
the Government National Mortgage Association ("Ginnie Mae") are supported by the
full faith and credit of the U.S. Government, which in general terms means that
the U.S. Treasury stands behind the obligation to pay principal and interest.

Ginnie Mae certificates are one type of mortgage-related U.S. Government
Security the Fund may invest in. The Fund may also invest in other mortgage-
related U.S. Government Securities that are issued or guaranteed by federal
agencies or government-sponsored entities but which are not supported by the
full faith and credit of the U.S. Government. Those securities include
obligations supported by the right of the issuer to borrow from the U.S.
Treasury, such as obligations of the Federal Home Loan Mortgage Corporation
("Freddie Mac"), obligations supported only by the credit of the
instrumentality, such as the Federal National Mortgage Association ("Fannie
Mae") or the Student Loan Marketing Association, and obligations supported by
the discretionary authority of the U.S. Government to repurchase certain
obligations of U.S. Government agencies or instrumentalities such as the Federal
Land Banks and the Federal Home Loan Banks. Other U.S. Government Securities the
Fund may invest in are collateralized mortgage obligations ("CMOs").

The value of U.S. Government Securities will fluctuate until they mature
depending on prevailing interest rates. Because the yields on U.S. Government
Securities are generally lower than on corporate debt securities, when the Fund
holds U.S. Government Securities it may attempt to increase the income it can
earn from them by writing covered call options against them, when market
conditions are appropriate. Writing covered calls is explained below, under
"Hedging."

/ / MORTGAGE-BACKED SECURITIES AND CMOS. Certain mortgage-backed securities,
whether issued by the U.S. Government or by private issuers, "pass-through" to
investors the interest and principal payments generated by a pool of mortgages
assembled for sale by government agencies. Pass-through mortgage-backed
securities entail the risk that principal may be repaid at any time because of
prepayments on the underlying mortgages. As a result, these securities may be
subject to greater price and yield volatility than traditional fixed-income
securities that have a fixed maturity and interest rate.

The Fund may also invest in CMOs, which generally are obligations fully
collateralized by a portfolio of mortgages or mortgage-related securities.
Payments of the interest and principal generated by the pool of mortgages
relating to the CMOs are passed through to the holders as the payments are
received. CMOs are issued with a variety of classes or series which have

<PAGE>

different maturities. Certain CMOs may be more volatile and less liquid than
other types of mortgage-related securities, because of the possibility of the
early repayment of principal due to prepayments on the underlying mortgage
loans.

/ / "STRIPPED" SECURITIES. The Fund may also invest in CMOs that are
"stripped." That means that the security is divided into two parts, one of which
receives some or all of the principal payments (and is known as a
"principal-only" security, or "P/O") and the other which receives some or all of
the interest (and is known as an "interest-only" security, or "I/O"). P/Os and
I/Os are generally referred to as "derivative investments," discussed further
below.

The yield to maturity on the class that receives only interest is extremely
sensitive to the rate of payment of the principal on the underlying mortgages.
Principal prepayments increase that sensitivity. Stripped securities that pay
"interest only" are therefore subject to greater price volatility when interest
rates change, and they have the additional risk that if the underlying mortgages
are prepaid, the Fund will lose the anticipated cash flow from the interest on
the prepaid mortgages. That risk is increased when general interest rates fall,
and in times of rapidly falling interest rates, the Fund might receive back less
than its investment.
The value of "principal only" securities generally increases as interest
rates decline and prepayment rates rise. The price of these securities is
typically more volatile than that of coupon-bearing bonds of the same maturity.

Private-issuer stripped securities are generally purchased and sold by
institutional investors through investment banking firms. At present,
established trading markets have not yet developed for these securities.
Therefore, most private-issuer stripped securities may be deemed "illiquid." If
the Fund holds illiquid stripped securities, the amount it can hold will be
subject to the Fund's investment policy limiting investments in illiquid
securities to 10% of the Fund's net assets, described in "Illiquid and
Restricted Securities," below.

/ / ASSET-BACKED SECURITIES. The Fund may invest in "asset-backed"
securities. These represent interests in pools of consumer loans and other trade
receivables, similar to mortgage-backed securities. They are issued by trusts
and "special purpose corporations." They are backed by a pool of assets, such as
credit card or auto loan receivables, which are the obligations of a number of
different parties. The income from the underlying pool is passed through to
holders, such as the Fund. These securities may be supported by a credit
enhancement, such as a letter of credit, a guarantee or a preference right.
However, the extent of the credit enhancement may be different for different
securities and generally applies to only a fraction of the security's value.
These securities present special risks. For example, in the case of credit card
receivables, the issuer of the security may have no security interest in the
related collateral.
/ / INVERSE FLOATING RATE INSTRUMENTS. The Fund may invest in inverse
floating rate debt instruments ("inverse floaters"), including leveraged inverse
floaters and inverse floating rate mortgage-backed securities, such as inverse
floating

<PAGE>
rate "interest only" stripped mortgage-backed securities. The interest rate on
inverse floaters resets in the opposite direction from the market rate of
interest to which the inverse floater is indexed. An inverse floater may be
considered to be leveraged to the extent that its interest rate varies by a
magnitude that exceeds the magnitude of the change in the index rate of
interest. The higher degree of leverage inherent in inverse floaters is
associated with greater volatility in their market values.

/ / MORTGAGE DOLLAR ROLLS. The Fund may invest up to 20% of its total assets
in mortgage dollar rolls. In a mortgage dollar roll the Fund sells
mortgage-backed securities for delivery in the current month and simultaneously
contracts to repurchase substantially similar (same type, coupon and maturity)
securities on a specified future date. During the roll period, the Fund foregoes
principal and interest paid on the mortgage-backed securities. The Fund is
compensated by the difference between the current sales price and the lower
forward price for the future purchase (often referred to as the "drop") as well
as by the interest earned on the cash proceeds of the initial sale.

A "covered roll" is a specific type of dollar roll for which there is an
offsetting cash position or a cash equivalent security position which matures on
or before the forward settlement date of the dollar roll transaction. All rolls
entered into by the Fund will be covered rolls. Covered rolls are not treated as
a borrowing or other senior security and are excluded from the calculation of
the Fund's borrowings and other senior securities. The Fund is also permitted to
purchase mortgage-backed securities and to sell such securities without regard
to the length of time held in separate transactions that do not constitute
dollar rolls. For financial reporting and tax purposes, the Fund treats mortgage
rolls as two separate transactions: one involving the purchase of securities and
a separate transaction involving a sale. The Fund does not currently intend to
enter into mortgage dollar roll transactions that are accounted for as a
financing.

/ / STRUCTURED NOTES. A structured note is a debt security having an
interest rate or principal repayment requirement based on the performance of a
benchmark asset or market, such as stock prices, currency exchange rates or
commodity prices. They provide exposure to the benchmark market while fixing the
maximum loss if that market does not perform as expected. Depending on the terms
of the note, the Fund could forego all or part of the interest and principal
that would be payable on a comparable conventional note, and the Fund's loss
could not exceed that amount.

/ / SHORT-TERM DEBT SECURITIES. When the Manager believes it is appropriate
(for example, for temporary defensive purposes during unstable market
conditions), the Fund can hold cash or invest without limit in money market
instruments. The Fund will 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

<PAGE>

banks and savings and loan associations. The Fund will purchase money market
instruments denominated in a foreign currency only within the limitations
described under "Foreign Securities." The issuers of foreign money market
instruments purchased by the Fund must have at least $1 billion (U.S.) of
assets.

The Fund may also invest in obligations of foreign branches of U.S. banks
(referred to as Eurodollar obligations) and U.S. branches of foreign banks
(Yankee dollars) as well as foreign branches of foreign banks. These investments
involve risks that are different from investments in securities of U.S. banks as
described in "Foreign Securities" above.

/ / LOANS OF PORTFOLIO SECURITIES. Subject to its investment policies and
restrictions, the Fund may seek to increase its income by lending portfolio
securities to brokers, dealers and financial institutions in transactions other
than repurchase agreements. The Fund must receive collateral for a loan. As a
matter of fundamental policy, these loans are limited to not more than 33 1/3%
of the Fund's total assets (taken at market value) and are subject to other
conditions described in the Statement of Additional Information. The Fund
presently does not intend to engage in loans of securities, but if it does so it
does not intend to lend securities that will exceed 5% of the value of the
Fund's total assets in the coming year.

/ / "WHEN-ISSUED" AND DELAYED DELIVERY TRANSACTIONS. The Fund may purchase
securities on a "when-issued" basis and may purchase or sell securities on a
"delayed delivery" basis. These terms refer to securities that have been created
and for which a market exists, but which are not available for immediate
delivery. There may be a risk of loss to the Fund if the value of the security
declines prior to the settlement date.

/ / EURODOLLAR AND YANKEE DOLLAR BANK OBLIGATIONS. The Fund may invest in
obligations of foreign branches of U.S. banks (referred to as Eurodollar
obligations) and U.S. branches of foreign banks (referred to as Yankee Dollars)
as well as foreign branches of foreign banks. These investments entail risks
that are different from investment in securities of U.S. banks.

/ / 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 must be fully
collateralized. However, if the vendor fails to pay the resale price on the
delivery date, the Fund may experience costs in disposing of the collateral and
may experience losses if there is any delay in doing so. As a matter of
fundamental policy, the Fund will not enter into a repurchase agreement that
causes more than 10% of its net assets to be invested in illiquid and restricted
securities (as described below), which includes repurchase agreements having a
maturity beyond seven days.

/ / INDEX-LINKED NOTES. "Index-linked" or "commodity-linked" notes are debt
securities that call for interest payments or repayment of principal on the
maturity of the note in different terms than a typical note where the borrower
agrees to pay a fixed sum on the maturity of the note. Principal or interest
payments on an index-linked note depend on the performance of one or more

<PAGE>

market indices, such as the S&P 500 Index, or on a weighted index of commodity
futures, such as crude oil, gasoline and natural gas. The Fund may invest in
"debt exchangeable for common stock" of an issuer or "equity-linked" debt
securities of an issuer. At maturity, the principal amount of the debt security
is exchanged for common stock of the issuer or is payable in an amount based on
the issuer's common stock price at the time of maturity. In either case there is
a risk that the amount payable at maturity will be less than the expected
principal amount of the debt.

/ / ILLIQUID AND RESTRICTED SECURITIES. Under the policies established by
the Fund's Board of Directors, 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. As a matter of fundamental
policy,
the Fund will not invest more than 10% of its total assets in illiquid and
restricted securities (including repurchase agreements having a maturity beyond
7 days, portfolio securities which do not have readily available market
quotations and time deposits maturing in more than 2 days). The percentage
limitation applicable to illiquid securities does not apply to certain
restricted securities that are eligible for resale to qualified institutional
buyers. The Fund has undertaken to apply this percentage limitation to 10% of
its net assets, as a matter of non-fundamental policy.

/ / HEDGING. The Fund may write covered call options on securities, stock or
bond indices and foreign currency. It may purchase and sell certain kinds of
futures contracts, forward contracts, and options on futures, broadly based
stock or bond indices and foreign currencies, or enter into interest rate swap
agreements. These are all referred to as "hedging instruments." While the Fund
currently does not engage extensively in hedging, the Fund may use these
instruments for hedging purposes and, in the case of covered calls, non-hedging
purposes as described below.

The Fund may write covered call options and buy and sell 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 of its portfolio securities may decline, or
to establish a position in the securities market as a temporary substitute for
purchasing individual securities. It may do so to try to manage its exposure to
changing interest rates. Some of these strategies, such as selling futures and
writing covered calls, hedge the Fund's portfolio against price fluctuations.

Other hedging strategies, such as buying futures, tend to increase the
Fund's exposure to the securities market. Forward contracts may be used to try
to manage foreign currency risks on the Fund's foreign investments. Foreign
currency options may be 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

<PAGE>

also provide income to the Fund for liquidity purposes, defensive reasons, or to
raise cash to distribute to shareholders. Hedging strategies entail special
risks, described in "Investment Risks," above.

The Fund may not purchase or sell physical commodities; however, the Fund
may purchase and sell foreign currency in hedging transactions. This restriction
also does not prevent the Fund from selling covered call options or buying or
selling futures contracts or from investing in securities or other instruments
backed by physical commodities.

/ / FUTURES. The Fund may buy and sell futures contracts that relate to (1)
foreign currencies (these are referred to as "Forward Contracts" and are
discussed below), (2) financial indices, such as U.S. or foreign government
securities indices, corporate debt securities indices or equity securities
indices (these are referred to as Financial Futures) and (3) interest rates
(those are referred to as Interest Rate Futures). These types of Futures are
described in "Hedging" in the Statement of Additional Information.

/ / COVERED CALL OPTIONS AND OPTIONS ON FUTURES. The Fund may write (that
is, sell) call options on securities, indices and foreign currencies for hedging
or liquidity purposes and write call options on Futures for hedging and non-
hedging purposes, but only if all such calls are "covered." This means the Fund
must own the investment on which the call was written or it must own other
securities that are acceptable for the escrow arrangements required for calls
while the call is outstanding or, in the case of calls on futures, segregate
appropriate liquid assets. When the Fund writes a call, it receives cash (called
a premium). The call gives the buyer the ability to buy the investment on which
the call was written from the Fund at the call price during the period in which
the call may be exercised. If the value of the investment does not rise above
the call price, it is likely that the call will lapse without being exercised,
while the Fund keeps the cash premium (and the investment). After the Fund
writes a call, not more than 20% of the value of its total assets may be subject
to calls.
The Fund may sell covered call options that are traded on U.S. or foreign
securities or commodity exchanges or which are used by Options Clearing
Corporation. In the case of foreign currency options, they may be quoted by
major recognized dealers in those options.

/ / 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 may use them for hedging purposes to try to "lock in"
the U.S. dollar price of a security denominated in a foreign currency that the
Fund has purchased or sold, or to protect against possible losses from changes
in the relative value of the U.S. dollar and a foreign currency. Normally, the
Fund will not use "cross hedging," where the Fund hedges against changes in
currencies other than the currency in which a security it holds is denominated.
The Fund will not speculate in foreign exchange.

/ / INTEREST RATE SWAPS. In an interest rate swap, the Fund and another
party exchange their right to receive or their obligation to pay interest on a
security. For example, they may swap a right to receive floating rate payments

<PAGE>

for fixed rate payments. The Fund will enter into swaps only on securities it
owns, and will not enter into swaps with respect to more than 25% of its total
assets. Also, the Fund will segregate liquid assets (such as cash or U.S.
Government Securities) to cover any amounts it could owe under swaps that exceed
the amounts it is entitled to receive, and it will adjust that amount daily as
needed. Income from interest rate swaps may be taxable.

/ / DERIVATIVE INVESTMENTS. Derivative investments may be used by the Fund
in some cases for hedging purposes and in other cases to seek income. In the
broadest sense, exchange-traded options and futures contracts (discussed in
"Hedging," above) may be considered "derivative investments."

Other examples of derivatives include CMOs, "stripped" securities, asset-
backed securities, index-linked and commodity-linked notes and debt exchangeable
for common stock, all described elsewhere in this section of the prospectus.
Some of the special risks of derivatives are described in "Investment Risks,"
above.

OTHER INVESTMENT RESTRICTIONS. The Fund has other investment restrictions which
are "fundamental" policies. Among these fundamental policies, the Fund cannot do
any of the following:

/ / The Fund cannot borrow amounts in excess of 10% of the Fund's total
assets, taken at market value at the time of the borrowing, and then only from
banks as a temporary measure for extraordinary or emergency purposes, or make
investments in portfolio securities while such outstanding borrowings exceed 5%
of the Fund's total assets.

/ / The Fund cannot invest more than 5% of the Fund's total assets (taken
at market value at the time of each investment) in the securities (other than
United States Government or Government agency securities) of any one issuer
(including repurchase agreements with any one bank or dealer) or more than 15%
of the Fund's total assets in the obligations of any one bank.

/ / The Fund cannot purchase more than either (i) 10% in principal amount
of the outstanding debt securities of an issuer, or (ii) 10% of the outstanding
voting securities of an issuer, except that such restrictions shall not apply to
securities issued or guaranteed by the United States Government or its agencies,
bank money instruments or bank repurchase agreements.

/ / The Fund cannot invest more than 25% of its assets in securities of
issuers in any single industry, provided that this limitation shall not apply to
obligations issued or guaranteed by the U.S. Government, its agencies or
instrumentalities. For the purpose of this restriction, each utility that
provides a separate service (e.g., gas, gas transmission, electric or telephone)
shall be considered a separate industry. This test shall be applied on a pro
forma basis using the market value of all assets immediately prior to making any
investment. The Fund has undertaken as a non-fundamental policy to apply this
restriction to 25% or more of its assets.

All of the percentage restrictions described above and elsewhere in this
Prospectus (except with respect to the 300% asset coverage requirement on
borrowing) apply only at the time the Fund purchases a security, and the Fund

<PAGE>
need not dispose of a security merely because the Fund's assets have changed or
the security has increased in value relative to the size of the Fund. There are
other fundamental policies discussed in the Statement of Additional Information.

HOW THE FUND IS MANAGED

The Company (and each series, including the Fund) is governed by a Board of
Directors, which is responsible for protecting the interests of shareholders
under Maryland law. The Directors meet periodically throughout the year to
oversee the Fund's activities, review its performance, and review the actions of
the Manager. "Directors and Officers of the Funds" in the Statement of
Additional Information names the Directors and 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 Director or to take other action described in the Fund's Articles of
Incorporation.

The Board of Directors 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 three classes of shares, Class A, Class B and
Class C. All classes invest in the same investment portfolio. Each class has its
own dividends and distributions, and pays certain expenses which may be
different for the different classes. Each class may have a different net asset
value. Each share has one vote at shareholder meetings, with fractional shares
voting proportionally on 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. Please refer to "How the Funds are Managed" in the
Statement of Additional Information for further information on voting of shares.

<PAGE>

The Agreement sets forth the rate of the management fees paid by the Fund to the
Manager and describes the expenses that the Fund is responsible to pay to
conduct its business.

The Manager has operated as an investment adviser since 1959. The Manager
and its affiliates currently manage investment companies, including other
Oppenheimer funds, with assets of more than $50 billion as of March 31, 1996,
and with nearly 3 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.

/ / PORTFOLIO MANAGEMENT. The Fund has a portfolio management team
consisting of five portfolio managers. The principal Portfolio Manager of the
Fund is Peter M. Antos. He is a Vice President of the Fund and a Senior Vice
President of the Manager and has been the senior portfolio manager of the Fund's
portfolio since 1989. He is also a Chartered Financial Analyst and serves as a
portfolio manager of other Oppenheimer funds. Mr. Antos was employed since 1989
by the Fund's prior investment adviser, G.R. Phelps & Co., Inc., as a Vice
President and Senior Portfolio Manager, Equities, before joining
OppenheimerFunds, Inc. Mr. Michael C. Strathearn, Mr. Stephen F. Libera, Mr.
Kenneth B. White and Mr. Authur J. Zimmer are also Vice Presidents and portfolio
managers of the Fund and the Manager. Messrs. Strathearn, White and Libera are
each a Chartered Financial Analyst and were employed by Connecticut Mutual Life
Insurance Company, the parent of G. R. Phelps, as Portfolio Managers prior to
joining Oppenheimer Funds, Inc. on March 1, 1996. Mr. Strathearn, Mr. White and
Mr. Libera have provided portfolio management services to the Fund since 1988,
1992 and 1985, respectively. Mr. Zimmer is a Vice President of the Fund and the
Manager and is an officer of other Oppenheimer funds. He became a portfolio
manager on March 1, 1996. Mr. Zimmer was a Vice President of Hanifen Imhoff
Management Company (a mutual fund investment adviser) prior to 1991.

/ / 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: 0.625% of the first $300 million of
aggregate net assets; 0.500% of the next $100 million; and 0.450% of net assets
in excess of $400 million. The Fund's management fee for its last fiscal year
was 0.625% of the average annual net assets for Class A and Class B shares (on
an annualized basis). There were no Class C shares outstanding during that
fiscal year.

The Fund pays expenses related to its daily operations, such as custodian
fees, Directors' 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.

<PAGE>
There is also information about the Fund's brokerage policies and practices
in "Brokerage Policies of the Funds" 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.

/ / THE DISTRIBUTOR. The Fund's shares are sold through dealers, brokers,
banks 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 and is sub-distributor for funds managed by a subsidiary of
the Manager.

/ / 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 the other Oppenheimer funds. Shareholders should direct
inquiries about their accounts to the Transfer Agent at the address and
toll-free number shown below in this Prospectus or 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 data may help you see how well your
investment has done over time and to compare it to market indices.

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.

/ / 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

<PAGE>
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 and 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
including 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.

27
<PAGE>
ABOUT YOUR ACCOUNT

HOW TO BUY SHARES

/ / 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
OppenheimerFunds prototype 401(k) plans). If you purchase Class A shares as part
of an investment of at least $1 million ($500,000 for OppenheimerFunds prototype
401(k) 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. 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.

/ / 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 varies
depending on how long you owned your shares, as described in "Buying Class B
Shares," below.
/ / 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
discussed in "Buying Class C Shares," below.

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 used the sales charge rates that apply
to each class, and considered the effect of the 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 your 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 the class
you invest in.

<PAGE>

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.

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 economic 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 might be more advantageous than Class C (as well as Class B)
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). If investing
$500,000 or more, Class A may be more advantageous as your investment horizon
approaches 3 years or more.

And for 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.

/ / 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,

<PAGE>

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
charge available for larger investments in Class A shares under the Fund's Right
of Accumulation. Unlike Class B shares, Class C shares do not convert to Class A
shares and remain subject to the asset-based sales charge.

Of course all of 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 you should analyze your
options carefully.
/ / ARE THERE DIFFERENCES IN ACCOUNT FEATURES THAT MATTER TO YOU? Because
some features may not be available to Class B or C shareholders, or other
features (such as Automatic Withdrawal Plans) may not be advisable (because of
the effect of the contingent deferred sales charge in non-retirement accounts)
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 to buy. 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, this may be a
factor to consider. Additionally, dividends payable to Class B and Class C
shareholders will be reduced by the additional expenses borne by those classes
that are not borne by Class A, such as the Class B and Class C asset-based sales
charges described below and in the Statement of Additional Information.
/ / 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 than for
selling another class. It is important that investors understand that the
purpose of the Class B and Class C contingent deferred sales charges and
asset-based sales charges is the same as the purpose of the front-end sales
charge on sales of Class A shares: to reimburse the Distributor for commissions
it pays to dealers and financial institutions for selling shares.

/ / With Asset Builder Plans, Automatic Exchange Plans, 403(b)(7) custodial
plans and military allotment plans, you can make initial and subsequent
investments for as little as $25; and subsequent purchases of at least $25 can
be made by telephone through AccountLink.

/ / Under pension and profit-sharing plans, 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.

<PAGE>
/ / There is no minimum investment requirement if you are buying shares by
reinvesting dividends from the Fund or other Oppenheimer funds (a list of them
appears in the Statement of Additional Information, or you can ask your dealer
or call the Transfer Agent), or by reinvesting distributions from unit
investment trusts that have made arrangements with the Distributor.

/ / 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.

/ / 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 to
transmit funds electronically to PURCHASE SHARES, to have the Transfer Agent
SEND REDEMPTION PROCEEDS, or to TRANSMIT DIVIDENDS AND DISTRIBUTIONS TO YOUR
BANK ACCOUNT.

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.
/ / 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.

/ / AT WHAT PRICES 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. In most cases, to enable you to receive that day's offering
price, the Distributor or its designated agent must receive your order by the

<PAGE>
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, the dealer must receive your order by
the close of The New York Stock Exchange on a regular business day and transmit
it 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 C 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 and Former Connecticut Mutual Funds
(each 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.

<PAGE>
Different sales charge rates and commissions applied to sales of Class A shares
prior to March 21, 1996. The current sales charge rates and commissions paid to
dealers and brokers are as follows:

<TABLE>
<CAPTION>
FRONT-END FRONT-END
SALES CHARGE SALES CHARGE COMMISSION AS
AS PERCENTAGE AS PERCENTAGE PERCENTAGE OF
OF OFFERING OF AMOUNT OFFERING
AMOUNT OF PURCHASE PRICE INVESTED PRICE
<S> <C> <C> <C>
- - -----------------------------------------------------------------------------------
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%
</TABLE>

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.
/ / 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:
/ / purchases aggregating $1 million or more, or
/ / purchases by an OppenheimerFunds prototype 401(k) plan 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.

The Distributor pays dealers of record commissions on those purchases in an
amount equal to the sum of 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. That commission will
be paid only on the amount of those purchases in excess of $1 million ($500,000
for purchases by OppenheimerFunds prototype 401(k) plans) that were not
previously subject to a front-end sales charge and dealer commission.

<PAGE>

original cost of the shares, whichever is less. 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 sales charge will
apply.
/ / SPECIAL ARRANGEMENTS WITH DEALERS. The Distributor may advance up to 13
months' commissions to dealers that have established special arrangements with
the Distributor for Asset Builder Plans for their clients. Dealers whose sales
of Class A shares of Oppenheimer funds (other than money market funds) under
OppenheimerFunds-sponsored 403(b)(7) custodial plans exceed $5 million per year
(calculated per quarter), will receive monthly one-half of the Distributor's
retained commissions on those sales, and if those sales exceed $10 million per
year, those dealers will receive the Distributor's entire retained commission on
those sales.

<PAGE>
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.

/ / LETTER OF INTENT. Under a Letter of Intent, if you purchase Class A
shares 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 your reduced sales charge rate
for the Class A shares purchased during that period. More information is
contained in the Application and in "Reduced Sales Charges" in the Statement of
Additional Information.

/ / 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.
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:
/ / the Manager or its affiliates;
/ / 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;
/ / registered management investment companies, or separate accounts of
insurance companies having an agreement with the Manager or the Distributor for
that purpose;
/ / dealers or brokers that have a sales agreement with the Distributor, if
they purchase shares for their own accounts or for retirement plans for their
employees;
/ / employees and registered representatives (and their spouses) of dealers
or brokers described above or financial institutions that have entered into
sales arrangements with such dealers or brokers (and 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);

/ / 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 or employee benefit
plans made available to their clients (those clients may be charged a
transaction fee by their dealer, broker or advisor for the purchase or sale of
shares of the Fund);

/ / employee benefit plans purchasing shares through a shareholder
servicing agent that the Distributor has appointed as its agent to accept those
purchase orders.

<PAGE>
/ / directors, trustees, officers or full-time employees of OpCap Advisors
or its affiliates, their relatives or any trust, pension, profit sharing or
other benefit plan which beneficially owns shares for those persons;
/ / accounts for which Oppenheimer Capital 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;
/ / any unit investment trust that has entered into an appropriate
agreement with the Distributor;
/ / a TRAC-2000 401(k) plan (sponsored by the former Quest for Value
Advisors) whose Class B or Class C shares of a Former Quest for Value Fund were
exchanged for Class A shares of that Fund due to the termination of the Class B
and C TRAC-2000 program on November 24, 1995; or

/ / 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 are
consummated and share purchases commence 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:
/ / shares issued in plans of reorganization, such as mergers, asset
acquisitions and exchange offers, to which the Fund is a party;
/ / shares purchased by the reinvestment of loan repayments by a
participant in a retirement plan for which the Manager or one of its affiliates
acts as sponsor;
/ / shares purchased by the reinvestment of dividends or other
distributions reinvested from the Fund or other Oppenheimer funds (other than
Oppenheimer Cash Reserves) or unit investment trusts for which reinvestment
arrangements have been made with the Distributor;
/ / shares purchased and paid for with the proceeds of shares redeemed in
the past 12 months 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 Fund shares, and the Distributor may require evidence
of your qualification for this waiver; and
/ / 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:

<PAGE>
/ / for retirement distributions or loans to participants or beneficiaries
from qualified retirement plans, deferred compensation plans or other employee
benefit plans, including OppenheimerFunds prototype 401(k) plans (these are all
referred to as "Retirement Plans");
/ / to return excess contributions made to Retirement Plans;
/ / to make Automatic Withdrawal Plan payments that are limited annually to
no more than 12% of the original account value;
/ / involuntary redemptions of shares by operation of law or involuntary
redemptions of small accounts (see "Shareholder Account Rules and Policies,"
below);
/ / if, at the time a purchase order is placed for Class A shares that
would otherwise be subject to the Class A contingent deferred sales charge, the
dealer agrees in writing to accept the dealer's portion of the commission
payable on the sale in installments of 1/18th of the commission per month (and
no further commission will be payable if the shares are redeemed within 18
months of purchase); or
/ / for distributions from OppenheimerFunds prototype 401(k) plans for any
of the following cases or 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) hardship withdrawals, as defined in the plan; (3) under a Qualified Domestic
Relations Order, as defined in the Internal Revenue Code; (4) to meet the
minimum distribution requirements of the Internal Revenue Code; (5) to establish
"substantially equal periodic payments" as described in Section 72(t) of the
Internal Revenue Code, or (6) separation from service.

/ / 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 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 Directors authorizes such
reimbursements, which it has not done as yet) 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 an annual rate not to exceed 0.25% of the average annual net assets
of Class A shares held in accounts of the service provider 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.

<PAGE>

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 six-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:

<TABLE>
<CAPTION>
CONTINGENT DEFERRED SALES
CHARGE ON REDEMPTIONS IN THAT
YEARS SINCE BEGINNING OF YEAR
MONTH IN WHICH PURCHASE (AS % OF AMOUNT SUBJECT TO
ORDER WAS ACCEPTED CHARGE)
<S> <C>
- - -------------------------------------------------------------------------------------
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
</TABLE>

/ / 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

<PAGE>
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.

BUYING CLASS C SHARES. Class C shares are sold at net asset value per share
without an initial sales charge. However, if Class C shares are redeemed within
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 charge will be assessed on the lesser of the net asset value
of the shares at the time of redemption or the original purchase price. 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.

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 and Class C expenses by up to 1.00% of the net assets per
year of the respective class.

The Distributor uses the service fees to compensate dealers for providing
personal services for accounts that hold Class B or 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 C shares
without a front-end sales charge while allowing the Distributor to compensate

<PAGE>

dealers that sell those shares. The Fund pays the asset-based sales charges to
the Distributor for its services rendered in distributing Class B 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 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 therefore
4.00% of the purchase price. The Distributor retains the Class B asset-based
sales charge.

The Distributor currently pays sales commissions of 0.75% of the purchase
price of Class C shares to dealers from its own resources at the time of sale.
Including the advance of the service fee, the total amount paid by the
Distributor to the dealer at the time of sale of Class C shares is therefore
1.00% of the purchase price. The Distributor plans to pay the asset-based sales
charge as an ongoing commission to the dealer on Class C shares that have been
outstanding for a year or more.

The Distributor's actual expenses in selling Class B and 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 C shares. If the Fund terminates either Plan, the
Board of Directors may allow the Fund to continue payments of the asset-based
sales charge to the Distributor for distributing shares before the Plan was
terminated.

WAIVERS OF CLASS B AND CLASS C SALES CHARGES. The Class B and Class C contingent
deferred sales charge 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 in
"Reduced Sales Charges" in the Statement of Additional Information.

WAIVERS FOR REDEMPTIONS IN CERTAIN CASES. The Class B and Class C contingent
deferred sales charges will be waived for redemptions of shares in the following
cases, if the Transfer Agent is notified that these conditions apply to the
redemption:
/ / 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);

/ / redemptions from accounts other than Retirement Plans following the
death or disability of the last surviving shareholder including a trustee of a

<PAGE>

"grantor" trust or revocable living trust for which the trustee is also the sole
beneficiary (the death or disability must have occurred after the account was
established, and for disability you must provide evidence of a determination of
disability by the Social Security Administration);

/ / returns of excess contributions to Retirement Plans;

/ / distributions from Retirement Plans to make "substantially equal
periodic payments" as permitted in section 72(t) of the Internal Revenue Code
that do not exceed 10% of the account value annually, measured from the date the
Transfer Agent receives the request;

/ / shares redeemed involuntarily, as described in "Shareholder Account
Rules and Policies," below; or
/ / distributions from OppenheimerFunds 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; or (5) for
separation from service.
WAIVERS FOR SHARES SOLD OR ISSUED IN CERTAIN TRANSACTIONS. The contingent
deferred sales charge is also waived on Class B and Class C shares sold or
issued in the following cases:
/ / shares sold to the Manager or its affiliates;
/ / shares sold to registered management investment companies or separate
accounts of insurance companies having an agreement with the Manager or the
Distributor for that purpose; and
/ / shares issued in plans of reorganization to which the Fund is a party.

SPECIAL INVESTOR SERVICES

<PAGE>
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.
/ / 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.
/ / 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.
/ / 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.
/ / EXCHANGING SHARES. With the OppenheimerFunds Exchange Privilege,
described below, you can exchange shares automatically by phone from your Fund
account to another Oppenheimer funds account you have already established by
calling the special PhoneLink number. Please refer to "How to Exchange Shares,"
below, for details.
/ / 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.

AUTOMATIC WITHDRAWAL AND EXCHANGE PLANS. The Fund has several plans that enable
you to sell shares automatically or exchange them to another Oppenheimer funds
account on a regular basis:
/ / 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 Application and Statement of Additional
Information for more details.
/ / AUTOMATIC EXCHANGE PLANS. You can authorize the Transfer Agent to
exchange an amount you establish in advance automatically 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, you have up to 6 months to reinvest all or part of the redemption

42
<PAGE>

proceeds in Class A shares of the Fund or 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.

/ / INDIVIDUAL RETIREMENT ACCOUNTS including rollover IRAs, for individuals
and their spouses

/ / 403(B)(7) CUSTODIAL PLANS for employees of eligible tax-exempt
organizations, such as schools, hospitals and charitable organizations

/ / SEP-IRAS (Simplified Employee Pension Plans) for small business owners
or people with income from self-employment, including SARSEP-IRAs

/ / PENSION AND PROFIT-SHARING PLANS for self-employed persons and other
employers

/ / 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

/ / 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 or
plan trustee, you must arrange for the distribution request to be signed and
sent by the plan administrator or trustee. There are additional details in the
Statement of Additional Information.

<PAGE>
/ / 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):
/ / You wish to redeem more than $50,000 worth of shares and receive a
check
/ / The redemption check is not payable to all shareholders listed on the
account statement
/ / The redemption check is not sent to the address of record on your
account statement
/ / Shares are being transferred to a Fund account with a different owner
or name
/ / Shares are redeemed by someone other than the owners (such as an
Executor)

/ / 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, or as a fiduciary, you must also
include your title in the signature.

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

<TABLE>
<CAPTION>
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
Denver, Colorado 80217 D
Denver, Colorado 80231
<S> <C>
</TABLE>

<PAGE>
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.
/ / To redeem shares through a service representative, call 1-800-852-8457
/ / 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.

/ / TELEPHONE REDEMPTIONS PAID BY CHECK. Up to $50,000 may be redeemed by
telephone, in any seven-day period. The check must be payable to all owners of
record of the shares and must be sent to the address on the account statement.
This service is not available within 30 days of changing the address on an
account.

/ / TELEPHONE REDEMPTIONS THROUGH ACCOUNTLINK OR 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.
Shareholders may also have the Transfer Agent send redemption proceeds of
$2,500 or more by Federal Funds wire to a designated commercial bank account if
the bank is a member of the Federal Reserve wire system. There is a $10 fee for
each Federal Funds wire. To place a wire redemption request, call the Transfer
Agent at 1-800-852-8457. The wire will normally be transmitted on the next bank
business day after the shares are redeemed. There is a possibility that the wire
may be delayed up to seven days to enable the Fund to sell securities to pay the
redemption proceeds. No dividends are accrued or paid on the proceeds of shares
that have been redeemed and are awaiting transmittal by wire. To establish wire
redemption privileges on an account that is already established, please contact
the Transfer Agent for instructions.

SELLING SHARES THROUGH YOUR DEALER. The Distributor has made arrangements to
repurchase Fund shares from dealers and brokers on behalf of their customers. To
find out more information about this service, please contact your dealer or
broker. Brokers or dealers may charge for that service. 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

<PAGE>
/ / The prospectuses of the Fund and the fund whose shares you want to buy
must offer the exchange privilege.
/ / 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.
/ / You must meet the minimum purchase requirements for the fund you
purchase by exchange.
/ / 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 the 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:

/ / 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."

/ / 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.

/ / 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.

<PAGE>
/ / 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.
/ / 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 taxable gain or a loss. For more information about taxes
affecting exchanges, please refer to "How to Exchange Shares" in the Statement
of Additional Information.
/ / 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

/ / 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 Directors 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.

/ / 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 Directors at any time the Board believes it is in the Fund's
best interest to do so.

/ / TELEPHONE TRANSACTION PRIVILEGES for purchases, redemptions or exchanges
may be modified, suspended or terminated by the Fund at any time. 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.

/ / 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 the Transfer Agent or the Fund 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.

<PAGE>
/ / REDEMPTION OR TRANSFER REQUESTS WILL NOT BE HONORED UNTIL THE TRANSFER
AGENT RECEIVES ALL REQUIRED DOCUMENTS IN PROPER FORM. From time to time, the
Transfer Agent in its discretion may waive certain of the requirements for
redemptions stated in this Prospectus.

/ / DEALERS THAT 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.

/ / 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 and Class C shares. Therefore, the redemption value of your
shares may be more or less than their original cost.

/ / 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 CERTIFIED CHECK OR ARRANGE WITH YOUR BANK TO PROVIDE
TELEPHONE OR WRITTEN ASSURANCE TO THE TRANSFER AGENT THAT YOUR PURCHASE PAYMENT
HAS CLEARED.

/ / INVOLUNTARY REDEMPTIONS OF SMALL ACCOUNTS may be made by the Fund if the
account has fewer than 100 shares, and in some cases involuntary redemptions may
be made to repay the Distributor for losses from the cancellation of share
purchase orders.

/ / 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.

/ / "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 your correct, certified Social
Security or Employer Identification Number and any other certifications required
by the Internal Revenue Service ("IRS") when you sign your application, or if
you violate IRS regulations on tax reporting of income.

/ / 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 charge when redeeming certain Class A, Class B and
Class C shares.

<PAGE>
/ / 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 and pays dividends separately for Class A, Class B
and Class C shares from net investment income, if any, semi-annually. Normally,
dividends are paid on the last business day every dividend period, but the Board
of Directors can change that date. Dividends paid on Class A 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 than for Class
A shares. There is no fixed dividend rate and there can be no assurance that the
Fund will pay any dividends.

CAPITAL GAINS. The Fund may make distributions annually in December out of any
net short-term or long-term capital gains. Long-term capital gains will be
separately identified in the tax information your Fund sends you after the end
of the year. 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:

/ / 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.

/ / REINVEST CAPITAL GAINS ONLY. You can elect to reinvest long-term capital
gains in the Fund while receiving dividends by check or sent to your bank
account on AccountLink.

/ / 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.

/ / REINVEST YOUR DISTRIBUTIONS IN ANOTHER OPPENHEIMER FUND ACCOUNT. You can
reinvest all distributions in another Oppenheimer fund account you have
established.

<PAGE>

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
and character of the dividends and other distributions you received for the
previous year.

/ / "BUYING A DIVIDEND". When the Fund goes ex-dividend, its share price is
reduced by the amount of the distribution. If you buy shares on or just before
the ex-dividend date, or just before the Fund declares a capital gains
distribution, you will pay the full price for the shares and then receive a
portion of the price back as a taxable dividend or capital gain.

/ / TAXES ON TRANSACTIONS. Share redemptions and repurchases, including
redemptions for exchanges, may produce a taxable gain or a loss, which generally
will be a capital gain or loss for shareholders who hold shares of the Fund as
capital assets. Generally speaking, a capital gain or loss is the difference
between your tax basis, which is usually the price you paid for the shares, and
the proceeds you received when you sold them. Special tax rules may apply to
certain redemptions preceded or followed by investments in the Fund or another
Oppenheimer fund.

/ / RETURNS OF CAPITAL. In certain cases distributions made by the Fund may
be considered a return of capital to shareholders. If that occurs, it will be
identified in notices to shareholders. A return of capital will reduce your tax
basis in shares of the Fund but will not be taxable except to the extent it
exceeds your tax basis.

This information is only a summary of certain federal tax information about
your investment. Tax-exempt or tax-deferred investors, foreign investors, and
investors subject to special tax rules (such as certain banks and securities
dealers) may have different tax consequences not described above. More tax
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.

50
<PAGE>
APPENDIX A:

DESCRIPTION OF SECURITIES RATINGS

DESCRIPTION OF MOODY'S INVESTORS SERVICE, INC. BOND RATINGS

AAA: Bonds rated "Aaa" are judged to be the best quality and to carry the
smallest degree of investment risk. Interest payments are protected by a large
or by an exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, the changes that can be expected are
most unlikely to impair the fundamentally strong position of such issues.

AA: Bonds rated "Aa" are judged to be of high quality by all standards.
Together with the "Aaa" group, they comprise what are generally known as
"high-grade" bonds. They are rated lower than the best bonds because margins of
protection may not be as large as with "Aaa" securities or fluctuation of
protective elements may be of greater amplitude or there may be other elements
present which make the long-term risks appear somewhat larger than those of
"Aaa" securities.

A: Bonds rated "A" possess many favorable investment attributes and are to
be considered as upper-medium grade obligations. Factors giving security to
principal and interest are considered adequate but elements may be present which
suggest a susceptibility to impairment sometime in the future.

BAA: Bonds rated "Baa" are considered medium grade obligations, that is,
they are neither highly protected nor poorly secured. Interest payments and
principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and have
speculative characteristics as well.

BA: Bonds rated "Ba" are judged to have speculative elements; their future
cannot be considered well-assured. Often the protection of interest and
principal payments may be very moderate and not well safeguarded during both
good and bad times over the future. Uncertainty of position characterizes bonds
in this class.

B: Bonds rated "B" generally lack characteristics of desirable investment.
Assurance of interest and principal payments or of maintenance of other terms of
the contract over any long period of time may be small.

CAA: Bonds rated "Caa" are of poor standing and may be in default or there
may be present elements of danger with respect to principal or interest.

CA: Bonds rated "Ca" represent obligations which are speculative in a high
degree and are often in default or have other marked shortcomings.

C: Bonds rated "C" can be regarded as having extremely poor prospects of
ever attaining any real investment standing.

DESCRIPTION OF STANDARD & POOR'S BOND RATINGS

AAA: "AAA" is the highest rating assigned to a debt obligation and indicates
an extremely strong capacity to pay principal and interest.

A-1

<PAGE>

AA: Bonds rated "AA" also qualify as high quality debt obligations. Capacity
to pay principal and interest is very strong, and in the majority of instances
they differ from "AAA" issues only in small degree.

A: Bonds rated "A" have a strong capacity to pay principal and interest,
although they are somewhat more susceptible to adverse effects of change in
circumstances and economic conditions.

BBB: Bonds rated "BBB" are regarded as having an adequate capacity to pay
principal and interest. Whereas they normally exhibit protection parameters,
adverse economic conditions or changing circumstances are more likely to lead to
a weakened capacity to pay principal and interest for bonds in this category
than for bonds in the "A" category.

BB, B, CCC, CC: Bonds rated "BB," "B," "CCC" and "CC" are regarded, on
balance, as predominantly speculative with respect to the issuer's capacity to
pay interest and repay principal in accordance with the terms of the obligation.
"BB" indicates the lowest degree of speculation and "CC" the highest degree.
While such bonds will likely have some quality and protective characteristics,
these are outweighed by large uncertainties or major risk exposures to adverse
conditions.

C, D: Bonds on which no interest is being paid are rated "C." Bonds rated
"D" are in default and payment of interest and/or repayment of principal is in
arrears.

A-2
<PAGE>
APPENDIX B

CREDIT QUALITY DISTRIBUTION

The average quality distribution of the portfolio of debt securities held by
Oppenheimer Disciplined Allocation Fund during the year ended December 31, 1995
was as follows:

<TABLE>
<CAPTION>
QUALITY DISTRIBUTION % OF
AS ASSIGNED BY RATING SERVICE AVERAGE VALUE PORTFOLIO
<S> <C> <C>
- - ------------------------------------------------------------------------------------
Government Securities $ 38,963,546.03 19.48%
AAA 684,257.15 0.34%
AA 1,905,602.13 0.95%
A 18,169,459.25 9.08%
BBB 12,720,500.93 6.36%
BB 4,519,705.47 2.26%
B 287,220.83 0.14%
Unrated 2,047,630.26 1.02%
----------------- ---------
Debt Securities (Total value) 79,297,922.05 39.64%
Equity Securities 79,855,031.63 39.93%
Short-Term Securities 40,893,893.07 20.44%
----------------- ---------
Total Portfolio 200,046,846.74 100.00%
</TABLE>

B-1
<PAGE>
APPENDIX C

SPECIAL SALES CHARGE ARRANGEMENTS

I. 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) Quest for Value Fund,
Inc., Quest for Value Growth and Income Fund, Quest for Value Opportunity Fund,
Quest for Value Small Capitalization Fund and Quest for Value Global Equity
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 Value
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 acquired by such
shareholder pursuant to an exchange of shares of one of the Oppenheimer funds
(i) that was one of the Former Quest for Value Funds or (ii) that were acquired
by exchange from one of those funds or from a fund into which one of the Former
Quest for Value Funds merged.

CLASS A SALES CHARGES

/ / REDUCED CLASS A INITIAL SALES CHARGE RATES FOR CERTAIN FORMER QUEST
SHAREHOLDERS.

/ / 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.

<TABLE>
<CAPTION>
FRONT-END FRONT-END
SALES SALES
NUMBER OF CHARGE AS A CHARGE AS A COMMISSION AS
ELIGIBLE PERCENTAGE PERCENTAGE PERCENTAGE
EMPLOYEES OF OFFERING OF AMOUNT OF OFFERING
OR MEMBERS PRICE INVESTED PRICE
<S> <C> <C> <C>
- - ------------------------------------------------------------------------------------
9 or fewer 2.50% 2.56% 2.00%
- - ------------------------------------------------------------------------------------
At least 10 but not more than 49 2.00% 2.04% 1.60%
</TABLE>

C-1

<PAGE>

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.

/ / SPECIAL CLASS A CONTINGENT DEFERRED SALES CHARGE RATES. Class A shares
of the Fund purchased by exchange of shares of other Oppenheimer funds that were
acquired as a result of the merger of Former Quest for Value Funds into those
Oppenheimer funds, and which shares were subject to a Class A contingent
deferred sales charge prior to November 24, 1995 will be subject to a contingent
deferred sales charge at the following rates: if they are redeemed within 18
months of the end of the calendar month in which they were purchased, at a rate
equal to 1.0% if the redemption occurs within 12 months of their initial
purchase and at a rate of 0.50 of 1.0% if the redemption occurs in the
subsequent six months. Class A shares of any of the Former Quest for Value Funds
purchased without an initial sales charge on or before November 22, 1995 will
continue to be subject to the applicable contingent deferred sales charge in
effect as of that date as set forth in the then-current prospectus for such
fund.

/ / 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:

/ / 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.
/ / 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.

/ / 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:

/ / Investors who purchased Class A shares from a dealer that is or was not
permitted to receive a sales load or redemption fee imposed on a

C-2

<PAGE>
shareholder with whom that dealer has a fiduciary relationship under the
Employee Retirement Income Security Act of 1974 and regulations adopted under
that law.
/ / 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

/ / 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 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.

/ / 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 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

C-3

<PAGE>
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
the Fund or another Oppenheimer fund.

SPECIAL DEALER ARRANGEMENTS.

Dealers who sold Class B shares of a Former Quest for Value Fund to Quest for
Value prototype 401(k) plans that were maintained on the TRAC-2000 recordkeeping
system and that were transferred to an OppenheimerFunds prototype 401(k) plan
shall be eligible for an additional one-time payment by the Distributor of 1% of
the value of the plan assets transferred, but that payment may not exceed $5,000
as to any one plan.
Dealers who sold Class C shares of a Former Quest for Value Fund to Quest
for Value prototype 401(k) plans that were maintained on the TRAC-2000
recordkeeping system and (i) the shares held by those plans were exchanged for
Class A shares, or (ii) the plan assets were transferred to an OppenheimerFunds
prototype 401(k) plan, shall be eligible for an additional one-time payment by
the Distributor of 1% of the value of the plan assets transferred, but that
payment may not exceed $5,000.

II. SPECIAL SALES CHARGE ARRANGEMENTS FOR SHAREHOLDERS OF THE FUND
WHO WERE SHAREHOLDERS OF THE FORMER CONNECTICUT MUTUAL FUNDS

Certain of the sales charge rates and waivers for Class A and Class B shares of
the Fund described elsewhere in this Prospectus are modified as described below
for those shareholders of Connecticut Mutual Liquid Account, Connecticut Mutual
Government Securities Account, Connecticut Mutual Income Account, Connecticut
Mutual Growth Account, Connecticut Mutual Total Return Account, CMIA LifeSpan
Diversified Income Account, CMIA LifeSpan Capital Appreciation Account and CMIA
LifeSpan Balanced Account (the "Former Connecticut Mutual Funds") on March 1,
1996, when OppenheimerFunds, Inc. became the investment adviser to the Former
Connecticut Mutual Funds.

PRIOR CLASS A CDSC AND CLASS A SALES CHARGE WAIVERS

C-4

<PAGE>

on an amount equal to the current market value or the original purchase price of
the shares sold, whichever is smaller (in such redemptions, any shares not
subject to the prior Class A CDSC will be redeemed first).

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

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

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

C-5

<PAGE>

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

CLASS A AND CLASS B CONTINGENT DEFERRED SALES CHARGE WAIVERS

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

C-6
<PAGE>
OPPENHEIMER DISCIPLINED ALLOCATION FUND
Two World Trade Center
New York, New York 10048-0203
1-800-525-7048

INVESTMENT ADVISOR
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 AND SHAREHOLDER SERVICING AGENT
OppenheimerFunds Services
P.O. Box 5270
Denver, Colorado 80217
1-800-525-7048

CUSTODIAN OF PORTFOLIO SECURITIES
State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02110

INDEPENDENT AUDITORS
Arthur Andersen LLP
One Financial Plaza
Hartford, Connecticut 06103

LEGAL COUNSEL
Hale and Dorr
60 State Street
Boston, Massachusetts 02109

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.

PR0375.001.0596 [logo] Printed on recycled paper

<PAGE>
OPPENHEIMER

Disciplined Value Fund

PROSPECTUS DATED MAY 1, 1996

Oppenheimer Disciplined Value Fund is a mutual fund that seeks long term growth
of capital by investing primarily in common stocks with low price-earnings
ratios and better-than-anticipated earnings. Realization of current income is a
secondary consideration. In selecting investments for the Fund, the investment
advisor uses a quantitative investment discipline in combination with
fundamental securities analysis. The Fund may invest the remainder of its assets
in corporate and U.S. Government debt obligations and short-term debt
instruments. The Fund may also use "hedging" instruments to seek to reduce the
risks of market fluctuations that affect the value of the securities the Fund
holds. Please refer to "Investment Policies and Strategies" 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 May 1,
1996 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 ("SEC") and is
incorporated into this Prospectus by reference (which means that it is legally
part of this Prospectus).

[LOGO]

<TABLE>
<S> <C>
ABOUT THE FUND

3 EXPENSES

5 A BRIEF OVERVIEW OF THE FUND

7 FINANCIAL HIGHLIGHTS

11 INVESTMENT OBJECTIVE AND POLICIES

12 INVESTMENT RISKS

15 INVESTMENT TECHNIQUES AND STRATEGIES

20 HOW THE FUND IS MANAGED

22 PERFORMANCE OF THE FUND

ABOUT YOUR ACCOUNT

24 HOW TO BUY SHARES
Class A Shares
Class B Shares
Class C Shares

37 SPECIAL INVESTOR SERVICES
AccountLink
Automatic Withdrawal and Exchange Plans
Reinvestment Privilege
Retirement Plans

39 HOW TO SELL SHARES
By Mail
By Telephone

41 HOW TO EXCHANGE SHARES

43 SHAREHOLDER ACCOUNT RULES AND POLICIES

44 DIVIDENDS, CAPITAL GAINS AND TAXES

A-1 APPENDIX A: DESCRIPTION OF SECURITIES RATINGS

B-1 APPENDIX B: SPECIAL SALES CHARGE ARRANGEMENTS
</TABLE>
<PAGE>
ABOUT THE FUND

EXPENSES

<TABLE>
<S> <C> <C> <C>
CLASS A CLASS B CLASS C
SHARES SHARES SHARES
- - ------------------------------------------------------------------------------------
Maximum Sales Charge on 5.75% None None
Purchases (as a % of offering
price)
- - -----------------------------------------------------------------------------------------
Sales Charge on Reinvested None None None
Dividends
- - -----------------------------------------------------------------------------------------
Deferred Sale Charge None(1) 5% in the first 1% if shares are
(as a % of the lower of the year, declining to redeemed within 12
original purchase price or 1% in the sixth months of
redemption proceeds) year and purchase(2)
eliminated
thereafter(2)
- - -----------------------------------------------------------------------------------------
Exchange Fee None None None
- - -----------------------------------------------------------------------------------------
Redemption Fee None(3) None(3) None(3)
</TABLE>

ANNUAL FUND OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET ASSETS):

<TABLE>
<S> <C> <C> <C>
CLASS A CLASS B CLASS C
SHARES SHARES SHARES
- - ------------------------------------------------------------------------------------
Management Fees 0.625% 0.625% 0.625%
- - ---------------------------------------------------------------------------------------
12b-1 Plan Fees 0.25 % 1.00 % 1.00 %
- - ---------------------------------------------------------------------------------------
Other Expenses 0.345% 0.345% 0.345%
- - ---------------------------------------------------------------------------------------
Total Fund Operating Expenses 1.22 % 1.97 % 1.97 %
</TABLE>

The numbers for Class A shares in the chart above are based on the Fund's
expenses in its last fiscal year. These amounts are shown as a percentage of the
average net assets of each class of the Fund's shares for that year. Class B
shares were not publicly offered before October 1, 1995. Therefore, the Class B
Annual Fund Operating Expenses shown are based on expenses for the period from
October 1, 1995 until December 31, 1995. Class C shares were not publicly
offered before May 1, 1996. Accordingly, the "Other Expenses" for Class C shares
are estimates based upon amounts that would have been payable if Class C shares
had been outstanding during the fiscal year. The actual expenses for each class
of shares in future years may be more or less than the numbers in the chart,
depending on a number of factors, including the actual amount of the Fund's
assets represented by each class of shares.
The "12b-1 Distribution Plan Fees" for Class A shares are the service fees
(which can be up to a maximum of 0.25% of average annual net assets of that
class). For Class B and Class C shares, 12b-1 Plan Fees include the service fees
(which can be up to a maximum of 0.25%) and an annual asset-based sales charges
of 0.75%. These plans are described in greater detail in "How to Buy Shares."
/ / 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, and 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

<PAGE>
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, 3, 5 and 10
years:

<TABLE>
<S> <C> <C> <C> <C>
1 YEAR 3 YEARS 5 YEARS 10 YEARS*
- - ------------------------------------------------------------------------------------
Class A Shares $69 $94 $121 $197
- - -----------------------------------------------------------------------------------------
Class B Shares $70 $92 $126 $192
- - -----------------------------------------------------------------------------------------
Class C Shares $30 $62 $106 $230
</TABLE>

If you did not redeem your investment, it would incur the following
expenses:

<TABLE>
<S> <C> <C> <C> <C>
1 YEAR 3 YEARS 5 YEARS 10 YEARS*
- - ------------------------------------------------------------------------------------
Class A Shares $69 $94 $121 $197
- - -----------------------------------------------------------------------------------------
Class B Shares $20 $62 $106 $210
- - -----------------------------------------------------------------------------------------
Class C Shares $20 $62 $106 $230
</TABLE>

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.
/ / WHAT IS THE FUND'S INVESTMENT OBJECTIVE? The Fund seeks long-term growth
of capital by investing primarily in common stocks with low price-earnings
ratios and better-than-anticipated earnings. Realization of current income is a
secondary consideration.
/ / WHAT DOES THE FUND INVEST IN? Under normal market conditions, the Fund
expects to invest primarily in common stocks. The Fund may invest the

<PAGE>
remainder of its assets in U.S. Government securities and corporate debt
obligations, including corporate bonds rated below investment grade (commonly
called "junk bonds") and may invest to a limited degree in foreign securities.
The Fund may write covered calls and use certain types of "hedging instruments"
and "derivative investments" to seek to reduce the risks of market fluctuations
that affect the value of the securities the Fund holds or to seek total return.
These investments are more fully explained in "Investment Objective and
Policies" starting on page 11.
/ / WHO MANAGES THE FUND? The Fund's investment advisor is OppenheimerFunds,
Inc., which (including a subsidiary) advises investment company portfolios
having over $50 billion in assets at March 31, 1996. The Manager is paid an
advisory fee by the Fund, based on its net assets. The Fund's Board of
Directors, elected by shareholders, oversees the investment advisor and the
portfolio managers. The Fund has a team of portfolio managers, who are employed
by the Manager. Peter C. Antos is the senior portfolio manager and he is
assisted by Michael C. Strathearn and Kenneth B. White. Please refer to "How the
Fund is Managed," starting on page 20 for more information about the Manager and
its fees.
/ / HOW RISKY IS THE FUND? All investments carry risks to some degree. 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 a particular stock may result from an event affecting the issuer. 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 considered a growth fund
that is considerably more aggressive than equity income or growth and income
funds because it invests for long-term growth of capital in common stocks that
tend to be more volatile than other investments. While the Manager tries to
reduce risks by diversifying investments, by researching securities before they
are purchased for the Fund's portfolio, and in some cases by using hedging
techniques, there is no guarantee of success in achieving the Fund's objective
and your shares may be worth more or less than their original cost when you
redeem them. Please refer to "Investment Objective and Policies" starting on
page 11 for a more complete discussion of the Fund's investment risks.
/ / 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" beginning on page 24
for more details.
/ / WILL I PAY A SALES CHARGE TO BUY SHARES? The Fund has three 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 and Class C shares are offered
without front-end sales charges, but may be subject to a contingent deferred
sales charge if redeemed within 6 years or 12 months, respectively, of

<PAGE>
purchase. There is also an annual asset-based sales charge on Class B and Class
C shares. Please review "How To Buy Shares" starting on page 24 for more
details, including a discussion about factors you and your financial advisor
should consider in determining which class may be appropriate for you.
/ / 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 39. The Fund also offers exchange
privileges to other Oppenheimer funds, described in "How to Exchange Shares" on
page 41.
/ / HOW HAS THE FUND PERFORMED? The Fund measures its performance by quoting
its average annual total returns and cumulative total returns, which measure
historical performance. Those returns can be compared to the total returns (over
similar periods) of other funds. Of course, other funds may have different
objectives, investments, and levels of risk. Please remember that past
performance does not guarantee future results.

FINANCIAL HIGHLIGHTS

The tables on the following pages present selected financial information about
the Fund, including per share data and expense ratios and other data based on
the Fund's average net assets. Class B shares have been offered since October 1,
1995. Class C shares were not publicly offered during the periods shown, and
consequently, no information on Class C shares is included in the tables on the
following pages or in the Fund's financial statements. The information for the
Fund has been audited by Arthur Andersen LLP, the Fund's independent auditors,
whose report for the fiscal year ended December 31, 1995 is included in the
Statement of Additional Information. Additional information about the
performance of the Fund is contained in the 1995 Annual Report which may be
obtained without charge by calling the Fund at the telephone number or writing
to the Fund's address on the back cover.

<PAGE>
FINANCIAL HIGHLIGHTS*

<TABLE>
<CAPTION>
CLASS A SHARES
----------------------------------------------
YEARS ENDED DECEMBER 31,
----------------------------------------------
1995 1994 1993 1992
<S> <C> <C> <C> <C>
- - --------------------------------------------------------------------
PER SHARE OPERATING
DATA:
Net asset value,
beginning of
period............ $ 14.20 $ 15.14 $ 14.20 $ 14.40
- - --------------------------------------------------------------------
Income (loss) from
investment
operations:
Net investment
income (loss)..... .25 .22 .30 .26
Net realized and
unrealized gain
(loss) on
investments,
options written
and foreign
currency
transactions...... 4.88 (.32) 2.64 1.44
- - --------------------------------------------------------------------
Total income (loss)
from investment
operations........ 5.13 (.10) 2.94 1.70
- - --------------------------------------------------------------------
Dividends and
distributions to
shareholders:
Dividends from net
investment
income............ (.25) (.22) (.30) (.26)
Distributions from
net realized gain
on investments and
foreign currency
transactions...... (1.24) (.62) (1.70) (1.64)
- - --------------------------------------------------------------------
Total dividends and
distributions to
shareholders...... (1.49) (.84) (2.00) (1.90)
- - --------------------------------------------------------------------
Net asset value, end
of period......... $ 17.84 $ 14.20 $ 15.14 $ 14.20
- - --------------------------------------------------------------------
TOTAL RETURN, AT NET
ASSET VALUE(A).... 36.40% (0.65)% 20.91% 11.99%
- - --------------------------------------------------------------------
RATIOS/SUPPLEMENTAL
DATA:
Net assets, end of
period (in
thousands)........ $ 118,118 $ 78,390 $ 64,495 $ 45,600
- - --------------------------------------------------------------------
Ratios to average
net assets:
Net investment
income (loss)..... 1.53% 1.50% 1.95% 1.74%
Expenses............ 1.22% 1.02% 1.05% 1.12%
- - --------------------------------------------------------------------
Portfolio turnover
rate.............. 69.69% 98.46% 99.67% 141.69%
- - --------------------------------------------------------------------
</TABLE>

*G.R. Phelps & Co. managed the Fund during these periods.
(a)Annual total returns do not include the effect of sales charges.

<PAGE>

<TABLE>
<CAPTION>
1991 1990 1989 1988 1987 1986
<S> <C> <C> <C> <C> <C> <C>
- - --------------------------------------------------------------------------------------------
PER SHARE OPERATING
DATA:
Net asset value,
beginning of
period............ $ 11.62 $ 13.05 $ 11.00 $ 9.80 $ 11.97 $ 10.94
- - --------------------------------------------------------------------------------------------
Income (loss) from
investment
operations:
Net investment
income (loss)..... .25 .34 .51 .20 .22 .24
Net realized and
unrealized gain
(loss) on
investments,
options written
and foreign
currency
transactions...... 4.00 (1.36) 3.30 1.20 (.12) 1.11
- - --------------------------------------------------------------------------------------------
Total income (loss)
from investment
operations........ 4.25 (1.02) 3.81 1.40 .10 1.35
- - --------------------------------------------------------------------------------------------
Dividends and
distributions to
shareholders:
Dividends from net
investment
income............ (.25) (.34) (.51) (.20) (.22) (.24)
Distributions from
net realized gain
on investments and
foreign currency
transactions...... (1.22) (.07) (1.25) -- (2.05) (.08)
- - --------------------------------------------------------------------------------------------
Total dividends and
distributions to
shareholders...... (1.47) (.41) (1.76) (.20) (2.27) (.32)
- - --------------------------------------------------------------------------------------------
Net asset value, end
of period......... $ 14.40 $ 11.62 $ 13.05 $ 11.00 $ 9.80 $ 11.97
- - --------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET
ASSET VALUE(A).... 36.91% (7.98)% 34.86% 14.32% (0.29)% 12.25%
- - --------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL
DATA:
Net assets, end of
period (in
thousands)........ $ 40,716 $ 35,202 $ 37,323 $ 26,285 $ 19,638 $ 19,469
- - --------------------------------------------------------------------------------------------
Ratios to average
net assets:
Net investment
income (loss)..... 1.74% 2.73% 3.90% 1.95% 1.71% 2.21%
Expenses............ 1.19% 1.19% 1.18% 1.23% 1.17% 1.31%
- - --------------------------------------------------------------------------------------------
Portfolio turnover
rate.............. 148.30% 143.95% 169.75% 246.14% 214.32% 163.15%
- - --------------------------------------------------------------------------------------------
</TABLE>

<PAGE>
FINANCIAL HIGHLIGHTS* (CONT'D)

<TABLE>
<CAPTION>
CLASS B SHARES(C)
PERIOD ENDED
DECEMBER 31, 1995
<S> <C>
- - -----------------------------------------------------------------------------------------
PER SHARE OPERATING DATA:
Net asset value, beginning of period................................ $ 17.83
- - -----------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss)........................................ .02
Net realized and unrealized gain (loss) on investments, options
written and foreign currency transactions.......................... 1.40
- - -----------------------------------------------------------------------------------------
Total income (loss) from investment operations...................... 1.42
- - -----------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income................................ (.02)
Distributions from net realized gain on investments and foreign
currency transactions.............................................. (1.15)
Total dividends and distributions to shareholders................... (1.17)
- - -----------------------------------------------------------------------------------------
Net asset value, end of period...................................... $ 18.08
- - -----------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE(B)................................. 8.04%
- - -----------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands)............................ $ 717
- - -----------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss)........................................ .21%(a)
Expenses............................................................ 1.97%(a)
- - -----------------------------------------------------------------------------------------
Portfolio turnover rate............................................. 69.69%
- - -----------------------------------------------------------------------------------------
</TABLE>

10
<PAGE>
INVESTMENT OBJECTIVE AND POLICIES

OBJECTIVE. The Fund seeks long term growth of capital by investing primarily in
common stocks with low price-earnings ratios and better-than-anticipated
earnings. Realization of current income is a secondary consideration.

INVESTMENT POLICIES AND STRATEGIES. Under normal circumstances, most of the
Fund's assets will be invested in stocks. The Manager chooses stock investments
for the Fund using a quantitative value investment discipline in combination
with fundamental securities analysis. A stock may have a low price-earnings
ratio (for example, below the price-earnings ratio of the S&P 500 Index) because
it is out-of-favor in the market. When an out-of-favor company demonstrates
better earnings than what most analysts were expecting, this is referred to as a
favorable earnings surprise. This may cause market analysts and investors to
reevaluate the issuer's earnings expectations and the price-earnings multiple,
which in turn may cause the company's stock price to increase in value.
As stocks with low price-earnings ratios and favorable earnings surprises
are identified, the Manager uses fundamental securities analysis to select
individual stocks for the Fund. When the price-earnings ratio of a stock held by
the Fund moves significantly above the multiple of the overall stock market, or
the company reports a material earnings disappointment, the Fund will normally
sell the stock.
The Fund may invest the remainder of its assets (up to 10% under normal
circumstances) in U.S. Government securities and corporate debt obligations,
including convertible bonds, which may be rated as low as B by Moody's Investors
Service, Inc. ("Moody's") or Standard and Poor's Ratings Group ("Standard &
Poor's"). When market conditions are unstable, the Fund may invest without limit
in high-quality short-term debt securities for temporary defensive purposes, as
described below.
Consistent with the foregoing policies, the Fund may invest to a limited
degree in securities of foreign issuers, including issuers in developing
countries. Please refer to "Foreign Securities," below.
/ / 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 investment 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 not a fundamental policy.
Shareholders of the Fund will be given 30 days' advance written notice of a
change to the Fund's investment objective.
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

<PAGE>
Statement of Additional Information). The Fund's Board of Directors may change
non-fundamental policies without shareholder approval, although significant
changes will be described in amendments to this Prospectus.
/ / CONVERTIBLE SECURITIES. Convertible securities are bonds, preferred
stocks and other securities that pay a fixed rate of interest or dividend and
are convertible into the issuer's common stock at the option of the buyer. While
the value of these securities depends in part on interest rate changes, their
value is also sensitive to the credit quality of the issuer and will change
based on the price of the underlying stock. The Manager consequently does not
look primarily to the ratings of these securities but considers them as "equity
substitutes." While these securities generally offer less potential for gains
than common stock and less income than non-convertible bonds, their income helps
to provide a cushion against the stock price's declines.
/ / PORTFOLIO TURNOVER. A change in the securities held by the Fund is known
as "portfolio turnover." The Fund ordinarily does not engage in short-term
trading to try to achieve its objective. As a result, the Fund's portfolio
turnover currently is not expected to be more than 100% a year. The "Financial
Highlights," above, show the Fund's portfolio turnover rates during past fiscal
years.
Portfolio turnover affects brokerage costs, dealer markups and other
transaction costs, and results in the Fund's realization of capital gains or
losses for tax purposes. It may also affect the ability of the Fund to qualify
as a "regulated investment company" under the Internal Revenue Code and avoid
being taxed on amounts distributed as dividends and capital gains to
shareholders. The Fund qualified in its last fiscal year and intends to do so in
the current and future years, although it reserves the right not to qualify.

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 obligation 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 case by using hedging techniques, changes in overall market prices can
occur at any time, and because the income earned on securities is subject

<PAGE>
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.
/ / 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.
Also, the Fund does not concentrate its investments in any one industry or group
of industries.
/ / FOREIGN SECURITIES HAVE SPECIAL RISKS. 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 value of the 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.
/ / SPECIAL RISKS OF LOWER-GRADE SECURITIES. The Fund can invest in domestic
and foreign corporate debt obligations, including high-yield, below-investment
grade debt securities (including both rated and unrated securities). These
"lower-grade" securities are commonly known as "junk bonds." All corporate debt
securities (whether foreign or domestic) are subject to some degree of credit
risk. High yield, lower-grade securities, whether rated or unrated, often have
speculative characteristics and special risks that make them riskier investments
than investment grade securities. They may be subject to greater market
fluctuations and risk of loss of income and principal than lower yielding,
investment grade securities. There may be less of a market for them and
therefore they may be harder to sell at an acceptable price. There is a
relatively greater possibility that the issuer's earnings may be insufficient to
make the payments of interest due on the bonds. The issuer's low
creditworthiness may increase the potential for its insolvency. For foreign
lower-grade debt securities, these risks are in addition to the risks of
investing

<PAGE>
in foreign securities, described above. These risks mean that the Fund may not
achieve the expected income from lower-grade securities, and that the Fund's net
asset value per share may be affected by declines in value of these securities.
/ / THERE ARE SPECIAL RISKS IN INVESTING IN DERIVATIVE INVESTMENTS. The Fund
can invest in a number of different kinds of "derivative" investments. In
general, a "derivative investment" is a specially designed investment whose
performance is linked to the performance of another investment or security, such
as an option, future, index, currency or commodity. The company issuing the
instrument may fail to pay the amount due on the maturity of the instrument.
Also, the underlying investment or security might not perform the way the
Manager expected it to perform. Markets, underlying securities and indices may
move in a direction not anticipated by the Manager. Performance of derivative
investments may also be influenced by interest rate and stock market changes in
the U.S. and abroad. All of this can mean that the Fund will realize less
principal or income from the investment than expected. Certain derivative
investments held by the Fund may be illiquid. Please refer to "Illiquid and
Restricted Securities."
/ / 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 values 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.
/ / HEDGING INSTRUMENTS CAN BE VOLATILE INVESTMENTS AND INVOLVE SPECIAL
RISKS. The use of hedging instruments requires special skills and knowledge of
investment techniques that are different from what is required for normal
portfolio management. If the Manager uses a hedging instrument at the wrong time
or judges market conditions incorrectly, hedging strategies may reduce the
Fund's return. The Fund could also experience losses if the prices of its
futures and options positions were not correlated with its other investments or
if it could not close out a position because of an illiquid market for the
future or option.
Options trading involves the payment of premiums, and options, futures and
forward contracts are subject to special tax rules that may affect the amount,
timing and character of the Fund's income and distributions. There are also
special risks in particular hedging strategies. For example, if a covered call
written by the Fund is exercised on an investment that has increased in value,
the Fund will be required to sell the investment at the call price and will not
be able to realize any profit if the investment has increased in value above the
call price. The use of Forward Contracts may reduce the gain that would
otherwise result from a change in the relationship between the U.S. dollar and a
foreign currency. These risks are described in greater detail in the Statement
of Additional Information.

<PAGE>
INVESTMENT TECHNIQUES AND STRATEGIES

The Fund may also use the investment techniques and strategies described below.
These techniques involve certain risks. The Statement of Additional Information
contains more information about the practices, including limitations on their
use that may help to reduce some of the risks.
/ / WARRANTS AND RIGHTS. Warrants basically are options to purchase stock at
set prices that are valid for a limited period of time. Rights are similar to
warrants but normally have a short duration and are distributed directly by the
issuer to its shareholders. The Fund may invest up to 5% of its total assets in
warrants or rights. That 5% limitation does not apply to warrants the Fund has
acquired as part of units with other securities or that are attached to other
securities. No more than 2% of the Fund's total assets may be invested in
warrants that are not listed on either The New York Stock Exchange or The
American Stock Exchange.
/ / FOREIGN SECURITIES. The Fund may purchase equity and debt securities
issued by foreign companies or issued or guaranteed by foreign governments. The
Fund may purchase securities in any country, developed or underdeveloped.
Investments in securities of issuers in underdeveloped countries or countries
that have emerging markets generally may offer greater potential for gain but
involve more risk and may be considered highly speculative. As a matter of
fundamental policy, the Fund may not invest more than 10% of its total assets in
foreign securities, except that the Fund may invest up to 25% of its total
assets in foreign equity and debt securities that are (i) issued, assumed or
guaranteed by foreign governments or their political subdivisions or
instrumentalities, (ii) assumed or guaranteed by domestic issuers, including
Eurodollar securities, or (iii) issued, assumed or guaranteed by foreign issuers
having a class of securities listed for trading on The New York Stock Exchange.
The Fund will hold foreign currency only in connection with the purchase or sale
of foreign securities. There are special risks of investing in foreign
securities, described in "Investment Risks," above.
/ / ADRS, EDRS AND GDRS. ADRs are receipts issued by a U.S. bank or trust
company which evidence ownership of underlying securities of foreign companies.
ADRs are traded on domestic exchanges or in the U.S. over-the-counter market and
generally are in registered form. If ADRs are bought through banks that do not
have a contractual relationship with the foreign issuer of the security
underlying the ADR to issue and service the ADR, there is a risk that the Fund
will not learn of corporate actions affecting the issuer in a timely manner.
EDRs and GDRs are receipts evidencing an arrangement with a non-U.S. bank
similar to that for ADRs and are designed for use in non-U.S. securities
markets. EDRs and GDRs are not necessarily quoted in the same currency as the
underlying security.
/ / DEBT SECURITIES. Under normal circumstances, the Fund may invest some of
its assets (normally up to 10%) in debt securities. However, when market

<PAGE>
conditions for stocks are volatile, the Fund may increase its investments in
debt securities for defensive purposes. The types of debt securities the Fund
invests in are described below.
/ / U.S. GOVERNMENT SECURITIES. U.S. Government Securities include debt
securities issued or guaranteed by the U.S. Government or its agencies and
instrumentalities. Certain U.S. Government Securities, including U.S. Treasury
bills, notes and bonds, and mortgage participation certificates guaranteed by
the Government National Mortgage Association ("Ginnie Mae") are supported by the
full faith and credit of the U.S. Government, which in general terms means that
the U.S. Treasury stands behind the obligation to pay principal and interest.
Ginnie Mae certificates are one type of mortgage-related U.S. Government
Security the Fund may invest in. The Fund may invest in other mortgage-related
U.S. Government Securities that are issued or guaranteed by federal agencies or
government-sponsored entities but which are not supported by the full faith and
credit of the U.S. Government. Those securities include obligations supported by
the right of the issuer to borrow from the U.S. Treasury, such as obligations of
the Federal Home Loan Mortgage Corporation ("Freddie Mac"), obligations
supported only by the credit of the instrumentality, such as the Federal
National Mortgage Association ("Fannie Mae") or the Student Loan Marketing
Association, and obligations supported by the discretionary authority of the
U.S. Government to repurchase certain obligations of U.S. Government agencies or
instrumentalities such as the Federal Land Banks and the Federal Home Loan
Banks.
The value of U.S. Government Securities will fluctuate until they mature,
depending on prevailing interest rates. Because the yields on U.S. Government
Securities are generally lower than on corporate debt securities, when the Fund
holds U.S. Government Securities it may attempt to increase the income it can
earn from them by writing covered call options against them, when market
conditions are appropriate. Writing covered calls is explained below, under
"Hedging."
/ / LOWER-GRADE DEBT SECURITIES. Lower-grade debt securities generally offer
higher income potential than investment grade securities. "Lower-grade"
securities have a rating below "BBB" by Standard & Poor's or "Baa" by Moody's or
similar ratings by other nationally-recognized rating organizations, or they are
not rated by a nationally-recognized rating organization, but the Manager judges
them to be comparable to lower-rated securities. The Fund will not purchase
securities rated below B by Moody's or Standard & Poor's. The Fund may retain
securities whose ratings fall below B after purchase unless and until the
Manager determines that disposing of such securities is in the best interests of
the Fund. Appendix A to this Prospectus describes the rating categories of
Moody's and Standard & Poor's. The special risks of investing in lower-grade
debt securities are described in "Investment Risks," above.
/ / LOANS OF PORTFOLIO SECURITIES. Subject to its investment policies and
restrictions, the Fund may seek to increase its income by lending portfolio

<PAGE>
securities to brokers, dealers and financial institutions in transactions other
than repurchase agreements. The Fund must receive collateral for a loan. As a
matter of fundamental policy, these loans are limited to not more than 33 1/3%
of the Fund's total assets (taken at market value) and are subject to other
conditions described in the Statement of Additional Information. The Fund
presently does not intend to engage in loans of securities, but if it does so it
does not intend to lend securities that will exceed 5% of the value of the
Fund's total assets in the coming year.
/ / "WHEN-ISSUED" AND DELAYED DELIVERY TRANSACTIONS. The Fund may purchase
securities on a "when-issued" basis and may purchase or sell securities on a
"delayed delivery" basis. These terms refer to securities that have been created
and for which a market exists, but which are not available for immediate
delivery. There may be a risk of loss to the Fund if the value of the security
declines prior to the settlement date.
/ / 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 must be fully
collateralized. However, if the vendor fails to pay the resale price on the
delivery date, the Fund may experience costs in disposing of the collateral and
may experience losses if there is any delay in doing so. As a matter of
fundamental policy, the Fund will not enter into a repurchase agreement that
causes more than 10% of its net assets to be invested in illiquid and restricted
securities (as described below) which includes repurchase agreements having a
maturity beyond seven days.
/ / ILLIQUID AND RESTRICTED SECURITIES. Under the policies established by
the Fund's Board of Directors, 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. As a matter of fundamental
policy, the Fund will not invest more than 10% of its total assets in illiquid
and restricted securities (including repurchase agreements having a maturity
beyond 7 days, portfolio securities which do not have readily available market
quotations, and time deposits maturing in more than 2 days). The Fund has
undertaken (as a matter of non-fundamental policy) to apply this restriction to
10% of its net assets. The Fund's 10% percent limitation on illiquid securities
does not apply to certain restricted securities that are eligible for resale to
qualified institutional buyers.
/ / TEMPORARY DEFENSIVE INVESTMENTS. When the Manager believes it is
appropriate (for example, because of unstable market conditions), the Fund can
hold cash or invest without limit in money market instruments for temporary
defensive purposes. The Fund will 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

<PAGE>
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 loan associations. The Fund will purchase
money market instruments denominated in a foreign currency only within the
limitations described under "Foreign Securities." The issuers of foreign money
market instruments purchased by the Fund must have at least $1 billion dollars
(U.S.) of assets.
The Fund may also invest in obligations of foreign branches of U.S. banks
(referred to as Eurodollar obligations) and U.S. branches of foreign banks
(Yankee dollars) as well as foreign branches of foreign banks. These investments
involve risks that are different from investment in securities of U.S. banks.
/ / HEDGING. The Fund may write covered call options on securities, stock
indices and foreign currency. It may purchase and sell certain kinds of futures
contracts, forward contracts, and options on futures, broadly based stock
indices and foreign currencies. These are all referred to as "hedging
instruments." While the Fund does not engage extensively in hedging, the Fund
may use these instruments for hedging purposes and, in the case of covered
calls, non-hedging purposes as well, as described below.
The Fund may write covered call options and buy and sell 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 of its portfolio securities may decline, or
to establish a position in the securities market as a temporary substitute for
purchasing individual securities. Some of these strategies, such as selling
futures and writing covered calls, hedge the Fund's portfolio against price
fluctuations.
Other hedging strategies, such as buying futures, tend to increase the
Fund's exposure to the securities market. Forward Contracts may be used to try
to manage foreign currency risks on the Fund's foreign investments. Foreign
currency options may be 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 for liquidity purposes, defensive reasons, or to
raise cash to distribute to shareholders. There are special risks of using
hedging instruments, described in "Investment Risks," above.
The Fund may not purchase or sell physical commodities; however, the Fund
may purchase and sell foreign currency in hedging transactions. This restriction
also does not prevent the Fund from selling covered call options or buying or
selling futures contracts or from investing in securities or other instruments
backed by physical commodities.
/ / FUTURES. The Fund may buy and sell futures contracts that relate to
foreign currencies (these are referred to as "Forward Contracts" and are
discussed below), and stock indices (these are referred to as "Stock Index
Futures"). These types of Futures are described in "Hedging" in the Statement of
Additional Information.

<PAGE>
/ / COVERED CALL OPTIONS AND OPTIONS ON FUTURES. The Fund may write (that
is, sell) call options on securities, indices and foreign currencies for hedging
or liquidity purposes and write call options on Futures for hedging and non-
hedging purposes, but only if all such calls are "covered." This means the Fund
must own the investment on which the call was written or it must own other
securities that are acceptable for the escrow arrangements required for calls
while the call is outstanding or, in the case of calls on futures, segregate
appropriate liquid assets. When the Fund writes a call, it receives cash (called
a premium). The call gives the buyer the ability to buy the investment on which
the call was written from the Fund at the call price during the period in which
the call may be exercised. If the value of the investment does not rise above
the call price, it is likely that the call will lapse without being exercised,
while the Fund keeps the cash premium (and the investment). After the Fund
writes a call, not more than 20% of the value of its total assets may be subject
to calls.
The Fund may write covered call options that are traded on U.S. or foreign
securities or commodity exchanges or which are used by the Options Clearing
Corporation. In the case of foreign currency options, they may be quoted by
major recognized dealers in those options.
/ / FORWARD CONTRACTS. Forward Contracts are foreign currency exchange
contracts. They may be used to buy or sell foreign currency for future delivery
at a fixed price. The Fund may use them for hedging purposes to try to "lock in"
the U.S. dollar price of a security denominated in a foreign currency that the
Fund has purchased or sold, or to protect against possible losses from changes
in the relative value of the U.S. dollar and a foreign currency. Normally, the
Fund will not use "cross hedging," where the Fund hedges against changes in
currencies other than the currency in which a security it holds is denominated.
The Fund will not speculate in foreign exchange.
/ / DERIVATIVE INVESTMENTS. Derivative investments may be used by the Fund
in some cases for hedging purposes and in other cases to seek income. In the
broadest sense, exchange-traded options and futures contracts (discussed in
"Hedging," above) may be considered "derivative investments." There are special
risks in investing in derivatives, discussed in "Investment Risks," above.

OTHER INVESTMENT RESTRICTIONS. The Fund has other investment restrictions which
are "fundamental" policies. Among these fundamental policies, the Fund cannot do
any of the following:
/ / The Fund cannot borrow amounts in excess of 10% of the Fund's total
assets, taken at market value at the time of the borrowing, and then only from
banks as a temporary measure for extraordinary or emergency purposes, or make
investments in portfolio securities while such outstanding borrowings exceed 5%
of the Fund's total assets.
/ / The Fund cannot invest more than 25% of its assets in securities of
issuers in any single industry, provided that this limitation shall not apply to
obligations issued or guaranteed by the U.S. Government, its agencies or
instrumentalities. For the purpose of this restriction, each utility that
provides a

<PAGE>
separate service (e.g., gas, gas transmission, electric or telephone) shall be
considered a separate industry. This test shall be applied on a pro forma basis
using the market value of all assets immediately prior to making any investment.
The Fund has undertaken as a matter of non-fundamental policy to apply this
restriction to 25% or more of its assets.
/ / The Fund cannot invest more than 5 percent of the Fund's total assets
(taken at market value at the time of each investment) in the securities (other
than United States Government or Government agency securities) of any one issuer
(including repurchase agreements with any one bank or dealer) or more than 15
percent of the Fund's total assets in the obligations of any one bank.
/ / The Fund cannot purchase more than either (i) 10 percent in principal
amount of the outstanding debt securities of an issuer, or (ii) 10 percent of
the outstanding voting securities of an issuer, except that such restrictions
shall not apply to securities issued or guaranteed by the United States
Government or its agencies, bank money instruments or bank repurchase
agreements.
All of the percentage restrictions described above and elsewhere in this
Prospectus apply only at the time the Fund purchases a security (except for the
300% asset coverage requirement on borrowing), and the Fund need not dispose of
a security merely because the Fund's assets have changed or the security has
increased in value relative to the size of the Fund. There are other fundamental
policies discussed in the Statement of Additional Information.

HOW THE FUND IS MANAGED

ORGANIZATION AND HISTORY. The Fund is a diversified series of Oppenheimer Series
Fund, Inc. (the "Company"). The Company was organized in 1981 as a Maryland
corporation and is an open-end management investment company. Organized as a
series fund, the Company presently has eight series, including the Fund. Until
March 18, 1996, the Fund was called Connecticut Mutual Growth Account.
The Company (and each series, including the Fund) is governed by a Board of
Directors, which is responsible for protecting the interests of shareholders
under Maryland law. The Directors meet periodically throughout the year to
oversee the Fund's activities, review its performance, and review the actions of
the Manager. "Directors and Officers of the Funds" in the Statement of
Additional Information names the Directors and officers of the Fund and provides
more information about them. Although the Fund normally will not 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 Director or to take other action described in the Fund's Articles of
Incorporation.
The Board of Directors 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 three classes of shares, Class A, Class B

<PAGE>
and Class C. All classes invest in the same investment portfolio. Each class has
its own dividends and distributions, and pays certain expenses which may be
different for the different classes. Each class may have a different net asset
value. Each share has one vote at shareholder meetings, with fractional shares
voting proportionally on 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. Please refer to "How the Funds are Managed" in the
Statement of Additional Information for further information on voting of shares.

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 Directors, under an
Investment Advisory Agreement which states the Manager's responsibilities. The
Agreement sets forth the rate of the management fees paid by the Fund to the
Manager and describes the expenses that the Fund is responsible to pay to
conduct its business.
The Manager has operated as an investment adviser since 1959. The Manager
and its affiliates currently manage investment companies, including other
Oppenheimer funds, with assets of more than $50 billion as of March 31, 1996,
and with nearly three 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.
/ / PORTFOLIO MANAGEMENT. The Fund has a portfolio management team
consisting of three portfolio managers. The principal Portfolio Manager of the
Fund is Peter M. Antos. He is a Vice President of the Fund and a Senior Vice
President of the Manager and has been the senior portfolio manager of the Fund's
portfolio since 1989. He is also a Chartered Financial Analyst and serves as a
portfolio manager of other Oppenheimer funds. Mr. Antos was employed since 1989
by the Fund's prior investment adviser, G.R. Phelps & Co., Inc., as a Vice
President and Senior Portfolio Manager, Equities, before joining Oppenheimer
Funds. Mr. Michael C. Strathearn and Mr. Kenneth B. White are also Vice
Presidents and portfolio managers of the Fund and Vice Presidents of the
Manager. Each is also a Chartered Financial Analyst, and each was also employed
since 1988 and 1987, respectively, by Connecticut Mutual Life Insurance Company,
the parent of G.R. Phelps, as a Portfolio Manager prior to joining Oppenheimer
Funds, Inc. on March 1, 1996. Mr. Strathearn and Mr. White have provided
portfolio management services to the Fund since 1988 and 1992, respectively.
/ / 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: 0.625% of the first $300 million of

<PAGE>
aggregate net assets; 0.500% of the next $100 million; and 0.450% of net assets
in excess of $400 million. The Fund's management fee for its last fiscal year
was 0.625% of the average annual net assets for Class A and Class B shares (on
an annualized basis). There were no Class C shares outstanding during that
fiscal year.
The Fund pays expenses related to its daily operations, such as custodian
fees, Directors' 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 Funds" 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.
/ / THE DISTRIBUTOR. The Fund's shares are sold through dealers, brokers,
banks 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 and is sub-distributor for funds managed by a subsidiary of
the Manager.
/ / 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 the other Oppenheimer funds. Shareholders should direct
inquiries about their accounts to the Transfer Agent at the address and
toll-free number shown below in this Prospectus or on the back cover.

PERFORMANCE OF THE FUND

<PAGE>
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.
/ / 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 and 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
including 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.

23
<PAGE>
ABOUT YOUR ACCOUNT

HOW TO BUY SHARES

CLASSES OF SHARES. The Fund offers investors three different classes of shares.
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.
/ / 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
OppenheimerFunds prototype 401(k) plans). If you purchase Class A shares as part
of an investment of at least $1 million ($500,000 for OppenheimerFunds prototype
401(k) 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. 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.
/ / 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 varies
depending on how long you owned your shares, as described in "Buying Class B
Shares," below.
/ / 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
discussed in "Buying Class C Shares," below.

WHICH CLASS OF SHARES SHOULD YOU CHOOSE? Once you decide that the Fund is an
appropriate investment for you, the decision as to which class of shares is
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 used the sales charge rates that apply
to each class, and considered the effect of the 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 your 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 the class
of shares you invest in.

<PAGE>
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.
/ / 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 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 the shares of Class B or Class C for
which no initial sales charge is paid.
/ / INVESTING FOR THE SHORT 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 in less than seven 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 economic 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 might be more advantageous than Class C (as well as Class B)
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). If investing
$500,000 or more, Class A may be more advantageous as your investment horizon
approaches 3 years or more.
And for 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.
/ / 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,

<PAGE>
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
charge available for larger investments in Class A shares under the Fund's Right
of Accumulation. Unlike Class B shares, Class C shares do not convert to Class A
shares and remain subject to the asset-based sales charge.
Of course all of 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 you should analyze your
options carefully.
/ / ARE THERE DIFFERENCES IN ACCOUNT FEATURES THAT MATTER TO YOU? Because
some features may not be available to Class B or C shareholders, or other
features (such as Automatic Withdrawal Plans) may not be advisable (because of
the effect of the contingent deferred sales charge in non-retirement accounts)
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 to buy. 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, this may be a
factor to consider. Additionally, dividends payable to Class B and Class C
shareholders will be reduced by the additional expenses borne by those classes
that are not borne by Class A, such as the Class B and Class C asset-based sales
charges described below and in the Statement of Additional Information.
/ / 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 than for
selling another class. It is important that investors understand that the
purpose of the Class B and Class C contingent deferred sales charges and
asset-based sales charges is the same as the purpose of the front-end sales
charge on sales of Class A shares: to reimburse the Distributor for commissions
it pays to dealers and financial institutions for selling shares.

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:
/ / With Asset Builder Plans, Automatic Exchange Plans, 403(b)(7) custodial
plans and military allotment plans, you can make initial and subsequent
investments for as little as $25; and subsequent purchases of at least $25 can
be made by telephone through AccountLink.
/ / Under pension and profit-sharing plans, 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.
/ / There is no minimum investment requirement if you are buying shares by
reinvesting dividends from the Fund or other Oppenheimer funds (a

<PAGE>
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.
/ / 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.
/ / BUYING SHARES THROUGH YOUR DEALER. Your dealer will place your order
with the Distributor on your behalf.
/ / BUYING SHARES THROUGH THE DISTRIBUTOR. Complete an OppenheimerFunds New
Account Application and return it with a check payable to "OppenheimerFunds
Distributor, Inc." Mail it to P.O. Box 5270, Denver, Colorado 80217. If you
don't list a dealer on the application, the Distributor will act as your agent
in buying the shares. However, we recommend that you discuss your investment
first with a financial advisor, to be sure it is appropriate for you.
/ / 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 to
transmit funds electronically to PURCHASE SHARES, to have the Transfer Agent
SEND REDEMPTION PROCEEDS, or to TRANSMIT DIVIDENDS AND DISTRIBUTIONS TO YOUR
BANK ACCOUNT.
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.
/ / 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.
/ / AT WHAT PRICES 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. In most cases, to enable you to receive that day's offering
price, the Distributor or its designated agent 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

<PAGE>
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, the dealer must receive your order by
the close of The New York Stock Exchange on a regular business day and transmit
it 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 B 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 and Former Connecticut Mutual Funds (as
defined in that Appendix).

<PAGE>
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.
/ / 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:
/ / purchases aggregating $1 million or more, or
/ / purchases by an OppenheimerFunds prototype 401(k) plan 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.
The Distributor pays dealers of record commissions on those purchases in an
amount equal to the sum of 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. That commission will
be paid only on the amount of those purchases in excess of $1 million ($500,000
for purchases by OppenheimerFunds prototype 401(k) plans) that were not
previously subject to a front-end sales charge and dealer commission.
If you redeem any of those shares 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 will be equal to 1.0% of either (1) the aggregate
net asset value of the redeemed shares (not including shares purchased by
reinvestment of dividends or capital gain distributions) or (2) the original
cost of the shares, whichever is less. 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 sales charge will
apply.
/ / SPECIAL ARRANGEMENTS WITH DEALERS. The Distributor may advance up to 13
months' commissions to dealers that have established special arrangements with
the Distributor for Asset Builder Plans for their clients. Dealers whose sales
of Class A shares of Oppenheimer funds (other than money market funds) under
OppenheimerFunds-sponsored 403(b)(7) custodial plans exceed $5 million per year
(calculated per quarter), will receive monthly one-half of

<PAGE>
the Distributor's retained commissions on those sales, and if those sales exceed
$10 million per year, those dealers will receive the Distributor's entire
retained commission on those sales.

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:
/ / 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
for 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 value of those shares will be based on the greater
of the amount you paid for the shares or their current value (at offering
price). 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.
/ / LETTER OF INTENT. Under a Letter of Intent, if you purchase Class A
shares 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 your reduced sales charge rate
for the Class A shares purchased during that period. More information is
contained in the Application and in "Reduced Sales Charges" in the Statement of
Additional Information.
/ / 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.
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:
/ / the Manager or its affiliates;
/ / 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;

<PAGE>
/ / registered management investment companies, or separate accounts of
insurance companies having an agreement with the Manager or the Distributor for
that purpose;
/ / dealers or brokers that have a sales agreement with the Distributor, if
they purchase shares for their own accounts or for retirement plans for their
employees;
/ / employees and registered representatives (and their spouses) of dealers
or brokers described above or financial institutions that have entered into
sales arrangements with such dealers or brokers (and 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);
/ / 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 or employee benefit
plans made available to their clients (those clients may be charged a
transaction fee by their dealer, broker or advisor for the purchase or sale of
shares of the Fund);
/ / employee benefit plans purchasing shares through a shareholder
servicing agent that the Distributor has appointed as its agent to accept those
purchase orders;
/ / directors, trustees, officers or full-time employees of OpCap Advisors
or its affiliates, their relatives or any trust, pension, profit sharing or
other benefit plan which beneficially owns shares for those persons;
/ / accounts for which Oppenheimer Capital 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;
/ / any unit investment trust that has entered into an appropriate
agreement with the Distributor;
/ / a TRAC-2000 401(k) plan (sponsored by the former Quest for Value
Advisors) whose Class B or Class C shares of a Former Quest for Value Fund were
exchanged for Class A shares of that fund due to the termination of the Class B
and C TRAC-2000 program on November 24, 1995; or
/ / 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 are
consummated and share purchases commence 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:
/ / shares issued in plans of reorganization, such as mergers, asset
acquisitions and exchange offers, to which the Fund is a party;

<PAGE>
/ / shares purchased by the reinvestment of loan repayments by a
participant in a retirement plan for which the Manager or one of its affiliates
acts as sponsor;
/ / shares purchased by the reinvestment of dividends or other
distributions reinvested from the Fund or other Oppenheimer funds (other than
Oppenheimer Cash Reserves) or unit investment trusts for which reinvestment
arrangements have been made with the Distributor;
/ / shares purchased and paid for with the proceeds of shares redeemed in
the past 12 months 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; and
/ / 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:
/ / for retirement distributions or loans to participants or beneficiaries
from qualified retirement plans, deferred compensation plans or other employee
benefit plans, including OppenheimerFunds prototype 401(k) plans (these are all
referred to as "Retirement Plans");
/ / to return excess contributions made to Retirement Plans;
/ / to make Automatic Withdrawal Plan payments that are limited annually to
no more than 12% of the original account value;
/ / involuntary redemptions of shares by operation of law or involuntary
redemptions of small accounts (see "Shareholder Account Rules and Policies,"
below);
/ / if, at the time a purchase order is placed for Class A shares that
would otherwise be subject to the Class A contingent deferred sales charge, the
dealer agrees in writing to accept the dealer's portion of the commission
payable on the sale in installments of 1/18th of the commission per month (and
no further commission will be payable if the shares are redeemed within 18
months of purchase); or
/ / for distributions from OppenheimerFunds prototype 401(k) plans for any
of the following cases or 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) hardship withdrawals, as defined in the plan; (3) under a Qualified Domestic
Relations Order, as defined in the Internal Revenue Code; (4) to meet the
minimum distribution requirements of the Internal Revenue Code; (5) to establish
"substantially equal periodic payments" as described in Section 72(t) of the
Internal Revenue Code, or (6) separation from service.

<PAGE>
/ / 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 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 Directors authorizes such
reimbursements, which it has not done as yet) 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 an annual rate not to exceed 0.25% of the average annual net assets
of Class A shares held in accounts of the service provider 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 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
charge will be assessed on the lesser of the net asset value of the shares at
the time of redemption or the original purchase price. The contingent deferred
sales charge is not imposed on the amount of your account value represented by
an increase in net asset value over the initial purchase price. The Class B
contingent deferred sales charge is paid to the Distributor to compensate it for
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 six-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.

<PAGE>
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:

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. Different contingent deferred sales charges applied to
redemptions of Class B shares prior to March 18, 1996.
/ / 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.

<PAGE>
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.

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
compensate the Distributor for its costs in distributing Class B and 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 that are
outstanding for six years or less and on Class C shares. The Distributor also
receives a service fee of 0.25% per year under each 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 and Class C expenses by up to 1.00% of the net assets per
year of the respective class.
The Distributor uses the service fees to compensate dealers for providing
personal services for accounts that hold Class B or 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 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 sales of Class B shares is therefore
4.00% of the purchase price. The Distributor retains the Class B asset-based
sales charge.
The Distributor currently pays sales commissions of 0.75% of the purchase
price of Class C shares to dealers from its own resources at the time of sale.
Including the advance of the service fee, the total amount paid by the
Distributor to the dealer at the time of sale of Class C shares is therefore
1.00% of the purchase price. The Distributor plans to pay the asset-based sales
charge as an ongoing commission to the dealer on Class C shares that have been
outstanding for a year or more.

<PAGE>
The Distributor's actual expenses in selling Class B and 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 C shares. If the Fund terminates either Plan, the
Board of Directors may allow the Fund to continue payments of the asset-based
sales charge to the Distributor for distributing shares before the Plan was
terminated.

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 in
"Reduced Sales Charges" in the Statement of Additional Information.
WAIVERS FOR REDEMPTIONS IN CERTAIN CASES. The Class B and Class C contingent
deferred sales charges will be waived for redemptions of shares in the following
cases, if the Transfer Agent is notified that these conditions apply to the
redemption:
/ / 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);
/ / 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 the sole
beneficiary (the death or disability must have occurred after the account was
established, and for disability you must provide evidence of a determination of
disability by the Social Security Administration);
/ / returns of excess contributions to Retirement Plans;
/ / distributions from Retirement Plans to make "substantially equal
periodic payments" as permitted in Section 72(t) of the Internal Revenue Code
that do not exceed 10% of the account value annually, measured from the date the
Transfer Agent receives the request);
/ / shares redeemed involuntarily, as described in "Shareholder Account
Rules and Policies," below; or
/ / distributions from OppenheimerFunds 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; or (5) for
separation from service.

<PAGE>
WAIVERS FOR SHARES SOLD OR ISSUED IN CERTAIN TRANSACTIONS. The contingent
deferred sales charge is also waived on Class B and Class C shares sold or
issued in the following cases:
/ / shares sold to the Manager or its affiliates;
/ / shares sold to registered management investment companies or separate
accounts of insurance companies having an agreement with the Manager or the
Distributor for that purpose; and
/ / shares issued in plans of reorganization to which the Fund is a party.

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 refer to the
Application for details or call the Transfer Agent for more information.
AccountLink privileges should be requested on the Application you use to buy
shares, or 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.
/ / 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.
/ / 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.
/ / 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.

<PAGE>
/ / EXCHANGING SHARES. With the OppenheimerFunds Exchange Privilege,
described below, you can exchange shares automatically by phone from your Fund
account to another Oppenheimer funds account you have already established by
calling the special PhoneLink number. Please refer to "How to Exchange Shares,"
below, for details.
/ / 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.

REINVESTMENT PRIVILEGE. If you redeem some or all of your Class A or Class B
shares, you have up to 6 months to reinvest all or part of the redemption
proceeds in Class A shares of the Fund or 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.

38
<PAGE>
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:
/ / INDIVIDUAL RETIREMENT ACCOUNTS including rollover IRAs, for individuals
and their spouses
/ / 403(B)(7) CUSTODIAL PLANS for employees of eligible tax-exempt
organizations, such as schools, hospitals and charitable organizations
/ / SEP-IRAS (Simplified Employee Pension Plans) for small business owners
or people with income from self-employment, including SARSEP-IRAs
/ / PENSION AND PROFIT-SHARING PLANS for self-employed persons and other
employers
/ / 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.
/ / 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 or
plan trustee, you must arrange for the distribution request to be signed and
sent by the plan administrator or trustee. There are additional details in the
Statement of Additional Information.
/ / 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):
/ / You wish to redeem more than $50,000 worth of shares and receive a
check
/ / The redemption check is not payable to all shareholders listed on the
account statement

<PAGE>
/ / The redemption check is not sent to the address of record on your
account statement
/ / Shares are being transferred to a Fund account with a different owner
or name
/ / Shares are redeemed by someone other than the owners (such as an
Executor)
/ / 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.

<TABLE>
<CAPTION>
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,
Denver, Colorado 80217 Building D
Denver, Colorado 80231
<S> <C>
</TABLE>

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.
/ / To redeem shares through a service representative, call 1-800-852-8457
/ / 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.

<PAGE>
/ / TELEPHONE REDEMPTIONS PAID BY CHECK. Up to $50,000 may be redeemed by
telephone, in any seven-day period. The check must be payable to all owners of
record of the shares and must be sent to the address on the account statement.
This service is not available within 30 days of changing the address on an
account.

SELLING SHARES THROUGH YOUR DEALER. The Distributor has made arrangements to
repurchase Fund shares from dealers and brokers on behalf of their customers. To
find out more information about this service contact your dealer or broker.
Brokers or dealers may charge for that service. 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:
/ / Shares of the fund selected for exchange must be available for sale in
your state of residence.
/ / The prospectuses of the Fund and the fund whose shares you want to buy
must offer the exchange privilege.
/ / 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.
/ / You must meet the minimum purchase requirements for the fund you
purchase by exchange.
/ / BEFORE EXCHANGING INTO A FUND, YOU SHOULD OBTAIN AND READ ITS
PROSPECTUS.

<PAGE>
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 the 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:

/ / 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."

/ / 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
names 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:
/ / 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.
/ / 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.
/ / 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.
/ / 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 taxable gain or a loss. For more information about taxes
affecting exchanges, please refer to "How to Exchange Shares" in the Statement
of Additional Information.
/ / 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.

<PAGE>
SHAREHOLDER ACCOUNT RULES AND POLICIES

/ / 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.

/ / 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

<PAGE>
price, which is the net asset value per share, will normally be different for
Class A, Class B and Class C shares. Therefore, the redemption value of your
shares may be more or less than their original cost.

/ / 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 and pays dividends separately for Class A, Class B
and Class C shares from net investment income, if any, semi-annually.

<PAGE>
Normally, dividends are paid on the last business day every dividend period, but
the Board of Directors can change that date. Dividends paid on Class A 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 than
for Class A shares. There is no fixed dividend rate and there can be no
assurance that the Fund will pay any dividends.

/ / 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.

/ / REINVEST CAPITAL GAINS ONLY. You can elect to reinvest long-term capital
gains in the Fund while receiving dividends by check or sent to your bank
account on AccountLink.

/ / 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.

/ / REINVEST YOUR DISTRIBUTIONS IN ANOTHER OPPENHEIMER FUND ACCOUNT. You can
reinvest all distributions in another Oppenheimer funds 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, including
certain net realized foreign exchange gains, 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
and character of the dividends and other distributions you received for the
previous year.

/ / "BUYING A DIVIDEND". When the Fund goes ex-dividend, its share price is
reduced by the amount of the distribution. If you buy shares on or just before

<PAGE>
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.

/ / FOREIGN TAXES. The Fund may be subject to foreign withholding taxes or
other foreign taxes on income (possibly including capital gains) on certain of
its foreign investments. These taxes may be reduced or eliminated pursuant to an
income tax treaty in some cases. The Fund does not expect to qualify to pass
such foreign taxes (and any related tax deductions or credits) through to its
shareholders.
This information is only a summary of certain federal tax information about
your investment. Tax-exempt or tax-deferred investors, foreign investors, and
investors subject to special tax rules (such as certain banks and securities
dealers) may have different tax consequences not described above. More tax
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.

46
<PAGE>
APPENDIX A:

DESCRIPTION OF SECURITIES RATINGS

DESCRIPTION OF MOODY'S INVESTORS SERVICE, INC. BOND RATINGS
AAA: Bonds rated "Aaa" are judged to be the best quality and to carry the
smallest degree of investment risk. Interest payments are protected by a large
or by an exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, the changes that can be expected are
most unlikely to impair the fundamentally strong position of such issues.
AA: Bonds rated "Aa" are judged to be of high quality by all standards.
Together with the "Aaa" group, they comprise what are generally known as
"high-grade" bonds. They are rated lower than the best bonds because margins of
protection may not be as large as with "Aaa" securities or fluctuation of
protective elements may be of greater amplitude or there may be other elements
present which make the long-term risks appear somewhat larger than those of
"Aaa" securities.
A: Bonds rated "A" possess many favorable investment attributes and are to
be considered as upper-medium grade obligations. Factors giving security to
principal and interest are considered adequate but elements may be present which
suggest a susceptibility to impairment sometime in the future.
BAA: Bonds rated "Baa" are considered medium grade obligations, that is,
they are neither highly protected nor poorly secured. Interest payments and
principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and have
speculative characteristics as well.
BA: Bonds rated "Ba" are judged to have speculative elements; their future
cannot be considered well-assured. Often the protection of interest and
principal payments may be very moderate and not well safeguarded during both
good and bad times over the future. Uncertainty of position characterizes bonds
in this class.
B: Bonds rated "B" generally lack characteristics of desirable investment.
Assurance of interest and principal payments or of maintenance of other terms of
the contract over any long period of time may be small.
CAA: Bonds rated "Caa" are of poor standing and may be in default or there
may be present elements of danger with respect to principal or interest.
CA: Bonds rated "Ca" represent obligations which are speculative in a high
degree and are often in default or have other marked shortcomings.
C: Bonds rated "C" can be regarded as having extremely poor prospects of
ever attaining any real investment standing.

DESCRIPTION OF STANDARD & POOR'S BOND RATINGS
AAA: "AAA" is the highest rating assigned to a debt obligation and indicates
an extremely strong capacity to pay principal and interest.

A-1

<PAGE>
AA: Bonds rated "AA" also qualify as high quality debt obligations. Capacity
to pay principal and interest is very strong, and in the majority of instances
they differ from "AAA" issues only in small degree.
A: Bonds rated "A" have a strong capacity to pay principal and interest,
although they are somewhat more susceptible to adverse effects of change in
circumstances and economic conditions.
BBB: Bonds rated "BBB" are regarded as having an adequate capacity to pay
principal and interest. Whereas they normally exhibit protection parameters,
adverse economic conditions or changing circumstances are more likely to lead to
a weakened capacity to pay principal and interest for bonds in this category
than for bonds in the "A" category.
BB, B, CCC, CC: Bonds rated "BB," "B," "CCC" and "CC" are regarded, on
balance, as predominantly speculative with respect to the issuer's capacity to
pay interest and repay principal in accordance with the terms of the obligation.
"BB" indicates the lowest degree of speculation and "CC" the highest degree.
While such bonds will likely have some quality and protective characteristics,
these are outweighed by large uncertainties or major risk exposures to adverse
conditions.
C, D: Bonds on which no interest is being paid are rated "C." Bonds rated
"D" are in default and payment of interest and/or repayment of principal is in
arrears.

A-2
<PAGE>
APPENDIX B

SPECIAL SALES CHARGE ARRANGEMENTS
I. SPECIAL SALES CHARGE ARRANGEMENTS FOR SHAREHOLDERS OF THE FUND
WHO WERE SHAREHOLDERS OF THE FORMER QUEST FOR VALUE FUNDS

CLASS A SALES CHARGES

/ / REDUCED CLASS A INITIAL SALES CHARGE RATES FOR CERTAIN FORMER QUEST
SHAREHOLDERS.
/ / 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

B-1

<PAGE>
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.

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 to 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.
/ / SPECIAL CLASS A CONTINGENT DEFERRED SALES CHARGE RATES. Class A shares
of the Fund purchased by exchange of shares of other Oppenheimer funds that were
Former Quest for Value Funds or were acquired as a result of the merger of
Former Quest for Value Funds into those Oppenheimer funds, and which shares were
subject to a Class A contingent deferred sales charge prior to November 24, 1995
will be subject to a contingent deferred sales charge at the following rates: if
they are redeemed within 18 months of the end of the calendar month in which
they were purchased, at a rate equal to 1.0% if the redemption occurs within 12
months of their initial purchase and at a rate of 0.50 of 1.0% if the redemption
occurs in the subsequent six months. Class A shares of any of the Former Quest
for Value Funds purchased without an initial sales charge on or before November
22, 1995 will continue to be subject to the applicable contingent deferred sales
charge in effect as of that date as set forth in the then-current prospectus for
such fund.

B-2

<PAGE>
/ / 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:
/ / 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.
/ / 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.
/ / 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:
/ / Investors who purchased Class A shares from a dealer that is or was not
permitted to receive a sales load or redemption fee imposed on a shareholder
with whom that dealer has a fiduciary relationship under the Employee Retirement
Income Security Act of 1974 and regulations adopted under that law.
/ / 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

B-3

<PAGE>
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 the Fund or another
Oppenheimer fund.

SPECIAL DEALER ARRANGEMENTS.

II. SPECIAL SALES CHARGE ARRANGEMENTS FOR SHAREHOLDERS OF THE FUND
WHO WERE SHAREHOLDERS OF THE FORMER CONNECTICUT MUTUAL FUNDS

B-4

<PAGE>
Mutual Total Return Account, CMIA LifeSpan Diversified Income Account, CMIA
LifeSpan Capital Appreciation Account and CMIA LifeSpan Balanced Account (the
"Former Connecticut Mutual Funds") on March 1, 1996, when OppenheimerFunds, Inc.
became the investment adviser to the Former Connecticut Mutual Funds.

PRIOR CLASS A CDSC AND CLASS A SALES CHARGE WAIVERS

/ / CLASS A CONTINGENT DEFERRED SALES CHARGE. Certain shareholders of the
Fund and the other Former Connecticut Mutual Funds are entitled to continue to
make additional purchases of Class A shares at net asset value without a Class A
initial sales charge, but subject to the Class A contingent deferred sales
charge that was in effect prior to March 18, 1996 (the "prior Class A CDSC").
Under the prior Class A CDSC, if any of those shares are redeemed within one
year of purchase, they will be assessed a 1% contingent deferred sales charge on
an amount equal to the current market value or the original purchase price of
the shares sold, whichever is smaller (in such redemptions, any shares not
subject to the prior Class A CDSC will be redeemed first).
Those shareholders who are eligible for the prior Class A CDSC are: (1)
persons whose purchases of Class A shares of the Fund and other Former
Connecticut Mutual Funds were $500,000 prior to March 18, 1996, as a result of
direct purchases or purchases pursuant to the Funds' policies on Combined
Purchases or Rights of Accumulation, who still hold those shares in the Fund or
other Former Connecticut Mutual Funds, and (2) persons whose intended purchases
under a Statement of Intention entered into prior to March 18, 1996, with the
Funds' former general distributor to purchase shares valued at $500,000 or more
over a 13-month period entitled those persons to purchase shares at net asset
value without being subject to the Class A initial sales charge.
Any of the Class A shares of the Fund and the other Former Connecticut
Mutual Funds that were purchased at net asset value prior to March 18, 1996,
remain subject to the prior Class A CDSC, or if any additional shares are
purchased by those shareholders at net asset value pursuant to this arrangement
they will be subject to the prior Class A CDSC.
/ / CLASS A SALES CHARGE WAIVERS. Additional Class A shares of the Fund may
be purchased without a sales charge, by a person who was in one (or more) of the
categories below and acquired Class A shares prior to March 18, 1996, and still
holds Class A shares:
(1) any purchaser, provided the total initial amount invested in the Fund or
any one or more of the Former Connecticut Mutual Funds totaled $500,000 or more,
including investments made pursuant to the Combined Purchases, Statement of
Intention and Rights of Accumulation features available at the time of the
initial purchase and such investment is still held in one or more of the Former
Connecticut Mutual Funds or a Fund into which such Fund merged; (2) any
participant in a qualified plan, provided that the total initial amount invested
by the plan in the Fund or any one or more of the Former

B-5

<PAGE>
Connecticut Mutual Funds totaled $500,000 or more; (3) Directors of the Fund or
any one or more of the Former Connecticut Mutual Funds and members of their
immediate families; (4) employee benefit plans sponsored by Connecticut Mutual
Financial Services, L.L.C. ("CMFS"), the Fund's prior distributor, and its
affiliated companies; (5) one or more members of a group of at least 1,000
persons (and persons who are retirees from such group) engaged in a common
business, profession, civic or charitable endeavor or other activity, and the
spouses and minor dependent children of such persons, pursuant to a marketing
program between CMFS and such group; and (6) an institution acting as a
fiduciary on behalf of an individual or individuals, if such institution was
directly compensated by the individual(s) for recommending the purchase of the
shares of the Fund or any one or more of the Former Connecticut Mutual Funds,
provided the institution had an agreement with CMFS. Purchases of Class A shares
made pursuant to (1) and (2) above may be subject to the Class A CDSC of the
Former Connecticut Mutual Funds described above.
Additionally, Class A shares of the Fund may be purchased without a sales
charge by any holder of a variable annuity contract issued in New York State by
Connecticut Mutual Life Insurance Company through the Panorama Separate Account
which is beyond the applicable surrender charge period and which was used to
fund a qualified plan, if that holder exchanges the variable annuity contract
proceeds to buy Class A shares of the Fund.

CLASS A AND CLASS B CONTINGENT DEFERRED SALES CHARGE WAIVERS

In addition to the waivers set forth in "How To Buy Shares," above, the
contingent deferred sales charge will be waived for redemptions of Class A and
Class B shares of the Fund and exchanges of Class A or Class B shares of the
Fund into Class A or Class B shares of a Former Connecticut Mutual Fund provided
that the Class A or Class B shares of the Fund to be redeemed or exchanged were
(i) acquired prior to March 18, 1996 or (ii) were acquired by exchange from an
Oppenheimer Fund that was a Former Connecticut Mutual Fund and the shares of
such Former Connecticut Mutual Fund were purchased prior to March 18, 1996: (1)
by the estate of a deceased shareholder; (2) upon the disability of a
shareholder, as defined in Section 72(m)(7) of the Internal Revenue Code; (3)
for retirement distributions (or loans) to participants or beneficiaries from
retirement plans qualified under Sections 401(a) or 403(b)(7)of the Code, or
from IRAs, deferred compensation plans created under Section 457 of the Code, or
other employee benefit plans; (4) as tax-free returns of excess contributions to
such retirement or employee benefit plans; (5) in whole or in part, in
connection with shares sold to any state, county, or city, or any
instrumentality, department, authority, or agency thereof, that is prohibited by
applicable investment laws from paying a sales charge or commission in
connection with the purchase of shares of any registered investment management
company; (6) in connection with the redemption of shares of the Fund due to a
combination with another investment company by

B-6

<PAGE>
virtue of a merger, acquisition or similar reorganization transaction; (7) in
connection with the Fund's right to involuntarily redeem or liquidate the Fund;
(8) in connection with automatic redemptions of Class A shares and Class B
shares in certain retirement plan accounts pursuant to an Automatic Withdrawal
Plan but limited to no more than 12% of the original value annually; and (9) as
involuntary redemptions of shares by operation of law, or under procedures set
forth in the Fund's Articles of Incorporation, or as adopted by the Board of
Directors of the Fund.

B-7
<PAGE>
OPPENHEIMER DISCIPLINED VALUE FUND
Two World Trade Center
New York, New York 10048-0203
1-800-525-7048

INVESTMENT ADVISOR
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 AND SHAREHOLDER SERVICING AGENT
OppenheimerFunds Services
P.O. Box 5270
Denver, Colorado 80217
1-800-525-7048

CUSTODIAN OF PORTFOLIO SECURITIES
State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02110

INDEPENDENT AUDITORS
Arthur Andersen LLP
One Financial Plaza
Hartford, Connecticut 06103

LEGAL COUNSEL
Hale and Dorr
60 State Street
Boston, Massachusetts 02109

PRO315.001.0596 [logo] Printed on recycled paper

<PAGE>
OPPENHEIMER

LifeSpan Funds

PROSPECTUS DATED MAY 1, 1996

The Oppenheimer LifeSpan Funds are three individual asset allocation mutual
funds having different objectives. Each Fund's assets are invested, in differing
proportions, in two broad asset classes -- stock and bonds -- with investments
in those classes allocated to a number of different types of securities, or
"components."

OPPENHEIMER LIFESPAN GROWTH FUND seeks long-term capital appreciation. It
invests in a strategically allocated portfolio consisting primarily of stocks.
Current income is not a primary consideration.

OPPENHEIMER LIFESPAN BALANCED FUND seeks a blend of capital appreciation and
income. It invests in a strategically allocated portfolio of stocks and bonds
with a slightly stronger emphasis on stocks.

OPPENHEIMER LIFESPAN INCOME FUND seeks high current income, with opportunities
for capital appreciation. It invests in a strategically allocated portfolio
consisting primarily of bond instruments.

Please refer to "Investment Policies and Strategies" for more information
about the types of securities each Fund invests in and to "Investment Risks" for
a discussion of the risks of investing in the Funds.

This Prospectus explains concisely what you should know before investing in
the Funds. Please read this Prospectus carefully and keep it for future
reference. You can find more detailed information about each Fund in the May 1,
1996 Statement of Additional Information. For a free copy, call OppenheimerFunds
Services, the Funds' 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 ("SEC") and is
incorporated into this Prospectus by reference (which means that it is legally
part of this Prospectus).

[LOGO]

SHARES OF THE FUNDS 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.

<TABLE>
<S> <C>
ABOUT THE FUNDS

3 EXPENSES

6 A BRIEF OVERVIEW OF THE FUNDS

8 FINANCIAL HIGHLIGHTS

11 INVESTMENT OBJECTIVES AND POLICIES

16 INVESTMENT RISKS

19 INVESTMENT TECHNIQUES AND STRATEGIES

27 HOW THE FUNDS ARE MANAGED

32 PERFORMANCE OF THE FUNDS

ABOUT YOUR ACCOUNT

33 HOW TO BUY SHARES
Class A Shares
Class B Shares
Class C Shares

46 SPECIAL INVESTOR SERVICES
AccountLink
Automatic Withdrawal and Exchange Plans
Reinvestment Privilege
Retirement Plans

48 HOW TO SELL SHARES
By Mail
By Telephone

50 HOW TO EXCHANGE SHARES

51 SHAREHOLDER ACCOUNT RULES AND POLICIES

53 DIVIDENDS, CAPITAL GAINS AND TAXES

A-1 APPENDIX A: DESCRIPTION OF SECURITIES RATINGS

B-1 APPENDIX B: SPECIAL SALES CHARGE ARRANGEMENTS
</TABLE>

2
<PAGE>
ABOUT THE FUNDS

EXPENSES

Each 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
transaction charges. The following tables are provided to help you understand
your direct expenses of investing in a Fund and the share of a Fund's business
operating expenses that you will bear indirectly. The numbers below are based on
the Funds' expenses during its last fiscal period ended December 31, 1995.

/ / SHAREHOLDER TRANSACTION EXPENSES are charges you pay when you buy or
sell shares of a Fund. Please refer to "About Your Account" starting on page 33
for an explanation of how and when these charges apply.

<TABLE>
<S> <C> <C> <C>
CLASS A CLASS B CLASS C
SHARES SHARES SHARES
- - ------------------------------------------------------------------------------------
Maximum Sales Charge on 5.75% None None
Purchases (as a % of offering
price)
- - -----------------------------------------------------------------------------------------
Sales Charge on Reinvested None None None
Dividends
- - -----------------------------------------------------------------------------------------
Deferred Sales Charge None(1) 5% in the first 1% if shares are
(as a % of the lower of the year, declining to redeemed within 12
original purchase price or 1% in the sixth months of
redemption proceeds) year and purchase(2)
eliminated
thereafter(2)
- - -----------------------------------------------------------------------------------------
Exchange Fee None None None
- - -----------------------------------------------------------------------------------------
Redemption Fee None(3) None(3) None(3)
</TABLE>

/ / ANNUAL FUND OPERATING EXPENSES are paid out of a Fund's assets and
represent the Fund's expenses in operating its business. For example, each

<PAGE>
Fund pays management fees to its investment advisor, 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 Funds are Managed," below. A Fund has
other regular expenses for services, such as transfer agent fees, custodial fees
paid to the bank that holds the Fund's portfolio securities, audit fees and
legal expenses. Those expenses are detailed in a Fund's Financial Statements in
the Statement of Additional Information.

ANNUAL FUND OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET ASSETS):

<TABLE>
<S> <C> <C> <C>
CLASS A CLASS B CLASS C
SHARES SHARES SHARES
- - ------------------------------------------------------------------------------------
Management Fees
Growth Fund.............................. 0.85% 0.85% 0.85%
Balanced Fund............................ 0.85% 0.85% 0.85%
Income Fund.............................. 0.75% 0.75% 0.75%
- - ---------------------------------------------------------------------------------------
12b-1 Plan Fees
Growth Fund.............................. 0.25% 1.00% 1.00%
Balanced Fund............................ 0.25% 1.00% 1.00%
Income Fund.............................. 0.25% 1.00% 1.00%
- - ---------------------------------------------------------------------------------------
Other Expenses
Growth Fund.............................. 0.45% 0.45% 0.45%
Balanced Fund............................ 0.45% 0.45% 0.45%
Income Fund.............................. 0.50% 0.50% 0.50%
- - ---------------------------------------------------------------------------------------
Total Fund Operating Expenses
Growth Fund.............................. 1.55% 2.30% 2.30%
Balanced Fund............................ 1.55% 2.30% 2.30%
Income Fund.............................. 1.50% 2.25% 2.25%
</TABLE>

The numbers for the Class A and Class B shares in the chart above are based
on the Fund's expenses for its last fiscal period ended December 31, 1995. These
amounts are shown as a percentage of the average net assets of each class of
each Fund's shares for that year. Class A and Class B shares were not publicly
offered before May 1, 1995 and October 1, 1995, respectively. Therefore, the
Annual Fund Operating Expenses shown are based on expenses for the period from
May 1, 1995 (for Class A shares) or October 1, 1995 (for Class B shares) until
December 31, 1995. Class C shares were not publicly offered during the fiscal
period ended December 31, 1995. Accordingly, the "Other Expenses" for Class C
shares are estimates based upon amounts that would have been payable if Class C
shares had been outstanding during the period from May 1, 1995 to December 31,
1995. The actual expenses for each class of shares in future years may be more
or less than the numbers in the chart, depending on a number of factors,
including the actual amount of a Fund's assets represented by each class of
shares.

<PAGE>

/ / 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 each Fund, and each
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 and 3 years:

<TABLE>
<S> <C> <C>
1 YEAR 3 YEARS
- - ------------------------------------------------------------------------------------
Class A Shares
Growth Fund...................................... $72 $104
Balanced Fund.................................... $72 $104
Income Fund...................................... $72 $102
- - ---------------------------------------------------------------------------------------
Class B Shares
Growth Fund...................................... $73 $112
Balanced Fund.................................... $73 $112
Income Fund...................................... $73 $110
- - ---------------------------------------------------------------------------------------
Class C Shares
Growth Fund...................................... $34 $72
Balanced Fund.................................... $34 $72
Income Fund...................................... $33 $70
</TABLE>

If you did not redeem your investment, it would incur the following
expenses:

<TABLE>
<S> <C> <C>
1 YEAR 3 YEARS
- - ------------------------------------------------------------------------------------
Class A Shares
Growth Fund...................................... $72 $104
Balanced Fund.................................... $72 $104
Income Fund...................................... $72 $102
- - ---------------------------------------------------------------------------------------
Class B Shares
Growth Fund...................................... $23 $72
Balanced Fund.................................... $23 $72
Income Fund...................................... $23 $70
- - ---------------------------------------------------------------------------------------
Class C Shares
Growth Fund...................................... $23 $72
Balanced Fund.................................... $23 $72
Income Fund...................................... $23 $70
</TABLE>

<PAGE>
Because of the effect of the asset-based sales charge and the contingent
deferred sales charge on Class B and Class C shares, long-term Class B and Class
C shareholders could pay the economic equivalent of more than the maximum
front-end sales charge allowed under applicable regulations. For Class B
shareholders, the automatic conversion of Class B shares into Class A shares is
designed to minimize the likelihood that this will occur. Please refer to "How
to Buy 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
FUNDS, WHICH MAY BE MORE OR LESS THAN THE AMOUNTS SHOWN.

A BRIEF OVERVIEW OF THE FUNDS

Some of the important facts about each 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 a Fund. Keep the Prospectus for reference after you
invest, particularly for information about your account, such as how to sell or
exchange shares.

/ / WHAT ARE THE FUNDS' INVESTMENT OBJECTIVES? Each LifeSpan Fund has its
own investment objective:

LIFESPAN GROWTH FUND seeks long-term capital appreciation. Current income is
not a primary consideration.

LIFESPAN BALANCED FUND seeks a blend of capital appreciation and income.

LIFESPAN INCOME FUND seeks high current income, with opportunities for
capital appreciation.

/ / WHAT DO THE FUNDS INVEST IN? Each Fund is an asset allocation fund and
seeks to achieve its investment objective by allocating its assets among two
broad classes of investments--stocks and bonds. The stock class includes equity
securities of all types. The bond class includes all varieties of fixed-income
instruments.

The Manager diversifies each Fund's stock class by allocating the Fund's
stock portfolio among four stock components: international stocks, value/ growth
stocks, growth and income stocks and small-capitalized growth stocks (small
cap). Each stock component may invest a portion of its assets in bonds to
enhance appreciation or income.

The Manager diversifies a Fund's bond class by allocating the Fund's bond
portfolio among three bond components: government and corporate bonds, high
yield/high risk bonds (also called "junk bonds") and short-term bonds.

There is no requirement that the Manager allocate a Fund's assets among all
stock or bond components at all times. Each Fund's normal allocation is shown in
the chart on page 12 below but the allocation ranges are subject to change. The
Funds' investments are more fully explained in "Investment Objectives and
Policies," starting on page 11.

<PAGE>

/ / WHO MANAGES THE FUNDS? The Funds' investment advisor is
OppenheimerFunds, Inc., which (including a subsidiary) advises investment
company portfolios having over $50 billion in assets at March 31, 1996. The
Funds' Board of Directors, elected by shareholders, oversees the investment
advisor and the portfolio managers. The Manager is paid an advisory fee by each
Fund, based on its net assets. The Manager has engaged three Sub-advisers to
manage specific components of each Fund: Babson-Stewart Ivory International
manages the assets in the international components; BEA Associates manages the
small cap stocks components; and Pilgrim Baxter & Associates Ltd. manages the
high yield/high risk components. The Manager manages the remaining components
using its own investment management personnel. Please refer to "How the Funds
are Managed," starting on page 27 for more information about the Manager, the
Sub-Advisers and their fees.

/ / HOW RISKY ARE THE FUNDS? All investments carry risks to some degree.
Allocating assets among different types of investments allows each Fund to take
advantage of opportunities in different types of investments, but also subjects
the Fund to the risks of those investment types. Stock values fluctuate in
response to the activities of individual companies and general market economic
conditions. The values of bonds fluctuate based on changes in interest rates and
in the credit quality of the issuer. A Fund's investments in foreign securities
are subject to additional risks associated with investing abroad. Non-investment
grade securities may have speculative characteristics and be subject to a
greater credit risk than investment grade securities. These changes affect the
value of a Fund's investments and its share prices for each class of its shares.
The Growth Fund, a stock fund, is expected to be more volatile than the Balanced
Fund, an income and growth fund, which in turn is generally expected to be more
volatile than the Income Fund.

While the Manager and Subadvisers try to reduce risks by diversifying
investments, by carefully researching securities before they are purchased and
in some cases by using hedging techniques, there is no guarantee of success in
achieving a Fund's objective. Your shares may be worth more or less than their
original cost when you redeem them. Please refer to "Investment Risks" starting
on page 16 for a more complete discussion of each Fund's investment risks.

/ / WILL I PAY A SALES CHARGE TO BUY SHARES? Each Fund has three 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 and Class C shares are offered
without front-end sales charges, but may be subject to a contingent deferred
sales charge if redeemed within 6 years or 12 months, respectively, of purchase.
There is also an annual asset-based sales charge on Class B and

<PAGE>

Class C shares. Please review "How To Buy Shares" starting on page 33 for more
details, including a discussion about factors you and your financial advisor
should consider in determining which class may be appropriate for you.

/ / 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 48. Each Fund also offers exchange
privileges to other Oppenheimer funds, described in "How to Exchange Shares" on
page 50.

/ / HOW HAVE THE FUNDS PERFORMED? Each Fund measures its performance by
quoting its average annual total returns and cumulative total returns, which
measure historical performance. Those returns can be compared to the total
returns (over similar periods) of other funds. Of course, other funds may have
different objectives, investments, and levels of risk. Please remember that past
performance does not guarantee future results.

FINANCIAL HIGHLIGHTS

The tables on the following pages present selected audited financial information
about the Funds, including per share data and expense ratios and other data
based on each Fund's respective average net assets. This information has been
audited by Arthur Andersen LLP, the Funds' independent auditors, whose report on
the Funds' financial statements for the fiscal period ended December 31, 1995,
is included in the Statement of Additional Information. Class C shares were not
publicly offered during the period shown, and consequently, no information on
Class C shares is included in the tables on the following pages or in the Funds'
financial statements. Additional information about the performance of each Fund
is contained in its 1995 Annual Report, which may be obtained without charge by
calling the Fund at the telephone number, or writing to the Fund's address, on
the back cover.

<PAGE>
FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
CLASS A(C)
--------------------------------------------
PERIOD ENDED DECEMBER 31, 1995*
--------------------------------------------
CAPITAL
APPRECIATION BALANCED DIVERSIFIED
FUND FUND INCOME FUND
<S> <C> <C> <C>
- - ------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA:
Net asset value, beginning of period.............. $ 10.00 $ 10.00 $ 10.00
- - ------------------------------------------------------------------------------------------------
Income (loss from investment operations........... -- -- --
Net investment income (loss)...................... .16 .24 .37
Net realized and unrealized gain (loss on
investments and foreign currency transactions.... 1.63 1.29 .73
- - ------------------------------------------------------------------------------------------------
Total income (loss) from investment operations.... 1.79 1.53 1.10
- - ------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income.............. (.17) (.25) (.36)
Distributions from net realized gain on
investments and foreign currency transactions.... (.23) (.23) (.04)
- - ------------------------------------------------------------------------------------------------
Total dividends and distributions to
shareholders..................................... (.40) (.48) (.40)
- - ------------------------------------------------------------------------------------------------
Net asset value, end of period.................... $ 11.39 $ 11.05 $ 10.70
- - ------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE(B)............... 18.02% 15.33% 11.22%
- - ------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands).......... $34,368 $41,861 $24,619
- - ------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss)...................... 2.32%(a) 3.47%(a) 5.35%(a)
Expenses.......................................... 1.55%(a) 1.55%(a) 1.50%(a)
- - ------------------------------------------------------------------------------------------------
Portfolio turnover rate........................... 71.77%(a) 76.26%(a) 45.78%(a)
- - ------------------------------------------------------------------------------------------------
</TABLE>

* G.R. Phelps & Co. managed the Funds during this period.
(a)Annualized
(b)Total returns do not include the effect of sales charges.
(c)For the period from May 1, 1995 (Inception) to December 31, 1995

<PAGE>
FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
CLASS B(C)
-------------------------------------------
PERIOD ENDED DECEMBER 31, 1995*
-------------------------------------------
CAPITAL
APPRECIATION BALANCED DIVERSIFIED
FUND FUND INCOME FUND
<S> <C> <C> <C>
- - -------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA:
Net asset value, beginning of period.............. $11.14 $10.95 $10.45
- - -------------------------------------------------------------------------------------------------
Income (loss) from investment operations.......... -- -- --
Net investment income (loss)...................... .03 .05 .12
Net realized and unrealized gain (loss) on
investments and foreign currency transactions.... .56 .45 .32
- - -------------------------------------------------------------------------------------------------
Total income (loss) from investment operations.... .59 .50 .44
- - -------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income.............. (.03) (.06) (.11)
Distributions from net realized gain on
investments and foreign currency transactions.... (.23) (.23) (.04)
- - -------------------------------------------------------------------------------------------------
Total dividends and distributions to
shareholders..................................... (.26) (.29) (.15)
- - -------------------------------------------------------------------------------------------------
Net asset value, end of period.................... $11.47 $11.16 $10.74
- - -------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE(B)............... 5.34% 4.49% 4.30%
- - -------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands).......... $ 561 $ 441 $ 192
- - -------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss)...................... 1.70%(a) 3.01%(a) 5.23%(a)
Expenses.......................................... 2.30%(a) 2.30%(a) 2.25%(a)
- - -------------------------------------------------------------------------------------------------
Portfolio turnover rate........................... 71.77%(a) 76.26%(a) 45.78%(a)
- - -------------------------------------------------------------------------------------------------
</TABLE>

* G.R. Phelps & Co. managed the Funds during this period.
(a)Annualized
(b)Total returns do not include the effect of sales charges.
(c)For the period from October 1, 1995 (Inception) to December 31, 1995

10
<PAGE>
INVESTMENT OBJECTIVES AND POLICIES

OBJECTIVES. Each LifeSpan Fund has its own investment objective:

LIFESPAN GROWTH FUND seeks long-term capital appreciation. Current income is
not a primary consideration.

LIFESPAN BALANCED FUND seeks a blend of capital appreciation and income.

LIFESPAN INCOME FUND seeks high current income, with opportunities for
capital appreciation.

INVESTMENT POLICIES AND STRATEGIES. Each Fund is an asset allocation fund and
seeks to achieve its investment objective by allocating its assets among two
broad classes of investments--stocks and bonds. The stock class includes equity
securities of many types. The bond class includes several varieties of fixed-
income instruments. Allocating assets among different types of investments
allows each Fund to take advantage of a greater variety of investment
opportunities than funds that invest in only one asset class, but also subjects
the Fund to the risks of those types of investments. The general risks of stock
and bond investments are discussed in "Investment Risks," below.

The Manager has the ability to allocate a Fund's assets within specified
ranges. A Fund's normal allocation indicates the benchmark for its combination
of investments in each asset class over time. As market and economic conditions
change, however, the Manager may adjust the asset mix between the stock and bond
classes within a normal asset allocation range as long as the relative risk and
return characteristics of the three Funds remain distinct and each Fund's
investment objective is preserved. The Manager will review normal allocations
between the stock and bond classes quarterly and, if necessary, will rebalance
the investment allocation at that time. Additional adjustments may be made if an
asset allocation shift of 5% or more is warranted.

/ / THE ASSET CLASS COMPONENTS. The Manager will diversify each Fund's
investments among four stock components: international stocks, value/growth
stocks, growth and income stocks and small-capitalized growth stocks ("small
cap" stocks). Each stock component is also permitted to invest a portion of its
assets in bonds when the Manager or relevant Subadviser determines that
increased flexibility in portfolio management is desirable to enhance
appreciation or income.

The Manager will diversify a Fund's bond investments among three bond
components: government and corporate bonds, high yield/high risk bonds (also
called "junk bonds") and short-term bonds. Although the Balanced Fund will
normally invest 25% of its assets in fixed-income senior securities, there is no
other requirement that the Manager allocate a Fund's assets among all stock or
bond components at all times. These stock and bond components have been selected
because the Manager believes that this additional level of

<PAGE>
asset diversification will provide each Fund with the potential for higher
returns with lower overall volatility. Each Fund's normal allocation is shown in
the chart below.

ASSET CLASSES AND COMPONENTS

<TABLE>
<CAPTION>
GROWTH FUND BALANCED FUND INCOME FUND
------------------- ------------------- -------------------
<S> <C> <C> <C> <C> <C> <C>
NORMAL NORMAL NORMAL
ALLOCATION RANGE ALLOCATION RANGE ALLOCATION RANGE
- - ------------------------------------------------------------------------------------
STOCKS.................................. 80% 70-90% 60% 50-70% 25% 15-35%
International......................... 20% 15-25% 15% 5-20% 0% 0%
Value/Growth.......................... 20% 15-30% 15% 10-25% 0% 0%
Growth/Income......................... 20% 15-30% 15% 10-25% 25% 15-35%
Small Cap............................. 20% 15-25% 15% 5-20% 0% 0%
- - ---------------------------------------------------------------------------------------------------------
BONDS................................... 20% 10-30% 40% 30-50% 75% 65-85%
Government/Corporate.................. 10% 5-15% 15% 10-25% 35% 30-34%
High Yield/High Risk Bonds............ 10% 5-15% 15% 5-20% 15% 5-20%
Short Term Bonds...................... 0% 0% 10% 5-20% 25% 15-30%
</TABLE>

All percentage limitations apply at the time of purchase of a security. The
Manager may rebalance the asset allocations quarterly to realign them in
response to market conditions. Once the Manager has determined the weighting of
the stock and bond asset classes and the components of each Fund, the Manager or
the relevant Subadviser will then select the individual securities to be
included in each component. It is important to note that the types of securities
normally held in each component are not exclusive to that component; other
components may hold foreign securities besides the International Component, for
example. Therefore the percentage allocation ranges do not limit a Fund's
holdings of particular types of securities to a particular component.

/ / THE SUBADVISERS. The Manager has engaged three subadvisers (each is
referred to as a "Subadviser") to manage certain components of each Fund's
investment portfolio. Each Subadviser manages the portion of a Fund's assets in
the particular component assigned to it by the Manager. The Manager has assigned
the management of the components as follows:

<TABLE>
<S> <C>
SUBADVISER COMPONENT MANAGED BY
SUBADVISER
- - ---------------------------------------------------------------------
Babson-Stewart Ivory International International Stocks
Pilgrim Baxter & Associates Small Cap Stocks
BEA Associates High Yield/High Risk Bonds
</TABLE>

The Manager manages the remaining components using its own investment
management personnel. See "How the Funds Are Managed" for additional
information.

<PAGE>

STOCK INVESTMENTS. Each Fund will invest the portion of its assets which are
allocated to stock investments among four components, each of which invests
principally in equity securities. Each differs with respect to investment
criteria and characteristics as described below:

/ / INTERNATIONAL COMPONENT. This component seeks long-term growth of
capital primarily through a diversified portfolio of marketable international
equity securities. The investments in the international component will be
allocated among several countries. In addition, up to 25% of the assets in this
component may be invested in stocks and bonds of companies based in emerging
countries. The component's assets generally will be invested in equity
securities of seasoned companies that are listed on foreign stock exchanges and
which the Subadviser considers to have attractive characteristics as to
profitability, growth and financial resources. "Seasoned" companies are those
known for the quality and acceptance of their products or services and for their
ability to generate profits. There are no issuer capitalization requirements for
investments. Stocks are purchased on the basis of fundamental and valuation
analyses, but investments are not based on the Subadviser's integration of any
particular analytical disciplines.

Consistent with the provisions of the Investment Company Act, the
component's assets may be invested in the securities of closed-end investment
companies that invest in foreign securities. A portion of the international
component's investments may be held in corporate bonds and government securities
of foreign issuers and cash and short-term instruments. The special risks of
investing in foreign securities and emerging markets are described in
"Investment Risks," below.

/ / VALUE/GROWTH COMPONENT. This component seeks to achieve long-term growth
of capital by investing primarily in common stocks with low price-earnings
ratios and better than anticipated earnings. Realization of current income is
not a primary consideration. Stocks with low price-earnings ratios and favorable
earnings surprises are identified by the Manager using fundamental securities
analysis to select individual stocks for purchase. When the price/earnings ratio
of a stock held by the value/growth component moves significantly above the
multiple of the overall stock market, or the company reports a material earnings
disappointment, the Manager may consider selling the stock. Up to 15% of the
component's assets may be invested in stocks of foreign issuers that generally
have a substantial portion of their business in the United States, and in
American Depository Receipts ("ADRs"). A portion of the component's assets may
be held in cash and in short-term investments.

/ / GROWTH/INCOME COMPONENT. This component seeks to enhance each Fund's
total return through capital appreciation and dividend income by investing
primarily in common stocks with low price-earnings ratios, better-than-
anticipated earnings and better than market average dividend yields. Stocks with
low price-earnings ratios (for example, below the price-earnings ratio of the
S&P 500 Index), favorable earnings surprises and above-average yields are
identified by the Manager using fundamental securities analysis to select
individual stocks for this component. When the price-earnings ratio of a stock

<PAGE>

held by the component moves significantly above the multiple of the overall
stock market, or the company reports a material earnings disappointment, or when
the yield drops significantly below the market yield, normally that stock will
be sold.

Up to 15% of the component's assets may be invested in stocks of foreign
issuers that generally have a substantial portion of their business in the
United States, and in ADRs. A portion of the component's investments may be held
in investment grade or below investment grade convertible securities, corporate
bonds and U.S. Government securities, cash and short-term instruments.

/ / SMALL CAP COMPONENT. This component seeks long-term growth of capital by
investing primarily in stocks of companies with relatively small market
capitalization, typically between $250 million to $1.5 billion. Capitalization
is the aggregate value of a company's stock, or its price per share times the
number of shares outstanding. Current income is a secondary consideration. When
selecting individual securities for the component's portfolio, the Subadviser
seeks companies that have an outlook for strong growth in earnings and the
potential for significant capital appreciation, particularly in industry
segments that are experiencing rapid growth. Securities will be sold when the
Subadviser believes that anticipated appreciation is no longer probable and that
alternative investments offer superior appreciation prospects, or the risk of a
decline in market price is too great. Historical results tend to confirm the
benefits of investing in companies with small capitalizations. A portion of the
component's investments may also be held in cash and short-term instruments.

BOND INVESTMENTS. Each Fund will invest those assets which are allocated to the
bond class among three components. Each component invests in an array of
fixed-income securities as described below. The LifeSpan Balanced Fund will
invest at least 25% of its assets in fixed-income senior securities.

/ / GOVERNMENT/CORPORATE COMPONENT. This component seeks current income and
the potential for capital appreciation by investment primarily in fixed-income
debt securities, including investment grade corporate debt obligations of
foreign and U.S. issuers and securities issued by the U.S. Government and its
agencies and instrumentalities and by foreign governments. Although the
component may invest in securities with maturities across the entire slope of
the yield curve, including long bonds (having maturities of 10 or more years),
intermediate notes (with maturities of 3 to 10 years) and short term notes (with
maturities of 1 to 3 years), the Manager expects that normally the component
will have an intermediate average maturity and duration.

The Manager may take into account prepayment features when determining the
maturity of an investment. The Manager's investment strategy includes the
purchase of bonds that are underpriced relative to other debt securities having
similar risk profiles. The Manager evaluates a broad array of factors, including
maturity, creditworthiness, cash flow certainty and interest

<PAGE>

rate volatility, and compares yields in relation to trends in the economy, the
financial and commodity markets and prevailing interest rates. The component may
also invest a portion of its assets in cash and short-term instruments.

/ / HIGH YIELD/HIGH RISK BOND COMPONENT. This component seeks to earn as
high a level of current income as is consistent with the risks associated with
high yield investments. The component's assets are invested primarily in bonds
that are rated BB or lower by Standard & Poor's or Ba or lower by Moody's
Investor Service, Inc. or, if not rated, that are deemed by the Subadviser to be
of comparable quality to rated securities in those categories. These are
commonly referred to as "junk bonds." This component may invest in bonds that
are in default. Bonds in default are not making interest or principal payments
on the date due.

The Subadviser employs an active sector rotational style utilizing all
sectors of the high yield market, with an emphasis on diversification to control
risk. The Subadviser typically favors higher quality companies in the non-
investment grade market, senior debt over junior debt, and secured over
unsecured investments. The Subadviser screens individual securities for such
characteristics as minimum yield and issue size, issue liquidity and financial
and operational strength. In-depth credit research will then be conducted to
arrive at a core group of securities within the high yield universe for the
component. Continuous credit monitoring and adherence to sell disciplines
associated with both price appreciation and depreciation are utilized to seek
the overall yield and price objectives of the component. The component may also
invest a portion of its assets in cash and short-term instruments. The special
risks of investing in below-investment grade securities are described in
"Investment Risks," below.

/ / SHORT-TERM BOND COMPONENT. This component seeks a high level of current
income consistent with prudent investment risk and preservation of capital by
investing primarily in debt obligations of foreign and U.S. issuers and
securities issued by the U.S. Government and its agencies and instrumentalities
and by foreign governments. This component invests primarily in fixed-income
securities generally maturing within five years of date of purchase, or in
securities having prepayment or similar features which, in the view of the
Manager, give the instrument a remaining effective maturity of up to five years.
It is anticipated that the average dollar weighted maturity of the component
will generally range between two and three years.

The Manager's investment management process incorporates analysis of an
issuer's debt service capability, financial flexibility and liquidity, as well
as the fundamental trends and the outlook for an issuer and its industry. Credit
risk management is also an important factor. The Manager conducts intensive
credit research, and carefully selects individual issues and attempts to broadly
diversify portfolio holdings by industry sector and issuer. The Manager believes
that determination of an issuer's attractiveness relative to alternative issues
and/or valuations within the marketplace are important considerations in its
investment decision-making. The component may also invest a portion of its
assets in cash and money market securities.

<PAGE>

CAN A FUND'S INVESTMENT OBJECTIVE AND POLICIES CHANGE? Each Fund has an
investment objective, described above, as well as investment policies it follows
to try to achieve its objective. Additionally, each Fund uses certain investment
techniques and strategies in carrying out those investment policies. A 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." Each Fund's investment objective is not a fundamental policy.
Fund shareholders will be given 30 days' advance written notice of a change to a
Fund's investment objective.

Fundamental policies are those that cannot be changed without the approval
of a "majority" of a 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). A Fund's Board of Directors may change non-fundamental
policies without shareholder approval, although significant changes will be
described in amendments to this Prospectus.

PORTFOLIO TURNOVER. A change in the securities held by a Fund is known as
"portfolio turnover." The Funds ordinarily do not engage in short-term trading
to try to achieve their objectives. Growth Fund's and Income Fund's portfolio
turnover rate is not expected to exceed 75%. The portfolio turnover rates of the
fixed income portion and the equity portion of the Balanced Fund are expected to
be 70% and 85%, respectively. The "Financial Highlights," above, show the Funds'
portfolio turnover rates during past fiscal years.

Portfolio turnover affects brokerage costs, dealer markups and other
transaction costs, and results in a Fund's realization of capital gains or
losses for tax purposes. It may also affect the ability of a Fund to qualify as
a "regulated investment company" under the Internal Revenue Code and avoid being
taxed on amounts distributed as dividends and capital gains to shareholders.
Each Fund qualified as such in its fiscal period ended December 31, 1995 and
intends to do so in the future, although it reserves the right not to qualify.

INVESTMENT RISKS

<PAGE>

Because of the types of securities each Fund invests in and the investment
techniques each Fund uses differ, each Fund has a different risk profile. The
LifeSpan Growth Fund and Balanced Fund are designed for investors who are
investing for the long term but not seeking assured income. The LifeSpan Income
Fund is designed for investors having a greater emphasis on income rather than
growth. While the Manager and Subadvisers try to reduce risks by diversifying
investments, by carefully researching securities before they are purchased, and
in some cases by using hedging strategies, changes in securities market prices
can occur at any time, and there is no assurance that the Funds will achieve
their investment objectives. When you redeem your shares, they may be worth more
or less than what you paid for them.

/ / STOCK INVESTMENT RISKS. Each Fund may invest in common stocks, preferred
stocks, convertible securities, warrants and other equity securities of domestic
or foreign companies of any size. At times, the stock markets can be volatile,
and stock prices can change substantially. This market risk will affect a 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, or changes in government regulations affecting an industry). Not all
of these factors can be predicted.

Each Fund attempts to limit market risks by diversifying its investments,
that is, by not holding a substantial amount of stock of any one company and by
not investing too great a percentage of a Fund's assets in any one company. Also
the Funds do not concentrate their investments in any one industry or group of
industries.

/ / INTEREST RATE RISKS. In addition to credit risks, described below, debt
securities are subject to changes in their value due to changes in prevailing
interest rates. When prevailing interest rates fall, the values 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 a 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.

/ / SPECIAL RISKS OF LOWER-GRADE SECURITIES. Each Fund can invest in
high-yield, below investment grade debt securities (including both rated and
unrated securities). These "lower-grade" securities are commonly known as "junk
bonds."

All corporate debt securities (whether foreign or domestic) are subject to
some degree of credit risk. High yield, lower-grade securities, whether rated or
unrated, often have speculative characteristics and special risks that make them
riskier investments than investment grade securities. They may be subject to
greater market fluctuations and risk of loss of income and principal than lower
yielding, investment grade securities. There may be less of a market for

<PAGE>

them and therefore they may be harder to sell at an acceptable price. There is a
relatively greater possibility that the issuer's earnings may be insufficient to
make the payments of interest due on the bonds. The issuer's low
creditworthiness may increase the potential for its insolvency. For foreign
lower-grade debt securities, these risks are in addition to the risks of
investing in foreign securities, described below. These risks mean that a Fund
may not achieve the expected income from lower-grade securities, and that a
Fund's net asset value per share may be affected by declines in value of these
securities.

/ / HEDGING INSTRUMENTS CAN BE VOLATILE INVESTMENTS AND MAY INVOLVE SPECIAL
RISKS. The use of hedging instruments requires special skills and knowledge of
investment techniques that are different from what is required for normal
portfolio management. If the Manager or a Subadviser uses a hedging instrument
at the wrong time or judges market conditions incorrectly, hedging strategies
may reduce a Fund's return. A Fund could also experience losses if the prices of
its futures and options positions were not correlated with its other investments
or if it could not close out a position because of an illiquid market for the
future or option.

Options trading involves the payment of premiums, and options, futures and
forward contracts are subject to special tax rules that may affect the amount,
timing and character of a Fund's income and distributions. There are also
special risks in particular hedging strategies. For example, if a covered call
written by a Fund is exercised on an investment that has increased in value, the
Fund will be required to sell the investment at the call price and will not be
able to realize any profit if the investment has increased in value above the
call price. In writing puts, there is a risk that a Fund may be required to buy
the underlying security at a disadvantageous price. The use of Forward Contracts
may reduce the gain that would otherwise result from a change in the
relationship between the U.S. dollar and a foreign currency. Interest rate swaps
are subject to the risk that the other party will fail to meet its obligations
(or that the underlying issuer will fail to pay on time), as well as interest
rate risks. A Fund could be obligated to pay more under its swap agreements than
it receives under them, as a result of interest rate changes. These risks are
described in greater detail in the Statement of Additional Information.

/ / THERE ARE SPECIAL RISKS IN INVESTING IN DERIVATIVE INVESTMENTS. The
company issuing the instrument may fail to pay the amount due on the maturity of
the instrument. Also, the underlying investment or security might not perform
the way the Manager or relevant Subadviser expected it to perform. Markets,
underlying securities and indices may move in a direction not anticipated by the
Manager or relevant Subadviser. Performance of derivative investments may also
be influenced by interest rate and stock market changes in the U.S. and abroad.
All of this can mean that a Fund will realize less principal or income from the
investment than expected. Certain derivative investments held by a Fund may be
illiquid. Please refer to "Illiquid and Restricted Securities."

<PAGE>

/ / FOREIGN SECURITIES HAVE SPECIAL RISKS. While foreign securities offer
special investment opportunities, there are special risks. Because each Fund may
purchase securities denominated in foreign currencies or traded primarily in
foreign markets, a change in the value of a foreign currency against the U.S.
dollar will result in a change in the U.S. dollar value of those foreign
securities. Foreign issuers are not required to use generally-accepted
accounting principles that apply to U.S. issuers. If foreign securities are not
registered for sale in the U.S. under U.S. securities laws, the issuer does not
have to comply with the disclosure requirements that U.S. companies are subject
to. The value of foreign investments may be affected by other factors, including
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.

In addition, it is generally more difficult to obtain court judgements
outside the U.S. if a Fund were to sue a foreign issuer or broker. Additional
costs may be incurred because foreign brokerage commissions are generally higher
than U.S. rates, and there are additional custodial costs associated with
holding securities abroad. More information about the risks and potential
rewards of investing in foreign securities is contained in the Statement of
Additional Information.

/ / EMERGING MARKET INVESTMENTS ARE VOLATILE. Investments in emerging market
countries may involve risks in addition to those identified above for
investments in foreign securities. Securities issued by emerging market
countries and by companies located in those countries may be subject to extended
settlement periods, and a Fund might not receive principal and/or income on a
timely basis. Its net asset values could be affected. Emerging market countries
may have smaller, less well-developed markets and exchanges; there may be a lack
of liquidity for emerging market securities; interest rates and foreign currency
exchange rates may be more volatile; sovereign limitations on foreign
investments may be more likely to be imposed; there may be significant balance
of payment deficits; and their economies and markets may respond in a more
volatile manner to economic changes than those of developed countries.

INVESTMENT TECHNIQUES AND STRATEGIES

The Funds may also use the investment techniques and strategies described below,
which involve certain risks. The Statement of Additional Information contains
more detailed information about these practices, including limitations on their
use that may help to reduce some of the risks.

/ / INVESTING IN LOWER-GRADE SECURITIES. Lower-grade debt securities
generally offer higher income potential than investment grade securities.
"Lower-grade" securities have a rating below "BBB" by Standard & Poor's or "Baa"
by Moody's or similar ratings by other domestic or foreign rating organizations,
or

<PAGE>

they are not rated by a nationally-recognized rating organization but the
Manager or Sub-Adviser judges them to be comparable to lower-rated securities. A
Fund may invest in securities rated as low as "D" by Standard & Poor's or "C" by
Moody's. Appendix A to this Prospectus describes the rating categories of
Moody's and Standard & Poor's. There are special risks investing in lower-grade
securities, discussed in "Investment Risks," above.

/ / INVESTING IN EMERGING MARKET COUNTRIES. Babson-Stewart, as the
Subadviser to the international component, may invest a portion of a Fund's
assets in companies located in emerging countries. The Subadviser considers
emerging countries to include any country that is defined as an emerging or
developing economy by the International Bank for Reconstruction and Development,
the International Finance Committee, The United Nations or its authorities, or
the MSCI Emerging Markets Index. There are special risks investing in emerging
markets, discussed in "Investment Risks," above.

/ / ADRS, EDRS AND GDRS. Each Fund may invest in ADRs, EDRs and GDRs. ADRs
are receipts issued by a U.S. bank or trust company which evidence ownership of
underlying securities of foreign corporations. ADRs are traded on domestic
exchanges or in the U.S. over-the-counter market and, generally, are in
registered form. To the extent a Fund acquires ADRs through banks which do not
have a contractual relationship with the foreign issuer of the security
underlying the ADR to issue and service that ADR, there may be an increased
possibility that the Fund would not become aware of and be able to respond in a
timely manner to corporate actions such as stock splits or rights offerings
involving the foreign issuer. A Fund may also invest in EDRs and GDRs, which are
receipts evidencing an arrangement with a non-U.S. bank similar to that for ADRs
and are designed for use in non-U.S. securities markets. EDRs and GDRs are not
necessarily quoted in the same currency as the underlying security.

/ / EURODOLLARS AND YANKEE DOLLARS. The Funds may also invest in obligations
of foreign branches of U.S. banks (denominated in Eurodollars) and U.S. branches
of foreign banks ("Yankee dollars") as well as foreign branches of foreign
banks. These investments involve risks that are different from investment in
securities of U.S. banks, including potential unfavorable political and economic
developments, different tax provisions, seizure of foreign deposits, currency
controls, interest limitations or other governmental restrictions which might
affect payment of principal or interest.

Ginnie Mae certificates are one type of mortgage-related U.S. Government
Security a Fund may invest in. Other mortgage-related U.S. Government

<PAGE>
Securities the Funds invest in that are issued or guaranteed by federal agencies
or government-sponsored entities are not supported by the full faith and credit
of the U.S. Government. Those securities include obligations supported by the
right of the issuer to borrow from the U.S. Treasury, such as obligations of
Federal Home Loan Mortgage Corporation ("Freddie Mac"), obligations supported
only by the credit of the instrumentality, such as Federal National Mortgage
Association ("Fannie Mae") or the Student Loan Marketing Association and
obligations supported by the discretionary authority of the U.S. Government to
repurchase certain obligations of U.S. Government agencies or instrumentalities
such as the Federal Land Banks and the Federal Home Loan Banks. Other U.S.
Government Securities a Fund may invest in are collateralized mortgage
obligations ("CMOs").
The value of U.S. Government Securities will fluctuate until they mature
depending on prevailing interest rates. Because the yields on U.S. Government
Securities are generally lower than on corporate debt securities, when a Fund
holds U.S. Government Securities it may attempt to increase the income it can
earn from them by writing covered call options against them, when market
conditions are appropriate. Writing covered calls is explained below, under
"Hedging."

/ / SHORT-TERM DEBT SECURITIES. Each 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 banks
and savings loan associations. While the LifeSpan Income Fund may use these
investments primarily for income purposes, each Fund may invest in these
securities in greater amounts for temporary defensive purposes when market
conditions are unstable, or for liquidity purposes.

/ / MORTGAGE-BACKED SECURITIES, CMOS AND REMICS. Certain mortgage-backed
securities, whether issued by the U.S. Government or by private issuers, "pass-
through" to investors the interest and principal payments generated by a pool of
mortgages assembled for sale by government agencies. Pass-through
mortgage-backed securities entail the risk that principal may be repaid at any
time because of prepayments on the underlying mortgages. That may result in
greater price and yield volatility than traditional fixed-income securities that
have a fixed maturity and interest rate.
Each Fund may also invest in CMOs, which generally are obligations fully
collateralized by a portfolio of mortgages or mortgage-related securities, and
in real estate mortgage investment conduits ("REMICs"). Payment of the interest
and principal generated by the pool of mortgages on CMOs and REMICs are passed
through to the holders as the payments are received. CMOs and REMICs are issued
with a variety of classes or series which have different maturities. Certain
CMOs and REMICs may be more volatile and less liquid

<PAGE>

than other types of mortgage-related securities, because of the possibility of
the prepayment of principal due to prepayments on the underlying mortgage loans.
The Funds do not intend to acquire "residual" interests in REMICs.

/ / "STRIPPED" SECURITIES. Each Fund may also invest in CMOs and REMICs that
are "stripped." That means that the security is divided into two parts, one of
which receives some or all of the principal payments (and is known as a
"principal-only" security or "P/O") and the other which receives some or all of
the interest (and is known as an "interest-only" security, or "I/O"). P/Os and
I/Os are generally referred to as "derivative investments," discussed further
below.

The yield to maturity on the class that receives only interest is extremely
sensitive to the rate of payment of the principal on the underlying mortgages.
Principal prepayments increase that sensitivity. Stripped securities that pay
"interest only" are therefore subject to greater price volatility when interest
rates change, and they have the additional risk that if the underlying mortgages
are prepaid, a Fund will lose the anticipated cash flow from the interest on the
prepaid mortgages. That risk is increased when general interest rates fall, and
in times of rapidly falling interest rates, a Fund might receive back less than
its investment.
The value of "principal only" securities generally increases as interest
rates decline and prepayment rates rise. The price of these securities is
typically more volatile than that of coupon-bearing bonds of the same maturity.

Private-issuer stripped securities are generally purchased and sold by
institutional investors through investment banking firms. At present,
established trading markets have not yet developed for these securities.
Therefore, most private-issuer stripped securities may be deemed "illiquid." If
a Fund holds illiquid stripped securities, the amount it can hold will be
subject to the Fund's investment policy limiting investments in illiquid
securities to 15% of the Fund's net assets, discussed below.

/ / ASSET-BACKED SECURITIES. A Fund may invest in "asset-backed" securities.
These represent interests in pools of consumer loans and other trade
receivables, similar to mortgage-backed securities. They are issued by trusts
and "special purpose corporations." They are backed by a pool of assets, such as
credit card or auto loan receivables, which are the obligations of a number of
different parties. The income from the underlying pool is passed through to
holders, such as one of the Funds. These securities may be supported by a credit
enhancement, such as a letter of credit, a guarantee or a preference right.
However, the extent of the credit enhancement may be different for different
securities and generally applies to only a fraction of the security's value.
These securities present special risks. For example, in the case of credit card
receivables, the issuer of the security may have no security interest in the
related collateral.

<PAGE>

fixing the maximum loss if that market does not perform as expected. Depending
on the terms of the note, the Fund could forego all or part of the interest and
principal that would be payable on a comparable conventional note, and the
Fund's loss could not exceed that amount.

/ / INVERSE FLOATING RATE INSTRUMENTS. The Funds may invest in inverse
floating rate debt instruments ("inverse floaters"), including leveraged inverse
floaters and inverse floating rate mortgage-backed securities, such as inverse
floating rate "interest only" stripped mortgage-backed securities. The interest
rate on inverse floaters resets in the opposite direction from the market rate
of interest to which the inverse floater is indexed. An inverse floater may be
considered to be leveraged to the extent that its interest rate varies by a
magnitude that exceeds the magnitude of the change in the index rate of
interest. The higher degree of leverage inherent in inverse floaters is
associated with greater volatility in their market values.

/ / WARRANTS AND RIGHTS. Warrants basically are options to purchase stock at
set prices that are valid for a limited period of time. Rights are similar to
warrants but normally have a short duration and are distributed directly by the
issuer to its shareholders. A Fund may invest up to 5% of its total assets in
warrants or rights. That 5% limitation does not apply to warrants a Fund has
acquired as part of units with other securities or that are attached to other
securities. No more than 2% of a Fund's total assets may be invested in warrants
that are not listed on either The New York Stock Exchange or The American Stock
Exchange. For further details, see "Warrants and Rights" in the Statement of
Additional Information.
/ / SMALL, UNSEASONED COMPANIES. Each Fund may invest in securities of
small, unseasoned companies. These are companies that have been in operation
less than three years, including the operations of any predecessors. Securities
of these companies may have limited liquidity (which means that a Fund may have
difficulty selling them at an acceptable price when it wants to) and the price
of these securities may be volatile. See "Investing in Small, Unseasoned
Companies" in the Statement of Additional Information for a further discussion
of the risks involved in such investments.

/ / LOANS OF PORTFOLIO SECURITIES. To attempt to increase its income or
raise cash for liquidity purposes, each Fund may lend its portfolio securities,
other than in repurchase transactions, to brokers, dealers and other financial
institutions. A Fund must receive collateral for a loan. As a matter of
fundamental policy, these loans are limited to not more than 33 1/3% of the
Fund's total assets (taken at market value) and are subject to other conditions
described in the Statement of Additional Information. The Funds presently do not
intend to engage in loans of securities, but if a Fund does so it does not
intend to lend securities in amounts that will exceed 5% of the Fund's total
assets in the coming year.

/ / "WHEN-ISSUED" AND DELAYED DELIVERY TRANSACTIONS. Each Fund may purchase
securities on a "when-issued" basis and may purchase or sell securities on a
"delayed delivery" basis. These terms refer to securities that have been created

<PAGE>
and for which a market exists, but which are not available for immediate
delivery. There may be a risk of loss to a Fund if the value of the security
declines prior to the settlement date.
/ / REPURCHASE AGREEMENTS. Each Fund may enter into repurchase agreements.
In a repurchase transaction, a Fund buys a security and simultaneously sells it
to the vendor for delivery at a future date. Repurchase agreements must be fully
collateralized. However, if the vendor fails to pay the resale price on the
delivery date, a Fund may experience costs in disposing of the collateral and
may experience losses if there is any delay in doing so.

/ / ILLIQUID AND RESTRICTED SECURITIES. Under the policies established by
the Funds' Board of Directors, the Manager determines the liquidity of certain
of the Funds' 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. Each Fund cannot invest more
than 15% of its net assets in illiquid securities (including repurchase
agreements having a maturity beyond 7 days, securities that are not readily
marketable, certain restricted securities, over-the-counter options and
privately-issued stripped mortgage-backed securities. Each Fund cannot invest
more than 15% of its total assets in restricted securities.

/ / HEDGING. Each Fund may write covered call options on securities, stock
or bond indices and foreign currency. Each may purchase and sell certain kinds
of futures contracts, forward contracts, and options on futures, broadly-based
stock or bond indices and foreign currency, or enter into interest rate swap
agreements. These are all referred to as "hedging instruments." While the Funds
currently do not engage extensively in hedging, a Fund may use these instruments
for hedging and non-hedging purposes as described below.

A Fund may write covered call options and buy and sell 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 of its portfolio securities may decline, or
to establish a position in the securities market as a temporary substitute for
purchasing individual securities. It may do so to try to manage its exposure to
changing interest rates. Some of these strategies, such as selling futures and
writing covered calls, hedge a Fund's portfolio against price fluctuations.

Other hedging strategies, such as buying futures, tend to increase a Fund's
exposure to the securities market. Forward contracts may be used to try to
manage foreign currency risks on a Fund's foreign investments. Foreign currency
options may be used to try to protect against declines in the dollar value of
foreign securities a 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 a Fund for liquidity purposes, defensive reasons, or to raise cash to
distribute to shareholders. Hedging strategies entail special risks, described
in "Investment Risks," above.

/ / FUTURES. A Fund may buy and sell futures contracts for hedging and
non-hedging purposes that relate to (1) foreign currencies (these are referred

<PAGE>
to as "Forward Contracts" and are discussed below), (2) financial indices, such
as U.S. or foreign government securities indices, corporate debt securities
indices or equity securities indices (these are referred to as Financial
Futures), and (3) interest rates (these are referred to as Interest Rate
Futures). These types of Futures are described in "Hedging" in the Statement of
Additional Information.

/ / COVERED CALL OPTIONS AND OPTIONS ON FUTURES. A Fund may write (that is,
sell) call options on securities, indices and foreign currencies for hedging
purposes and write call options on Futures for hedging and non-hedging purposes,
but only if all such calls are "covered." This means a Fund must own the
security subject to the call while the call is outstanding or, in the case of
calls on futures or indices, segregate appropriate liquid assets. When a Fund
writes a call, it receives cash (called a premium). The call gives the buyer the
ability to buy the investment on which the call was written from a Fund at the
call price during the period in which the call may be exercised. If the value of
the investment does not rise above the call price, it is likely that the call
will lapse without being exercised, while the Fund keeps the cash premium (and
the investment).

A Fund may purchase put options on Futures. Buying a put on an investment
gives a Fund the right to sell the investment at a set price to a seller of a
put on that investment. A Fund may sell a put on Futures, but only if the puts
are covered by segregated liquid assets.
A Fund may sell covered call options that are traded on U.S. or foreign
securities or commodity exchanges or are traded in the over-the-counter markets.
In the case of foreign currency options, they may be quoted by major recognized
dealers in those options. Options traded in the over-the-counter market may be
"illiquid," and therefore may be subject to a Fund's restrictions on illiquid
investments.

/ / 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. A Fund may use them to try to "lock in" the U.S. dollar price of
a security denominated in a foreign currency that the Fund has purchased or
sold, or to protect against possible losses from changes in the relative value
of the U.S. dollar and a foreign currency. A Fund may also use "cross hedging,"
where the Fund hedges against changes in currencies other than the currency in
which a security it holds is denominated. No Fund will speculate in foreign
exchange.

/ / INTEREST RATE SWAPS. A Fund may enter into interest rate swaps both for
hedging and to seek to increase total return. In an interest rate swap, a Fund
and another party exchange their right to receive, or their obligation to pay,
interest on a security. For example, they may swap a right to receive floating
rate interest payments for fixed rate payments. A Fund enters into swaps only on
a net basis, which means the two payment streams are netted out, with the Fund
receiving or paying, as the case may be, only the net amount of the two
payments. A Fund will segregate liquid assets (such as cash or U.S.

25
<PAGE>

Government securities) to cover any amounts it could owe under swaps that exceed
the amounts it is entitled to receive, and it will adjust that amount daily, as
needed.

/ / DERIVATIVE INVESTMENTS. Each Fund can invest in a number of different
kinds of "derivative" investments. In general, a "derivative investment" is a
specially designed investment whose performance is linked to the performance of
another investment or security, such as an option, future, index, currency or
commodity. A Fund may not purchase or sell physical commodities; however, a Fund
may purchase and sell foreign currency in hedging transactions. This shall not
prevent a Fund from buying or selling options and futures contracts or from
investing in securities or other instruments backed by physical commodities.
There are special risks of investing in derivatives, described in "Investment
Risks," above.

Derivative investments used by a Fund are used in some cases for hedging
purposes and in other cases to seek income. In the broadest sense,
exchange-traded options and futures contracts (discussed in "Hedging," above)
may be considered "derivative investments."

"Index-linked" or "commodity-linked" notes are debt securities that call for
interest payments or repayment of principal in different terms than a typical
note where the borrower agrees to pay a fixed sum on the maturity of the note.
Principal or interest payments on an index-linked note depend on the performance
of one or more market indices, such as the S&P 500 Index or a weighted index of
commodity futures, such as crude oil, gasoline and natural gas. A Fund may
invest in "debt exchangeable for common stock" of an issuer or "equity-linked"
debt securities of an issuer. At maturity, the principal amount of the debt
security is exchanged for common stock of the issuer or is payable in an amount
based on the issuer's common stock price at the time of maturity. In either case
there is a risk that the amount payable at maturity will be less than the
expected principal amount of the debt.

OTHER INVESTMENT RESTRICTIONS. The Funds have other investment restrictions
which are "fundamental" policies. Among these fundamental policies, each Fund
cannot do any of the following:

/ / A Fund cannot borrow money, except for emergency or extraordinary
purposes including (i) from banks for temporary or short-term purposes or for
the clearance of transactions, in amounts not to exceed 33 1/3% of the value of
the Fund's total assets (including the amount borrowed) taken at market value,
(ii) in connection with the redemption of Fund shares or to finance failed
settlements of portfolio trades without immediately liquidating portfolio
securities or other assets; and (iii) in order to fulfill commitments or plans
to purchase additional securities pending the anticipated sale of other
portfolio securities or assets, but only if after each such borrowing there is
asset coverage of at least 300% as defined in the Investment Company Act. For
purposes of this investment restriction, mortgage dollar rolls, futures
contracts, options on futures contracts, securities or indices and forward
commitment transactions shall not constitute borrowing.

<PAGE>

/ / A Fund cannot make loans, except that the Fund (1) may lend portfolio
securities in accordance with the Fund's investment policies up to 33 1/3% of
the Fund's total assets taken at market value, (2) enter into repurchase
agreements, and (3) purchase all or a portion of an issue of publicly
distributed bonds, debentures or other similar obligations.

/ / A Fund cannot purchase the securities of issuers conducting their
principal activity in the same industry if, immediately after such purchase, the
value of its investments in such industry would exceed 25% of its total assets
taken at market value at the time of such investment. This limitation does not
apply to investments in obligations of the U.S. Government or any of its
agencies, instrumentalities or authorities. The Funds have undertaken, as a
matter of non-fundamental policy, to apply this restriction to 25% or more of
their assets.

/ / With respect to 75% of its total assets, a Fund cannot purchase
securities of an issuer (other than the U.S. Government, its agencies,
instrumentalities or authorities), if: (a) such purchase would cause more than
5% of the Fund's total assets taken at market value to be invested in the
securities of such issuer; or (b) such purchase would at the time result in more
than 10% of the outstanding voting securities of such issuer being held by the
Fund.

All of the percentage restrictions described above (except the 300% asset
coverage requirement on borrowing) and elsewhere in this Prospectus apply only
at the time a Fund purchases a security, and a Fund need not dispose of a
security merely because the Fund's assets have decreased or the security has
increased in value relative to the size of the Fund. There are other fundamental
policies discussed in the Statement of Additional Information.

HOW THE FUNDS ARE MANAGED

ORGANIZATION AND HISTORY. The Funds are series of Oppenheimer Series Fund, Inc.
(the "Company"), which was organized in 1981 as a Maryland corporation. It is an
open-end management investment company. Organized as a series fund, the Company
presently has eight series, each of which is diversified, including the three
LifeSpan Funds. Prior to March 18, 1996, the LifeSpan Funds were called CMIA
LifeSpan Capital Appreciation Fund, CMIA LifeSpan Balanced Fund and CMIA
LifeSpan Diversified Income Fund.

The Company (including the Funds) is governed by a Board of Directors, which
is responsible for protecting the interests of shareholders under Maryland law.
The Directors meet periodically throughout the year to oversee each Fund's
activities, review its performance, and review the actions of the Manager and
the Subadvisers. "Directors and Officers of the Fund" in the Statement of
Additional Information names the Directors and officers of the Funds and
provides more information about them. Although the Funds will not normally hold
annual meetings of shareholders, they may hold shareholder

<PAGE>
meetings from time to time on important matters, and shareholders have the right
to call a meeting to remove a Director or to take other action described in the
Company's Articles of Incorporation.
The Board of Directors has the power, without shareholder approval, to
divide unissued shares of the Company into two or more classes. The Board has
done so, and each Fund currently has three classes of shares, Class A, Class B
and Class C. All classes invest in the same investment portfolio. Each class has
its own dividends and distributions, and pays certain expenses which may be
different for the different classes. Each class may have a different net asset
value. Each share has one vote at shareholder meetings, with fractional shares
voting proportionally on 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. Please refer to "How the Funds are Managed" in the
Statement of Additional Information for further information on voting of shares.

THE MANAGER, THE SUB-ADVISERS AND THEIR AFFILIATES. The Funds are managed by the
Manager, OppenheimerFunds, Inc., which supervises each Fund's investment program
and handles its day-to-day business. The Manager carries out its duties, subject
to the policies established by the Board of Directors, under separate Investment
Advisory Agreements for each Fund which state the Manager's responsibilities.
The Agreements set forth the rates of the management fees paid by a Fund to the
Manager, and describes the expenses that a Fund is responsible to pay to conduct
its business.

The Manager has operated as an investment adviser since 1959. The Manager
(including a subsidiary) currently manages investment companies, including other
Oppenheimer funds, with assets of more than $50 billion as of March 31, 1996,
and with nearly 3 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 SUBADVISERS. The Manager has engaged three Subadvisers to provide
day-to-day portfolio management for certain components of the Funds.
Babson-Stewart, One Memorial Drive, Cambridge, MA 02142, the Subadviser to the
international component, was established in 1987. The general partners of
Babson-Stewart are David L. Babson & Co., which is an indirect subsidiary of
Massachusetts Mutual Life Insurance Company, and Stewart Ivory & Co., Ltd. As of
December 31, 1995, Babson-Stewart had approximately $5.4 billion in assets under
management.

BEA Associates, One Citicorp Center, 153 East 53rd Street, 57th Floor, New
York, NY 10022, the Subadviser to the high yield/high risk bond component, has
been providing fixed-income and equity management services to institutional
clients since 1984. BEA is a partnership between Credit Suisse

<PAGE>

Capital Corporation and CS Advisors Corp. As of December 31, 1995, BEA
Associates, together with its global affiliate, had $27.4 billion in assets
under management.

Pilgrim Baxter, 1255 Drummers Lane, Wayne, PA 19087, the Subadviser to the
small cap component, was established in 1982 to provide specialized equity
management for institutional investors including other investment companies.
Pilgrim Baxter is a wholly-owned subsidiary of United Asset Management
Corporation. As of March 31, 1996, Pilgrim Baxter had over $9 billion in assets
under management. Each Subadviser is responsible for choosing the investments of
its respective component for each Fund and its duties and responsibilities are
set forth in its respective contract with the Manager. The Manager, not the
Funds, pay the Subadvisers.

/ / PORTFOLIO MANAGERS. The Manager supervises each Fund's investment
program and regularly reviews the asset allocation among each Fund's classes and
components. The Manager's personnel manage certain of the components. The
Portfolio Managers of each component are listed below.

<TABLE>
<CAPTION>
COMPONENT PORTFOLIO MANAGER/BUSINESS EXPERIENCE (LAST 5 YEARS)
<S> <C>
- - ------------------------------------------------------------------------------------
INTERNATIONAL James W. Burns: Managing Director, Babson-Stewart
(Babson-Stewart) (1993-present) and Director, Stewart-Ivory & Co. Ltd.
(since 1990)
John G.L. Wright: Managing Director, Babson-Stewart
(1987-present); Director, Stewart Ivory & Co. Ltd. (since
1971)
- - ------------------------------------------------------------------------------------
VALUE/GROWTH Peter M. Antos, C.F.A.: Principal Portfolio Manager, Vice
(the Manager) President of the Fund and Senior Vice President of the
Manager; portfolio manager of other Oppenheimer funds;
previously Vice President and Senior Portfolio Manager,
Equities--G.R. Phelps & Co. ("G.R. Phelps") (1989-1996)
Michael C. Strathearn, C.F.A.: Vice President of the
Funds and the Manager since March, 1996; portfolio
manager of other Oppenheimer funds; previously a
Portfolio Manager, Equities--Connecticut Mutual Life
Insurance Company ("CML") (1988-1996)
Kenneth B. White, C.F.A.: Vice President of the Funds and
the Manager since March, 1996; portfolio manager of other
Oppenheimer funds; previously a Portfolio Manager,
Equities--CML (1982-1996); Senior Investment Officer,
Equities--CML (1987-1992)
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
COMPONENT PORTFOLIO MANAGER/BUSINESS EXPERIENCE (LAST 5 YEARS)
- - ------------------------------------------------------------------------------------
<S> <C>
GROWTH/INCOME Michael C. Strathearn, C.F.A.: (see biographical data
(the Manager) above)
Peter M. Antos, C.F.A.: (see biographical data above)
Stephen F. Libera, C.F.A.: Vice President of the Funds
and the Manager since March, 1996; portfolio manager of
other Oppenheimer funds; previously a Vice President and
Senior Portfolio Manager, Fixed Income--G.R. Phelps
(1985-1996)
Kenneth B. White, C.F.A.: (see biographical data above)
- - ------------------------------------------------------------------------------------
SMALL CAP STOCKS Gary L. Pilgrim: Director, Member of Executive Committee,
(Pilgrim Baxter) President and Chief Investment Officer, Pilgrim Baxter
(1985-Present)
John F. Force: Portfolio Manager/Analyst, Pilgrim Baxter
(since 1993); and Vice President/Portfolio Manager,
Fiduciary Management Associates (1989-1993)
James M. Smith: Portfolio Manager/Analyst, Pilgrim Baxter
(since 1993); Senior Vice President/Portfolio Manager,
Selected Financial Services (1992-1993); and Vice
President, Sears Investment Management Company (prior to
1992)
Michael D. Jones: Portfolio Manager/Analyst, Pilgrim
Baxter (since 1995); Vice President/Portfolio Manager,
Bank of New York (1990-1995)
- - ------------------------------------------------------------------------------------
GOVERNMENT SECURITIES/ Stephen F. Libera, C.F.A.: (see biographical data above)
CORPORATE BONDS
(the Manager)
- - ------------------------------------------------------------------------------------
HIGH YIELD BONDS Richard J. Lindquist: Managing Director and High Yield
(BEA Associates) Portfolio Manager, BEA Associates (1995); CS First Boston
(1989-1995)
- - ------------------------------------------------------------------------------------
SHORT-TERM BONDS Stephen F. Libera, C.F.A.: (see biographical data above)
(the Manager)
</TABLE>

/ / FEES AND EXPENSES. Under separate Investment Advisory Agreements, each
Fund pays the Manager a monthly fee. For the LifeSpan Growth and Balanced Funds,
the fee is at the following annual rates: 0.85% of the average daily net assets
up to $250 million and 0.75% of average daily net assets over

<PAGE>

$250 million. For the LifeSpan Income Fund, the annual rates are: 0.75% of
average daily net assets up to $250 million and 0.65% of average daily net
assets over $250 million.

Under its Investment Subadvisory Agreements with Babson-Stewart for the
LifeSpan Growth and LifeSpan Balanced Funds, the Manager pays Babson-Stewart a
monthly fee, at the following annual rates, which decline as the average daily
net assets of that portion of the respective Fund's component allocated to
Babson-Stewart grow: 0.75% of the first $10 million of average daily net assets
allocated to Babson-Stewart, 0.625% of the next $15 million, 0.50% of the next
$25 million and 0.375% of such assets in excess of $50 million. The net assets
of all Funds allocated to Babson-Stewart are not aggregated in applying these
breakpoints.

Under its Investment Subadvisory Agreements with BEA for each LifeSpan Fund,
the Manager pays BEA a quarterly fee at the following annual rates, which
decline as the combined average daily net assets of each Fund allocated to BEA
grow: 0.45% of the first $25 million of combined average daily net assets
allocated to BEA, 0.40% of the next $25 million, 0.35% of the next $50 million
and 0.25% of the assets in excess of $100 million.

Under its Investment Subadvisory Agreements with Pilgrim, the Manager pays
Pilgrim a monthly fee equal to 0.60% of the combined average daily net assets of
the Funds allocated to Pilgrim. For purposes of calculating the fees payable to
BEA and Pilgrim, the net asset values of those portions of the assets of each
Fund subadvised by BEA and Pilgrim are aggregated with those portions of the net
assets of Panorama Series Fund, Inc. managed by BEA and Pilgrim, respectively.

Each Fund pays expenses related to its daily operations, such as custodian
fees, Directors' fees, transfer agency fees, legal and auditing costs. Those
expenses are paid out of a 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 Agreements and the other expenses paid
by the Funds is contained in the Statement of Additional Information.
There is also information about the Funds' brokerage policies and practices
in "Brokerage Policies of the Funds" in the Statement of Additional Information.
That section discusses how brokers and dealers are selected for the Funds'
portfolio transactions. When deciding which brokers to use, the Manager is
permitted by the Investment Advisory Agreements to consider whether brokers have
sold shares of the Funds or any other funds for which the Manager serves as
investment adviser.

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

<PAGE>
/ / THE TRANSFER AGENT. Each Fund's transfer agent is OppenheimerFunds
Services, a division of the Manager, which acts as the shareholder servicing
agent for each Fund on an "at-cost" basis. It also acts as the shareholder
servicing agent for the other Oppenheimer funds. Shareholders should direct
inquiries about their accounts, to the Transfer Agent at the address and toll-
free number shown below in this Prospectus or on the back cover.

PERFORMANCE OF THE FUNDS

EXPLANATION OF PERFORMANCE TERMINOLOGY. Each 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 a 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). A
Fund's performance data may help you see how well your investment has done over
time and to compare it to market indices.

It is important to understand that a 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 a Fund's performance. A
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.

/ / TOTAL RETURNS. There are different types of "total returns" used to
measure a Fund's performance. Total return is the change in value of a
hypothetical investment in a 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
a Fund's actual year-by-year performance.

<PAGE>
ABOUT YOUR ACCOUNT

HOW TO BUY SHARES

CLASSES OF SHARES. Each Fund offers investors three different classes of shares.
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.

WHICH CLASS OF SHARES SHOULD YOU CHOOSE? Once you decide that a 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. A 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 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 a Fund. We used the sales charge rates that apply
to each class, and considered the effect of the 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 your investment each year. Of course, the actual
performance of your investment cannot be predicted and will vary, based on a
Fund's actual investment returns, and the operating expenses borne by the class
of shares you invest in.

<PAGE>

/ / 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 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 or higher class-based expenses on the shares of Class B or Class C for
which no initial sales charge is paid.
/ / INVESTING FOR THE SHORT 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 in less than seven 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 economic 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 might be more advantageous than Class C (as well as Class B)
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). If investing
$500,000 or more, Class A may be more advantageous as your investment horizon
approaches 3 years or more.

<PAGE>

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
charge available for larger investments in Class A shares under a Fund's Right
of Accumulation. Unlike Class B shares, Class C shares do not convert to Class A
shares and remain subject to the asset-based sales charge.

Of course all of 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 you should analyze your
options carefully.
/ / ARE THERE DIFFERENCES IN ACCOUNT FEATURES THAT MATTER TO YOU? Because
some features may not be available to Class B or C shareholders, or other
features (such as Automatic Withdrawal Plans) may not be advisable (because of
the effect of the contingent deferred sales charge in non-retirement accounts)
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 to buy. 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, this may be a
factor to consider. Additionally, dividends payable to Class B and Class C
shareholders will be reduced by the additional expenses borne by those classes
that are not borne by Class A, such as the Class B and Class C asset-based sales
charges described below and in the Statement of Additional Information.
/ / 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 than for
selling another class. It is important that investors understand that the
purpose of the Class B and Class C contingent deferred sales charges and
asset-based sales charges are the same as the purpose of the front-end sales
charge on sales of Class A shares: to reimburse the Distributor for commissions
it pays to dealers and financial institutions for selling shares.

<PAGE>
/ / There is no minimum investment requirement if you are buying shares by
reinvesting dividends from a 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.

/ / BUYING SHARES THROUGH YOUR DEALER. Your dealer will place your order
with the Distributor on your behalf.
/ / BUYING SHARES THROUGH THE DISTRIBUTOR. Complete an OppenheimerFunds New
Account Application and return it with a check payable to "OppenheimerFunds
Distributor, Inc." Mail it to P.O. Box 5270, Denver, Colorado 80217. If you
don't list a dealer on the application, the Distributor will act as your agent
in buying the shares. However, we recommend that you discuss your investment
first with a financial advisor, to be sure it is appropriate for you.
/ / 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 to
transmit funds electronically to PURCHASE SHARES, to have the Transfer Agent
SEND REDEMPTION PROCEEDS, or 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.
/ / ASSET BUILDER PLANS. You may purchase shares of a 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.

<PAGE>
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, the dealer must receive your order by
the close of The New York Stock Exchange on a regular business day and transmit
it 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 FUND SHARES.

SPECIAL SALES CHARGE ARRANGEMENTS FOR CERTAIN PERSONS. Appendix B 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 Fund shares
(including purchases by exchange) by a person who was a shareholder of one of
the Former Quest for Value Funds and Former Connecticut Mutual 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 may be net asset value. In some cases, reduced sales charges may
be available, as described below. Out of the amount you invest, a 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.
Different sales charge rates and commissions applied to sales of Class A shares
prior to March 18, 1996. The current sales charge rates and commissions paid to
dealers and brokers are as follows:

If you redeem any of those shares 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 will be equal to 1.0% of either (1) the aggregate
net asset value of the redeemed shares (not including shares purchased by
reinvestment of dividends or capital gain distributions) or (2) the original
cost of the shares, whichever is less. The Class A contingent deferred sales
charge will not exceed the aggregate 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, a 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 a 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 sales charge will
apply.
/ / SPECIAL ARRANGEMENTS WITH DEALERS. The Distributor may advance up to 13
months' commissions to dealers that have established special arrangements with
the Distributor for Asset Builder Plans for their clients. Dealers whose sales
of Class A shares of Oppenheimer funds (other than money market funds) under
OppenheimerFunds-sponsored 403(b)(7) custodial plans exceed $5 million per year
(calculated per quarter), will receive monthly one-half of

<PAGE>
the Distributor's retained commissions on those sales, and if those sales exceed
$10 million per year, those dealers will receive the Distributor's entire
retained commission on those sales.

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:
/ / 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 a Fund and other Oppenheimer funds to reduce the sales charge rate for
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 value of those shares will be based on the greater
of the amount you paid for the shares or their current value (at offering
price). 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.
/ / LETTER OF INTENT. Under a Letter of Intent, if you purchase Class A
shares or Class A and Class B shares of a 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. More information is contained
in the Application and in "Reduced Sales Charges" in the Statement of Additional
Information.
/ / 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.
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:
/ / the Manager or its affiliates;
/ / 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 a Fund, the Manager and its affiliates,
and retirement plans established by them for their employees;

/ / dealers, brokers, banks or registered investment advisers that have
entered into an agreement with the Distributor providing specifically for the
use of shares of a Fund in particular investment products or employee benefit
plans made available to their clients (those clients may be charged a
transaction fee by their dealer, broker or advisor for the purchase or sale of
Fund shares)

/ / employee benefit plans purchasing shares through a shareholder
servicing agent that the Distributor has appointed as its agent to accept those
purchase orders.

/ / directors, trustees, officers or full-time employees of OpCap Advisors
or its affiliates, their relatives or any trust, pension, profit sharing or
other benefit plan which beneficially owns shares for those persons;
/ / accounts for which Oppenheimer Capital 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;
/ / any unit investment trust that has entered into an appropriate
agreement with the Distributor;
/ / a TRAC-2000 401(k) plan (sponsored by the former Quest for Value
Advisors) whose Class B or Class C shares of a Former Quest for Value Fund were
exchanged for Class A shares of that Fund due to the termination of the Class B
and C TRAC-2000 program on November 24, 1995; or

<PAGE>
/ / shares purchased by the reinvestment of loan repayments by a
participant in a retirement plan for which the Manager or one of its affiliates
acts as sponsor;
/ / shares purchased by the reinvestment of dividends or other
distributions reinvested from a Fund or other Oppenheimer funds (other than
Oppenheimer Cash Reserves) or unit investment trusts for which reinvestment
arrangements have been made with the Distributor;
/ / shares purchased and paid for with the proceeds of shares redeemed in
the past 12 months 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 Fund shares, and the Distributor may require evidence
of your qualification for this waiver; and
/ / 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:
/ / for retirement distributions or loans to participants or beneficiaries
from qualified retirement plans, deferred compensation plans or other employee
benefit plans, including OppenheimerFunds prototype 401(k) plans (these are all
referred to as "Retirement Plans");
/ / to return excess contributions made to Retirement Plans;
/ / to make Automatic Withdrawal Plan payments that are limited annually to
no more than 12% of the original account value;
/ / involuntary redemptions of shares by operation of law or involuntary
redemptions of small accounts (see "Shareholder Account Rules and Policies,"
below);
/ / if, at the time a purchase order is placed for Class A shares that
would otherwise be subject to the Class A contingent deferred sales charge, the
dealer agrees in writing to accept the dealer's portion of the commission
payable on the sale in installments of 1/18th of the commission per month (and
no further commission will be payable if the shares are redeemed within 18
months of purchase); or
/ / for distributions from OppenheimerFunds prototype 401(k) plans for any
of the following cases or 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) hardship withdrawals, as defined in the plan; (3) under a Qualified Domestic
Relations Order, as defined in the Internal Revenue Code; (4) to meet the
minimum distribution requirements of the Internal Revenue Code; (5) to establish
"substantially equal periodic payments" as described in Section 72(t) of the
Internal Revenue Code, or (6) separation from service.

<PAGE>
/ / SERVICE PLAN FOR CLASS A SHARES. Each 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 accounts
that hold Class A shares. Reimbursement is made quarterly at an annual rate that
may not exceed 0.25% of the average annual net assets of Class A shares of each
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 a Fund's Board of Directors authorizes such reimbursements,
which no Fund Board has done as yet) for its other expenditures under the Plan.
Services to be provided include, among others, answering customer inquiries
about a Fund, assisting in establishing and maintaining accounts in a Fund,
making a Fund's investment plans available and providing other services at the
request of a Fund or the Distributor. Payments are made by the Distributor
quarterly at 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.

To determine whether the contingent deferred sales charge applies to a
redemption, a 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 six-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.

<PAGE>
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:

<TABLE>
<CAPTION>
YEARS SINCE BEGINNING OF CONTINGENT DEFERRED SALES CHARGE ON
MONTH IN WHICH PURCHASE REDEMPTIONS IN THAT YEAR
ORDER WAS ACCEPTED (AS % OF AMOUNT SUBJECT TO CHARGE)
<S> <C>
- - -----------------------------------------------------------------------------
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
</TABLE>

BUYING CLASS C SHARES. Class C shares are sold at net asset value per share
without an initial sales charge. However, if Class C shares are redeemed within
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 charge will be assessed on the lesser of the net asset value
of the shares at the time of redemption or the original purchase price. 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 a
Fund in connection with the sale of Class C shares.

<PAGE>
To determine whether the contingent deferred sales charge applies to a
redemption, a 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.

DISTRIBUTION AND SERVICE PLANS FOR CLASS B AND CLASS C SHARES. Each Fund has
adopted Distribution and Service Plans for Class B and Class C shares to
compensate the Distributor for its costs in distributing Class B and C shares
and servicing accounts. Under the Plans, a Fund pays the Distributor an annual
"asset-based sales charge" of 0.75% per year on Class B shares that are
outstanding for 6 years or less and on Class C shares. The Distributor also
receives a service fee of 0.25% per year.

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

The Distributor currently pays sales commissions of 3.75% on 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 sales of Class B shares is therefore
4.00% of the purchase price. The Distributor retains the Class B asset-based
sales charge.

The Distributor currently pays sales commissions of 0.75% of the purchase
price of Class C shares to dealers from its own resources at the time of sale.
Including the advance of the service fee, the total amount paid by the
Distributor to the dealer at the time of sale of Class C shares is therefore
1.00% of the purchase price. The Distributor retains the asset-based sales
charge during the first year Class C shares are outstanding to recoup the sales
commissions it has paid, the advances of service fee payments it has made,

<PAGE>
and its financing costs and other expenses. The Distributor plans to pay the
asset-based sales charge as an ongoing commission to the dealer on Class C
shares that have been outstanding for a year or more.

The Distributor's actual expenses in selling Class B and C shares may be
more than the payments it receives from contingent deferred sales charges
collected on redeemed shares and from a Fund under the Distribution and Service
Plans for Class B and C shares. If a Fund terminates either of its Plans, the
Board of Directors may allow the Fund to continue payments of the asset-based
sales charge to the Distributor for distributing shares before the Plan was
terminated.

/ / 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 the sole
beneficiary (the death or disability must have occurred after the account was
established, and for disability you must provide evidence of a determination of
disability by the Social Security Administration);

/ / returns of excess contributions to Retirement Plans;

/ / distributions from Retirement Plans to make "substantially equal
periodic payments" as permitted in Section 72(t) of the Internal Revenue Code
that do not exceed 10% of the account value annually, measured from the date the
Transfer Agent receives the request;

45
<PAGE>
WAIVERS FOR SHARES SOLD OR ISSUED IN CERTAIN TRANSACTIONS. The contingent
deferred sales charge is also waived on Class B and Class C shares sold or
issued in the following cases:
/ / shares sold to the Manager or its affiliates;
/ / shares sold to registered management investment companies or separate
accounts of insurance companies having an agreement with the Manager or the
Distributor for that purpose; and
/ / shares issued in plans of reorganization to which a Fund is a party.

SPECIAL INVESTOR SERVICES

<PAGE>
/ / EXCHANGING SHARES. With the OppenheimerFunds Exchange Privilege,
described below, you can exchange shares automatically by phone from your Fund
account to another Oppenheimer funds account you have already established by
calling the special PhoneLink number. Please refer to "How to Exchange Shares,"
below, for details.
/ / SELLING SHARES. You can redeem shares by telephone automatically by
calling the PhoneLink number and a Fund will send the proceeds directly to your
AccountLink bank account. Please refer to "How to Sell Shares," below for
details.

AUTOMATIC WITHDRAWAL AND EXCHANGE PLANS. Each Fund has several plans that enable
you to sell shares automatically or exchange them to another Oppenheimer funds
account on a regular basis:
/ / 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 Application and Statement of Additional
Information for more details.
/ / AUTOMATIC EXCHANGE PLANS. You can authorize the Transfer Agent to
exchange an amount you establish in advance automatically 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 a Fund, you have up to 6 months to reinvest all or part of the
redemption proceeds in Class A shares of the Fund or 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:
/ / INDIVIDUAL RETIREMENT ACCOUNTS including rollover IRAs, for individuals
and their spouses
/ / 403(B)(7) CUSTODIAL PLANS for employees of eligible tax-exempt
organizations, such as schools, hospitals and charitable organizations

<PAGE>
/ / SEP-IRAS (Simplified Employee Pension Plans) for small business owners
or people with income from self-employment, including SARSEP-IRAs
/ / PENSION AND PROFIT-SHARING PLANS for self-employed persons and other
employers
/ / 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

/ / CERTAIN REQUESTS REQUIRE A SIGNATURE GUARANTEE. To protect you and the
Funds 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):
/ / You wish to redeem more than $50,000 worth of shares and receive a
check
/ / The redemption check is not payable to all shareholders listed on the
account statement
/ / The redemption check is not sent to the address of record on your
account statement
/ / Shares are being transferred to a Fund account with a different owner
or name
/ / Shares are redeemed by someone other than the owners (such as an
Executor)
/ / 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

<PAGE>

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:
/ / Your name
/ / Your Fund's name
/ / Your Fund account number (from your account statement)
/ / The dollar amount or number of shares to be redeemed
/ / Any special payment instructions
/ / Any share certificates for the shares you are selling
/ / The signatures of all registered owners exactly as the account is
registered, and
/ / Any special requirements or documents requested by the Transfer Agent
to assure proper authorization of the person asking to sell shares.

<TABLE>
<CAPTION>
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,
Denver, Colorado 80217 Building D
Denver, Colorado 80231
<S> <C>
</TABLE>

<PAGE>
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.
Shareholders may also have the Transfer Agent send redemption proceeds of
$2,500 or more by Federal Funds wire to a designated commercial bank account if
the bank is a member of the Federal Reserve wire system. There is a $10 fee for
each Federal Funds wire. To place a wire redemption request, call the Transfer
Agent at 1-800-852-8457. The wire will normally be transmitted on the next bank
business day after the shares are redeemed. There is a possibility that the wire
may be delayed up to seven days to enable a Fund to sell securities to pay the
redemption proceeds. No dividends are accrued or paid on the proceeds of shares
that have been redeemed and are awaiting transmittal by wire. To establish wire
redemption privileges on an account that is already established, please contact
the Transfer Agent for instructions.

SELLING SHARES THROUGH YOUR DEALER. The Distributor has made arrangements to
repurchase Fund shares from dealers and brokers on behalf of their customers. To
find out more information about that service, please contact your dealer or
broker. Brokers or dealers may charge for that service. 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 a 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:
/ / Shares of the fund selected for exchange must be available for sale in
your state of residence.
/ / The prospectuses of your Fund and the fund whose shares you want to buy
must offer the exchange privilege.
/ / 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.
/ / You must meet the minimum purchase requirements for the fund you
purchase by exchange.
/ / BEFORE EXCHANGING INTO A FUND, YOU SHOULD OBTAIN AND READ ITS
PROSPECTUS.
SHARES OF A PARTICULAR CLASS MAY BE EXCHANGED ONLY FOR SHARES OF THE SAME
CLASS IN THE OTHER OPPENHEIMER FUNDS. FOR EXAMPLE, YOU CAN EXCHANGE CLASS A
SHARES OF A 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.

<PAGE>
Exchanges may be requested in writing or by telephone:

/ / 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."

/ / Because excessive trading can hurt fund performance and harm
shareholders, a 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.
/ / A Fund may amend, suspend or terminate the exchange privilege at any
time. Although a Fund will attempt to provide you notice whenever it is
reasonably able to do so, it may impose these changes at any time.
/ / 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 taxable gain or a loss. For more information about taxes
affecting exchanges, please refer to "How to Exchange Shares" in the Statement
of Additional Information.
/ / 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

<PAGE>

that class that are outstanding. The Board of Directors of the Funds has
established procedures to value each 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.

/ / TELEPHONE TRANSACTION PRIVILEGES for purchases, redemptions or exchanges
may be modified, suspended or terminated by a Fund at any time. If an account
has more than one owner, a 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.

/ / 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 the Transfer Agent or a Fund may be liable for losses due
to unauthorized transactions, but otherwise neither the Transfer Agent nor a
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.

/ / 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 a Fund
if the dealer performs any transaction erroneously.

/ / THE REDEMPTION PRICE FOR SHARES WILL VARY from day to day because the
value of the securities in a Fund's portfolio fluctuates, and the redemption
price, which is the net asset value per share, will normally be different for
Class A, Class B and Class C shares. Therefore, the redemption value of your
shares may be more or less than their original cost.

<PAGE>
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 CERTIFIED CHECK OR ARRANGE WITH
YOUR BANK TO PROVIDE TELEPHONE OR WRITTEN ASSURANCE TO THE TRANSFER AGENT THAT
YOUR PURCHASE PAYMENT HAS CLEARED.

/ / INVOLUNTARY REDEMPTIONS OF SMALL ACCOUNTS may be made by a Fund if the
account has fewer than 100 shares, and in some cases involuntary redemptions may
be made to repay the Distributor for losses from the cancellation of share
purchase orders.

/ / UNDER UNUSUAL CIRCUMSTANCES, shares of a Fund may be redeemed "in kind,"
which means that the redemption proceeds will be paid with securities from a
Fund's portfolio. Please refer to "How to Sell Shares" in the Statement of
Additional Information for more details.

/ / "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 a Fund a certified Social Security or Employer
Identification Number when you sign your application, or if you violate Internal
Revenue Service regulations on tax reporting of income.

/ / A 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 charge when redeeming certain Class A, Class B and
Class C shares.

/ / TO AVOID SENDING DUPLICATE COPIES OF MATERIALS TO HOUSEHOLDS, each Fund
will mail only one copy of its 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. Each Fund declares dividends separately for Class A, Class B and
Class C shares from net investment income. LifeSpan Growth Fund and LifeSpan
Balanced Fund pay those dividends to shareholders semi-annually, and LifeSpan
Income Fund pays those dividends to shareholders monthly. Normally, dividends
are paid on the last business day every dividend period, but the Board of
Directors can change that date. Distributions may be made monthly by LifeSpan
Income Fund and semi-annually by the LifeSpan Growth and Balanced Funds from any
net short-term capital gains it realizes in selling securities. Dividends paid
on Class A shares generally are expected to be higher than for Class B and Class
C shares because expenses allocable to

<PAGE>

Class B and Class C shares will generally be higher than for Class A shares.
There is no fixed dividend rate and there can be no assurance that a Fund will
pay any dividends.

CAPITAL GAINS. Each Fund may make distributions annually in December out of any
net short-term or long-term capital gains. Long-term capital gains will be
separately identified in the tax information your Fund sends you after the end
of the year. There can be no assurance that your Fund will pay any capital gains
distributions in a particular year.

/ / REINVEST ALL DISTRIBUTIONS IN YOUR FUND. You can elect to reinvest all
dividends and long-term capital gains distributions in additional shares of your
Fund.

/ / REINVEST CAPITAL GAINS ONLY. You can elect to reinvest long-term capital
gains in your Fund while receiving dividends by check or sent to your bank
account on AccountLink.

/ / 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.

/ / REINVEST YOUR DISTRIBUTIONS IN ANOTHER OPPENHEIMER FUNDS ACCOUNT. You
can reinvest all distributions in another Oppenheimer funds 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 a Fund. A 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 a
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 a Fund's distributions treated as
ordinary income, subject to applicable limitations under the Internal Revenue
Code. Every year your Fund will send you and the IRS a statement showing the
amount of the dividends and other distributions you received for the previous
year.

/ / "BUYING A DIVIDEND". When a Fund goes ex-dividend, its share price is
reduced by the amount of the distribution. If you buy shares on or just before
the ex-dividend date, or just before your 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.

<PAGE>
shares as capital assets. Such a gain or loss is the difference between your tax
basis, which is usually the price you paid for the shares, and the proceeds you
received when you sold them. Special tax rules may apply to certain redemptions
preceded or followed by investments in the same Fund or another Oppenheimer
fund.

/ / RETURNS OF CAPITAL. In certain cases distributions made by your Fund may
be considered a return of capital to shareholders. If that occurs, it will be
identified in notices to shareholders. A return of capital will reduce your tax
basis in your Fund shares but will not be taxable except to the extent it
exceeds such tax basis.

/ / FOREIGN TAXES. Each Fund may be subject to foreign withholding taxes or
other foreign taxes on income (possibly including capital gains) on certain of
its foreign investments, if any. These taxes may be reduced or eliminated
pursuant to an income tax treaty in some cases. The Funds do not expect to
qualify to pass such foreign taxes and any related tax deductions or credits
through to their shareholders.

55
<PAGE>
APPENDIX A:

DESCRIPTION OF SECURITIES RATINGS

DESCRIPTION OF STANDARD & POOR'S BOND RATINGS
AAA: "AAA" is the highest rating assigned to a debt obligation and indicates
an extremely strong capacity to pay principal and interest.

A-1

A-2
<PAGE>

APPENDIX B
SPECIAL SALES CHARGE ARRANGEMENTS

I. 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 and Class
B shares of a Fund described elsewhere in this Prospectus are modified as
described below for those shareholders of (i) Quest for Value Fund, Inc., Quest
for Value Growth and Income Fund, Quest for Value Opportunity Fund, Quest for
Value Small Capitalization Fund and Quest for Value Global Equity 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 Value 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 Funds acquired by such shareholder pursuant to an exchange of shares of
one of the Oppenheimer funds (i) that was one of the Former Quest for Value
Funds or (ii) that were acquired by exchange from one of those funds or from an
Oppenheimer fund into which one of the Former Quest for Value Funds merged.

CLASS A SALES CHARGES

/ / REDUCED CLASS A INITIAL SALES CHARGE RATES FOR CERTAIN FORMER QUEST
SHAREHOLDERS
/ / 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

B-1

<PAGE>
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.

/ / SPECIAL CLASS A CONTINGENT DEFERRED SALES CHARGE RATES Class A shares of
a Fund purchased by exchange of shares of other Oppenheimer funds that were
acquired as a result of the merger of Former Quest for Value Funds into those
Oppenheimer funds, and which shares were subject to a Class A contingent
deferred sales charge prior to November 24, 1995 will be subject to a contingent
deferred sales charge at the following rates: if they are redeemed within 18
months of the end of the calendar month in which they were purchased, at a rate
equal to 1.0% if the redemption occurs within 12 months of their initial
purchase and at a rate of 0.50 of 1.0% if the redemption occurs in the
subsequent six months. Class A shares of any of the Former Quest for Value Funds
purchased without an initial sales charge on or before November 22, 1995 will
continue to be subject to the applicable contingent deferred sales charge in
effect as of that date as set forth in the then-current prospectus for such
fund.

B-2

<PAGE>

/ / WAIVER OF CLASS A SALES CHARGES FOR CERTAIN SHAREHOLDERS Class A shares
of a Fund purchased by the following investors are not subject to any Class A
initial or contingent deferred sales charges:

/ / 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 a Fund purchased by the following investors who
were shareholders of any Former Quest for Value Fund:

/ / Investors who purchased Class A shares from a dealer that is or was not
permitted to receive a sales load or redemption fee imposed on a shareholder
with whom that dealer has a fiduciary relationship under the Employee Retirement
Income Security Act of 1974 and regulations adopted under that law.

/ / 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 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 AND CLASS B CONTINGENT DEFERRED SALES CHARGE WAIVERS

/ / 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 or B shares of a Fund acquired 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 Class B 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.

B-3

<PAGE>
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 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 or B 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 the Fund or another
Oppenheimer fund.

SPECIAL DEALER ARRANGEMENTS

II. SPECIAL SALES CHARGE ARRANGEMENTS FOR SHAREHOLDERS OF A FUND
WHO WERE SHAREHOLDERS OF THE FORMER CONNECTICUT MUTUAL FUNDS

Certain of the sales charge rates and waivers for Class A and Class B shares of
the Funds described elsewhere in this Prospectus are modified as described below
for those shareholders of Connecticut Mutual Liquid Account, Connecticut Mutual
Government Securities Account, Connecticut Mutual Income Account, Connecticut
Mutual Growth Account, Connecticut Mutual Total Return Account, CMIA LifeSpan
Diversified Income Account, CMIA LifeSpan Capital Appreciation Account and CMIA
LifeSpan Balanced Account (the "Former Connecticut Mutual Funds") on March 1,
1996, when OppenheimerFunds, Inc. became the investment adviser to the Former
Connecticut Mutual Funds.

B-4

<PAGE>

PRIOR CLASS A CDSC AND CLASS A SALES CHARGE WAIVERS

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

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

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

/ / CLASS A SALES CHARGE WAIVERS. Additional Class A shares of a Fund may be
purchased without a sales charge by a person who was in one (or more) of the
categories below and acquired Class A shares prior to March 18, 1996, and still
holds Class A shares: (1) any purchaser, provided the total initial amount
invested in the Fund or any one or more of the Former Connecticut Mutual Funds
totaled $500,000 or more, including investments made pursuant to the Combined
Purchases, Statement of Intention and Rights of Accumulation features available
at the time of the initial purchase and such investment is still held in one or
more of the Former Connecticut Mutual Funds or a fund into which such fund
merged; (2) any participant in a qualified plan, provided that the total initial
amount invested by the plan in the Fund or any one or more of the Former
Connecticut Mutual Funds totaled $500,000 or more; (3) Directors of the Fund or
any one or more of the Former Connecticut Mutual Funds and members of their
immediate families; (4) employee benefit plans sponsored by Connecticut Mutual
Financial Services, L.L.C. ("CMFS"), the Fund's prior distributor, and its
affiliated companies; (5) one or more members of a group of at least 1,000
persons (and persons who are retirees from such group) engaged in a common
business, profession, civic or charitable endeavor or other activity, and the
spouses and minor dependent children of such persons,

B-5

<PAGE>

pursuant to a marketing program between CMFS and such group; and (6) an
institution acting as a fiduciary on behalf of an individual or individuals, if
such institution was directly compensated by the individual(s) for recommending
the purchase of the shares of the Fund or any one or more of the Former
Connecticut Mutual Funds, provided the institution had an agreement with CMFS.
Purchases of Class A shares made pursuant to (1) and (2) above may be subject to
the Class A CDSC of the Former Connecticut Mutual Funds described above.

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

CLASS A AND CLASS B CONTINGENT DEFERRED SALES CHARGE WAIVERS

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

B-6
<PAGE>

OPPENHEIMER LIFESPAN GROWTH FUND
OPPENHEIMER LIFESPAN BALANCED FUND
OPPENHEIMER LIFESPAN INCOME FUND
Two World Trade Center
New York, New York 10048-0203
1-800-525-7048

INVESTMENT ADVISOR
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 AND SHAREHOLDER SERVICING AGENT
OppenheimerFunds Services
P.O. Box 5270
Denver, Colorado 80217
1-800-525-7048

CUSTODIAN OF PORTFOLIO SECURITIES
State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02110

INDEPENDENT AUDITORS
Arthur Andersen LLP
One Financial Plaza
Hartford, Connecticut 06103

LEGAL COUNSEL
Hale and Dorr
60 State Street
Boston, Massachusetts 02109

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 FUNDS, 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.

PR0000.002.0596 [logo] Printed on recycled paper

<PAGE>

SUPPLEMENT TO THE STATEMENT OF ADDITIONAL INFORMATION
DATED MAY 1, 1996

OPPENHEIMER SERIES FUND, INC.
Two World Trade Center, New York, New York 10048-0203
1-800-525-7048

The members of the Company's Board of Directors described under the caption,
"How the Funds are Managed--Directors and Officers of the Company" will take
office as Directors of the Company on May 31, 1996. Until that date, the
Company's Board of Directors is comprised of the following members:

RICHARD H. AYERS, 52, DIRECTOR
Chairman and Chief Executive Officer, The Stanley Works (tool manufacturer).
Address: The Stanley Works, 1000 Stanley Drive, New Britain, Connecticut 06050

DAVID E.A. CARSON, 61, DIRECTOR
President, Chairman and Chief Executive Officer, People's Bank.
Address: People's Bank, 899 Main Street, Bridgeport, Connecticut 06604

RICHARD W. Greene, 60, DIRECTOR
Executive Vice President and Treasurer, University of Rochester.
Address: University of Rochester, Wilson Boulevard, Rochester, New York 14627

BEVERLY L. HAMILTON, 48, DIRECTOR
President, ARCO Investment Management Company (1991-Present); Deputy
Comptroller, City of New York (1987-1991).
Address: ARCO Investment Management Company, 555 South Flower Street, Los
Angeles, California 90071

DAVID E. SAMS, JR., 52, DIRECTOR(*)
President and Chief Executive Officer, CML (1993-present); President and Chief
Executive Officer, Agency Group, Capital Holdings Corporation (1987-1993).

- - ---------------------------------
*Denotes an "interested person" of the Company as defined in the Investment
Company Act of 1940, as amended.

REMUNERATION OF DIRECTORS. The officers of the Company are affiliated with the
Manager; they and the Directors of the Company who are affiliated with the
Manager receive no salary or fee from the Company or the Funds.

As of December 31, 1995, the then Directors and officers of the Company as
a group owned of record or beneficially less than 1% of the outstanding shares
of the Company.

The chart below sets forth the fees paid by each Fund to the persons who
served as Directors of the Company for the fiscal year ended December 31, 1995
and certain other information for the same period:

<PAGE>

RICHARD M. DONALD E.A. RICHARD W. BEVERLY L. DONALD H. DAVID E.
AYERS CARSON GREENE HAMILTON POND, JR. SAMS, JR.
---------- ---------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
COMPENSATION RECEIVED
FROM EACH PORTFOLIO

- - -Disciplined Allocation
Fund 2,328 2,512 2,851 2,420 -0- -0-

- - -Disciplined Value Fund 1,309 1,404 1,597 1,357 -0- -0-

- - -LifeSpan Income Fund 128 148 169 138 -0- -0-

- - -LifeSpan Balanced Fund 221 255 289 238 -0- -0-

- - -LifeSpan Growth Fund 172 199 226 182 -0- -0-

TOTAL COMPENSATION FROM
COMPANY AND OTHER FORMER
CONNECTICUT MUTUAL FUNDS
PAID TO THE DIRECTORS** 13,500 14,500 16,500 14,000 -0- -0-

</TABLE>

--------------------------
** As of the calendar year ended December 31, 1996, there were 22
investment companies (including the Funds) among the former Connecticut
Mutual funds.
<PAGE>
OPPENHEIMER SERIES FUND, INC.
Two World Trade Center, New York, New York 10048-0203
1-800-525-7048

STATEMENT OF ADDITIONAL INFORMATION DATED MAY 1, 1996

OPPENHEIMER SERIES FUND, INC. is an investment company consisting of eight
separate series (each is referred to in this document as a "Fund" and
collectively as the "Funds"):

OPPENHEIMER DISCIPLINED ALLOCATION FUND ("DISCIPLINED ALLOCATION
FUND")
OPPENHEIMER DISCIPLINED VALUE FUND ("DISCIPLINED VALUE FUND")

AND

OPPENHEIMER LIFESPAN BALANCED FUND ("LIFESPAN BALANCED FUND")
OPPENHEIMER LIFESPAN GROWTH FUND ("LIFESPAN GROWTH FUND")
OPPENHEIMER LIFESPAN INCOME FUND ("LIFESPAN INCOME FUND")
(COLLECTIVELY, THESE THREE FUNDS ARE REFERRED TO AS THE
"LIFESPAN FUNDS")

THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS. THIS DOCUMENT
CONTAINS ADDITIONAL INFORMATION ABOUT THE FUNDS AND SUPPLEMENTS INFORMATION IN
EACH FUND'S PROSPECTUS DATED MAY 1, 1996. IT SHOULD BE READ TOGETHER WITH EACH
PROSPECTUS WHICH MAY BE OBTAINED BY WRITING TO THE FUNDS' 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.

<PAGE>
CONTENTS
Page
ABOUT THE FUNDS

Investment Objectives and Policies.......................... 3
Investment Techniques and Strategies........................ 14
Other Investment Restrictions............................... 27
How the Funds are Managed................................... 35
Organization and History............................... 35
Directors and Officers of the Company.................. 35
The Manager, the Subadvisers and their Affiliates...... 40
Brokerage Policies of the Funds............................. 45
Performance of the Funds.................................... 47
Distribution and Service Plans.............................. 55

ABOUT YOUR ACCOUNT

How to Buy Shares........................................... 57
How to Sell Shares.......................................... 66
How to Exchange Shares...................................... 72
Dividends, Capital Gains and Taxes.......................... 74

ADDITIONAL INFORMATION ABOUT THE FUNDS

FINANCIAL INFORMATION ABOUT THE FUNDS

Independent Auditors' Report and Financial Statements....... 76

Appendix: Industry Classifications.......................... A-1

-2-
<PAGE>

ABOUT THE FUNDS

The Funds' investment adviser is OppenheimerFunds, Inc. (the
"Manager"). In the case of the LifeSpan Funds, the Manager has
engaged Babson-Stewart Ivory International ("Babson-Stewart"), BEA
Associates and Pilgrim, Baxter & Assoc. Ltd. ("Pilgrim") as
subadvisers to assist in the management of certain components of
the LifeSpan Funds. Babson-Stewart, BEA Associates and Pilgrim
are sometimes referred to individually in this document as a
"Subadviser" and collectively as the "Subadvisers."

INVESTMENT OBJECTIVES AND POLICIES

The investment objectives and policies of each Fund are
described in that Fund's Prospectus. Set forth below is
supplemental information about those policies and the types of
securities in which the Funds may invest, as well as the
strategies the Funds may use to try to achieve their objective.
Certain capitalized terms used in this Statement of Additional
Information have the same meaning as those terms have in the
Prospectuses. Not all of the Funds engage in all of the
investment practices described below, and each section indicates
which Funds engage in a particular practice.

EQUITY SECURITIES (All Funds). Additional information about
some of the types of equity securities a Fund may invest in is
provided below.

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

WARRANTS AND RIGHTS (ALL FUNDS). Warrants are options to
purchase equity securities at set prices valid for a specified
period of time. The prices of warrants do not necessarily move in
a manner parallel to the prices of the underlying securities. The

-3-
<PAGE>

price a Fund pays for a warrant will be lost unless the warrant is
exercised prior to its expiration. Rights are similar to
warrants, but normally have a short duration and are distributed
directly by the issuer to its shareholders. Rights and warrants
have no voting rights, receive no dividends and have no rights
with respect to the assets of the issuer.

PREFERRED STOCK (ALL FUNDS). Preferred stocks are equity
securities, but possess certain attributes of debt securities and
are generally considered fixed income securities. Holders of
preferred stocks normally have the right to receive dividends at a
fixed rate when and as declared by the issuer's board of
directors, but do not participate in other amounts available for
distribution by the issuing corporation. Dividends on the
preferred stock may be cumulative, and all cumulative dividends
usually must be paid prior to dividend payments to common
stockholders. Because of this preference, preferred stocks
generally entail less risk than common stocks. Upon liquidation
of the issuer, preferred stocks are entitled to a specified
liquidation preference, which is generally the same as the par or
stated value of the stock, and are senior in right of payment to
common stocks. However, preferred stocks are equity securities in
that they do not represent a liability of the issuer and therefore
do not offer as great a degree of protection of capital or
assurance of continued income as investments in corporate debt
securities. In addition, preferred stocks are subordinated in
right of payment to all debt obligations and creditors of the
issuer, and convertible preferred stocks may be subordinated to
other preferred stock of the same issuer.

FOREIGN SECURITIES (ALL FUNDS). Consistent with any
limitations a Fund may have on foreign investing set forth in its
Prospectus, each Fund may invest in foreign securities. The Funds
may also invest in debt and equity securities of corporate and
governmental issuers in countries with emerging economies or
securities markets. Each Fund is subject to restrictions on the
amount of its assets that may be invested in foreign securities.
See "Other Investment Restrictions," below.

Investing in foreign securities offers potential benefits not
available from investing solely in securities of domestic issuers,
such as 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 or bond markets that do not move in a manner
parallel to U.S. markets. If a Fund's portfolio 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 Directors under applicable rules of the Securities and
Exchange Commission ("SEC"). In buying foreign securities, a Fund
may convert U.S. dollars into foreign currency, but only to effect

-4-
<PAGE>

securities transactions on foreign securities exchanges and not to
hold such currency as an investment.

"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 primarily 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 primarily
traded on a U.S. securities exchange, or are traded primarily in
the U.S. over-the-counter market are not considered "foreign
securities" for purposes of a Fund's investment allocations,
because they are not subject to many of the special considerations
and risks (discussed below) that apply to foreign securities
traded and held abroad.

RISKS OF FOREIGN INVESTING. Investing in foreign securities,
and in particular in securities in emerging countries, 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 in some 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;
possibilities in some countries, and in particular emerging
countries, of expropriation or nationalization of assets,
confiscatory taxation, political, financial or social instability
or adverse diplomatic developments; and unfavorable differences
between the U.S. economy and foreign economies. In the past, U.S.
Government policies have discouraged certain investments abroad by
U.S. investors, through taxation or other restrictions, and it is
possible that such restrictions could be re-imposed.

Because the Funds may invest in securities that are
denominated or quoted in foreign currencies, the strength or
weakness of the U.S. dollar against such currencies may account
for part of a Fund's investment performance. A decline in value
of any particular currency against the U.S. dollar will cause a
decline in the U.S. dollar value of a Fund's holdings of
securities denominated in that currency, and therefore will cause
an overall decline in the Fund's net asset value and any net

-5-

<PAGE>
investment income (and capital gains) to be distributed in U.S.
dollars to shareholders of the Funds.

A Fund's investment income or, in some cases, capital gains
from foreign issuers may be subject to foreign withholding or
other foreign taxes, thereby reducing a Fund's net investment
income and/or net realized capital gains.

DEBT SECURITIES (ALL FUNDS). All debt securities are subject
to two types of risks: credit risk and interest rate risk (these
are in addition to other investment risks that may affect a
particular security).

CREDIT RISK. Credit risk relates to the ability of the
issuer to meet interest or principal payments or both as they
become due. Generally, higher yielding bonds are subject to
credit risk to a greater extent than higher quality bonds.

INTEREST RATE RISK. Interest rate risk refers to the
fluctuations in value of fixed-income securities resulting solely
from the inverse relationship between the market value of
outstanding fixed-income securities and changes in interest rates.
An increase in interest rates will generally reduce the market
value of fixed-income investments, and a decline in interest rates
will tend to increase their value. In addition, debt securities
with longer maturities, which tend to produce higher yields, are
subject to potentially greater capital appreciation and
depreciation than obligations with shorter maturities.
Fluctuations in the market value of fixed-income securities
subsequent to their acquisition will not affect the interest
payable on those securities, and thus the cash income from such
securities, but will be reflected in the valuations of those
securities used to compute a Fund's net asset values.

HIGH YIELD SECURITIES. Each Fund may invest in high-yield/
high risk securities (commonly called junk bonds).

The Manager does not rely solely on credit ratings assigned
by rating agencies in assessing investment opportunities in debt
securities. Ratings by credit agencies assess safety of principal
and interest payments and do not reflect market risks. In
addition, ratings by credit agencies may not be changed by the
agencies in a timely manner to reflect subsequent economic events.
By carefully selecting individual issues and diversifying
portfolio holdings by industry sector and issuer, the Manager
believes that the risk of the Fund holding defaulted lower grade
securities can be reduced. Emphasis on credit risk management
involves the Manager's own internal analysis to determine the debt
service capability, financial flexibility and liquidity of an
issuer, as well as the fundamental trends and outlook for the
issuer and its industry. The Manager's rating helps it determine

-6-
<PAGE>

the attractiveness of specific issues relative to the valuation by
the market place of similarly rated credits.

SPECIAL RISKS OF LOWER RATED SECURITIES. High yield, lower-
grade securities, whether rated or unrated, often have speculative
characteristics. Lower-grade securities have special risks that
make them riskier investments than investment grade securities.
They may be subject to limited liquidity and secondary market
support, as well as substantial market price volatility resulting
from changes in prevailing interest rates. They may be
subordinated to the prior claims of banks and other senior
lenders. The operation of mandatory sinking fund or call/
redemption provisions during periods of declining interest rates
may cause the Fund to invest premature redemption proceeds in
lower yielding portfolio securities. There is a possibility that
earnings of the issuer may be insufficient to meet its debt
service, and the issuer may have low creditworthiness and
potential for insolvency during periods of rising interest rates
and economic downturn. As a result of the limited liquidity of
some high yield securities, their prices have at times experienced
significant and rapid decline when a substantial number of holders
decided to sell. A decline is also likely in the high yield bond
market during an economic downturn. An economic downturn or an
increase in interest rates could severely disrupt the market for
high yield bonds and adversely affect the value of outstanding
bonds and the ability of the issuers to repay principal and
interest. In addition, there have been several Congressional
attempts to limit the use of tax and other advantages of high
yield bonds which, if enacted, could adversely affect the value of
these securities and the net asset value of a Fund. For example,
federally-insured savings and loan associations have been required
to divest their investments in high yield bonds.

U.S. GOVERNMENT SECURITIES (ALL FUNDS). U.S. Government
Securities are debt obligations issued or guaranteed by the U.S.
Government or one of its agencies or instrumentalities, and
include "zero coupon" Treasury securities. Some of these
obligations, including U.S. Treasury notes and bonds, and
mortgage-backed securities guaranteed by the Government National
Mortgage Association ("GNMA"), are supported by the full faith and
credit of the United States, which means that the government
pledges to use its taxing power to repay the debt. Other U.S.
Government Securities issued or guaranteed by Federal agencies or
government-sponsored enterprises are not supported by the full
faith and credit of the United States. They may include
obligations supported by the ability of the issuer to borrow from
the U.S. Treasury. However, the Treasury is not under a legal
obligation to make a loan. Examples of these are obligations of
Federal Home Loan Mortgage Corporation ("FHLMC") Other
obligations are supported by the credit of the instrumentality,
such as bonds issued by Federal National Mortgage Association
("FNMA").

-7-
<PAGE>

U.S. TREASURY OBLIGATIONS. These include Treasury Bills
(which have maturities of one year or less when issued), Treasury
Notes (which have maturities of one to ten years when issued) and
Treasury Bonds (which have maturities generally greater than ten
years when issued). U.S. Treasury obligations are backed by the
full faith and credit of the United States.

MORTGAGE-BACKED SECURITIES (ALL FUNDS EXCEPT VALUE FUND).
These securities represent participation interests in pools of
residential mortgage loans which are guaranteed by agencies or
instrumentalities of the U.S. Government. Such securities differ
from conventional debt securities which generally provide for
periodic payment of interest in fixed or determinable amounts
(usually semi-annually) with principal payments at maturity or
specified call dates. Some mortgage-backed securities in which
the Funds may invest may be backed by the full faith and credit of
the U.S. Treasury (E.G., GNMA direct pass-through certificates;
some are supported by the right of the issuer to borrower from the
U.S. Government (E.G., FHLMC obligations); and some are backed by
only the credit of the issuer itself. Those guarantees do not
extend to the value of or yield of the mortgage-backed securities
themselves or to the net asset value of a Fund's shares.

The yield on mortgage-backed securities is based on the
average expected life of the underlying pool of mortgage loans.
The actual life of any particular pool will be shortened by any
unscheduled or early payments of principal and interest.
Principal prepayments generally result from the sale of the
underlying property or the refinancing or foreclosure of
underlying mortgages. The occurrence of prepayments is affected
by a wide range of economic, demographic and social factors and,
accordingly, it is not possible to predict accurately the average
life of a particular pool. Yield on such pools is usually
computed by using the historical record of prepayments for that
pool, or, in the case of newly issued mortgages, the prepayment
history of similar pools. The actual prepayment experience of a
pool of mortgage loans may cause the yield realized by a Fund to
differ from the yield calculated on the basis of the expected
average life of the pool.

Prepayments tend to increase during periods of falling
interest rates, while during periods of rising interest rates
prepayments will most likely decline. When prevailing interest
rates rise, the value of a pass-through security may decrease as
do the values of other debt securities, but, when prevailing
interest rates decline, the value of a pass-through security is
not likely to rise to the extent that the value of other debt
securities rise, because of the prepayment feature of pass-through
securities. A Fund's reinvestment of scheduled principal payments
and unscheduled prepayments it receives may occur at times when
available investments offer higher or lower rates than the
original investment, thus affecting the yield of such Fund.

-8-

<PAGE>

Monthly interest payments received by a Fund have a compounding
effect which may increase the yield to the Fund more than debt
obligations that pay interest semi-annually. A Fund may purchase
mortgage-backed securities at par, at a premium or at a discount.
Accelerated prepayments adversely affect yields for pass-through
securities purchased at a premium (I.E., at a price in excess of
their principal amount) and may involve additional risk of loss of
principal because the premium may not have been fully amortized at
the time the obligation is repaid. The opposite is true for pass-
through securities purchased at a discount.

As new types of mortgage-related securities are developed and
offered to investors, the Manager will, subject to the direction
of the Board of Directors and consistent with a Fund's investment
objective and policies, consider making investments in such new
types of mortgage-related securities.

GNMA CERTIFICATES. GNMA certificates are mortgaged-backed
securities of GNMA that evidence an undivided interest in a pool
or pools of mortgages ("GNMA Certificates"). The GNMA
Certificates that a Fund may purchase may be of the "modified
pass-through" type, which entitle the holder to receive timely
payment of all interest and principal payments due on the mortgage
pool, net of fees paid to the "issuer" and GNMA, regardless of
whether the mortgagor actually makes the payments.

The National Housing Act authorizes GNMA to guarantee the
timely payment of principal and interest on securities backed by a
pool of mortgages insured by the Federal Housing Administration
("FHA") or guaranteed by the Veterans Administration ("VA"). The
GNMA guarantee is backed by the full faith and credit of the U.S.
Government. GNMA is also empowered to borrow without limitation
from the U.S. Treasury if necessary to make any payments required
under its guarantee.

The average life of a GNMA Certificate is likely to be
substantially shorter than the original maturity of the mortgages
underlying the securities. Prepayments of principal by mortgagors
and mortgage foreclosures will usually result in the return of the
principal investment long before the maturity of the mortgages in
the pool. Foreclosures impose no risk to principal investment
because of the GNMA guarantee, except to the extent that a Fund
has purchased the certificates at a premium in the secondary
market.

FNMA SECURITIES. The Federal National Mortgage Association
("FNMA") was established to create a secondary market in mortgages
insured by the FHA. FNMA issues guaranteed mortgage pass-through
certificates ("FNMA Certificates"). FNMA Certificates resemble
GNMA Certificates in that each FNMA Certificate represents a pro
rata share of all interest and principal payments made and owed on
the underlying pool. FNMA guarantees timely payment of interest

-9-

<PAGE>

and principal on FNMA Certificates. The FNMA guarantee is not
backed by the full faith and credit of the U.S. Government.

FHLMC SECURITIES. The Federal Home Loan Mortgage Corporation
("FHLMC") was created to promote development of a nationwide
secondary market for conventional residential mortgages. FHLMC
issues two types of mortgage pass-through certificates ("FHLMC
Certificates"): mortgage participation certificates ("PCs") and
guaranteed mortgage certificates ("GMCs"). PCs resemble GNMA
Certificates in that each PC represents a pro rata share of all
interest and principal payments made and owed on the underlying
pool. FHLMC guarantees timely monthly payment of interest on PCs
and the ultimate payment of principal. The FHLMC guarantee is not
backed by the full faith and credit of the U.S. Government. GMCs
also represent a pro rata interest in a pool of mortgages.
However, these instruments pay interest semi-annually and return
principal once a year in guaranteed minimum payments. The
expected average life of these securities is approximately ten
years. The FHLMC guarantee is not backed by the full faith and
credit of the U.S. Government.

PRIVATE-ISSUER MORTGAGE-BACKED SECURITIES. Mortgage-backed
securities may also be issued by trusts or other entities formed
or sponsored by private originators of and institutional investors
in mortgage loans and other foreign or domestic non-governmental
entities (or represent custodial arrangements administered by such
institutions). These private originators and institutions include
domestic and foreign savings and loan associations, mortgage
bankers, commercial banks, insurance companies, investment banks
and special purpose subsidiaries of the foregoing. Privately
issued mortgage-backed securities are generally backed by pools of
conventional (I.E., non-government guaranteed or insured) mortgage
loans.

Since such mortgage-backed securities are not guaranteed by
an entity having the credit standing of GNMA, FNMA or FHLMC, in
order to receive a high quality rating, they normally are
structured with one or more types of "credit enhancement." Such
credit enhancements fall generally into two categories; (1)
liquidity protection and (2) protection against losses resulting
after default by a borrower and liquidation of the collateral.
Liquidity protection refers to the providing of cash advances to
holders of mortgage-backed securities when a borrower on an
underlying mortgage fails to make its monthly payment on time.
Protection against losses resulting after default and liquidation
is designed to cover losses resulting when, for example, the
proceeds of a foreclosure sale are insufficient to cover the
outstanding amount on the mortgage. Such protection may be
provided through guarantees, insurance policies or letters of
credit, through various means of structuring the transaction or
through a combination of such approaches.

-10-

<PAGE>

COLLATERALIZED MORTGAGE-BACKED OBLIGATIONS ("CMOS").
Disciplined Allocation Fund and each of the LifeSpan Funds may
invest in collateralized mortgage obligations ("CMOs"). CMOs are
fully-collateralized bonds that are the general obligations of the
issuer thereof, either the U.S. Government, a U.S. Government
instrumentality, or a private issuer, which may be a domestic or
foreign corporation. Such bonds generally are secured by an
assignment to a trustee (under the indenture pursuant to which the
bonds are issued) of collateral consisting of a pool of mortgages.
Payments with respect to the underlying mortgages generally are
made to the trustee under the indenture. Payments of principal
and interest on the underlying mortgages are not passed through to
the holders of the CMOs as such (I.E., the character of payments
of principal and interest is not passed through, and therefore
payments to holders of CMOs attributable to interest paid and
principal repaid on the underlying mortgages do not necessarily
constitute income and return of capital, respectively, to such
holders), but such payments are dedicated to payment of interest
on and repayment of principal of the CMOs.

CMOs often are issued in two or more classes with different
characteristics such as varying maturities and stated rates of
interest. Because interest and principal payments on the
underlying mortgages are not passed through to holders of CMOs,
CMOs of varying maturities may be secured by the same pool of
mortgages, the payments on which are used to pay interest on each
class and to retire successive maturities in sequence.

Unlike other mortgage-backed securities (discussed above),
CMOs are designed to be retired as the underlying mortgages are
repaid. In the event of prepayment on such mortgages, the class
of CMO first to mature generally will be paid down. Therefore,
although in most cases the issuer of CMOs will not supply
additional collateral in the event of such prepayment, there will
be sufficient collateral to secure CMOs that remain outstanding.

"STRIPPED" MORTGAGE-BACKED SECURITIES. The Disciplined
Allocation Fund and each LifeSpan Fund may invest in "stripped"
mortgage-backed securities, in which the principal and interest
portions of the security are separated and sold. Stripped
mortgage-backed securities usually have at least two classes, each
of which receives different proportions of interest and principal
distributions on the underlying pool of mortgage assets. One
common variety of stripped mortgage-backed security has one class
that receives some of the interest and most of the principal,
while the other class receives most of the interest and remainder
of the principal. In some cases, one class will receive all of
the interest (the "interest-only" or "IO" class), while the other
class will receive all of the principal (the "principal-only" or
"PO" class).

-11-

<PAGE>

Interest-only securities are extremely sensitive to interest
rate changes, and prepayments of principal on the underlying
mortgage assets. An increase in principal payments or prepayments
will reduce the income available from the IO security. In
accordance with a requirement imposed by the staff of the SEC, the
Manager or the relevant Subadviser will consider privately-issued
fixed rate IOs and POs to be illiquid securities for purposes of a
Fund's limitation on investments in illiquid securities. Unless
the Manager or the relevant Subadviser, acting pursuant to
guidelines and standards established by the Board of Directors,
determines that a particular government-issued fixed rate IO or PO
is liquid, they will also consider these IOs and POs to be
illiquid. In other types of CMOs, the underlying principal
payments may apply to various classes in a particular order, and
therefore the value of certain classes or "tranches" of such
securities may be more volatile than the value of the pool as a
whole, and losses may be more severe than on other classes.

CUSTODIAL RECEIPTS. In addition to stripped mortgage-backed
securities, each of the Funds may acquire U.S. Government
Securities and their unmatured interest coupons that have been
separated (stripped) by their holder, typically a custodian bank
or investment brokerage firm. Having separated the interest
coupons from the underlying principal of the U.S. Government
Securities, the holder will resell the stripped securities in
custodial receipt programs with a number of different names,
including Treasury Income Growth Receipts (TIGRs) and Certificate
of Accrual on Treasury Securities (CATS). The stripped coupons
are sold separately from the underlying principal, which is
usually sold at a deep discount because the buyer receives only
the right to receive a future fixed payment on the security and
does not receive any rights to periodic interest (cash) payments.
The underlying U.S. Treasury bonds and notes themselves are
generally held in book-entry form at a Federal Reserve Bank.

Counsel to the underwriters of these certificates or other
evidences of ownership of U.S. Treasury securities have stated
that, in their opinion, purchasers of the stripped securities most
likely will be deemed the beneficial holders of the underlying
U.S. Government Securities for federal tax and securities
purposes. In the case of CATS and TIGRs, the IRS has reached this
conclusion for the purpose of applying the tax diversification
requirements applicable to regulated investment companies such as
the Funds. CATS and TIGRs are not considered U.S. Government
Securities by the staff of the SEC, however. Further, the IRS'
conclusion is contained only in a general counsel memorandum,
which is an internal document of no precedential value or binding
effect, and a private letter ruling, which also may not be relied
upon by the Funds. The Company is not aware of any binding
legislative, judicial or administrative authority on this issue.

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<PAGE>

MORTGAGE DOLLAR ROLLS. The Disciplined Allocation Fund may
enter into "forward roll" transactions with respect to mortgage-
backed securities issued by GNMA, FNMA or FHLMC. In a forward
roll transaction, which is considered to be a "borrowing" by the
Fund, the Fund will sell a mortgage security to a bank or other
permitted entity and simultaneously agree to repurchase a similar
security from the institution at a later date at an agreed upon
price. The mortgage securities that are repurchased will bear the
same interest rate as those sold, but generally will be
collateralized by different pools of mortgages with different
prepayment histories than those sold. Risks of mortgage-backed
security rolls include: (i) the risk of prepayment prior to
maturity, (ii) the possibility that the proceeds of the sale may
have to be invested in money market instruments (typically
repurchase agreements) maturing not later than the expiration of
the roll, and (iii) the possibility that the market value of the
securities sold by the Fund may decline below the price at which
the Fund is obligated to purchase the securities. Upon entering
into a mortgage-backed security roll, the Fund will be required to
place cash, U.S. Government Securities or other high-grade debt
securities in a segregated account with its Custodian in an amount
equal to its obligation under the roll.

ASSET-BACKED SECURITIES. Disciplined Allocation Fund and
each LifeSpan Fund may purchase asset-back securities. The value
of an asset-backed security is affected by changes in the market's
perception of the asset backing the security, the creditworthiness
of the servicing agent for the loan pool, the originator of the
loans, or the financial institution providing any credit
enhancement, and is also affected if any credit enhancement has
been exhausted. The risks of investing in asset-backed securities
are ultimately dependent upon payment of consumer loans by the
individual borrowers. As a purchaser of an asset-backed security,
a Fund would generally have no recourse to the entity that
originated the loans in the event of default by a borrower. The
underlying loans are subject to prepayments, which shorten the
weighted average life of asset-backed securities and may lower
their return, in the same manner as described above for the
prepayments of a pool of mortgage loans underlying mortgage-backed
securities.

ZERO COUPON SECURITIES AND DEFERRED INTEREST BONDS. The
Funds may invest in zero coupon securities and deferred interest
bonds issued by the U.S. Treasury or by private issuers such as
domestic or foreign corporations. Zero coupon U.S. Treasury
securities include: (1) U.S. Treasury bills without interest
coupons, (2) U.S. Treasury notes and bonds that have been stripped
of their unmatured interest coupons and (3) receipts or
certificates representing interests in such stripped debt
obligations or coupons. Zero coupon securities and deferred
interest bonds usually trade at a deep discount from their face or
par value and will be subject to greater fluctuations in market

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value in response to changing interest rates than debt obligations
of comparable maturities that make current payments of interest.
An additional risk of private-issuer zero coupon securities and
deferred interest bonds is the credit risk that the issuer will be
unable to make payment at maturity of the obligation.

While zero coupon bonds do not require the periodic payment
of interest, deferred interest bonds generally provide for a
period of delay before the regular payment of interest begins.
Although this period of delay is different for each deferred
interest bond, a typical period is approximately one-third of the
bond's term to maturity. Such investments benefit the issuer by
mitigating its initial need for cash to meet debt service, but
some also provide a higher rate of return to attract investors who
are willing to defer receipt of such cash. With zero coupon
securities, however, the lack of periodic interest payments means
that the interest rate is "locked in" and the investor avoids the
risk of having to reinvest periodic interest payments in
securities having lower rates.

Because a Fund accrues taxable income from zero coupon and
deferred interest securities without receiving cash and is
required to distribute its net investment income for each taxable
year, including such accrued income, in order to avoid liabilities
for federal income and/or excise tax, a Fund may be required to
sell portfolio securities in order to obtain cash necessary to pay
dividends or redemption proceeds for its shares, which require the
payment of cash. This will depend on several factors: the
proportion of shareholders who elect to receive dividends in cash
rather than reinvesting dividends in additional shares of a Fund,
and the amount of cash a Fund receives from other investments and
the sale of shares.

INVESTMENT TECHNIQUES AND STRATEGIES

COMMERCIAL PAPER (ALL FUNDS). Each Fund may purchase
commercial paper for temporary defensive purposes as described in
its Prospectus. In addition, a Fund may invest in floating rate
notes as follows:

FLOATING RATE/VARIABLE RATE NOTES. Some of the notes a Fund
may purchase may have variable or floating interest rates.
Variable rates are adjustable at stated periodic intervals;
floating rates are automatically adjusted according to a specified
market rate for such investments, such as the percentage of the
prime rate of a bank, or the 91-day U.S. Treasury Bill rate. Such
obligations may be secured by bank letters of credit or other
support arrangements. Any bank providing such a bank letter, line
of credit, guarantee or loan commitment will meet a Fund's
investment quality standards relating to investments in bank
obligations.

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<PAGE>

A Fund will invest in variable and floating rate instruments
only when the Manager or relevant Subadviser deems the investment
to meet the investment guidelines applicable to a Fund. The
Manager or relevant Subadviser will also continuously monitor the
creditworthiness of issuers of such instruments to determine
whether a Fund should continue to hold the investments.

The absence of an active secondary market for certain
variable and floating rate notes could make it difficult to
dispose of the instruments, and a Fund could suffer a loss if the
issuer defaults or during periods in which the Fund is not
entitled to exercise its demand rights.

Variable and floating rate instruments held by a Fund will be
subject to the Fund's limitation on investments in illiquid
securities if a reliable trading market for the instruments does
not exist and the Fund cannot demand payment of the principal
amount of such instruments within seven days.

BANK OBLIGATIONS AND INSTRUMENTS SECURED THEREBY (ALL FUNDS).
The bank obligations a Fund may invest in include time deposits,
certificates of deposit, and bankers' acceptances if they are:
(i) obligations of a domestic bank with total assets of at least
$1 billion or (ii) obligations of a foreign bank with total assets
of at least U.S. $1 billion. A Fund may also invest in
instruments secured by such obligations (E.G., debt which is
guaranteed by the bank). For purposes of this section, the term
"bank" includes commercial banks, savings banks, and savings and
loan associations which may or may not be members of the Federal
Deposit Insurance Corporation.

Time deposits are non-negotiable deposits in a bank for a
specified period of time at a stated interest rate, whether or not
subject to withdrawal penalties. However, time deposits that are
subject to withdrawal penalties, other than those maturing in
seven days or less, are subject to the limitation on investments
by a Fund in illiquid investments, set forth in the relevant
Prospectus under "Illiquid and Restricted Securities."

Banker's acceptances are marketable short-term credit
instruments used to finance the import, export, transfer or
storage of goods. They are deemed "accepted" when a bank
guarantees their payment at maturity.

PORTFOLIO TURNOVER. Each Fund's particular portfolio
securities may be changed without regard to the holding period of
those securities (subject to certain tax restrictions), when the
Manager or respective Subadviser deems that this action will help
achieve the Fund's objective given a change in an issuer's
operations or changes in general market conditions. Short-term
trading means the purchase and subsequent sale of a security after
it has been held for a relatively brief period of time. The Funds

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<PAGE>

do not generally intend to invest for the purpose of seeking
short-term profits. Variations in portfolio turnover rate from
year to year reflect the investment discipline applied to the
particular Fund and do not generally reflect trading for short-
term profits.

LOANS OF FUND SECURITIES. A Fund may lend its portfolio
securities (other than in repurchase transactions) to brokers,
dealers and other financial institutions subject to the
restrictions stated in its Prospectus. Under applicable
regulatory requirements (which are subject to change), the loan
collateral must, on each business day, be at least equal the
market value of the loaned securities and must consist of cash,
bank letters of credit, U.S. Government Securities, or other cash
equivalents in which the Fund is permitted to invest. To be
acceptable as collateral, letters of credit must obligate a bank
to pay amounts demanded by the Fund if the demand meets the terms
of the letter. 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 Fund may share the interest it
receives on the collateral securities with the borrower as long as
it realizes at least a minimum amount of interest required by the
lending guidelines established by the Board of Directors.

A Fund will not lend its portfolio securities to any officer,
director, employee or affiliate of the Fund, the Manager or any
Subadviser. The terms of a Fund's loans must meet certain tests
under the Internal Revenue Code and permit the Fund to reacquire
loaned securities on five business days' notice or in time to vote
on any important matter.

"WHEN-ISSUED" AND DELAYED DELIVERY TRANSACTIONS. Securities
may be purchased by a Fund on a "when-issued" or on a "forward
commitment" basis. These transactions, which involve a commitment
by a Fund to purchase or sell particular securities with payment
and delivery taking place at a future date (perhaps one or two
months later), permit the Fund to lock in a price or yield on a
security, regardless of future changes in interest rates. A Fund
will purchase securities on a "when-issued" or forward commitment
basis only with the intention of completing the transaction and
actually purchasing the securities. If deemed appropriate by the
Manager or, in the case of the LifeSpan Funds, the relevant
Subadviser, however, a Fund may dispose of or renegotiate a
commitment after it is entered into, and may sell securities it
has committed to purchase before those securities are delivered to

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<PAGE>

the Fund on the settlement date. In these cases, the Fund may
realize a gain or loss.

When a Fund agrees to purchase securities on a "when-issued"
or forward commitment basis, the Fund's custodian will set aside
cash or high grade debt securities equal to the amount of the
commitment in a separate account. Normally, the custodian will
set aside portfolio securities to satisfy a purchase commitment,
and in such a case the Fund may be required subsequently to place
additional assets in the separate account in order to ensure that
the value of the account remains equal to the amount of the Fund's
commitments. The market value of a Fund's net assets may
fluctuate to a greater degree when it sets aside portfolio
securities to cover such purchase commitments then when it sets
aside cash. Because a Fund's liquidity and ability to manage its
portfolio might be affected when it sets aside cash or portfolio
securities to cover such purchase commitments, each Fund expects
that its commitments to purchase when-issued securities and
forward commitments will not exceed 33% of the value of its total
assets absent unusual market conditions.

When a Fund engages in "when-issued" and forward commitment
transactions, it relies on the other party to the transaction to
consummate the trade. Failure of such party to do so may result
in the Fund incurring a loss or missing an opportunity to obtain a
price considered to be advantageous.

The market value of the securities underlying a "when-issued"
purchase or a forward commitment to purchase securities, and any
subsequent fluctuations in their market value, are taken into
account when determining the net asset value of a Fund starting on
the day the Fund agrees to purchase the securities. The Fund does
not earn interest or dividends on the securities it has committed
to purchase until the settlement date.

REPURCHASE AGREEMENTS. Each Fund may acquire securities that
are subject to repurchase agreements, in order to generate income
while providing liquidity. In a repurchase transaction, the Fund
acquires a security from, and simultaneously resells it to, an
approved vendor for delivery on an agreed-upon future date. An
"approved vendor" is a U.S. commercial bank, 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 the
credit requirements set by the Fund's Board of Directors from time
to time. The sale 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 resale typically will occur within one to five days of
the purchase.

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<PAGE>

Repurchase agreements are considered "loans" under the
Investment Company Act, collateralized by the underlying security.
The Fund's repurchase agreements will require that at all times
while the repurchase agreement is in effect, the collateral's
value must equal or exceed the repurchase price to fully
collateralize the repayment obligation. Additionally, the Manager
or relevant Subadviser will impose creditworthiness requirements
to confirm that the vendor is financially sound and will
continuously monitor the collateral's value. If the vendor of a
repurchase agreement fails to pay the agreed-upon resale price on
the delivery date, the Fund's risks in such event may include any
costs of disposing of the collateral, and any loss from any delay
in foreclosing on the collateral.

REVERSE REPURCHASE AGREEMENTS. The LifeSpan Funds are
permitted to engage in reverse repurchase transactions but have no
present intention to do so in the current year. A LifeSpan Fund
that does engage in such transactions will maintain, in a
segregated account with its Custodian, cash, Treasury bills or
other U.S. Government Securities that have an aggregate value
equal to the amount of such commitment to repurchase, including
accrued interest, until payment is made. A LifeSpan Fund will
use reverse repurchase agreements as a source of funds on a short-
term basis (and not for leverage). In determining whether to
enter into a reverse repurchase agreement with a bank or broker-
dealer, a LifeSpan Fund will take into account the
creditworthiness of such party.

RESTRICTED AND ILLIQUID SECURITIES. To enable a Fund to sell
restricted securities not registered under the Securities Act of
1933 (the "1933 Act"), 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 registra-
tion 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. A 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 realized upon the sale of such securities.

HEDGING. Consistent with the limitations set forth in the
relevant Prospectus and below, a Fund may employ one or more of
the types of hedging instruments described below. In the future,
a Fund may employ hedging instruments and strategies that are not
presently contemplated but which may be developed, to the extent

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<PAGE>

such investment methods are consistent with the Fund's investment
objective, legally permissible and adequately disclosed.

HEDGING STRATEGIES. Hedging, by use of futures contracts,
seeks to establish with more certainty the effective price and
rate of return on portfolio securities and securities that a Fund
proposes to acquire. The Funds may, for example, take a "short"
position in the futures market by selling futures contracts in
order to hedge against an anticipated rise in interest rates or a
decline in market prices that would adversely affect the value of
a Fund's portfolio securities. Such futures contracts may include
contracts for the future delivery of securities held by the Fund
or securities with characteristics similar to those of the Fund's
portfolio securities.

If, in the opinion of the Fund's Manager or, in the case of
the LifeSpan Funds, the relevant Subadviser, there is a sufficient
degree of correlation between price trends for a Fund's portfolio
securities and futures contracts based on other financial
instruments, securities indices or other indices, the Fund may
also enter into such futures contracts as part of its hedging
strategy. Although under some circumstances prices of securities
in a Fund's portfolio may be more or less volatile than prices of
such futures contracts, the Manager or, in the case of the
LifeSpan Funds, the relevant Subadviser will attempt to estimate
the extent of this volatility difference based on historical
patterns and compensate for any such differential by having the
Fund enter into a greater or lesser number of futures contracts or
by attempting to achieve only a partial hedge against price
changes affecting a Fund's securities portfolio. When hedging of
this character is successful, any depreciation in the value of
portfolio securities will be substantially offset by appreciation
in the value of the futures position. On the other hand, any
unanticipated appreciation in the value of a Fund's portfolio
securities would be substantially offset by a decline in the value
of the futures position.

On other occasions, the Funds may take a "long" position by
purchasing futures contracts. This would be done, for example,
when a Fund anticipates the subsequent purchase of particular
securities when it has the necessary cash, but expects the prices
then available in the applicable market to be less favorable than
prices that are currently available.

OPTIONS ON SECURITIES, SECURITIES INDICES AND FOREIGN
CURRENCIES. Each Fund may write covered call options. Such
options may relate to particular U.S. or non-U.S. securities, to
various U.S. or non-U.S. stock indices or to U.S. or non-U.S.
currencies. To the extent that a Fund engages in options
transactions, the Fund may purchase and write call options which
are issued by the Options Clearing Corporation (the "OCC") or
which are traded on U.S. and non-U.S. exchanges.

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<PAGE>

WRITING COVERED CALLS. When a 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 if the option is exercised during the call period
(usually not more than nine 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. A Fund retains the risk of loss should the price of the
underlying investment decline during the call period, which may be
offset to some extent by the premium.

To terminate its obligation on a call it has written, a 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 written was more or less than the
price of the call subsequently purchased. A profit may also be
realized if the call expires unexercised, because a Fund retains
the underlying investment and the premium received. If a 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.

FUTURES CONTRACTS AND RELATED OPTIONS. To hedge against
changes in interest rates, securities prices or currency exchange
rates, each Fund may, subject to its investment objective and
policies, purchase and sell various kinds of futures contracts and
write covered call options on such contracts. A Fund may also
enter into closing purchase and sale transactions with respect to
any of these contracts and options. The Disciplined Allocation
Fund and Disciplined Value Fund may purchase and sell stock index
futures contracts; and the Disciplined Allocation Fund may
purchase and sell interest rate future contracts. In addition,
each Fund that may invest in securities that are denominated in a
foreign currency may purchase and sell futures on currencies. A
Fund will engage in futures and related options transactions only
for bona fide hedging purposes as defined in regulations
promulgated by the CFTC. All futures contracts entered into by
the Funds are traded on U.S. exchanges or boards of trade that are
licensed and regulated by the CFTC or on foreign exchanges
approved by the CFTC.

A Fund may buy and sell futures contracts on interest rates
("Interest Rate Futures"). No price is paid or received upon the
purchase or sale of an Interest Rate Future. An Interest Rate
Future obligates the seller to deliver and the purchaser to take a
specific type of debt security at a specific future date for a
fixed price. That obligation may be satisfied by actual delivery
of the debt security or by entering into an offsetting contract.

A Fund may buy and sell futures contracts related to
financial indices (a "Financial Future"). A financial index

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<PAGE>

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.

Upon entering into a futures transaction, a 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 will be deposited with a 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 made to or by the futures broker
on a daily basis.

Prior to expiration of the Future, if a 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 realized for tax purposes. Although Financial Futures and
Interest Rate Futures by their terms call for settlement by
delivery 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.

OPTIONS ON FUTURES CONTRACTS. The Funds may use options on
futures contracts solely for bona fide hedging purposes as
described below. The writing of a call option on a futures
contract generates a premium which may partially offset a decline
in the value of a Fund's assets. By writing a call option, a Fund
becomes obligated, in exchange for the premium, to sell a futures
contract (if the option is exercised), which may have a value
higher than the exercise price. Conversely, the writing of a put
option on a futures contract generates a premium which may
partially offset an increase in the price of securities that a
Fund intends to purchase. However, a Fund becomes obligated to
purchase a futures contract (if the option is exercised) which may
have a value lower than the exercise price. Thus, the loss
incurred by a Fund in writing options on futures is potentially
unlimited and may exceed the amount of the premium received. The
Funds will incur transaction costs in connection with the writing
of options on futures.

The holder or writer of an option on a futures contract may
terminate its position by selling or purchasing an offsetting

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option on the same series. There is no guarantee that such
closing transactions can be effected. A Fund's ability to
establish and close out positions on such options will be subject
to the development and maintenance of a liquid market.

FORWARD CONTRACTS. Each Fund may enter into foreign currency
exchange contracts ("Forward Contracts") for hedging and
non-hedging purposes. A forward currency exchange contract
generally has no deposit requirement, and no commissions are
generally charged at any stage for trades. A Forward Contract
involves bilateral obligations of one party to purchase, and
another party to sell, a specific currency at a future date (which
may be any fixed number of days from the date of the contract
agreed upon by the parties), at a price set at the time the
contract is entered into. A Fund generally will not enter into a
forward currency exchange contract with a term of greater than one
year. These contracts are traded in the interbank market
conducted directly between currency traders (usually large
commercial banks) and their customers.

A Fund may use Forward Contracts to protect against
uncertainty in the level of future exchange rates. The use of
Forward Contracts does not eliminate fluctuations in the prices of
the underlying securities a Fund owns or intends to acquire, but
it does fix a rate of exchange in advance. In addition, although
Forward Contracts limit the risk of loss due to a decline in the
value of the hedged currencies, at the same time they limit any
potential gain that might result should the value of the
currencies increase.

A Fund may enter into Forward Contracts with respect to
specific transactions. For example, when a Fund enters into a
contract for the purchase or sale of a security denominated in a
foreign currency, or when it anticipates receipt of dividend
payments in a foreign currency, a Fund may desire to "lock-in" the
U.S. dollar price of the security or the U.S. dollar equivalent of
such payment by entering into a Forward Contract, for a fixed
amount of U.S. dollars per unit of foreign currency, for the
purchase or sale of the amount of foreign currency involved in the
underlying transaction ("transaction hedge"). A Fund will thereby
be able to protect itself against a possible loss resulting from
an adverse change in the relationship between the currency
exchange rates during the period between the date on which the
security is purchased or sold, or on which the payment is
declared, and the date on which such payments are made or
received.

A Fund may also use Forward Contracts to lock in the U.S.
dollar value of portfolio positions ("position hedge"). In a
position hedge, for example, when a Fund believes that foreign
currency may suffer a substantial decline against the U.S. dollar,
it may enter into a forward sale contract to sell an amount of

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that foreign currency approximating the value of some or all of a
Fund's portfolio securities denominated in such foreign currency,
or when it believes that the U.S. dollar may suffer a substantial
decline against a foreign currency, it may enter into a forward
purchase contract to buy that foreign currency for a fixed dollar
amount. In this situation a Fund may, in the alternative, enter
into a Forward Contract to sell a different foreign currency for a
fixed U.S. dollar amount where the Fund believes that the U.S.
dollar value of the currency to be sold pursuant to the Forward
Contract will fall whenever there is a decline in the U.S. dollar
value of the currency in which portfolio securities of the Fund
are denominated ("cross hedge").

A Fund will not enter into such Forward Contracts or maintain
a net exposure to such contracts where the consummation of the
contracts would obligate a fund to deliver an amount of foreign
currency in excess of the value of the Fund's portfolio securities
or other assets denominated in that currency. However, in order
to avoid excess transactions and transaction costs, a Fund may
maintain a net exposure to Forward Contracts in excess of the
value of the Fund's portfolio securities or other assets
denominated in that currency provided the excess amount is
"covered" by liquid, high-grade debt securities, denominated in
any currency, at least equal at all times to the amount of such
excess. As an alternative, a LifeSpan Fund may purchase a call
option permitting the Fund to purchase the amount of foreign
currency being hedged by a forward sale contract at a price no
higher than the forward contract price. A LifeSpan Fund may
purchase a put option permitting the Fund to sell the amount of
foreign currency subject to a forward purchase contract at a price
as high as or higher than the forward contract price.
Unanticipated changes in currency prices may result in poorer
overall performance for a Fund than if it had not entered into
such contracts.

The precise matching of the Forward Contract amounts and the
value of the securities involved will not generally be possible
because the future value of such securities in foreign currencies
will change as a consequence of market movements in the value of
these securities between the date the Forward Contract is entered
into and the date it is sold. Accordingly, it may be necessary
for a Fund to purchase additional foreign currency on the spot
(I.E., cash) market (and bear the expense of such purchase), if
the market value of the security is less than the amount of
foreign currency a Fund is obligated to deliver and if a decision
is made to sell the security and make delivery of the foreign
currency. Conversely, it may be necessary to sell on the spot
market some of the foreign currency received upon the sale of the
portfolio security if its market value exceeds the amount of
foreign currency a Fund is obligated to deliver. The projection
of short-term currency market movements is extremely difficult,
and the successful execution of a short-term hedging strategy is

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highly uncertain. Forward Contracts involve the risk that
anticipated currency movements will not be accurately predicted,
causing a Fund to sustain losses on these contracts and
transactions costs.

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

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

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

INTEREST RATE SWAP TRANSACTIONS. Disciplined Allocation Fund
and the LifeSpan Funds may enter into swap transactions. A Fund
will enter into swap transactions with appropriate counterparties
pursuant to master netting agreements. A master netting agreement
provides that all swaps done between a Fund and that counterparty
under that master agreement shall be regarded as parts of an
integral agreement. If on any date amounts are payable in the
same currency in respect of one or more swap transactions, the net
amount payable on that date in that currency shall be paid. In
addition, the master netting agreement may provide that if one

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<PAGE>

party defaults generally or on one swap, the counterparty may
terminate the swaps with that party. Under such agreements, if
there is a default resulting in a loss to one party, the measure
of that party's damages is calculated by reference to the average
cost of a replacement swap with respect to each swap (I.E., the
mark-to-market value at the time of the termination of each swap).
The gains and losses on all swaps are then netted, and the result
is the counterparty's gain or loss on termination. The
termination of all swaps and the netting of gains and losses on
termination is generally referred to as "aggregation."

Swap agreements entail both interest rate risk and credit
risk. There is a risk that, based on movements of interest rates
in the future, the payments made by a Fund under a swap agreement
will have been greater than those received by them. Credit risk
arises from the possibility that the counterparty will default.
If the counterparty to an interest rate swap defaults, a Fund's
loss will consist of the net amount of contractual interest
payments that the Fund has not yet received. The Manager or
relevant Subadviser will monitor the creditworthiness of counter-
parties to a Fund's interest rate swap transactions on an ongoing
basis.

The swap market has grown substantially in recent years with
a large number of banks and investment banking firms acting both
as principals and as agents utilizing standardized swap
documentation. As a result, the swap market has become relatively
liquid in comparison with the markets for other similar
instruments which are traded in the interbank market. However,
the staff of the SEC currently takes the position that swaps, caps
and floors are illiquid investments that are subject to a
limitation on such investments by investment companies.

ADDITIONAL INFORMATION ABOUT HEDGING INSTRUMENTS AND THEIR
USE. A Fund's Custodian, or a securities depository acting for
the Custodian, will act as a Fund's escrow agent, through the
facilities of the Options Clearing Corporation ("OCC"), as to the
investments on which a Fund has written options traded on
exchanges or as to other acceptable escrow securities, so that no
margin will be required for such transactions. OCC will release
the securities covering a call on the expiration of the option or
upon a Fund entering into a closing purchase transaction. An
option position may be closed out only on a market which provides
secondary trading for options of the same series, and there is no
assurance that a liquid secondary market will exist for any
particular option.

REGULATORY ASPECTS OF HEDGING INSTRUMENTS. The Funds are
required to operate within certain guidelines and restrictions
with respect to their use of futures and options thereon as es-
tablished by the Commodities Futures Trading Commission ("CFTC").

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<PAGE>

In particular, the Funds are excluded from registration as a "com-
modity pool operator" if they comply with the requirements of Rule
4.5 adopted by the CFTC. The Rule does not limit the percentage
of the Funds' assets that may be used for Futures margin and re-
lated options premiums for a bona fide hedging position. However,
under the Rule a Fund must limit its aggregate initial futures
margin and related option premiums to no more than 5% of the
Funds' net assets for hedging strategies that are not considered
bona fide hedging strategies under the Rule.

Transactions in options by the Funds are subject to limita-
tions established by each of the exchanges governing the maximum
number of options which may be written or held by a single inves-
tor 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 through one or more brokers. Thus, the
number of options which the Funds 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 in-
vestment adviser. Position limits also apply to Futures. An ex-
change may order the liquidation of positions found to be in vio-
lation 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 Funds purchase a Future, the
Funds will maintain, in a segregated account or accounts with
their Custodian, cash or readily-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.

TAX ASPECTS OF COVERED CALLS AND HEDGING INSTRUMENTS. Each
Fund intends to qualify as a "regulated investment company" under
the Internal Revenue Code. That qualification enables a Fund to
"pass through" its income and realized capital gains to
shareholders without the Fund having to pay tax on them. This
avoids a "double tax" on that income and capital gains, since
shareholders will be taxed on the dividends and capital gains they
receive from the Fund. One of the tests for a Fund's
qualification is that less than 30% of its gross income
(irrespective of losses) must be derived from gains realized on
the sale of securities or certain other investments held for less
than three months. To comply with that 30% cap, a Fund will limit
the extent to which it engages in the following activities, but
will not be precluded from them: (i) selling investments,
including Futures, held for less than three months, whether or not
they were purchased on the exercise of a call held by the Fund;
(ii) purchasing calls or puts which expire in less than three
months; (iii) effecting closing transactions with respect to calls
or puts written or purchased less than three months previously;
(iv) exercising puts or calls held by a Fund for less than three

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<PAGE>

months; or (v) writing calls on investments held for less than
three months.

RISKS OF HEDGING WITH OPTIONS AND FUTURES. In addition to
the risks with respect to hedging discussed in the relevant
Prospectus and above, there is a risk in using short hedging by
selling Futures to attempt to protect against a decline in value
of a Fund's portfolio securities (due to an increase in interest
rates) that the prices of such Futures will correlate imperfectly
with the behavior of the cash (I.E., market value) prices of a
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 offsetting 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.

OTHER INVESTMENT RESTRICTIONS

INVESTMENT RESTRICTIONS THAT ARE FUNDAMENTAL POLICIES. Each
Fund has adopted the following investment restrictions that are
"fundamental policies." Each Fund's most significant investment
restrictions are also set forth in its Prospectus. Fundamental
policies cannot be changed without the vote of a "majority" of a
Fund's outstanding voting securities. Under the Investment
Company Act, such a "majority" vote is defined as the vote of the
holders of the lesser of (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.

Each of the Disciplined Value and Disciplined Allocation
Funds may not:

1. Issue senior securities, except as permitted by
paragraphs 7, 8, 9 and 11 below. For purposes of this
restriction, the issuance of shares of common stock in multiple
classes or series, the purchase or sale of options, futures
contracts and options on futures contracts, forward commitments,
and repurchase agreements entered into in accordance with the

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<PAGE>

Fund's investment policies, and the pledge, mortgage or
hypothecation of the Fund's assets are not deemed to be senior
securities.

2. (a) Invest more than 5 percent of its total assets
(taken at market value at the time of each investment) in the
securities (other than United States Government or Government
agency securities) of any one issuer (including repurchase
agreements with any one bank or dealer) or more than 15 percent of
its total assets in the obligations of any one bank; and (b)
purchase more than either (i) 10 percent in principal amount of
the outstanding debt securities of an issuer, or (ii) 10 percent
of the outstanding voting securities of an issuer, except that
such restrictions shall not apply to securities issued or
guaranteed by the United States Government or its agencies, bank
money instruments or bank repurchase agreements.

3. Invest more than 25 percent of the value of its total
assets in the securities of issuers in any single industry,
provided that this limitation shall not apply to the purchase of
obligations issued or guaranteed by the United States Government,
its agencies or instrumentalities. For the purpose of this
restriction, each utility that provides a separate service (E.G.,
gas, gas transmission, electric or telephone) shall be considered
to be a separate industry. This test shall be applied on a
proforma basis using the market value of all assets immediately
prior to making any investment. Each Fund has undertaken to apply
this restriction to 25% or more of its total assets, as a matter
of non-fundamental policy.

4. Alone, or together with any other portfolio or
portfolios, make investments for the purpose of exercising control
over, or management of, any issuer.

5. Purchase securities of other investment companies,
except in connection with a merger, consolidation, acquisition or
reorganization, or by purchase in the open market of securities of
closed-end investment companies where no underwriter or dealer's
commission or profit, other than the customary broker's commission
is involved and only if immediately thereafter not more than 10
percent of such portfolio's total assets, taken at market value,
would be invested in such securities.

6. Purchase or sell interests in oil, gas or other mineral
exploration or development programs, commodities, commodity
contracts or real estate, except that such portfolio may: (1)
purchase securities of issuers which invest or deal in any of the
above and (2) invest for hedging purposes in futures contracts on
securities, financial instruments and indices, and foreign
currency, as are approved for trading on a registered exchange.

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<PAGE>

7. Purchase any securities on margin (except that the Fund
may obtain such short-term credits as may be necessary for the
clearance of purchases and sales of portfolio securities) or make
short sales of securities or maintain a short position. The
deposit or payment by the Fund of initial or maintenance margin in
connection with futures contracts or related options transactions
is not considered the purchase of a security on margin.

8. Make loans, except that the Fund (1) may lend portfolio
securities in accordance with the Fund's investment policies up to
33 1/3% of the Fund's total assets taken at market value, (2)
enter into repurchase agreements, and (3) purchase all or a
portion of an issue of publicly distributed debt securities, bank
loan participation interests, bank certificates of deposit,
bankers' acceptances, debentures or other securities, whether or
not the purchase is made upon the original issuance of the
securities.

9. Borrow amounts in excess of 10 percent of its total
assets, taken at market value at the time of the borrowing, and
then only from banks as a temporary measure for extraordinary or
emergency purposes, or make investments in portfolio securities
while such outstanding borrowings exceed 5 percent of its total
assets.

10. Allow its current obligations under reverse repurchase
agreements, together with borrowings, to exceed 1/3 of the value
of its total assets (less all its liabilities other than the
obligations under borrowings and such agreements).

11. Mortgage, pledge, hypothecate or in any manner transfer,
as security for indebtedness, any securities owned or held by such
Fund except as may be necessary in connection with borrowings as
mentioned in investment restriction (9) above, and then such
mortgaging, pledging or hypothecating may not exceed 10 percent of
such Fund's total assets, taken at market value at the time
thereof. In order to comply with certain state statutes, such
Fund will not, as a matter of operating policy, mortgage, pledge
or hypothecate its portfolio securities to the extent that at any
time the percentage of the value of pledged securities plus the
maximum sales charge will exceed 10 percent of the value of such
Fund's shares at the maximum offering price. The deposit of cash,
cash equivalents and liquid debt securities in a segregated
account with the custodian and/or with a broker in connection with
futures contracts or related options transactions and the purchase
of securities on a "when-issued" basis is not deemed to be a
pledge.

12. Underwrite securities of other issuers except insofar as
the Fund may be deemed an underwriter under the 1933 Act in
selling portfolio securities.

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<PAGE>

13. Write, purchase or sell puts, calls or combinations
thereof, except that covered call options may be written.

14. Invest in securities of foreign issuers if at the time
of acquisition more than 10 percent of its total assets, taken at
market value at the time of the investment, would be invested in
such securities. However, up to 25 percent of the total assets of
such portfolio may be invested in the aggregate in such securities
(i) issued, assumed or guaranteed by foreign governments, or
political subdivisions or instrumentalities thereof, (ii) assumed
or guaranteed by domestic issuers, including Eurodollar
securities, or (iii) issued, assumed or guaranteed by foreign
issuers having a class of securities listed for trading on The New
York Stock Exchange.

15. Invest more than 10 percent in the aggregate of the
value of its total assets in repurchase agreements maturing in
more than seven days, time deposits maturing in more than 2 days,
portfolio securities which do not have readily available market
quotations and all other illiquid assets.

Each LifeSpan Fund may not:

1. Issue senior securities, except as permitted by
paragraphs 2, 3, 6 and 7 below. For purposes of this restriction,
the issuance of shares of common stock in multiple classes or
series, the purchase or sale of options, futures contracts and
options on futures contracts, forward commitments and repurchase
agreements entered into in accordance with the Fund's investment
policies, are not deemed to be senior securities.

2. Purchase any securities on margin (except that the Fund
may obtain such short-term credits as may be necessary for the
clearance of purchases and sales of portfolio securities) or make
short sales of securities or maintain a short position. The
deposit or payment by the Fund of initial or maintenance margin in
connection with futures contracts or related options transactions
is not considered the purchase of a security on margin.

3. Borrow money, except for emergency or extraordinary
purposes including (i) from banks for temporary or short-term
purposes or for the clearance of transactions in amounts not to
exceed 33 1/3% of the value of the Fund's total assets (including
the amount borrowed) taken at market value, (ii) in connection
with the redemption of Fund shares or to finance failed
settlements of portfolio trades without immediately liquidating
portfolio securities or other assets; and (iii) in order to
fulfill commitments or plans to purchase additional securities
pending the anticipated sale of other portfolio securities or
assets, but only if after each such borrowing there is asset
coverage of at least 300% as defined in the Investment Company
Act. For purposes of this investment restriction, reverse

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<PAGE>

repurchase agreements, mortgage dollar rolls, short sales, futures
contracts, options on futures contracts, securities or indices and
forward commitment transactions shall not constitute borrowing.

4. Act as an underwriter, except to the extent that in
connection with the disposition of portfolio securities, the Fund
may be deemed to be an underwriter for purposes of the 1933 Act.

5. Purchase or sell real estate except that the Fund may
(i) acquire or lease office space for its own use, (ii) invest in
securities of issuers that invest in real estate or interests
therein, (iii) invest in securities that are secured by real
estate or interests therein, (iv) purchase and sell mortgage-
related securities and (v) hold and sell real estate acquired by
the Fund as a result of the ownership of securities.

6. Invest in commodities, except the Fund may purchase and
sell options on securities, securities indices and currency,
futures contracts on securities, securities indices and currency
and options on such futures, forward foreign currency exchange
contracts, forward commitments, securities index put or call
warrants and repurchase agreements entered into in accordance with
the Fund's investment policies.

7. Make loans, except that the Fund (1) may lend portfolio
securities in accordance with the Fund's investment policies up to
33 1/3% of the Fund's total assets taken at market value, (2)
enter into repurchase agreements, and (3) purchase all or a
portion of an issue of publicly distributed bonds, debentures or
other similar obligations.

8. Purchase the securities of issuers conducting their
principal activity in the same industry if, immediately after such
purchase, the value of its investments in such industry would
exceed 25% of its total assets taken at market value at the time
of such investment. This limitation does not apply to investments
in obligations of the U.S. Government or any of its agencies,
instrumentalities or authorities. Each Fund has undertaken, as a
mater of non-fundamental policy, to apply this restriction to 25%
or more of the Fund's total assets.

9. With respect to 75% of total assets, purchase securities
of an issuer (other than the U.S. Government, its agencies,
instrumentalities or authorities), if:

(a) such purchase would cause more than 5% of the Fund's
total assets taken at market value to be invested in the
securities of such issuer; or

(b) such purchase would at the time result in more than 10%
of the outstanding voting securities of such issuer being held by
the Fund.

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<PAGE>

For purposes of the fundamental investment restrictions, the
term "borrow" does not include mortgage dollar rolls, reverse
repurchase agreements or lending portfolio securities and the
terms "illiquid securities" and "portfolio securities which do not
have readily available market quotations" shall include restricted
securities. However, as non-fundamental policies, the Company
will treat reverse repurchase agreements as borrowings, master
demand notes as illiquid securities and mortgage dollar rolls as
sales transactions and not as a financing.

For purposes of the restriction on investing more than 25% of
the Funds' assets in the securities of issuers in any single
industry, the category Financial Services as used in the Financial
Statements may include several different industries such as
mortgage-backed securities, brokerage firms and other financial
institutions.

For purposes of a Funds' policy not to concentrate their
assets, described in the above restrictions, the Funds have
adopted the industry classifications set forth in the Appendix to
this Statement of Additional Information. This is not a fundamen-
tal policy.

The percentage restrictions described above and in each
Fund's Prospectus apply only at the time of investment (except for
the 300% asset coverage requirement on borrowing) and require no
action by a Fund as a result of subsequent changes in value of the
investments or the size of a Fund.

INVESTMENT RESTRICTIONS THAT ARE NON-FUNDAMENTAL. The
following restrictions are non-fundamental and may be changed by
the Board of Directors without the approval of shareholders.
However, any significant changes will be reflected in a supplement
to this Statement of Additional Information.

Each LifeSpan Fund may not:

(1) Pledge, mortgage or hypothecate its assets, except to
secure permitted borrowings and then only if such pledging,
mortgaging or hypothecating does not exceed 33 1/3% of the Fund's
total assets taken at market value. Collateral arrangements with
respect to margin, option and other risk management and when-
issued and forward commitment transactions are not deemed to be
pledges or other encumbrances for purposes of this restriction.

(2) Participate on a joint or joint-and-several basis in any
securities trading account. The "bunching" of orders for the sale
or purchase of marketable portfolio securities with other accounts
under the management of the Manager or the Subadvisers to save
commissions or to average prices among them is not deemed to
result in a joint securities trading account.

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<PAGE>

(3) Purchase or retain securities of an issuer if one or
more of the Directors or officers of the Company or directors or
officers of the Manager or any Subadviser or any investment
management subsidiary of the Manager or any Subadviser
individually owns beneficially more than 0.5% and together own
beneficially more than 5% of the securities of such issuer.

(4) Purchase a security if, as a result, (i) more than 10%
of a Fund's assets would be invested in securities of other
investment companies, (ii) such purchase would result in more than
3% of the total outstanding voting securities of any one such
investment company being held by the Fund or (iii) more than 5% of
the Fund's assets would be invested in any one such investment
company. The Funds will not purchase the securities of any open-
end investment company except when such purchase is part of a plan
of merger, consolidation, reorganization or purchase of
substantially all of the assets of any other investment company,
or purchase the securities of any closed-end investment company
except in the open market where no commission or profit to a
sponsor or dealer results from the purchase, other than customary
brokerage fees. The Funds have no current intention of investing
in other investment companies.

(5) Invest more than 15% of total assets in restricted
securities, including securities eligible for resale pursuant to
Rule 144A under the Securities Act of 1933.

(6) Invest more than 5% of total assets in securities of any
issuer which, together with its predecessors, has been in
operation for less than three years.

(7) Invest in securities which are illiquid if, as a result,
more than 15% of its net assets would consist of such securities,
including repurchase agreements maturing in more than seven days,
securities that are not readily marketable, certain restricted
securities, purchased OTC options, certain assets used to cover
written OTC options, and privately issued stripped mortgage-backed
securities.

(8) Purchase securities while outstanding borrowings exceed
5% of the Fund's total assets.

(9) Invest in real estate limited partnership interests.

(10) Purchase warrants of any issuer, if, as a result of such
purchase, more than 2% of the value of the Fund's total assets
would be invested in warrants which are not listed on an exchange
or more than 5% of the value of the total assets of the Fund would
be invested in warrants generally, whether or not so listed. For
these purposes, warrants are to be valued at the lesser of cost or
market, but warrants acquired by the Fund in units with or
attached to debt securities shall be deemed to be without value.

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<PAGE>

(11) Purchase interests in oil, gas, or other mineral
exploration programs or mineral leases; however, this policy will
not prohibit the acquisition of securities of companies engaged in
the production or transmission of oil, gas, or other minerals.

(12) Write covered call or put options with respect to more
than 25% of the value of its total assets, invest more than 25% of
its total assets in protective put options or invest more than 5%
of its total assets in puts, calls, spreads or straddles, or any
combination thereof, other than protective put options. The
aggregate value of premiums paid on all options, other than
protective put options, held by the Fund at any time will not
exceed 20% of the Fund's total assets.

(13) Invest for the purpose of exercising control over or
management of any company.

To comply with certain SEC positions, Disciplined Value Fund
and Disciplined Allocation Fund have each undertaken as a matter
of non-fundamental policy not to invest more than 10% of its net
assets in illiquid and restricted securities as defined in its
respective applicable fundamental investment restriction. Each
Fund has undertaken as a matter of non-fundamental policy not to
invest 25% or more of its assets in securities of issuers in any
single industry as defined in its respective applicable
fundamental investment restriction.

In order to permit the sale of shares of the Funds in certain
states, the Board of Directors may, in its sole discretion, adopt
restrictions on investment policy more restrictive than those
described above. Should the Board of Directors determine that any
such more restrictive policy is no longer in the best interest of
a Fund and its shareholders, the Fund may cease offering shares in
the state involved and the Board of Directors may revoke such
restrictive policy. Moreover, if the states involved shall no
longer require any such restrictive policy, the Board of Directors
may, in its sole discretion, revoke such policy.

HOW THE FUNDS ARE MANAGED

ORGANIZATION AND HISTORY. The Company was incorporated in
Maryland on December 9, 1981. Prior to March 18, 1996, the
Company was named Connecticut Mutual Investment Accounts, Inc.

As series of a Maryland corporation, the Funds are not
required to hold, and do not plan to hold, regular annual meetings
of shareholders. The Funds 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 Directors or upon proper
request of the shareholders. The Directors will call a meeting of
shareholders to vote on the removal of a Director upon the written

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<PAGE>

request of the record holders of 10% of the Company's outstanding
shares. In addition, if the Directors receive a request from at
least 10 shareholders (who have been shareholders for at least six
months) holding shares of the Company valued at $25,000 or more or
holding at least 1% of the Company's outstanding shares, whichever
is less, stating that they wish to communicate with other
shareholders to request a meeting to remove a Director, the
Directors will then either make each Fund's shareholder list
available to the applicants or mail their communication to all
other shareholders at the applicants' expense, or the Directors
may take such other action as set forth under Section 16(c) of the
Investment Company Act.

DIRECTORS AND OFFICERS OF THE COMPANY. The Company's Directors
and officers and their principal occupations and business
affiliations during the past five years are listed below. The
address of each Director and officer is Two World Trade Center,
New York, New York 10048-0203, unless another address is listed
below. All of the Directors are directors or trustees of
Oppenheimer Target Fund, Oppenheimer Fund, Oppenheimer Global
Fund, Oppenheimer Growth Fund, Oppenheimer Discovery Fund,
Oppenheimer Global Growth & Income Fund, Oppenheimer Global
Emerging Growth Fund, Oppenheimer Gold & Special Minerals Fund,
Oppenheimer Tax-Free Bond Fund, Oppenheimer New York Tax-Exempt
Fund, Oppenheimer California Tax-Exempt Fund, Oppenheimer
Multi-State Tax-Exempt Trust, Oppenheimer Money Market Fund, Inc.,
Oppenheimer Asset Allocation Fund, Oppenheimer Enterprise Fund,
Oppenheimer International Growth Fund, Oppenheimer U.S. Government
Trust, Oppenheimer Multi-Sector Income Trust and Oppenheimer
Multi-Government Trust (the "New York-based OppenheimerFunds")
(except that Ms. Macaskill is not a director of Oppenheimer Money
Market-Fund, Inc.). Ms. Macaskill and Messrs. Bishop, Bowen,
Donohue, Farrar and Zack, who are officers of the Company, hold
the same offices with the other New York-based OppenheimerFunds as
with the Company.

LEON LEVY, CHAIRMAN OF THE BOARD OF DIRECTORS; AGE: 70
31 West 52nd Street, New York, New York 10019
General Partner of Odyssey Partners, L.P. (investment partnership)
and Chairman of Avatar Holdings, Inc. (real estate development).

ROBERT G. GALLI, DIRECTOR*; AGE: 62
Vice Chairman of the Manager and Vice President and Counsel of
Oppenheimer Acquisition Corp. ("OAC"), the Manager's parent hold-
ing company; formerly he held the following positions: a director
of the Manager and OppenheimerFunds Distributor, Inc. (the

- - ------------------
* A Director who is an "interested person" of the Company as
defined in the investment Company Act.

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<PAGE>

"Distributor"), Vice President and a director of HarbourView Asset
Management Corporation ("HarbourView") and Centennial Asset
Management Corporation ("Centennial"), investment advisory
subsidiaries of the Manager, a director of Shareholder Financial
Services, Inc. ("SFSI") and Shareholder Services, Inc. ("SSI"),
transfer agent subsidiaries of the Manager, an officer of other
Oppenheimer funds and Executive Vice President and General Counsel
of the Manager and the Distributor.

BENJAMIN LIPSTEIN, DIRECTOR; AGE: 72
591 Breezy Hill Road, Hillsdale, New York 12529
Professor Emeritus of Marketing, Stern Graduate School of Business
Administration, New York University; a director of Sussex
Publications, Inc. (Publishers of PSYCHOLOGY TODAY ON MOTHER EARTH
NEWS) and a director of Spy Magazine, L.P.

BRIDGET A. MACASKILL, PRESIDENT AND DIRECTOR; AGE: 47
President, Chief Executive Officer and a Director of the Manager;
Chairman and a Director of SSI, Vice President and a Director of
OAC and HarbourView; a director of Oppenheimer Partnership
Holdings, Inc., a holding company subsidiary of the Manager; for-
merly an Executive Vice President of the Manager.

ELIZABETH B. MOYNIHAN, DIRECTOR; AGE: 66
801 Pennsylvania Avenue, N.W., Washington, DC 20004
Author and architectural historian; a trustee of the Freer Gallery
of Art (Smithsonian Institution), the Institute of Fine Arts (New
York University), and the National Building Museum; a member of
the Trustees Council, Preservation League of New York State; a
member of the Indo-U.S. Sub-Commission on Education and Culture.

KENNETH A. RANDALL, DIRECTOR; AGE: 68
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 pro-
ducer), Enron-Dominion Cogen Corp. (cogeneration company), Kemper
Corporation (insurance and financial services company), and
Fidelity Life Association (mutual life insurance company);
formerly Chairman of the Board of ICL, Inc. (information systems),
and President and Chief Executive Officer of The Conference Board,
Inc. (international economic and business research).

EDWARD V. REGAN, DIRECTOR; AGE: 65
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; a member
of the U.S. Competitiveness Policy Council; a director of
GranCare, Inc. (healthcare provider); formerly New York State
Comptroller and trustee, New York State and Local Retirement Fund.

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<PAGE>

RUSSELL S. REYNOLDS, JR., DIRECTOR; AGE: 64
200 Park Avenue, New York, New York 10166
Founder and Chairman of Russell Reynolds Associates, Inc. (execu-
tive recruiting); Chairman of Directors Publication, Inc. (con-
sulting and publishing); a trustee of Mystic Seaport Museum, In-
ternational House, Greenwich Historical Society and Greenwich Hos-
pital.

SIDNEY M. ROBINS, DIRECTOR; AGE: 84
50 Overlook Road, Ossining, New York 10562
Chase Manhattan Professor Emeritus of Financial Institutions,
Graduate School of Business, Columbia University; Visiting Profes-
sor of Finance, University of Hawaii; a director of The Korea
Fund, Inc. (closed-end investment company); a member of the Board
of Advisors, Olympus Private Placement Fund, L.P.; Professor
Emeritus of Finance, Adelphi University.

DONALD W. SPIRO, VICE CHAIRMAN AND DIRECTOR*; AGE: 70
Chairman Emeritus and a director of the Manager; formerly Chairman
of the Manager and the Distributor.

PAULINE TRIGERE, DIRECTOR; AGE: 83
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, DIRECTOR; AGE: 65
1325 Merrie Ridge Road, McLean, Virginia 22101
Of Counsel to 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.

ANDREW J. DONOHUE, VICE PRESIDENT AND SECRETARY; AGE: 45
Executive Vice President and General Counsel of the Manager and
the Distributor; President and a Director of Centennial; an
officer of other Oppenheimer funds; formerly Senior Vice President
and Associate General Counsel of the Manager and the Distributor;
formerly a Partner in Kraft & McManimon (a law firm), prior to
which he was an officer of First Investors Corporation (a
broker-dealer) and First Investors Management Company, Inc.

- - -----------------------
* A Director who is an "interested person" of the Company as
dedined in the investment Company Act.

-37-

<PAGE>

(broker-dealer and investment adviser), and a director and an of-
ficer of First Investors Family of Funds and First Investors Life
Insurance Company.

PETER M. ANTOS, VICE PRESIDENT AND SENIOR PORTFOLIO MANAGER
(DISCIPLINED ALLOCATION FUND AND DISCIPLINED VALUE FUND); AGE 51
10 State House Square, Hartford, Connecticut 06103
Senior Vice President and Portfolio Manager of the Manager; a
Chartered Financial Analyst; an officer of other Oppenheimer
funds; Vice President of HarbourView; prior to March, 1996 he was
a portfolio manager for the Company and other mutual funds managed
by G.R. Phelps & Co. Inc. ("G.R. Phelps"), the Company's former
investment adviser: of which he was a Vice President and Senior
Portfolio Manager, Equities, and which was a subsidiary of
Connecticut Mutual Life Insurance Company ("CML").

STEPHEN F. LIBERA, VICE PRESIDENT AND PORTFOLIO MANAGER
(DISCIPLINED ALLOCATION FUND); AGE 45
10 State House Square, Hartford, Connecticut 06103
Vice President and Portfolio Manager of the Manager; a Chartered
Financial Analyst; an officer of other Oppenheimer funds; a Vice
President of HarbourView; prior to March, 1996 he was a portfolio
manager for the Company and other mutual funds managed by G.R.
Phelps, of which he was Senior Portfolio Manager, Fixed Income.

MICHAEL C. STRATHEARN, VICE PRESIDENT AND PORTFOLIO MANAGER
(DISCIPLINED ALLOCATION FUND AND DISCIPLINED VALUE FUND); AGE 43
10 State House Square, Hartford, Connecticut 06103
Vice President and Portfolio Manager of the Manager; a Chartered
Financial Analyst; an officer of other Oppenheimer funds; a Vice
President of HarbourView; prior to March, 1996 he was an equity
portfolio manager for the Company and other mutual funds managed
by G.R. Phelps, and Portfolio Manager, Equities for CML.

KENNETH B. WHITE, VICE PRESIDENT AND PORTFOLIO MANAGER
(DISCIPLINED ALLOCATION FUND AND DISCIPLINED VALUE FUND); AGE 49
10 State House Square, Hartford, Connecticut 06103
Vice President and Portfolio Manager of the Manager; Chartered
Financial Analyst; an officer of the Oppenheimer funds; Vice
President of HarbourView; prior to March, 1996 he was an equity
portfolio manager for the Company and other mutual funds managed
by G.R. Phelps, a Portfolio Manager, Equities of CML, prior to
which he was Senior Investment Officer, Equities of CML.

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<PAGE>

ARTHUR ZIMMER, VICE PRESIDENT AND PORTFOLIO MANAGER (DISCIPLINED
ALLOCATION FUND); AGE 49
Vice President and Portfolio Manager of the Manager Centennial;
and Officer and Portfolio Manager of other Oppenheimer funds.

GEORGE C. BOWEN, TREASURER AND ASSISTANT SECRETARY; AGE: 59
3410 South Galena Street, Denver, Colorado 80231
Senior Vice President and Treasurer of the Manager; Vice President
and Treasurer of the Distributor and HarbourView; Senior Vice
President, Treasurer, Assistant Secretary and a director of Cen-
tennial; Vice President, Treasurer and Secretary of SSI and SFSI;
an officer of other Oppenheimer funds.

ROBERT G. ZACK, ASSISTANT SECRETARY; AGE: 47
Senior Vice President and Associate General Counsel of the Man-
ager; Assistant Secretary of SSI and SFSI; and officer of other
Oppenheimer funds.

ROBERT BISHOP, ASSISTANT TREASURER; AGE: 36
3410 South Galena Street, Denver, Colorado 80231
Assistant Vice President of the Manager/Mutual Fund Accounting; an
officer of other Oppenheimer funds; previously a Fund Controller
for the Manager, prior to which he was an Accountant for Yale &
Seffinger, P.C., an accounting firm, and previously an Accountant
and Commissions Supervisor for Stuart James Company Inc., a
broker-dealer.

SCOTT FARRAR, ASSISTANT TREASURER; AGE: 30
3410 South Galena Street, Denver, Colorado 80231
Assistant Vice President of the Manager/Mutual Fund Accounting; an
officer of other Oppenheimer funds; previously a Fund Controller
for the Manager, prior to which he was an International Mutual
Fund Supervisor for Brown Brothers Harriman Co., a bank, and pre-
viously a Senior Fund Accountant for State Street Bank & Trust
Company.

REMUNERATION OF DIRECTORS AND OFFICERS. The officers of the
Company are affiliated with the Manager; they and the Directors of
the Company who are affiliated with the Manager receive no salary
or fee from the Company or the Funds.

As of December 31, 1995, the then Directors and officers of
the Company as a group owned of record or beneficially less than
1% of the outstanding shares of the Company.

MAJOR SHAREHOLDERS. As of April 15, 1996, Massachusetts
Mutual Life Insurance Company ("MML") and its affiliates owned
shares of the Funds as follows: Value Fund (1,980,906 shares)
(28% of shares outstanding); LifeSpan Growth Fund (2,590,448
shares) (79% of shares outstanding); LifeSpan Balanced Fund
(3,485,974 shares) (85% of shares outstanding); LifeSpan Income
Fund (2,086,830 shares) (86% of shares outstanding). On March 1,

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<PAGE>

1996, Connecticut Mutual Life Insurance Company ("CML") merged
into MML (indirect parent of the Manager) and MML became the
successor owner of shares of the Company previously owned by CML.
MML and its affiliates are deemed to be controlling persons of any
Fund of the Company of which they own more than 25% of the shares
outstanding. As such, the exercise by MML and its affiliates of
their voting rights may diminish the voting power of other
shareholders. Effective April 15, 1996, no other shareholders of
the Company owned of record or beneficially 5% or more of the
outstanding shares of any Fund.

THE MANAGER, THE SUBADVISERS AND THEIR AFFILIATES. The Manager is
wholly-owned by Oppenheimer Acquisition Corporation ("OAC"), a
holding company controlled by MML. OAC is also owned in part by
certain of the Manager's directors and officers, some of whom also
serve as officers of the Funds, and three of whom (Ms. Macaskill
and Messrs. Galli and Spiro) serve as Directors of the Company.

The Manager and the Company have a Code of Ethics, as does
each Subadviser. The Codes of Ethics are designed to detect and
prevent improper personal trading by certain employees, including
portfolio managers, that would compete with or take advantage of a
Fund's portfolio transactions. Compliance with the respective
Code of Ethics is carefully monitored and strictly enforced by the
Manager or the relevant Subadviser.

THE INVESTMENT ADVISORY AGREEMENTS. Each Fund has entered
into an Investment Advisory Agreement with the Manager, effective
March 1, 1996. The investment advisory agreement between the
Manager and each Fund requires the Manager, at its expense, to
provide each 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 each 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 the
continuous public sale of shares of each Fund.

Expenses not expressly assumed by the Manager under an
advisory agreement are paid by the relevant Fund. The advisory
agreement lists examples of expenses to be paid by a Fund, the
major categories of which relate to interest, taxes, brokerage
commissions, fees to certain Directors, legal, and audit expenses,
custodian and transfer agent expenses, share issuance costs,
certain printing and registration costs and non-recurring
expenses, including litigation.

The advisory fees paid by the Funds to G.R. Phelps & Co., the
Funds' prior investment advisor (until March 1, 1996), for the
last three fiscal years were:

-40-

1993 1994 1995
---------- ---------- ----------

<S> <C> <C> <C>
Disciplined Allocation Fund $ 867,544 $1,173,401 $1,251,666

Disciplined Value Fund $ 342,082 $ 447,812 $ 613,378

LifeSpan Balanced Fund N/A N/A $ 214,011

LifeSpan Growth Fund N/A N/A $ 166,212

LifeSpan Income Fund $ 111,599

Total All Funds $1,209,626 $1,621,213 $2,356,866
---------- ---------- ----------
---------- ---------- ----------

</TABLE>

The advisory agreements contain no provisions limiting a
Fund's expenses. However, independent of each advisory agreement,
the Manager has voluntarily undertaken that the total expenses of
a Fund in any fiscal year (including the management fee but
excluding taxes, interest, brokerage commissions, distribution
plan payments and extraordinary expenses such as litigation costs)
shall not exceed the most stringent state regulatory requirements
on expense limitations applicable to a Fund. For the purpose of
such calculation, there shall be excluded any expense borne
directly or indirectly by a Fund which is permitted to be excluded
from the computation of such limitation by such statute or state
regulatory authority. At present, the most stringent state
expense limitation is imposed by California, and limits expenses
(with specific exclusions) to 2.5% of the first $30 million of
average net assets, 2% of the next $70 million of average net
assets and 1.5% of average net assets in excess of $100 million.
The Manager reserves the right to terminate or amend this
undertaking at any time. Any assumption of a Fund's expenses
under this limitation would lower a Fund's overall expense ratio
and increase its total return during any period in which expenses
are limited.

The advisory agreements provide that in the absence of
willful misfeasance, bad faith, gross negligence in the
performance of its duties, or reckless disregard of its
obligations and duties under the advisory agreement, the Manager
is not liable for any loss resulting from any good faith errors or
omissions in connection with any matters to which the agreement
relates. Each 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 its other
investment activities. If the Manager shall no longer act as
investment adviser to the Funds, the right of the Funds to use the
name "Oppenheimer" as part of their names may be withdrawn.

THE INVESTMENT SUBADVISORY AGREEMENTS. The advisory
agreements permit the Manager to hire one or more subadvisers to

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<PAGE>

assist with the management of the Funds, at the Manager's expense.
The Manager has done so for the LifeSpan Funds.

With respect to the international component for the LifeSpan
Growth Fund and LifeSpan Balanced Fund, the Manager has entered
into investment subadvisory agreements with Babson-Stewart Ivory
International ("Babson-Stewart"). With respect to the small cap
component of the LifeSpan Growth Fund and LifeSpan Balanced Fund,
the Manager has entered into investment subadvisory agreements
with Pilgrim Baxter & Associates ("Pilgrim"). With respect to the
high yield/high risk bond component for each LifeSpan Fund, the
Manager has entered into investment subadvisory agreements with
BEA Associates.

Babson-Stewart, One Memorial Drive, Cambridge, Massachusetts
02142, is a Massachusetts general partnership and a registered
investment adviser and was originally established in 1987. The
general partners of Babson-Stewart are David L. Babson & Co.,
which is an indirect subsidiary of Massachusetts Life Insurance
Company, and Stewart Ivory & Co. (International), Ltd. As of
December 31, 1995, Babson-Stewart had approximately $5.4 billion
in assets under management.

BEA Associates, One Citicorp Center, 153 E. 53rd Street, 57th
Floor, New York, NY 10022, is a partnership between Credit Suisse
Capital Corporation and CS Advisors Corp. BEA Associates has been
providing domestic and global fixed income and equity investment
management services for institutional clients and mutual funds
since 1984 and, had $27.4 billion in assets under management as of
December 31, 1995.

Pilgrim, 1255 Drummers Lane, Wayne, Pennsylvania 19087, was
established in 1982 to provide specialized equity management for
institutional investors. Pilgrim is a Delaware corporation and a
wholly owned subsidiary of United Asset Management Corporation.
As of March 31, 1996, Pilgrim had over $9 billion in assets under
management.

Under the respective investment subadvisory agreements, the
corresponding Subadviser, subject to the review of the Board of
Directors and the overall supervision of the Manager, is
responsible for managing the investment operations of the
corresponding LifeSpan Fund component and the composition of the
component's portfolio and furnishing the LifeSpan Fund with advice
and recommendations with respect to investments and the purchase
and sale of securities for the respective component. The
shareholders of the Funds approved new subadvisory agreements with
the relevant subadvisers effective March 1, 1996. The Manager,
not the Fund, pays the subadvisers. The subadvisers are paid at
the rate set forth in the relevant Prospectus.

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<PAGE>

The investment subadvisory agreements with Babson-Stewart
provide that in the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard with respect to its
obligations and duties under the agreements, Babson-Stewart will
not be subject to liability for any loss sustained by reason of
its good faith errors of omissions in connection with any matters
to which the agreements relate.

The investment subadvisory agreements with Pilgrim provide
that in the absence of willful misfeasance, bad faith, negligence,
or reckless disregard of the performance of its duties under the
agreements, Pilgrim is not subject to liability for any error of
judgment or mistake of law or for any other action or omission in
the course of, or connected with, rendering services or for any
losses that may be sustained in the purchase, holding or sale of
any security, or otherwise.

The investment subadvisory agreements with BEA Associates
provide that in the absence of willful misfeasance, bad faith,
negligence, or reckless disregard of the performance of its duties
under the agreement, BEA Associates is not subject to liability
for losses as a result of its activities in connection with the
adoption of any investment policy or the purchase, sale or
retention of securities on behalf of the LifeSpan Funds subadvised
by BEA Associates if such activities were made with due care and
in good faith.

For the fiscal year ended December 31, 1995, the Company's
prior investment adviser paid subadvisory fees to BEA Associates,
Pilgrim and Scudder, Stevens & Clark, Inc. (the prior subadviser
to the international component of LifeSpan Growth and LifeSpan
Balanced Fund) of $34,923, $51,015 and $55,900, respectively.

THE DISTRIBUTOR. Under its Distribution Agreements with each
Fund dated March 18, 1996, the Distributor acts as each Fund's
principal underwriter in the continuous public offering of the
Fund's shares, but is not obligated to sell a specific number of
shares. Expenses normally attributable to sales (other than those
paid under the Distribution and Service Plans, but including
advertising and the cost of printing and mailing prospectuses
other than those furnished to existing shareholders), are borne by
the Distributor.

The compensation paid by the Funds to Connecticut Mutual
Financial Services, L.L.C., the prior distributor of the Funds'
shares (until March 18, 1996), for distribution fees for the last
three fiscal years was:

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<PAGE>

1993 1994 1995
---------- ---------- ----------
<S> <C> <C> <C>
Allocation Fund $1,790,711 $1,671,181 $ 902,663

Value Fund $ 416,056 $ 513,544 $ 559,650

LifeSpan Income Fund N/A N/A $ 75,262

LifeSpan Balanced Fund N/A N/A $ 123,711

LifeSpan Growth Fund N/A N/A $ 151,750

</TABLE>

For additional information about distribution of the Funds' shares
and the expenses connected with such activities, please refer to
"Distribution and Service Plans," below.

THE TRANSFER AGENT. OppenheimerFunds Services, a division of
the Manager, serves as each Fund's transfer agent. It is
responsible for maintaining each Fund's shareholder registry and
shareholder accounting records, and for shareholder servicing and
administrative functions.

BROKERAGE POLICIES OF THE FUNDS

The Company has no obligation to deal with any dealer or
group of dealers in the execution of transactions in portfolio
securities. Subject to applicable policies established by the
Board of Directors, the Manager and the relevant Subadvisers are
primarily responsible for the investment decisions of each Fund or
Fund component and the placing of its portfolio transactions. It
is the policy of each Fund to obtain the most favorable net
results, taking into account various factors, including price,
dealer spread or commission, if any, size of the transaction and
difficulty of execution. While the Manager and the Subadvisers
generally seek reasonably competitive spreads or commissions, the
Funds will not necessarily pay the lowest spread or commission
available.

BROKERAGE PROVISIONS OF THE INVESTMENT ADVISORY AGREEMENTS.
One of the duties of the Manager under each advisory agreement is
to arrange the portfolio transactions for each Fund. Each
advisory agreement contains provisions relating to the employment
of broker-dealers ("brokers") to effect a Fund's portfolio
transactions. In doing so, the Manager is authorized by the
advisory agreement to employ such 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 a 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

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<PAGE>

with the interest and policies of a Fund as established by its
Board of Directors. Purchases of securities from underwriters
include a commission or concession paid by the issuer to the
underwriter, and purchasers from dealers include a spread between
the bid and asked price.

Under each advisory agreement, the Manager is authorized to
select brokers that provide brokerage and/or research services for
a 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
and 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 a Fund and other
investment companies managed by the Manager or its affiliates as a
factor in the selection of brokers for a Fund's portfolio
transactions. There are similar provisions in the subadvisory
agreements for the LifeSpan Funds, pursuant to which the relevant
subadviser selects brokers for portfolio transactions for a
component.

DESCRIPTION OF BROKERAGE PRACTICES FOLLOWED BY THE MANAGER
AND SUBADVISERS. Most purchases of debt securities, commercial
paper, and money market instruments made by the Funds are
principal transactions at net prices, and the Funds incur little
or no brokerage costs for these transactions.

Subject to the provisions of the advisory agreements and the
subadvisory agreements and the procedures and rules described
above, allocations of brokerage are generally made by the
Manager's or the Subadviser's portfolio traders based upon
recommendations from the applicable portfolio managers. In
certain instances, portfolio managers may directly place trades
and allocate brokerage, also subject to the provisions of the
advisory agreements and the subadvisory agreements and the
procedures and rules described above. In either case, brokerage
is allocated under the supervision of the Manager's or the
Subadviser'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 or for certain fixed income agency transactions
in the secondary market and otherwise only if it appears likely
that a better price or execution can be obtained.

When the Funds engage 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 the Subadvisers and their respective affiliates are

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<PAGE>

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.

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, or of a Subadviser, and investment research
received for the commissions of those other accounts may be useful
both to the Funds 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 in commission dollars. The
Board of Directors 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
trades to obtain research where the broker has represented to the
Manager that (i) the trade is not from 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 broadens the scope
and supplements the research activities of the Manager or the
relevant Subadvisers, by making available additional views for
consideration and comparisons, and enabling the Manager or
Subadvisers to obtain market information for the valuation of
securities held in a Fund's portfolio or being considered for
purchase. The Board of Directors, including the "independent"
Directors of the Funds (those Directors of the Funds who are not
"interested persons" as defined in the Investment Company Act)
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.

Brokerage commissions for the most recent three year period
for the Fund's listed below were as follows:

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<PAGE>

<TABLE>
<CAPTION>
1993 1994 1995
---- ---- ----
Brokerage Brokerage Brokerage
Fund Commissions Commissions Commissions
---- ----------- ----------- -----------
<S> <C> <C> <C>
Disciplined Value Fund $187,654 $249,665 $233,480
Disciplined Allocation Fund $297,403 $379,734 $211,491
LifeSpan Income Fund* N/A N/A $12,083
LifeSpan Balanced Fund* N/A N/A $58,577
LifeSpan Growth Fund* N/A N/A $62,173
</TABLE>

* The Fund commenced operations on September 1, 1995.

PERFORMANCE OF THE FUNDS

YIELD AND TOTAL RETURN INFORMATION. From time to time, as set
forth in a Fund's Prospectus, the "standardized yield," "dividend
yield," "average annual total return," or "cumulative total
return", as the case may be, of an investment in a class of shares
of a Fund may be advertised. An explanation of how yields and
total returns are calculated for each class and the components of
those calculations is set forth below. The maximum sales charge
rate on Class A shares of the Funds was lower prior to March 18,
1996, and actual investment performance would be affected by that
change.

A Fund's advertisement of its performance must, under
applicable rules of the SEC, include the average annual total
returns for the advertised class of shares of a Fund for the 1, 5
and 10-year periods (or the life of the class, if less) as of the
most recently ended calendar quarter. This enables an investor to
compare a 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 a Fund is not insured;
its yields and total returns 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. Yields and
total returns for any given past period are not a prediction or
representation by a Fund of future yields or rates of return on
its shares. The yields and total returns of Class A, Class B or
Class C shares of a Fund, as the case may be, are affected by
portfolio quality, portfolio maturity, the type of investments the
Fund holds and its operating expenses allocated to a particular
class.

STANDARDIZED YIELDS

Yield. A Fund's "yield" (referred to as "standardized
yield") for a given 30-day period for a class of shares is
calculated using the following formula set forth in rules adopted
by the SEC that apply to all funds that quote yields:

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<PAGE>

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

The symbols above represent the following factors:

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

The standardized yield of a class of shares for a 30-day
period may differ from its yield for any other period. The SEC
formula assumes that the standardized yield for a 30-day period
occurs at a constant rate for a six-month period and is annualized
at the end of the six-month period. This standardized yield is
not based on actual distributions paid by a Fund to shareholders
in the 30-day period, but is a hypothetical yield based upon the
net investment income from a Fund's portfolio investments
calculated for that period. The standardized yield may differ
from the "dividend yield" of that class, described below.
Additionally, because each class of shares is subject to different
expenses, it is likely that the standardized yields of a Fund's
classes of shares will differ.

DIVIDEND YIELD AND DISTRIBUTION RETURN. From time to time a
Fund may quote a "dividend yield" or a "distribution return" for
each class. Dividend yield is based on the dividends paid on
shares of a class from dividends derived from net investment
income during a stated period. Distribution return includes
dividends derived from net investment income and from realized
capital gains declared during a stated period. Under those
calculations, the dividends and/or distributions for that class
declared during a stated period of one year or less (for example,
30 days) are added together, and the sum is divided by the maximum
offering price per share of that class) on the last day of the
period. When the result is annualized for a period of less than
one year, the "dividend yield" is calculated as follows:

Dividend Yield of the Class =

Dividends of the Class DIVIDED BY Number of days (accrual
- - ----------------------
Max. Offering Price of the Class period) X 365
(last day of period)

The maximum offering price for Class A shares includes the
current maximum front-end sales charge. For Class B or Class C
shares, as the case may be, the maximum offering price is the net

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<PAGE>

asset value per share, without considering the effect of
contingent deferred sales charges. From time to time similar
yield or distribution return calculations may also be made using
the Class A net asset value (instead of its respective maximum
offering price) at the end of the period.

TOTAL RETURN INFORMATION

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:

(ERV)1/n - 1 = AVERAGE ANNUAL TOTAL RETURN
---
P

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 Fund's
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 discussed
below). For Class B shares, the payment of the current contingent
deferred sales charge (5.0% for the first year, 4.0% for the
second year, 3.0% for the third and fourth years, 2.0% in the
fifth year, 1.0% in the sixth year and none thereafter) is applied
to the investment result for the time period shown (unless the
total return is shown at the net asset value, as described below).
For Class C shares, the 1.0% contingent deferred sales charge is
applied to the investment results for the one-year period (or
less). Total returns also assume that all dividends and capital
gains distributions during the period are reinvested to buy
additional shares at net asset value per share, and that the
investment is redeemed at the end of the period.

TOTAL RETURNS AT NET ASSET VALUE. From time to time a 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,

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<PAGE>

Class B or Class C shares, as the case may be. 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.

PERFORMANCE RESULTS FOR CLASS A SHARES OF THE DISCIPLINED
ALLOCATION FUND:

<TABLE>
<CAPTION>
Average Annual Average Annual
Total Return Total Return
Initial (excluding (including
Investment Investment current 5.75% current 5.75%
Period Date max. sales charge) max. salescharge)
<S> <C> <C> <C>
10 Years Ended 12/31/85 12.02% 11.36%

12/31/95

5 Years Ended 12/31/90 14.65% 13.30%
12/31/95

1 Year Ended 12/31/94 23.95% 16.82%
12/31/95
</TABLE>

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<PAGE>

PERFORMANCE RESULTS FOR CLASS B SHARES OF THE DISCIPLINED
ALLOCATION FUND:

Cumulative Cumulative
--------------------------------
Initial Total Return Total Return
Investment Investment (excluding 5% (including 5%
Period Date CDSC) CDSC)

Life of Class 10/01/95* 4.93% -0.31%
12/31/95

PERFORMANCE RESULTS FOR CLASS A SHARES OF THE DISCIPLINED
VALUE FUND:

Average Annual Average Annual
-----------------------------------
Total Return Total Return
Initial (excluding (including
Investment Investment current 5.75% current 5.75%
Period Date max. sales charge) max. sales charge)

10 Years Ended 12/31/85 14.84% 14.16%
12/31/95

5 Years Ended 12/31/90 20.23% 18.81%
12/31/95

1 Year Ended 12/31/94 36.40% 28.56%
12/31/95

PERFORMANCE RESULTS FOR CLASS B SHARES OF THE DISCIPLINED
VALUE FUND:

Cumulative Cumulative
--------------------------------
Initial Total Return Total Return
Investment Investment (excluding 5% (including 5%
Period Date CDSC) CDSC)

Life of Class 10/01/95* 8.04% 2.63%
12/31/95

*Date of Inception of Class

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<PAGE>

PERFORMANCE RESULTS FOR CLASS A SHARES OF THE LIFESPAN GROWTH
FUND:

Cumulative Cumulative
-----------------------------------
Total Return Total Return
Initial (excluding (including
Investment Investment current 5.75% current 5.75%
Period Date max. sales charge) max. sales charge)

Life of Class 5/1/95* 18.02% 11.23%
12/31/95

PERFORMANCE RESULTS FOR CLASS B SHARES OF THE LIFESPAN GROWTH
FUND:

Cumulative Cumulative
--------------------------------
Initial Total Return Total Return
Investment Investment (excluding 5% (including 5%
Period Date CDSC) CDSC)

Life of Class 10/01/95* 5.34% 0.07%
12/31/95

PERFORMANCE RESULTS FOR CLASS A SHARES OF THE LIFESPAN
BALANCED FUND:

Life of Class 5/1/95* 15.33% 8.70%
12/31/95

*Date of Inception of Class

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<PAGE>

PERFORMANCE RESULTS FOR CLASS B SHARES OF THE LIFESPAN
BALANCED FUND:

Cumulative Cumulative
--------------------------------
Initial Total Return Total Return
Investment Investment (excluding 5% (including 5%
Period Date CDSC) CDSC)

Life of Class 10/1/95* 4.49% -0.73%
12/31/95

PERFORMANCE RESULTS FOR CLASS A SHARES OF THE LIFESPAN INCOME
FUND:

Life of Class 5/1/95* 11.22% 4.82%
12/31/95

PERFORMANCE RESULTS FOR CLASS B SHARES OF THE LIFESPAN INCOME
FUND:

Cumulative Cumulative
--------------------------------
Initial Total Return Total Return
Investment Investment (excluding 5% (including 5%
Period Date CDSC) CDSC)

Life of Class 10/01/95* 4.30% -0.92%
12/31/95

*Date of Inception of Class

OTHER PERFORMANCE COMPARISONS. From time to time a Fund may
publish the ranking of its shares by Lipper Analytical Services,
Inc. ("Lipper"), a widely-recognized independent mutual fund
monitoring service. Lipper monitors the performance of regulated
investment companies, including the Funds, and ranks their
performance for various periods based on categories relating to
investment objectives. The Lipper performance rankings are based
on total returns that include the reinvestment of capital

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<PAGE>

gain distributions and income dividends but do not take taxes into
consideration.

From time to time a Fund may publish the ranking of the
performance of its shares by Morningstar, Inc., an independent
mutual fund monitoring service that ranks mutual funds, including
the Funds, monthly in broad investment categories (equity, taxable
bond, municipal bond and hybrid) based on risk-adjusted investment
return. Investment return measures a fund's three, five and ten-
year average annual total returns (when available) in excess of
90-day U.S. Treasury bill returns after considering expenses.
Risk measures fund performance below 90-day U.S. Treasury bill
monthly returns. Risk and investment return are combined to
produce star rankings reflecting performance relative to the
average fund in a 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%). Morningstar
may rank the shares of the Fund in relation to other funds in
their respective categories. Rankings are subject to change
monthly.

From time to time a Fund may also include in its
advertisements and sales literature performance information about
a Fund or rankings of a Fund's performance cited in newspapers or
periodicals, such as The New York Times or the Wall Street
Journal. These articles may include quotations of performance
from other sources, such as Lipper Analytical Services, Inc. or
Morningstar, Inc.

From time to time, the Manager may publish rankings or
ratings of the Manager (or the Transfer Agent), by independent
third-parties, or the investor services provided by them to
shareholders of the Oppenheimer funds, other than the performance
rankings of the Oppenheimer funds themselves. These 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.

When comparing yield, total return and investment risk of an
investment in Class A, Class B or Class C shares, as the case may
be, of a Fund with other investments, investors should understand
that certain other investments have different risk characteristics
than an investment in shares of a Fund. For example, certificates
of deposit may have fixed rates of return and may be insured as to
principal and interest by the FDIC, while a Fund's returns will
fluctuate and its share values and returns are not guaranteed.
U.S. Treasury securities are backed as to repayment of

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<PAGE>

principal and payment of interest by the full faith and credit of the U.S.
government.

DISTRIBUTION AND SERVICE PLANS

Each Fund has adopted a Service Plan for Class A Shares and a
Distribution and Service Plan for Class B and Class C shares of
the Fund under Rule 12b-1 of the Investment Company Act. Pursuant
to such Plans, each Fund will reimburse the Distributor for all or
a portion of its costs incurred in connection with the
distribution and/or servicing of the shares of that class, as
described in the Prospectuses. Each Plan has been approved by a
vote of (i) the Board of Directors of the Company, including a
majority of the Independent Directors, 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 the Class C shares, the votes were cast by the Manager
as the then-sole initial holder of Class C shares of the
respective Funds.

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 a 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 a Fund. The Distributor and the Manager may, in their sole
discretion, increase or decrease the amount of payments they make
to Recipients from their own resources.

Unless terminated as described below, each Plan continues in
effect from year to year but only as long as such continuance is
specifically approved at least annually by the Board of Directors,
including its Independent Directors, 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 Directors or by the vote of the holders of a
"majority" (as defined in the Investment Company Act) of the
outstanding shares of the class of shares of a Fund to which a
Plan relates. No Plan may be amended to increase materially the
amount of payments to be made unless such amendment is approved by
shareholders of the class of shares of the Fund affected by the
amendment. In addition, because Class B shares of each Fund auto-
matically convert into Class A shares after six years, a Fund is
required to obtain the approval of Class B as well as Class A
shareholders for a proposed amendment to a Class A Plan that would
materially increase payments under the Class A Plan. Such
approval must be by a "majority" of the Class A and Class B shares
(as defined in the Investment Company Act) of that

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<PAGE>

Fund, voting separately by class. All material amendments must be approved by
the Board and the Independent Directors.

While the Plans are in effect, the Treasurer of the Funds
shall provide separate written reports to the Board of Directors
at least quarterly for its review, detailing the amount of all
payments made pursuant to each Plan, the purpose for which the
payments were made and the identity of each Recipient that
received any such payment and the purpose of the payments. The
reports for the Class B Plans shall also state the Distributor's
distribution costs for that quarter. Those reports, including the
allocations on which they are based, will be subject to the review
and approval of the Independent Directors in the exercise of their
fiduciary duty. Each Plan further provides that while it is in
effect, the selection and nomination of those Directors who are
not "interested persons" of the Funds are committed to the
discretion of the Independent Directors. This does not prevent
the involvement of others in such selection and nomination if the
final decision on any such selection or nomination is approved by
a majority of the Independent Directors.

Under the Plans, no payment will be made to any Recipient in
any quarter if the aggregate net asset value of all shares of a
Fund held by the Recipient for itself and its customers did not
exceed a minimum amount, if any, that may be determined from time
to time by a majority of the Fund's Independent Directors.
Initially, the Board of Directors has set the fees at the maximum
rate and has set no minimum amount.

Any unreimbursed expenses incurred by the Distributor with
respect to Class A shares for any fiscal quarter by the
Distributor may not be recovered under the Class A Plan in
subsequent fiscal quarters. Payments received by the Distributor
under the Plan for Class A shares will not be used to pay any
interest expense, carrying charges, or other financial costs, or
allocation of overhead by the Distributor.

The Class B and Class C Plans allow the service fee payments
to be paid by the Distributor to Recipients in advance for the
first year Class B and Class C shares are outstanding, and
thereafter on a quarterly basis, as described in the Prospectuses.
The advance payment is based on the net asset value of the Class B
and Class C shares sold. An exchange of shares does not entitle
the Recipient to an advance service fee payment. In the event
Class B or Class C shares are redeemed during the first year such
shares are outstanding, the Recipient will be obligated to repay
the Distributor a pro rata portion of the Distributor's advance
payment for those shares.

Although the Class B and the Class C Plans permit the
Distributor to retain both the asset-based sales charges and the
service fee, or to pay Recipients the service fee on a quarterly

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<PAGE>

basis, without payment in advance, the Distributor presently
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 Plans and the Class C Plans by the
Board. Initially, the Board has set no minimum holding period.
All payments under the Class B Plans 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.

For the fiscal year ended December 31, 1995, each Fund paid
the former distributor the following amounts under its then-
current Class A and Class B Plans:

<TABLE>
<CAPTION>
Class A Class B
----------- --------
<S> <C> <C>
Disciplined Allocation Fund $ 348,698 $ 917

Disciplined Value Fund $ 176,158 $ 742

LifeSpan Growth Fund $ 48,745 $ 563

LifeSpan Balanced Fund $ 62,792 $ 608

LifeSpan Income Fund $ 37,134 $ 264
</TABLE>

During this period, no Class C Plans were in effect for the
Funds and no Class C shares were outstanding.

The Class B and Class C Plans provide for the Distributor to
be compensated at a flat rate whether the Distributor's
distribution expenses are more or less than the amounts paid by a
Fund during that period. Such payments are made in recognition
that the Distributor (i) pays sales commissions to authorized
brokers and dealers at the time of sale and pays service fees as
described in the Prospectuses, (ii) may finance such commissions
and/or the advance of the service fee payment to Recipients under
those Plans or may provide such financing from its own resources,
or from an affiliate, (iii) employs personnel to support
distribution of shares, and (iv) may bear the costs of sales
literature, advertising and prospectuses (other than those
furnished to current shareholders), state "blue sky" registration
fees and certain other distribution expenses.

ABOUT YOUR ACCOUNT

HOW TO BUY SHARES

ALTERNATIVE SALES ARRANGEMENTS - CLASS A, CLASS B AND CLASS C
SHARES. Each Fund offers three classes of shares, Class A, Class
B and Class C shares. The availability of multiple classes of

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<PAGE>

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 another. The Distributor will not accept any order for
$500,000 of Class B shares or $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
a Fund instead.

A Fund's 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 those classes, including the
asset-based sales charges 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 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 a Fund's Class A, Class B and
Class C shares recognizes two types of expenses. General expenses
that do not pertain specifically to a class are allocated pro rata
to the shares of each class, based on the percentage of the net
assets of such class to a Fund's total net 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

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<PAGE>

Information and other materials for current shareholders, (iv)
fees to unaffiliated Directors, (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 and/or Service 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 a Fund as a whole.

DETERMINATION OF NET ASSET VALUES PER SHARE. The net asset
value per share of Class A, Class B and Class C shares of a Fund
is determined as of the close of business of The New York Stock
Exchange on each day the Exchange is open by dividing the value of
a Fund's net assets attributable to that class by the number of
shares of that class outstanding. The Exchange normally closes at
4:00 P.M., New York time, but may close earlier on some days (for
example, in case of weather emergencies or on days falling before
a holiday). The Exchange's most recent annual holiday schedule
(which is subject to change) states that it will close New Year's
Day, Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day and Christmas Day. It may close on
other days. Trading may occur at times when the Exchange is
closed (including weekends and holidays or after 4:00 P.M., on a
regular business day). Because the net asset values of a Fund
will not be calculated at such times, if securities held by a Fund
are traded at such time, the net asset values per share of
Class A, Class B or Class C shares of a Fund may be significantly
affected on such days when shareholders do not have the ability to
purchase or redeem shares.

The Board of Directors has established procedures for the
valuation of each Fund's securities, generally as follows:
(i) equity securities traded on a securities exchange or on the
NASDAQ National Market System are valued at the last reported sale
prices on their primary exchange or NASDAQ that day (or, in the
absence of sales that day, at values based on the last sales
prices of the preceding trading day, or closing bid and asked
prices on the current day); (ii) securities actively traded on a
foreign securities exchange are valued at the last sales price
available to the pricing service approved by the Board of
Directors or to the Manager as reported by the principal exchange
on which the security is traded; (iii) unlisted foreign securities
or listed foreign securities not actively traded are valued as in
(i) above, if available, or at the mean between "bid" and "asked"
prices obtained from active market makers in the security on the
basis of reasonable inquiry; (iv) long-term debt securities having
a remaining maturity in excess of 60 days are valued at the mean
between the "bid" and "asked" prices determined by a portfolio

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<PAGE>

pricing service approved by the Board of Directors or obtained
from active market makers in the security on the basis of
reasonable inquiry; (v) debt instruments having a maturity of more
than one year when issued, and non-money market type instruments
having a maturity of one year or less when issued, which have a
remaining maturity of 60 days or less are valued at the mean
between "bid" and "asked" prices determined by a pricing service
approved by the Board of Directors or obtained from active market
makers in the security on the basis of reasonable inquiry;
(vi) money market debt securities having a maturity of less than
one year when issued that have a remaining maturity of 60 days or
less are valued at cost, adjusted for amortization of premiums and
accretion of discounts; and (vii) securities (including restricted
securities) not having readily-available market quotations are
valued at fair value under the Board's procedures.

In the case of U.S. Government Securities and mortgage-backed
securities, when last sale information is not generally available,
such pricing procedures may include "matrix" comparisons to the
prices for comparable instruments on the basis of quality, yield,
maturity, and other special factors involved. The Board of
Directors has authorized the Manager to employ a pricing service
to price U.S. Government Securities for which last sale
information is not generally available. The Directors will
monitor the accuracy of such pricing services by comparing prices
used for portfolio evaluation to actual sales prices of selected
securities.

Trading in securities on European and Asian exchanges and
over-the-counter markets is normally completed before the close of
The New York Stock Exchange. Events affecting the values of
foreign securities traded in stock markets that occur between the
time their prices are determined and the close of the Exchange
will not be reflected in a Fund's calculation of net asset values
unless the Board of Directors or the Manager, under procedures
established by the Board of Directors, determines that the
particular event would materially affect a Fund's net asset
values, in which case an adjustment would be made. Foreign
currency, including forward contracts, will be valued at the
closing price in the London foreign exchange market that day as
provided by a reliable bank, dealer or pricing service. The
values of securities denominated in foreign currency will be
converted to U.S. dollars at the closing price in the London
foreign exchange market that day as provided by a reliable bank,
dealer or pricing service.

Calls, puts and Futures are valued at the last sale prices on
the principal exchanges on which they are traded, or on NASDAQ,
as applicable, or, if there are no sales that day, in accordance
with (i) above. When a Fund writes an option, an amount equal to
the premium received by the Fund is included in the Fund's
Statement of Assets and Liabilities as an asset, and an

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<PAGE>

equivalent deferred credit is included in the liability section. The
deferred credit is "marked-to-market" to reflect the current
market value of the option. In determining a Fund's gain on
investments, if a call written by a Fund is exercised, the
proceeds are increased by the premium received. If a call written
by a Fund expires, the Fund has a gain in the amount of the
premium; if the Fund enters into a closing purchase transaction,
it will have a gain or loss depending on whether the premium was
more or less than the cost of the closing transaction.

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 the shares.
Dividends will begin to accrue on shares purchased by the proceeds
of ACH transfers on the business day a Fund receives Federal Funds
for such purchase through the ACH system before the close of The
New York Stock Exchange. The Exchange normally closes at 4:00
P.M., but may close earlier on certain days. If the 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 a Fund three days after the transfers are
initiated. The Distributor and the Funds are not responsible for
any delays in purchasing shares resulting from delays in ACH
transmissions.

REDUCED SALES CHARGES. A reduced sales charge rate may be
obtained for Class A shares under Right of Accumulation and
Letters of Intent because of the economies of sales efforts and
reduction in expenses realized by the Distributor, dealers and
brokers making such sales. No sales charge is imposed in certain
other circumstances described in each Fund's Prospectus because
the Distributor or broker-dealer incurs little or no selling
expenses. The term "immediate family" refers to one's spouse,
children, grandchildren, grandparents, parents, parents-in-law,
siblings, aunts, uncles, nieces, nephews, sons- and daughters-in-
law, a sibling's spouse and a spouse's siblings.

THE OPPENHEIMERFUNDS. The Oppenheimerfunds are those mutual
funds for which the Distributor acts as the distributor or the
sub-Distributor and include the following:

Oppenheimer Tax-Free Bond Fund
Oppenheimer New York Tax-Exempt Fund
Oppenheimer California Tax-Exempt Fund
Oppenheimer Intermediate Tax-Exempt Fund
Oppenheimer Insured Tax-Exempt Fund
Oppenheimer Main Street California Tax-Exempt Fund
Oppenheimer Florida Tax-Exempt Fund
Oppenheimer New Jersey Tax-Exempt Fund
Oppenheimer Pennsylvania Tax-Exempt Fund

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<PAGE>

Oppenheimer Fund
Oppenheimer Discovery Fund
Oppenheimer Enterprise Fund
Oppenheimer Target Fund
Oppenheimer Growth Fund
Oppenheimer Equity Income Fund
Oppenheimer Value Stock Fund
Oppenheimer Asset Allocation Fund
Oppenheimer Total Return Fund, Inc.
Oppenheimer Main Street Income & Growth Fund
Oppenheimer High Yield Fund
Oppenheimer Champion Income Fund
Oppenheimer Bond Fund
Oppenheimer U.S. Government Trust
Oppenheimer Limited-Term Government Fund
Oppenheimer Global Fund
Oppenheimer Global Emerging Growth Fund
Oppenheimer Global Growth & Income Fund
Oppenheimer Gold & Special Minerals Fund
Oppenheimer Strategic Income Fund
Oppenheimer Strategic Income & Growth Fund
Oppenheimer International Bond Fund
Oppenheimer International Growth Fund
Oppenheimer Quest Value Fund, Inc.
Oppenheimer Quest Growth & Income Value Fund
Oppenheimer Quest Officers Value Fund
Oppenheimer Quest Opportunity Value Fund
Oppenheimer Quest Small Cap Value Fund
Oppenheimer Quest Global Value Fund, Inc.
Oppenheimer Disciplined Value Fund
Oppenheimer Disciplined Allocation Fund
Oppenheimer LifeSpan Growth Fund
Oppenheimer LifeSpan Balanced Fund
Oppenheimer LifeSpan Income Fund
Oppenheimer Bond Fund for Growth
Rochester Fund Municipals*
Limited-Term New York Municipal Fund*

the following "Money Market Funds":

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

- - -----------------------
*Shares of the Fund are not presently exchangeable for shares of
this fund.

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<PAGE>

Centennial California Tax Exempt Trust
Centennial America Fund, L.P.
Daily Cash Accumulation Fund, Inc.

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 or Class A and Class B
shares of a 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 a Fund (and other Oppenheimer
funds) that applies under the Right of Accumulation to current
purchases of Class A shares. Each purchase of Class A shares
under the Letter will be made at the public offering price
(including the sales charge) that applies to a single lump-sum
purchase of shares in the amount intended to be purchased under
the Letter.

In submitting a Letter, the investor makes no commitment to
purchase shares, 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 applicable Fund's 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 a Fund, that those amendments will apply
automatically to existing Letters of Intent.

For purchases of shares of a 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

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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 total
purchases. If total eligible purchases during the Letter of
Intent period exceed the intended 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.

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 a Fund equal in
value 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 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

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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 acquired subject to a contingent deferred sales charge, and
(c) Class A shares or Class 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 Prospectuses
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 Prospectuses. Asset Builder Plans also enable
shareholders of Oppenheimer Cash Reserves to use those accounts
for monthly automatic purchases of shares of up to four other
Oppenheimer funds.

There is a front-end sales charge on the purchase of Class A
shares of certain OppenheimerFunds, or a contingent deferred sales
charge may apply to shares purchased by Asset Builder payments.
An application should be obtained from the Transfer Agent,
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

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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.
Each 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 a Fund's shares (for example, when a purchase check is
returned to a 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 a
Fund for the loss, the Distributor will do so. A 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.

HOW TO SELL SHARES

Information on how to sell shares of the Funds is stated in
the Prospectuses. The information below supplements the terms and
conditions for redemptions set forth in the Prospectus.

INVOLUNTARY REDEMPTIONS. A Fund's Board of Directors has the
right to cause the involuntary redemption of the shares held in
any account if the number of shares is less than 100. 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.

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

PAYMENTS "IN KIND". Each Fund's Prospectus states that
payment for shares tendered for redemption is ordinarily made in
cash. However, if the Board of Directors of a Fund determines that
it would be detrimental to the best interests of the remaining
shareholders of a Fund to make payment of a redemption order
wholly or partly in cash, the Fund may pay the redemption proceeds
in whole or in part by a distribution "in kind" of securities from

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the portfolio of the Fund, in lieu of cash, in conformity with
applicable rules of the SEC. Each 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 a Fund uses to value its portfolio securities described
above under "Determination of Net Asset Values Per Share" and such
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 without sales charge all or part of the
redemption proceeds of (i) Class A shares purchased subject to an
initial sales charge, or (ii) Class B shares that were subject to
a contingent deferred sales charge when redeemed. This privilege
does not apply to Class C shares. The reinvestment may be made
without sales charge only in Class A shares of a Fund or any of
the other Oppenheimer funds into which shares of a Fund are
exchangeable as described in "How to Exchange Shares" below, at
the net asset value next computed after receipt by the Transfer
Agent of the reinvestment order. The shareholder must ask the
Distributor for such privilege at the time of reinvestment. Any
capital gain that was realized when the shares were redeemed is
taxable. 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 Fund shares are redeemed before the 91st day after the
date they were acquired and the redemption proceeds of Fund shares
on which a sales charge was paid are reinvested in shares of a
Fund or another of the Oppenheimer funds, the shareholder's basis
in the shares of the Fund that were redeemed will not include all
or a portion of the sales charge paid, to the extent a sales load
that would otherwise have applied to the reinvestment is reduced
or eliminated. That would reduce the loss or increase the gain
recognized from the redemption. However, in that case, the
disregarded portion of the sales charge would be added to the
basis of the shares acquired by the reinvestment of the redemption
proceeds. A 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 any 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

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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 a
Fund's Prospectus under "How to Buy Shares" for the imposition of
the Class B and 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, 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 relevant Fund's 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 a
Fund's other redemption requirements. Participants (other than
self-employed persons maintaining a plan account in their own
name) in OppenheimerFunds-sponsored prototype pension or 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 Funds, 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 Funds' agent to repurchase
their shares from authorized dealers or brokers. 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

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its customer prior to the time the Exchange closes (normally, that
is 4:00 P.M., but may be earlier on 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 document as described in the
Prospectuses.

AUTOMATIC WITHDRAWAL AND EXCHANGE PLANS. Investors owning
shares of a 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. Because exchanges and withdrawals are effected
through share redemptions, they are taxable events which produce a
gain or loss.

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. A Fund cannot guarantee
receipt of the 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, because of the imposition of the Class B and
Class C contingent deferred sales charges on such withdrawals
(except where the Class B and Class C contingent deferred sales
charge is waived as described in the Prospectuses under "Waivers
of Class B and Class C Contingent Deferred 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 and in the provisions of the
OppenheimerFunds Application relating to such Plans, as well as
the Prospectuses. These provisions may be amended from time to

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time by a Fund and/or the Distributor. When adopted, such
amendments will automatically apply to existing Plans.

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 a 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.

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 thereafter 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 and the
affected Fund shall incur no liability to the Planholder for any
action taken or omitted by the Transfer Agent and the Fund in good
faith to administer the Plan. Certificates will not be issued for
shares of a 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 such 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 a
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.

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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 a 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 such 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 a 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 a 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 a
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 Prospectuses, shares of a particular class
of Oppenheimerfunds having more than one class of shares may be
exchanged only for shares of the same class of other
Oppenheimerfunds. Shares of the Oppenheimerfunds 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 Tax Exempt Trust, Centennial Government Trust,
Centennial New York Tax Exempt Trust, Centennial California Tax

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Exempt Trust, Centennial America Fund, L.P. and Daily Cash
Accumulation Fund Inc., which only offer Class A shares, and
Oppenheimer Main Street California Tax Exempt 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).

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).

Shares of a 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, when Class A shares acquired by exchange
of Class A shares of other Oppenheimer funds purchased subject to
a Class A contingent deferred sales charge are redeemed within 18
months of the end of the calendar month of the initial purchase of
the exchanged Class A shares, the Class A contingent deferred
sales charge is imposed on the redeemed shares (see "Class A
Contingent Deferred Sales Charge" in the applicable Prospectus).
The Class B contingent deferred sales charge is imposed on Class B
shares acquired by exchange if they are redeemed within 6 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
Prospectuses for the imposition of the Class B and 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.

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A Fund reserves the right to reject telephone or written
exchange requests submitted in bulk by anyone on behalf of more
than one account. A Fund may accept requests for exchanges of up
to 50 accounts per day from representatives of authorized dealers
that qualify for this privilege. In connection with any exchange
request, the number of shares exchanged may be less than the
number requested if the exchange or the number requested would
include shares subject to a restriction cited in the relevant
Fund's Prospectus or this Statement of Additional Information or
would include shares covered by a share certificate that is not
tendered with the request. In those cases, only the shares
available for exchange without restriction will be exchanged.

When exchanging shares by telephone, the 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. A 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 a Fund).

The different Oppenheimer funds available for exchange have
different investment objectives, policies and risks, and a
shareholder should assure that the funds selected are 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 Funds, 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.

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DIVIDENDS, CAPITAL GAINS AND TAXES

DIVIDENDS AND DISTRIBUTIONS. 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 shares as a
result of the asset-based sales charges on Class B and Class C
shares and the imposition of certain class-specific expenses and,
will also differ in amount as a consequence of any difference in
net asset value between the classes.

If prior distributions must be re-characterized at the end of
the fiscal year as a result of the effect of a Fund's investment
policies, shareholders may have a return of capital, nontaxable to
the extent of their tax basis in their Fund shares and generally
giving rise to capital gains to the extent they are in excess of
such basis, which will be identified in notices to shareholders.

Each Fund is treated as a separate entity for federal income
tax purposes. If a 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. Each Fund qualified as a regulated investment
company in its last taxable year and intends to qualify in the
current and future years, but reserves the right not to qualify.
The Internal Revenue Code contains a number of complex tests to
determine whether a Fund will qualify, and a Fund might not meet
those tests in a particular year. For example, if a Fund derives
30% or more of its gross income for a taxable year from the sale
of securities held less than three months, it would fail to
qualify (see "Tax Aspects of Covered Calls and Hedging
Instruments," above). If it does not qualify, a 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
each Fund must distribute 98% of its taxable investment income

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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 a Fund
must pay a 4% excise tax on the amounts not distributed. Certain
dividends declared by a Fund in October, November or December and
paid in the following January may be treated as paid by a Fund,
and received by its shareholders, on December 31 of the year in
which they are declared. While it is presently anticipated that
each Fund will meet those requirements, a Fund's Board and the
Manager might determine in a particular year that it would be in
the best interest of shareholders for a 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.

A Fund will not distribute net long-term capital gains
realized in any year to the extent that a capital loss is carried
forward from prior years against such gain. For federal income
tax purposes, a Fund is permitted to carry forward a net capital
loss in any year to offset its own net capital gains, if any,
during the eight years following the year of the loss. To the
extent subsequent net capital gains are offset by such losses,
they would not result in federal income tax liability to the Fund
and would not be distributed as such to shareholders.

For purposes of the dividends received deduction available to
corporations that own shares of a Fund, dividends received by a
Fund, if any, from U.S. domestic corporations with respect to the
stock of such corporations held by the Fund for at least a minimum
holding period (generally 46 days) and distributed and designated
by the Fund may be treated as qualifying dividends. Corporate
shareholders must meet the minimum holding period requirement
referred to above with respect to their shares of the Fund in
order to qualify for the deduction and, if they borrow to acquire
such shares, may be denied a portion of the dividends received
deduction. Additionally, any corporate shareholder should consult
its tax adviser regarding the possibility that its basis in its
shares may be reduced, for Federal income tax purposes, by reason
of "extraordinary dividends" received with respect to the shares,
for the purpose of computing its gain or loss on redemption or
other disposition of the shares.

Any loss realized upon the redemption of shares with a tax
holding period of six months or less will be treated as a long-
term capital loss to the extent of any amounts treated as
distributions of long-term capital gain with respect to such
shares.

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The foregoing discussion relates solely to certain aspects of
U.S. Federal income tax law and does not address special tax rules
applicable to certain classes of investors. Dividends, capital
gain distributions, and ownership of or gains realized on the
redemption (including an exchange) of Fund shares may also be
subject to state and local taxes. Shareholders should consult
their own tax advisers as to the Federal, state or local tax
consequences of ownership of shares of, and receipt of
distributions from, the Funds in their particular circumstances.

DIVIDEND REINVESTMENT IN ANOTHER FUND. Shareholders of a 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, the 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 Transfer
Agent to establish an account. The investment will be made at 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 a Fund on the same basis.

ADDITIONAL INFORMATION ABOUT THE FUNDS

THE CUSTODIAN. State Street Bank and Trust Company is the
Custodian of the Funds' assets. The Custodian's responsibilities
include safeguarding and controlling the Funds' portfolio
securities, collecting income on the portfolio securities and
handling the delivery of such securities to and from the Funds.

INDEPENDENT AUDITORS. The independent auditors of the Funds
audit the Funds' financial statements and perform other related
audit services. They also act as auditors for certain other funds
advised by the Manager and its affiliates.

FINANCIAL INFORMATION ABOUT THE FUNDS

INDEPENDENT AUDITORS' REPORT AND FINANCIAL STATEMENTS. The
Funds' financial statements for the year ended December 31, 1995
are attached to and incorporated by reference from the Company's

Annual Report into this Statement of Additional Information. The
financial statements are so attached and incorporated in reliance
upon the report of Arthur Andersen LLP, independent public
accountants, as experts in accounting and auditing.

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APPENDIX A

Industry Classifications

Aerospace/Defense Food
Air Transportation Gas Utilities*
Auto Parts Distribution Gold
Automotive Health Care/Drugs
Bank Holding Companies Health Care/Supplies & Services
Banks Homebuilders/Real Estate
Beverages Hotel/Gaming
Broadcasting Industrial Services
Broker-Dealers Insurance
Building Materials Leasing & Factoring
Cable Television Leisure
Chemicals Manufacturing
Commercial Finance Metals/Mining
Computer Hardware Nondurable Household Goods
Computer Software Oil - Integrated
Conglomerates Paper
Consumer Finance Publishing/Printing
Containers Railroads
Convenience Stores Restaurants
Department Stores Savings & Loans
Diversified Financial Shipping
Diversified Media Special Purpose Financial
Drug Stores Specialty Retailing
Drug Wholesalers Steel
Durable Household Goods Supermarkets
Education Telecommunications - Technology
Electric Utilities Telephone - Utility
Electrical Equipment Textile/Apparel
Electronics Tobacco
Energy Services & Producers Toys
Entertainment/Film Trucking
Environmental

_____________________
*For purposes of a Fund's investment policy not to concentrate in
securities of issuers in the same industry, utilities are divided
into "industries" according to their services (E.G., gas
utilities, gas transmission utilities, electric utilities and
telephone utilities are each considered a separate industry).

Oppenheimer Series Fund, Inc.
Two World Trade Center
New York, New York 10048-0203
1-800-525-7048

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INVESTMENT ADVISOR
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 AND SHAREHOLDER SERVICING AGENT
OppenheimerFunds Services
P.O. Box 5270
Denver, Colorado 80217
1-800-525-7048

CUSTODIAN OF PORTFOLIO SECURITIES
State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02110

INDEPENDENT AUDITORS
Arthur Andersen LLP
One Financial Plaza
Hartford, Connecticut 06103

LEGAL COUNSEL
Hale and Dorr
60 State Street
Boston, Massachusetts 02109

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