OPPENHEIMER EQUITY INCOME FUND INC, PRE 14A, 1997-04-21

OPPENHEIMER EQUITY INCOME FUND INC
PRE 14A, 1997-04-21

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SCHEDULE 14A
Information Required in Proxy Statement
(Rule 14a-101)
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment No. )

Filed by the Registrant / X /
Filed by a Party other than the Registrant / /
Check the appropriate box:
/X/ Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or 14a-12

OPPENHEIMER EQUITY INCOME FUND
- -----------------------------------------------------------------
(Name of Registrant as Specified in its Charter)

KATHERINE P. FELD, ESQ.
- -----------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)

Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1),
14a-6(i)(2) or Item 22(a)(2) or Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange
Act Rule 14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules
14a-6(i)(4) and 0-11.
- -----------------------------------------------------------------
(1) Title of each class of securities to which transaction
applies:
- -----------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- -----------------------------------------------------------------
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the amount
on which the filing fee is calculated and state how it was
determined):
- -----------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- -----------------------------------------------------------------
(5) Total fee paid:
- -----------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which the
offsetting fee was paid previously. Identify the previous filing
by registration statement number, or the Form or Schedule and the
date of its filing.
(1) Amount Previously Paid:
- -----------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- -----------------------------------------------------------------
(3) Filing Party:
- -----------------------------------------------------------------
(4) Date Filed:
<PAGE>

[Bridget Macaskill Letterhead]

May, 1997

Dear Oppenheimer Equity Income Fund Shareholder:

We have scheduled a shareholder meeting in June for you to
decide upon some important proposals for the Fund. Your ballot
card and a detailed statement of the issues are enclosed with this
letter.

Your vote is very important because these decisions can affect
your investment, and it's your chance to help shape the policies of
the Fund. So we urge you to consider these issues carefully and to
make your vote count.

How do you vote?

To vote, simply complete the ballot by marking your choices,
sign it, and return it in the postage-paid envelope provided.
Remember, it can be expensive for the Fund -- a portion of which is
owned by you as a shareholder -- to remail ballots if not enough
responses are received to conduct the meeting.

What are the issues?

After consideration, the Board of Trustees, which represents
your interests in the day-to-day management of the Fund, recommends
approval of the following items:

Election of Trustees. There are eleven Trustees up for
reelection in June. You will find detailed information on the
Trustees in the enclosed proxy statement.

Ratification of Auditors. Each year, outside auditors are
employed to review the Fund's annual financial statements, as
explained in the proxy statement.

Approval of Certain Changes to Fundamental Investment
Policies. Your approval is requested to change certain of the
Fund's fundamental investment policies. These proposed changes
would give the Fund further investment flexibility.

Approval of the current Investment Advisory Agreement. The
Fund's Investment Advisory Agreement establishes the Manager's
responsibility for day-to-day management of the Fund, including
managing the Fund's investments, adherence to investment policies
and arranging for the purchase and sale of securities. The
Agreement also requires the Manager to maintain effective
administration and recordkeeping for the Fund.

Changes in Distribution and Service Plan for Class B Shares
(Class B Shareholders Only). Currently, the Fund's distributor is
reimbursed for a portion of its distribution expenses from the
service fee and the asset-based sales charge. Your approval is
requested to change the way the distributor is paid so that it is
compensated for its distribution efforts at the same rate. This is
a common type of plan in the mutual fund industry. Any
distribution costs in excess of that rate will be the
responsibility of the distributor. This proposed Class B 12b-1
Plan is the same as the current Class C 12b-1 Plan, discussed
below.

Approval of current Distribution and Service Plan for Class
C Shares (Class C Shareholders Only). You are asked to approve the
Fund's current Class B 12b-1 Distribution and Service Plan. The
Fund's current Class C 12b-1 plan was initially approved by the
Manager as the sole initial shareholder of the Fund's Class C
shares, and is now being submitted to all shareholders for
approval.

Please read the enclosed proxy statement for complete details
on these proposals. Of course if you have any questions, please
contact your financial advisor or call us at 1-800-525- 7048.

As always, we appreciate your confidence in OppenheimerFunds
and thank you for allowing us to manage a portion of your
investment assets.

Sincerely,

[Bridget Macaskill signature]

Enclosures

<PAGE>

Preliminary Copy

Oppenheimer Equity Income Proxy for Shareholders Meeting To
Fund - Class A Shares Be Held June 25, 1997

Your shareholder Your prompt response can save your
vote is important! Fund the expense of another
mailing.
Please mark your proxy on the
reverse side, date and sign it,
and return it promptly in the
accompanying envelope, which
requires no postage if mailed in
the United States.

Please detach at perforation before mailing.

<TABLE>
<S> <C>
Oppenheimer Equity Income Proxy For Shareholders Meeting To
Fund - Class A Shares Be Held June 25, 1997

The undersigned shareholder of Proxy solicited on behalf of the
Oppenheimer Equity Income Fund Board of Trustees, which
(the "Fund"), does hereby appoint recommends a vote FOR the election
Robert Bishop, George C. Bowen, of all nominees for Trustee and FOR
Rendle Myer and Scott Farrar, each proposal on the reverse side.
and each of them, as attorneys-in The shares represented hereby
fact and proxies of the undersigned, will be voted as indicated on the
with full power of substitution, to reverse side or FOR if no choice
attend the Meeting of Shareholders is indicated.
of the Fund to be held June 25,
1997, at 6803 South Tucson Way,
Englewood, Colorado 80112 at 11:00
A.M., Denver time, and at all
adjournments thereof, and to vote the
shares held in the name of the
undersigned on the record date for
said meeting for the election of
Trustees and on the proposals
specified on the reverse side. Said
attorneys-in-fact shall vote in
accordance with their best judgment
as to any other matter.
</TABLE>

OVER
300

<PAGE>

<TABLE>
<S> <C>
Oppenheimer Equity Income Proxy for Shareholders Meeting to be held
Fund - Class A Shares June 25, 1997

Your shareholder Your prompt response can save your Fund money.
vote is important! Please vote, sign and mail your proxy ballot (this
card) in the enclosed postage-paid envelope today,
no matter how many shares you own. A majority of
the Fund's shares must be represented in person or
by proxy. Please vote your proxy so your Fund can
avoid the expense of another mailing.
</TABLE>

Please detach at perforation before mailing.

<TABLE>
<S> <C> <C> <C>
1. Election of A) R. Avis H) R. Kirchner 1.// For all nominees
of Trustees B) W. Baker I) B. Macaskill listed except as marked
C) C. Conrad J) N Steel to the contrary at left.
D) J. Fossel K) J. Swain Instruction: To withhold
E) S. Freedman authority to vote for
F) R. Kalinowski any individual nominees,
G)C.H. Kast line out that nominee's
name at left.
// Withhold authority to
vote for all nominees
listed at left.
</TABLE>

<TABLE>
<S> <C> <C> <C>
2. Ratification of selection 2./ /For / /Against / /Abstain
of Deloitte & Touche LLP as
independent auditors
(Proposal No. 1)
3. Approval of changes to the 3./ /For / /Against / /Abstain
Fund's fundamental investment
policies (Proposal No. 2)
/ / Real Estate Investment Trusts
/ / Investments in Other Investment Companies
/ / Commodities
/ / Hedging
/ / Borrowing
/ / Underwriting
4. Approval of the current 4./ /For / /Against / /Abstain
Investment Advisory Agreement
(Proposal No. 3)
</TABLE>

NOTE: Please sign exactly as your name(s) appear hereon. When
signing as custodian, attorney, executor, administrator, trustee,
etc., please give your full title as such. All joint owners should
sign this proxy. If the account is registered in the name of a
corporation, partnership or other entity, a duly authorized
individual must sign on its behalf and give title.
OVER
Dated: , 1997
-------------------------------------
(Month) (Day)

Signature(s)
-------------------------------------
Signature(s)
-------------------------------------
Please read both sides of this ballot. 300

<PAGE>

Preliminary Copy

Oppenheimer Equity Income Proxy for Shareholders Meeting To
Fund - Class B Shares Be Held June 25, 1997

Please detach at perforation before mailing.

<TABLE>
<S> <C>
Oppenheimer Equity Income Proxy For Shareholders Meeting To
Fund - Class B Shares Be Held June 25, 1997

OVER
300

<TABLE>
<S> <C>
Oppenheimer Equity Income Proxy for Shareholders Meeting to be held
Fund - Class B Shares June 25, 1997

Please detach at perforation before mailing.

Signature(s)
-------------------------------------
Signature(s)
-------------------------------------
Please read both sides of this ballot. 300

<PAGE>

Preliminary Copy

Oppenheimer Equity Income Proxy for Shareholders Meeting To
Fund - Class C Shares Be Held June 25, 1997

Please detach at perforation before mailing.

<TABLE>
<S> <C>
Oppenheimer Equity Income Proxy For Shareholders Meeting To
Fund - Class C Shares Be Held June 25, 1997

<PAGE>

<TABLE>
<S> <C>
Oppenheimer Equity Income Proxy for Shareholders Meeting to be held
Fund - Class C Shares June 25, 1997

Please detach at perforation before mailing.

Signature(s)
-------------------------------------
Signature(s)
-------------------------------------
Please read both sides of this ballot. 300

<PAGE>

Preliminary Copy

OPPENHEIMER EQUITY INCOME FUND

6803 South Tucson Way, Englewood, Colorado 80112

Notice Of Meeting Of Shareholders To Be Held

June 25, 1997

To The Shareholders of Oppenheimer Equity Income Fund:

Notice is hereby given that a Meeting of the Shareholders of
Oppenheimer Equity Income Fund (the "Fund") will be held at 6803
South Tucson Way, Englewood, Colorado, 80112, at 11:00 A.M., Denver
time, on June 25, 1997, or any adjournments thereof, for the
following purposes:

To be voted on by holders of:

<TABLE>
<CAPTION>
Class A Class B Class C
Shares Shares Shares
<S> <C> <C> <C>
X X X (a) To elect eleven Trustees to hold office until the
next meeting of shareholders called for the purpose of
electing Trustees and until their successors are
elected and shall qualify;

X X X (b) To ratify the selection of Deloitte & Touche LLP
as the independent certified public accountants and
auditors of the Fund for the fiscal year beginning
September 1, 1996 (Proposal No. 1);

X X X (c) To approve changes to certain of the Fund's
fundamental investment policies (Proposal No. 2);

X X X (d) To approve the current Investment Advisory
Agreement between the Fund and OppenheimerFunds, Inc.
(the "Manager") (Proposal No. 3);

X (e) To approve the Fund's Class B 12b-1 Distribution
and Service Plan (only shareholders of Class B shares
vote on this proposal) (Proposal No. 4);

X (f) To approve the Fund's Class C 12b-1 Distribution
and Service Plan (only shareholders of Class C shares
vote on this proposal) (Proposal No. 5); and

X X X (g) To transact such other business as may properly
come before the meeting, or any adjournments thereof.
</TABLE>

Shareholders of record at the close of business on April 2, 1997,
are entitled to notice of and to vote at the meeting. The election
of Trustees and the Proposals are more fully discussed in the Proxy
Statement. Please read it carefully before telling us, through
your proxy or in person, how you wish your shares to be voted. The
Board of Trustees of the Fund recommends a vote to elect each of
the nominees as Trustee and in favor of each Proposal. WE URGE YOU
TO MARK, SIGN, DATE AND MAIL THE ENCLOSED PROXY PROMPTLY.

By Order of the Board of Trustees,

Andrew J. Donohue, Secretary

May 1, 1997

Shareholders who do not expect to attend the Meeting are asked to
indicate voting instructions on the enclosed proxy and to date,
sign and return it in the accompanying postage-paid envelope. To
avoid unnecessary duplicate mailings, we ask your cooperation in
promptly mailing your proxy no matter how large or small your
holdings may be.

300

<PAGE>

Preliminary Copy

OPPENHEIMER EQUITY INCOME FUND
6803 South Tucson Way, Englewood, Colorado 80112

PROXY STATEMENT

Meeting of Shareholders
To Be Held June 25, 1997

This statement is furnished to the shareholders of Oppenheimer
Equity Income Fund (the "Fund") in connection with the solicitation
by the Fund's Board of Trustees of proxies to be used at a meeting
(the "Meeting") of shareholders to be held at 6803 South Tucson
Way, Englewood, Colorado, 80112, at 11:00 A.M., Denver time, on
June 25, 1997, or any adjournments thereof. It is expected that
the mailing of this Proxy Statement will be made on or about May 1,
1997. For a free copy of the Fund's annual report for its most
recent fiscal year ended August 31, 1996, or semi-annual report for
the six months ended February 28, 1997, call OppenheimerFunds
Services, the Fund's transfer agent, at 1-800-525-7048.

The enclosed proxy, if properly executed and returned, will be
voted (or counted as an abstention or withheld from voting) in
accordance with the choices specified thereon, and will be included
in determining whether there is a quorum to conduct the meeting.
The proxy will be voted in favor of the nominees for Trustee named
in this Proxy Statement unless a choice is indicated to withhold
authority to vote for all listed nominees or any individual
nominee. The proxy will be voted in favor of each Proposal unless
a choice is indicated to vote against or to abstain from voting on
that Proposal.

Shares owned of record by broker-dealers for the benefit of their
customers ("street account shares") will be voted by the broker-
dealer based on instructions received from its customers. If no
instructions are received ("broker non-votes"), the broker-dealer
may (if permitted under applicable stock exchange rules) as record
holder vote such shares for the election of Trustees and on the
Proposals in the same proportion as that broker-dealer votes street
account shares for which voting instructions were received in time
to be voted. Abstentions and broker non-votes will be counted as
present for purposes of determining a quorum and will have the same
effect as a vote against the proposal.

If a shareholder executes and returns a proxy but fails to indicate
how the votes should be cast, the proxy will be voted in favor of
the election of each of the nominees named herein for Trustee and
in favor of each Proposal.

The proxy may be revoked at any time prior to the voting by: (1)
writing to the Secretary of the Fund at 6803 South Tucson Way,
Englewood, Colorado 80112 (if received in time to be acted upon);
(2) attending the meeting and voting in person; or (3) signing and
returning a new proxy (if returned and received in time to be
voted).

The cost of printing and distributing these proxy materials is an
expense of the Fund. In addition to the solicitation of proxies by
mail, proxies may be solicited by officers or employees of the
Fund's transfer agent, personally or by telephone or other means;
any expenses so incurred will also be borne by the Fund. Brokers,
banks and other fiduciaries may be required to forward soliciting
material to their principals and to obtain authorization for the
execution of proxies. For those services they will be reimbursed
by the Fund for their out-of-pocket expenses.

Shares Outstanding and Entitled to Vote. As of April 2, 1997, the
record date, there were approximately 222,569,054 shares of the
Fund issued and outstanding, consisting of approximately
192,440,531 Class A shares, 27,830,928 Class B shares and 2,297,595
Class C shares. Each Class A, Class B and Class C share of the
Fund has voting rights as stated in this Proxy Statement and is
entitled to one vote for each share (and a fractional vote for a
fractional share) held of record at the close of business on the
record date. As of April 2, 1997, no entity was known by
management of the Fund to be the record or beneficial owner of 5%
or more of the outstanding shares of any class of the Fund's
shares.

ELECTION OF TRUSTEES

At the Meeting, eleven Trustees are to be elected to hold office
until the next meeting of shareholders called for the purpose of
electing Trustees and until their successors shall be duly elected
and shall have qualified. Each nominee has agreed to be named and
to serve. The persons named as attorneys-in-fact in the enclosed
proxy have advised the Fund that unless a proxy instructs them to
withhold authority to vote for all listed nominees or any
individual nominee, all validly executed proxies will be voted by
them for the election of the nominees named below as Trustees of
the Fund. As a Massachusetts business trust, the Fund does not
contemplate holding annual shareholder meetings for the purpose of
electing Trustees. Thus, the Trustees will be elected for
indefinite terms until a shareholder meeting is called for the
purpose of voting for Trustees and until their successors are
elected and shall qualify.

Each of the nominees is also a trustee, director or managing
general partner of Oppenheimer Total Return Fund, Inc., Oppenheimer
Cash Reserves, Centennial America Fund, L.P., Oppenheimer Variable
Account Funds, Oppenheimer Champion Income Fund, Oppenheimer High
Yield Fund, Oppenheimer Main Street Funds, Inc., Oppenheimer
Municipal Fund, Oppenheimer Real Asset Fund, Oppenheimer Strategic
Income Fund, Oppenheimer Strategic Income & Growth Fund,
Oppenheimer International Bond Fund, Oppenheimer Integrity Funds,
Oppenheimer Limited-Term Government Fund, The New York Tax-Exempt
Income Fund, Inc., Panorama Series Fund, Inc., Centennial Money
Market Trust, Centennial Government Trust, Centennial New York Tax
Exempt Trust, Centennial California Tax Exempt Trust, Daily Cash
Accumulation Fund, Inc. and Centennial Tax Exempt Trust (which
together with the Fund, comprise the "Denver-based Oppenheimer
funds"), except that Mr. Fossel and Ms. Macaskill are not trustees
of Oppenheimer Strategic Income Fund, Panorama Series Fund, Inc.,
Oppenheimer Variable Account Funds and Oppenheimer Integrity Funds
and Mr. Fossel is not a trustee of Centennial New York Tax Exempt
Trust or a managing general partner of Centennial America Fund,
L.P. Ms. Macaskill is the President and Mr. Swain is the Chairman
and CEO, of all the Denver Oppenheimer funds.

Each nominee indicated below by an asterisk is an "interested
person" (as that term is defined in the Investment Company Act of
1940, hereinafter referred to as the "Investment Company Act") of
the Fund due to the positions indicated with the Fund's investment
adviser, OppenheimerFunds, Inc. (the "Manager") or its affiliates,
or other positions described. Mr. Fossel may also be considered an
"interested person" of the Fund or the Manager. Please see the
section entitled "The Manager, the Distributor and the Transfer
Agent" under Proposal No. 3 for more information. The year given
below indicates when the nominee first became a Trustee or Director
of any of the Denver-based Oppenheimer funds without a break in
service. The beneficial ownership of Class A shares listed below
includes voting and investment control, unless otherwise indicated
below. If a nominee should be unable to accept election, the Board
of Trustees may, in its discretion, select another person to fill
the vacant position. As of April 2, 1997, the Trustees and
officers of the Fund as a group owned 42,288.256 Class A shares of
the Fund in the aggregate (including 6,415.494 shares owned by Mr.
Steel's spouse, of which he disclaims beneficial ownership), which
is less than 1% of the outstanding shares of that class. None of
the Trustees or officers owned any Class B or Class C shares of the
Fund.

<TABLE>
<CAPTION>
Class A Shares
Beneficially
Name And Business Experience Owned as of
Other Information During the Past Five Years April 2, 1997
<S> <C> <C>
Robert G. Avis* Vice Chairman of A.G. Edwards & Sons, -0-
first became a Inc. (a broker-dealer) and A.G.E. Edwards,
Trustee in 1993. Inc. (its parent holding company);
Age: 65 Chairman of A.G.E. Asset Management and
A.G. Edwards Trust Company (its affiliated
investment adviser and trust company,
respectively).

William A. Baker Management Consultant. -0-
first became a
Trustee in 1966.
Age: 82

Charles Conrad, Jr. Chairman and Chief Executive Officer 1,978.902
first became a of Universal Space Lines, Inc. (a
Trustee in 1970. space services management company);
Age: 66 formerly Vice President of McDonnell
Douglas Space Systems Co. and associated
with the National Aeronautics and Space
Administration.

Jon S. Fossel* Member of the Board of Governors of the -0-
first became a Investment Company Institute (a national
Trustee in 1990. trade association of investment companies),
Age: 54 Chairman of the Investment Company Institute
Education Foundation; formerly Chairman
and a director of the Manager, President and a
director of Oppenheimer Acquisition Corp.
("OAC"), the Manager s parent holding
company, and formerly a director of
Shareholder Services, Inc. ("SSI") and
Shareholder Financial Services, Inc. ("SFSI"),
transfer agent subsidiaries of the Manager.

Sam Freedman Formerly Chairman and Chief Executive -0-
first become a Officer of OppenheimerFunds Services,
Trustee in 1996. a division of the Manager which is a
Age 56 transfer agent; formerly Chairman, Chief
Executive Officer and a director of SSI & SFSI,
Vice President and director of OAC, and
a director of the Manager.

Raymond J. Kalinowski Director of Wave Technologies International, 17,895.389
first became a Inc. (a computer products training company);
Trustee in 1988. formerly Vice Chairman and a director of
Age: 67 A.G. Edwards, Inc., parent holding company
of A.G. Edwards & Sons, Inc. (a broker-dealer),
of which he was a Senior Vice President.

C. Howard Kast Formerly Managing Partner of Deloitte, -0-
first became a Haskins & Sells (an accounting firm).
Trustee in 1988.
Age: 75

Robert M. Kirchner President of The Kirchner Company 7,725.280
first became a Trustee (management consultants).
in 1963.
Age: 75

Bridget A. Macaskill* President, Chief Executive Officer and a -0-
first become a a Director of the Manager and HarbourView
Trustee in 1995. Asset Management Corporation
Age: 48 ("HarbourView"), an investment adviser
subsidiary of the Manager; Chairman and a
director of SSI and SFSI; President and a
director of OAC and Oppenheimer
Partnership Holdings, Inc., a holding
company subsidiary of the Manager; a
director of Oppenheimer Real Asset
Management, Inc.; formerly Executive
Vice President of the Manager.

Ned M. Steel Chartered Property and Casualty Underwriter; 8,746.349**
first became a a director of Visiting Nurse Corporation of
Trustee in 1963. Colorado; formerly Senior Vice President
Age: 81 and a director of Van Gilder Insurance Corp.
(insurance brokers).

James C. Swain* Vice Chairman of the Manager; formerly a -0-
first became a director of the Manager, President and a
Trustee in 1969. director of Centennial Asset Management
Age: 63 Corporation ("Centennial"), an investment
adviser subsidiary of the Manager, and
Chairman of the Board of SSI.
</TABLE>

- -------------------
*A nominee who is an "interested person" of the Fund and the
Manager under the Investment Company Act.

**6,415.494 of these shares are owned by Mr. Steel's spouse, of
which he disclaims beneficial ownership.

Vote Required. The affirmative vote of a majority of the votes
cast by shareholders of the Fund without regard to class is
required for the election of a nominee as Trustee. The Board of
Trustees recommends a vote for the election of each nominee.

Functions of the Board of Trustees. The primary responsibility for
the management of the Fund rests with the Board of Trustees. The
Trustees meet regularly to review the activities of the Fund and of
the Manager, which is responsible for its day-to-day operations.
Six regular meetings of the Trustees were held during the fiscal
period ended June 30, 1996. The Fund has changed its fiscal year
from June 30 to August 31 during which period the Board met once.
Each of the Trustees was present for at least 75% of the meetings
held of the Board (except Mr. Freedman who was appointed a Trustee
on June 27, 1996 and attended the Board meeting during the
remainder of the Fund's fiscal year ended August 31, 1996) and of
all committees on which that Trustee served.

The Trustees of the Fund have appointed an Audit Committee,
comprised of Messrs. Baker (Chairman), Conrad and Kirchner, none of
whom is an "interested person" (as that term is defined in the
Investment Company Act) of the Manager or the Fund. The functions
of the Committee include (i) making recommendations to the Board
concerning the selection of independent auditors for the Fund; (ii)
reviewing the methods, scope and results of audits and the fees
charged; (iii) reviewing the adequacy of the Fund's internal
accounting procedures and controls; and (iv) establishing a
separate line of communication between the Fund's independent
auditors and its independent Trustees. The Committee met six times
during the fiscal period ended June 30, 1996. The Board of
Trustees does not have a standing nominating or compensation
committee.

Remuneration of Trustees. The officers of the Fund are
affiliated with the Manager. They and the Trustees of the Fund
who are affiliated with the Manager (Ms. Macaskill and Mr. Swain,
who are both officers and Trustees) receive no salary or fee from
the Fund. The remaining Trustees of the Fund (excluding Mr.
Fossel) received the compensation shown below from the Fund during
its fiscal year ended June 30, 1996, and during the period from
July 1, 1996 to August 31, 1996, and from all of the Denver-based
Oppenheimer funds (including the Fund) for which they served as
Trustee, Director or Managing General Partner. Mr. Freedman became
a Trustee on June 22, 1996. Mr. Fossel received no payments from
the Fund during any period noted below. Compensation is paid for
services in the positions listed beneath their names:

<TABLE>
<CAPTION>
Aggregate Aggregate
Compensation Compensation Total Compensation
From the Fund From the Fund From All
Fiscal Year Fiscal Period Denver-based
Name and Position Ended 6/30/96 Ended 8/31/96 Oppenheimer funds1
<S> <C> <C> <C>
Robert G. Avis $7,926 $1,348 $53,000
Trustee

William A. Baker $10,955 $1,862 $73,255
Audit and Review
Committee Chairman
and Trustee

Charles Conrad, Jr. $9,618 $1,635 $64,309
Audit and Review
Committee Member
and Trustee

Sam Freedman N/A $ $
Trustee

Raymond J. Kalinowski $9,721 $1,653 $65,000
Risk Management
Oversight Committee
member and Trustee

C. Howard Kast $9,721 $1,653 $65,000
Risk Management
Oversight Committee
member and Trustee

Robert M. Kirchner $10,213 $1,736 $68,292
Audit and Review
Committee Member
and Trustee

Ned M. Steel $7,927 $1,347
$53,000
Trustee
</TABLE>

- -------------------
1For the 1996 calendar year during which the Denver-based funds
listed in the first paragraph of this section included Panorama
Series Fund, Inc., which became an Oppenheimer fund in June of
1996.

Officers of the Fund. Each officer of the Fund is elected by the
Trustees to serve an annual term. Information is given below about
the executive officers who are not Trustees of the Fund, including
their business experience during the past five years.

John P. Doney, Vice President and Portfolio Manager; Age: 67
Two World Trade Center, New York, New York 10048-0203
Vice President of the Manager; formerly Senior Vice President and
Chief Investment Officer-Equities of National Securities & Research
Corporation (mutual fund investment adviser) and Vice President of
the National affiliated investment companies.

Andrew J. Donohue, Vice President and Secretary; Age 46.
Executive Vice President and General Counsel of the Manager and
OppenheimerFunds Distributor, Inc. (the "Distributor"); President
and a director of Centennial; Executive Vice President, General
Counsel and a director of HarbourView, SFSI, SSI and Oppenheimer
Partnership Holdings Inc.; President and a director of Oppenheimer
Real Asset Management, Inc.; General Counsel of OAC; Executive Vice
President, General Counsel and a director of MultiSource Services,
Inc. (a broker-dealer); an officer of other Oppenheimer funds;
formerly Senior Vice President and Associate General Counsel of the
Manager and the Distributor; Partner in Kraft & McManimon (a law
firm); an officer of First Investors Corporation (a broker-dealer)
and First Investors Management Company, Inc. (broker-dealer and
investment adviser); director and an officer of First Investors
Family of Funds and First Investors Life Insurance Company.

George C. Bowen, Vice President, Assistant Secretary and Treasurer;
Age 60.
6803 South Tucson Way, Englewood, Colorado 80112
Senior Vice President and Treasurer of the Manager; Vice President
and Treasurer of the Distributor and HarbourView; Senior Vice
President, Treasurer and Assistant Secretary and a director of
Centennial; Senior Vice President, Treasurer and Secretary of SSI;
Vice President, Treasurer and Secretary of SFSI; Treasurer of OAC;
Vice President and Treasurer of Oppenheimer Real Asset Management,
Inc.; Chief Executive Officer, Treasurer and a director of
MultiSource Services, Inc. and an officer of other Oppenheimer
funds.

Robert G. Zack, Assistant Secretary; Age 48.
Senior Vice President and Associate General Counsel of the Manager;
Assistant Secretary of SSI and SFSI; an officer of other
Oppenheimer funds.

Robert J. Bishop, Assistant Treasurer; Age 38.
6803 South Tucson Way, Englewood, Colorado 80112
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 T. Farrar, Assistant Treasurer; Age 31.
6803 South Tucson Way, Englewood, Colorado 80112
Vice President of the Manager/Mutual Fund Accounting; an officer of
other Oppenheimer funds; previously a Fund Controller for the
Manager.

RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
(Proposal No. 1)

The Investment Company Act requires that independent certified
public accountants and auditors ("auditors") be selected annually
by the Board of Trustees and that such selection be ratified by the
shareholders at the next-convened annual meeting of the Fund, if
one is held. The Board of Trustees of the Fund, including a
majority of the Trustees who are not "interested persons" (as
defined in the Investment Company Act) of the Fund or the Manager,
at a meeting held June 27, 1996, selected Deloitte & Touche LLP
("Deloitte") as auditors of the Fund for the ensuing fiscal year.
Deloitte also serves as auditors for certain other funds for which
the Manager acts as investment adviser and also serves as auditors
for the Manager and certain of its affiliates. At the Meeting, a
resolution will be presented for the shareholders' vote to ratify
the selection of Deloitte as auditors. Representatives of Deloitte
are not expected to be present at the Meeting but will have the
opportunity to make a statement if they desire to do so and will be
available should any matter arise requiring their presence. The
Board of Trustees recommends approval of the selection of Deloitte
as auditors of the Fund.

APPROVAL OF CHANGES TO CERTAIN OF THE
FUND'S FUNDAMENTAL INVESTMENT POLICIES
(Proposal No. 2)

The Manager proposes that certain of the Fund's fundamental
investment policies be changed, as described below, to give the
Fund further investment flexibility. An investment policy that has
been designated as "fundamental" is one that cannot be changed
without the requisite shareholder approval described below under
"Vote Required." Non-fundamental investment policies may be changed
by the Manager in consultation with and approval by the Board of
Trustees without the expense and delay of seeking shareholder
approval. A vote in favor of this Proposal shall be a vote in
favor of all proposed investment policy changes described in this
Proposal. If approved, the effective date of this Proposal may be
delayed until the Fund's Prospectus or Statement of Additional
Information is updated to reflect these changes.

At a meeting held February 25, 1997, the Fund's Board of Trustees,
including a majority of its independent Trustees, determined that
the best interests of the Fund would be served by allowing the Fund
greater investment flexibility, as set forth in these proposed
investment policy changes, in response to market or regulatory
developments.

Real Estate Investment Trusts. As a matter of fundamental
policy, "The Fund cannot buy or sell real estate or interests in
real estate investment trusts." The Manager proposes that this
fundamental policy be replaced, subject to shareholder approval,
with the following fundamental policy, thereby removing the
prohibition on investing in real estate investment trusts
("REITs"):

The Fund cannot invest in real estate or in interests in
real estate, but may purchase securities of issuers holding
real estate or interests therein.

This new policy on investments in real estate must be fundamental,
as required by sections 8(b)(1) and 13(a)(2) of the Investment
Company Act of 1940. Securities of companies holding real estate
or interests therein, including REITs and real estate limited
partnerships, seek to earn profits for investors by managing
income-producing real estate or lending money to developers.
Assets are generally managed by one or more trustees (in the case
of a REIT) or general partners (in the case of a real estate
limited partnership) who control acquisitions and investments.
There are special risks associated with these types of investments.
The value of the Fund's investments in REITs or real estate limited
partnerships will be affected by changes in the values of the
underlying real estate investments as well as changes in interest
rates. At times, the real estate market can be volatile and prices
can changes substantially. These risks may affect the Fund's net
asset values per share.

Investments in Other Investment Companies. Currently, as a
matter of fundamental policy, the Fund cannot buy securities of
other investment companies, except in connection with a merger or
consolidation. The Manager proposes that this fundamental policy
be eliminated.

Until the recent enactment of the National Securities Markets
Improvement Act of 1996 (the "Securities Markets Improvement Act"),
the ability of investment companies to invest in other investment
companies had been significantly limited. With the passage of the
Securities Markets Improvement Act, the ability to invest in other
investment companies has been greatly expanded and the Securities
and Exchange Commission has been granted broad exemptive authority
to permit other arrangements. Accordingly, the elimination of this
fundamental restriction will allow the Fund to purchase securities
of other investment companies to the extent permitted by law,
regulation and exemptions, subject to the approval by the Board of
Trustees. This change would also permit the Fund, subject to
approval by the Board of Trustees, to adopt a "master-feeder"
structure. The Fund has no current plans to adopt a "master-feeder" structure.

Commodities. As a matter of fundamental policy, "The Fund cannot
buy or sell commodities or commodity contracts other than those
hedging instruments which are considered commodities."

This policy prohibits the Fund from trading in physical
commodities, and the Fund does not seek permission to trade
physical commodities. However, this investment policy could be
read to prohibit the Fund from buying or selling options, futures,
securities or other instruments backed by, or the investment return
from which is linked to changes in the price of, physical
commodities, including "commodity-linked" notes unless they are
hedging instruments.

The Manager proposes that this fundamental investment policy be
deleted and replaced with a new policy that is also fundamental, as
required by sections 8(b)(1) and 13(a)(2) of the Investment Company
Act of 1940. Although the Fund's current Prospectus contains
disclosure regarding options, futures, securities or other
instruments backed by, or the investment return from which is
linked to changes in the price of, physical commodities, including
"commodity-linked" notes, replacing this fundamental investment
policy as described below will resolve any ambiguity as to whether
the Fund may invest in those instruments. The new fundamental
policy would read as follows:

The Fund cannot invest in physical commodities or physical
commodity contracts; however, the Fund may: (i) buy and sell
hedging instruments permitted by any of its other investment
policies, and (ii) buy and sell options, futures, securities
or other instruments backed by, or the investment return from
which is linked to changes in the price of, physical
commodities.

Hedging. The Fund has two fundamental investment policies that
pertain to the use of hedging instruments, as follows:

The Fund cannot engage in short sales or purchase securities on
margin, however, the Fund may make margin deposits in connection
with any of the hedging instruments it may use.

The Fund cannot mortgage, pledge or hypothecate the Fund's
assets; the escrow, collateral and margin arrangements involved
with hedging instruments are not considered to involve a mortgage,
hypothecation or pledge.

The Manager proposes that these two fundamental policies be amended
to allow the Fund to enter into escrow, collateral and margin
arrangements in connection not only with its hedging instruments,
but also with any of its permitted investments.

These revised fundamental investment policies would read as
follows:

The Fund cannot engage in short sales or purchase securities on
margin; however, the Fund may make margin deposits in connection
with any of its other investments.

The Fund cannot mortgage, pledge or hypothecate the Fund's
assets; the escrow, collateral and margin arrangements involved
with any permitted investments are not considered to involve a
mortgage, hypothecation or pledge.

Borrowing. The Fund has a fundamental investment policy that it
cannot borrow money. The Manager proposes that this fundamental
investment policy be revised to give the Fund flexibility to borrow
money in the event of an emergency. An emergency might be, for
example, unanticipated redemptions which would require the sale of
portfolio securities at a time or price disadvantageous to the
Fund.

This revised fundamental investment policy would read as follows:

The Fund cannot borrow money, except for temporary,
emergency purposes or under other unusual circumstances.

Underwriting Securities. The Fund currently has a fundamental
investment policy that, "The Fund cannot act as an underwriter of
securities of other issuers." The Manager wishes to revise this
policy to clearly state the exception to the underwriting
prohibition that is permitted by the Investment Company Act of
1940. This revised fundamental policy would read as follows:

The Fund cannot act as an underwriter of securities, except in
connection with sales of its portfolio securities.

Vote Required. An affirmative vote of the holders of a "majority
of the outstanding voting securities" (as defined in the Investment
Company Act) of the Fund is required for approval of this Proposal;
the classes do not vote separately. The requirement for such
"majority" is defined in the Investment Company Act as the vote of
the holders of the lesser of: (i) 67% or more of the voting
securities present or represented by proxy at the shareholders
meeting, if the holders of more than 50% of the outstanding voting
securities are present or represented by proxy; or (ii) more than
50% of the outstanding voting securities. The Board of Trustees
recommends a vote in favor of approving this Proposal.

APPROVAL OF CURRENT INVESTMENT ADVISORY AGREEMENT
(Proposal No. 3)

The Fund has an Investment Advisory Agreement dated October 22,
1990 with the Manager (the "Agreement") which was most recently
approved by the Fund's Board of Trustees, including a majority of
the Trustees who are not "interested persons" (as defined in the
Investment Company Act) of the Fund or of the Manager, on December
17, 1996. Prior to January 5, 1996, the Manager was known as
Oppenheimer Management Corporation. The Agreement was approved by
shareholders of the Fund at a meeting held on October 1, 1990
because of the acquisition of the Manager by Massachusetts Mutual
Life Insurance Company ("MassMutual") through a wholly-owned
subsidiary, Oppenheimer Acquisition Corp. The Board of Trustees
has determined to submit the Fund's current Investment Advisory
Agreement for shareholder approval. A copy of the Agreement is
included in this Proxy Statement as Exhibit A. If approved by the
shareholders at this meeting, the Agreement will continue in effect
until December 31, 1997, and thereafter from year to year unless
terminated, but only so long as such continuance is approved in
accordance with the Investment Company Act.

Under the Agreement, the Manager supervises the investment
operations of the Fund and the composition of its portfolio and
furnishes the Fund advice and recommendations with respect to
investments, investment policies and the purchase and sale of
securities. The management fee, computed daily and payable monthly
under the Agreement to the Manager, is computed on the average
annual net assets of the Fund at the following annual rates: 0.75%
of the first $100 million of average annual net assets; 0.70% of
the next $100 million; 0.65% of the next $100 million; 0.60% of the
next $100 million; 0.55% of the next $100 million and 0.50% of
average annual net assets in excess of $500 million. During the
fiscal year ended June 30, 1996, and the fiscal period ended August
31, 1996, the Fund paid the Manager a fee of $12,078,956 and
$2,134,834, respectively, under the Agreement. The Manager also
acts as investment adviser to other Oppenheimer funds that have
similar or comparable investment objectives. A list of those funds
and the net assets and advisory fee rates paid by those funds is
contained in Exhibit B to this Proxy Statement.

The Agreement requires the Manager, at its expense, to provide the
Fund with adequate office space, facilities and equipment as well
as to provide, and supervise the activities of all administrative
and clerical personnel required to provide effective administration
for the Fund, including the compilation and maintenance of records
with respect to its operations, the preparation and filing of
specified reports, and composition of proxy materials and
registration statements for continuous public sale of shares of the
Fund. Expenses not expressly assumed by the Manager under the
Agreement or by the Distributor of the Fund's shares are paid by
the Fund. The Agreement lists examples of expenses paid by the
Fund, the major categories of which relate to interest, taxes,
brokerage commissions, fees to certain Trustees, legal and audit
expenses, custodian and transfer agent expenses, share certificate
issuance costs, certain printing and registration costs, and non-
recurring expenses, including litigation.

The Agreement contains an expense limitation. Under the Agreement,
the Manager guarantees that the total expenses of the Fund in any
calendar year, including the management fee but exclusive of taxes,
interest, brokerage commissions and extraordinary non-recurring
expenses shall not exceed, and the Manager undertakes to pay or
refund to the Fund any amount by which such expenses shall exceed,
the aggregate of one and one-half percent of the first $30 million
of the Fund's average annual net assets plus one percent of the
Fund's average annual net assets in excess of $30 million. The
payment of the management fee at the end of any month will be
reduced so that there will not be any accrued but unpaid liability
under this expense limitation. During the Fund's most recent
fiscal year ended June 30, 1996, and its most recent fiscal period
ended August 31, 1996 (the Fund has changed its fiscal year from
June 30 to August 31), the Fund's expenses did not exceed the
threshold set in the Investment Advisory Agreement.

So long as it shall have acted with due care and in good faith, the
Manager shall not be liable for any loss sustained by reason of any
investment, the adoption of any investment policy, or the purchase,
sale or retention of any security irrespective of whether the
determinations of the Manager relative thereto shall have been
based, wholly or partly, upon the investigation or research of any
other individual, firm or corporation believed by it to be
reliable. Nothing contained in the Agreement shall, however, be
construed to protect the Manager against any liability to the Fund
or its shareholders by reason of willful misfeasance, bad faith or
gross negligence in the performance of its duties, or by reason of
its reckless disregard of its obligations and duties under this
Agreement.

The Agreement permits the Manager to act as investment adviser for
any other person, firm or corporation and to use the name
"Oppenheimer" in connection with other investment companies for
which it may act as investment adviser. If the Manager shall no
longer act as investment adviser to the Fund, the right of the Fund
to use the name "Oppenheimer" as part of its name may be withdrawn.

Brokerage Provisions of the Agreement. One of the duties of the
Manager under the Agreement is to arrange the portfolio
transactions for the Fund. The Agreement contains provisions
relating to the employment of broker-dealers ("brokers") to effect
the Fund's portfolio transactions. In doing so, the Manager is
authorized by the 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 the Fund to obtain, at
reasonable expense, the "best execution" (prompt and reliable
execution at the most favorable price obtainable) of such
transactions. The Manager need not seek competitive commission
bidding but is expected to be aware of the current rates of
eligible brokers and to minimize the commissions paid to the extent
consistent with the interest and policies of the Fund as
established by its Board of Trustees. Purchases of securities from
underwriters include a commission or concession paid by the issuer
to the underwriter, and purchases from dealers include a spread
between the bid and asked price.

Under the Agreement, the Manager is authorized to select brokers
that provide brokerage and/or research services for the Fund and/or
the other accounts over which the Manager or its affiliates have
investment discretion. The commissions paid to such brokers may be
higher than another qualified broker would have charged if a good
faith determination is made by the Manager that the commissions are
fair and reasonable in relation to the services provided. Subject
to the foregoing considerations, the Manager may also consider
sales of shares of the Fund and other investment companies managed
by the Manager or its affiliates as a factor in the selection of
brokers for the Fund's portfolio transactions.

Description of Brokerage Practices. Subject to the provisions of
the Agreement, and the procedures and rules described above,
allocations of brokerage are generally made by the Manager's
portfolio traders based upon recommendations from the Manager's
portfolio managers. In certain instances, portfolio managers may
directly place trades and allocate brokerage, also subject to the
provisions of the Agreement and the procedures and rules described
above. In either case, brokerage is allocated under the
supervision of the Manager's executive officers. Transactions in
securities other than those for which an exchange is the primary
market are generally done with principals or market makers.
Brokerage commissions are paid primarily for effecting
transactions in listed securities or for certain fixed-income
agency transactions in the secondary market and are otherwise paid
only if it appears likely that a better price or execution can be
obtained. When the Fund engages in an option transaction,
ordinarily the same broker will be used for the purchase or sale of
the option and any transaction in the securities to which the
option relates. When possible, concurrent orders to purchase or
sell the same security by more than one of the accounts managed by
the Manager or its affiliates are combined. The transactions
effected pursuant to such combined orders are averaged as to price
and allocated in accordance with the purchase or sale orders
actually placed for each account. Option commissions may be
relatively higher than those which would apply to direct purchases
and sales of portfolio securities.

The research services provided by a particular broker may be useful
only to one or more of the advisory accounts of the Manager and its
affiliates, and investment research received for the commissions of
those other accounts may be useful both to the Fund and one or more
of such other accounts. Such research, which may be supplied by a
third party at the instance of a broker, includes information and
analyses on particular companies and industries as well as market
or economic trends and portfolio strategy, receipt of market
quotations for portfolio evaluations, information systems, computer
hardware and similar products and services. If a research service
also assists the Manager in a non-research capacity (such as
bookkeeping or other administrative functions), then only the
percentage or component that provides assistance to the Manager in
the investment decision-making process may be paid in commission
dollars. The Board of Trustees permits the Manager to use
concessions on fixed price offerings to obtain research, in the
same manner as is permitted for agency transactions. The Board
also permits the Manager to use stated commissions on secondary
fixed-income agency trades to obtain research where the broker has
represented to the Manager that: (i) the trade is not from or for
the broker's own inventory; (ii) the trade was executed by the
broker on an agency basis at the stated commission; and (iii) the
trade is not a riskless principal transaction.

The research services provided by brokers broaden the scope and
supplement the research activities of the Manager, by making
available additional views for consideration and comparisons, and
by enabling the Manager to obtain market information for the
valuation of securities held in the Fund's portfolio or being
considered for purchase.

The Manager, the Distributor and the Transfer Agent. Subject to
the authority of the Board of Trustees, the Manager is responsible
for the day-to-day management of the Fund's business, pursuant to
its investment advisory agreement with the Fund. OppenheimerFunds
Distributor, Inc., a wholly-owned subsidiary of the Manager, is the
general distributor (the "Distributor") of the Fund's shares.
OppenheimerFunds Services, a division of the Manager, serves as the
transfer and shareholder servicing agent for the Fund on an "at-
cost" basis, for which it was paid $2,688,008 and $570,503 by the
Fund during its fiscal year ended June 30, 1996 and its fiscal
period ended August 31, 1996, respectively.

The Manager (including a subsidiary) currently manages investment
companies, including other Oppenheimer funds, with assets of more
than $62 billion as of December 31, 1996, and with more than 3
million shareholder accounts. The Manager is a wholly-owned
subsidiary of Oppenheimer Acquisition Corp. ("OAC"), a holding
company controlled by Massachusetts Mutual Life Insurance Company
("MassMutual"). The Manager, the Distributor and OAC are located
at Two World Trade Center, New York, New York 10048. MassMutual is
located at 1295 State Street, Springfield, Massachusetts 01111.
OAC acquired the Manager on October 22, 1990. As indicated below,
the common stock of OAC is owned by (i) certain officers and/or
directors of the Manager, (ii) MassMutual and (iii) another
investor. No institution or person holds 5% or more of OAC's
outstanding common stock except MassMutual. MassMutual has engaged
in the life insurance business since 1851.

The common stock of OAC is divided into three classes. At December
31, 1996, MassMutual held (i) all of the 2,160,000 shares of Class
A voting stock, (ii) 716,943 shares of Class B voting stock, and
(iii) 1,353,873 shares of Class C non-voting stock. This
collectively represented 86.2% of the outstanding common stock and
94.2% of the voting power of OAC as of that date. Certain officers
and/or directors of the Manager held (i) 407,866 shares of the
Class B voting stock, representing 8.3% of the outstanding common
stock and 4.1% of the voting power, and (ii) options acquired
without cash payment which, when they become exercisable, allow the
holders to purchase up to 684,407 shares of Class C non-voting
stock. That group includes persons who serve as officers of the
Fund, and Ms. Macaskill and Mr. Swain, who serve as Trustees of the
Fund. Holders of OAC Class B and Class C common stock may put
(sell) their shares and vested options to OAC or MassMutual at a
formula price (based on earnings of the Manager). MassMutual may
exercise call (purchase) options on all outstanding shares of both
such classes of common stock and vested options at the same formula
price. From the period November 1, 1995 to December 31, 1996, the
only transactions by persons who serve as Directors of the Fund
were by Ms. Macaskill, who surrendered to OAC 20,000 stock
appreciation rights issued in tandem with the Class C OAC options,
for cash payments aggregating $1,421,800, Mr. Fossel who sold
117,838 shares of Class B OAC common stock to MassMutual for an
aggregate of $15,133,735, Mr. Swain who surrendered to OAC 20,000
stock appreciation rights issued in tandem with Class C OAC
options, for a cash payment aggregating $2,267,780, and Mr.
Freedman who surrendered to OAC 45,474 stock appreciation rights
issued in tandem with Class C OAC options, for a cash payment of
$4,808,876. Mr. Freedman and Mr. Fossel no longer hold any OAC
stock, stock appreciation rights or other financial interests in
the Manager or any of its affiliates. Mr. Fossel, however, may be
entitled to an additional payment to be made in 1997.

The names and principal occupations of the executive officers and
directors of the Manager are as follows: Bridget A. Macaskill,
President, Chief Executive Officer and a director; Donald W. Spiro,
Chairman Emeritus; Robert G. Galli and James C. Swain, Vice
Chairmen; Robert C. Doll, O. Leonard Darling, Paula Gabriele,
Barbara Hennigar, James Ruff, Loretta McCarthy, Tilghman G. Pitts
III and Nancy Sperte, Executive Vice Presidents; Andrew J. Donohue,
Executive Vice President and General Counsel; George C. Bowen,
Senior Vice President and Treasurer; Peter M. Antos, Victor Babin,
Robert A. Densen, Ronald H. Fielding, Robert E. Patterson, Richard
Rubinstein, Arthur Steinmetz, Ralph Stellmacher, John Stoma, Jerry
A. Webman, William L. Wilby and Robert G. Zack, Senior Vice
Presidents. These officers are located at one of the four offices
of the Manager: Two World Trade Center, New York, NY 10048; 6803
South Tucson Way, Englewood, CO 80112; 350 Linden Oaks, Rochester,
NY 14625 and One Financial Plaza, 755 Main Street, Hartford, CT
06103.

Considerations by the Board of Trustees. In connection with the
annual review by the Board of Trustees in December 1996 to
determine if the Investment Advisory Agreement should be approved
and renewed, the Board and the Independent Trustees considered and
reviewed materials prepared for this purpose by a consultant. The
Board also considered materials provided by the Manager. As a
result of its deliberations, the Board of Trustees including the
Independent Trustees concluded to approve and renew the Agreement
without amendment for an additional one year period.

The materials reviewed and considered by the Board included
information on: the nature, quality and extent of services rendered
by the Manager to the Fund; an analysis of the Fund s investment
advisory fee, investment performance, expense ratios and expenses
of the Fund as compared in each case to comparable mutual funds;
the investment performance of other mutual funds for which the
Manager acts as investment adviser; information on the portfolio
manager for the Fund and his experience and qualifications; the
profitability of the Manager from its investment advisory
operations for the Fund and other mutual funds for which it or its
affiliates are the investment adviser; the financial condition and
resources of the Manager and its parent, OAC; the benefits which
the Manager obtains from its relationship with the Fund; and
economies of scale made available to the Fund by the Manager. The
Board also considered the terms and conditions of the current
Agreement, and considered alternatives to the use of the Manager.

The Board of Trustees including the Independent Trustees considered
all of the above matters in reaching its decision to approve the
Agreement and to renew it for an additional year. The Board did
not single out any one factor or group of factors as being more
important than other factors, but considered such matters together
in arriving at its decision. The Board of Trustees also considered
that the Manager has been the investment adviser for the Fund for
a number of years and the Board has found the performance of the
Manager pursuant to the Investment Advisory Agreement to be
satisfactory.

Determination by the Independent Trustees and the Board of
Trustees. After completion of its review, the Independent Trustees
recommended that the Board of Trustees approve, and the Board
unanimously approved, the Agreement.

APPROVAL OF THE FUND'S CLASS B 12b-1 DISTRIBUTION
AND SERVICE PLAN AND AGREEMENT
(Proposal No. 4)

NOTE: This Proposal applies to Class B Shareholders only.

Class B shares were first offered to the public on August 17, 1993.
In connection with the initial public offering of those shares, the
Fund had previously adopted a Distribution and Service Plan dated
June 22, 1993 for Class B shares pursuant to Rule 12b-1 of the
Investment Company Act, in conformity with the National Association
of Securities Dealers, Inc. ("NASD") Rule which permits the Fund to
pay up to 0.25% of its average annual net assets as a service fee
and up to 0.75% of its average annual net assets as an asset-based
sales charge. The Manager, as the sole initial shareholder of the
Fund's Class B shares, approved this Distribution and Service Plan
for Class B shares of the Fund. At a meeting held June 22, 1993,
the Fund's Board of Trustees, including a majority of the Trustees
who are not "interested persons" (as defined in the Investment
Company Act) of the Fund or the Manager, and who have no direct or
indirect financial interest in the operation of the Fund's 12b-1
plans or in any related agreements ("Independent Trustees"),
approved this Distribution and Service Plan.

At meetings of the Fund's Board of Trustees held February 25, 1997
and April 29, 1997, the Manager proposed the adoption of a new
Class B Distribution and Service Plan and Agreement for Class B
shares (the "Distribution and Service Plan") which is
recharacterized as a "compensation type plan" instead of a
"reimbursement type plan." The Fund's Board of Trustees, including
a majority of the Independent Trustees, approved the new
Distribution and Service Plan, subject to shareholder approval, and
determined to recommend it for approval by Class B shareholders.
A copy of this Distribution and Service Plan dated June 25, 1997 is
attached as Exhibit C to this proxy statement.

Description of the Current and Proposed Distribution and Service
Plans. Except as explained below, the terms of the current and
proposed 12b-1 plans are substantially the same. Under both the
proposed and current Distribution and Service Plans, the Fund makes
payments to the Distributor for its services in connection with the
distribution of Class B Shares and the personal service and
maintenance of accounts that hold Class B shares. The Fund pays
the Distributor an asset-based sales charge of 0.75% per annum of
Class B shares outstanding for six years or less, and also pays the
Distributor a service fee of 0.25% per annum, each of which is
computed on the average annual net assets of Class B shares of the
Fund.

Both the proposed and current Distribution and Service Plans
provide for payments for two different distribution related
functions. The Distributor pays certain brokers, dealers, banks or
other institutions, persons or entities ("Recipients") a service
fee of 0.25% for personal services to Class B shareholders and
maintenance of shareholder accounts by those Recipients. The
services rendered by Recipients in connection with personal
services and the maintenance of Class B shareholder accounts may
include, but shall not be limited to, the following: answering
routine inquiries from the Recipient's customers concerning the
Fund, providing such customers with information on their investment
in shares, assisting in the establishment and maintenance of
accounts or sub-accounts in the Fund, making the Fund's investment
plans and dividend payment options available, and providing such
other information and customer liaison services and the maintenance
of accounts as the Distributor or the Fund may reasonably request.
The Distributor is permitted under the Distribution and Service
Plan to retain service fee payments to compensate it for rendering
such services.

Service fee payments by the Distributor to Recipients are made (i)
in advance for the first year Class B shares are outstanding,
following the purchase of shares, in an amount equal to 0.25% of
the net asset value of the shares purchased by the Recipient or its
customers and (ii) thereafter, on a quarterly basis, computed as of
the close of business each day at an annual rate of 0.25% of the
net asset value of Class B shares held in accounts of the Recipient
or its customers. In the event Class B shares are redeemed less
than one year after the date such shares were sold, the Recipient
is obligated to repay to the Distributor on demand a pro rata
portion of such advance service fee payments, based on the ratio of
the remaining period to one year.

Both the proposed and current Distribution and Service Plans also
provide that the Fund will pay the Distributor on a monthly basis
an asset-based sales charge at an annual rate of 0.75% of the net
asset value of Class B shares outstanding to compensate it for
other services in connection with the distribution of the Fund's
Class B shares. The distribution assistance and administrative
support services rendered by the Distributor in connection with the
sales of Class B shares may include: (i) paying sales commissions
to any broker, dealer, bank or other institution that sells the
Fund's Class B shares, (ii) paying compensation to and expenses of
personnel of the Distributor who support distribution of Class B
shares by Recipients, (iii) obtaining financing or providing such
financing from its own resources or from an affiliate, for the
interest and other borrowing costs of the Distributor s
unreimbursed expenses incurred in rendering distribution assistance
for Class B shares, and (iv) paying certain other distribution-
related expenses. The other distribution assistance in connection
with the sale of Class B shares rendered by the Distributor and
Recipients may include, but shall not be limited to, the following:
distributing sales literature and prospectuses other than those
furnished to current Class B shareholders, processing Class B share
purchase and redemption transactions, and providing such other
information in connection with the distribution of Class B shares
as the Distributor or the Fund may reasonably request.

The Distributor currently pays sales commissions from its own
resources to Recipients at the time of sale equal to 3.75% of the
purchase price of Fund shares sold by such Recipient, and advances
the first year service fee of 0.25%. The proposed Distribution and
Service Plan will also provide that where the dealer has entered
into an agreement with the Distributor, the Distributor will pay to
the dealer on a quarterly basis the service fee and the asset-based
sales charge payable on Class B shares in lieu of paying the sales
commission of 3.75% and the advance of the service fee at the time
of purchase. Asset-based sales charge payments are designed to
permit an investor to purchase shares of the Fund without the
assessment of a front-end sales load and at the same time permit
the Distributor to compensate Recipients in connection with the
sale of shares of the Fund. The Distributor and the Fund
anticipate that it will take a number of years for the Distributor
to recoup the sales commissions paid to Recipients and other
distribution-related expenses, from the Fund's payments to the
Distributor under the Class B Distribution and Service Plan, and
from the contingent deferred sales charge deducted from redemption
proceeds for Class B shares redeemed before the end of six years of
their purchase, as described in the Fund's prospectus.

Both the proposed and current Distribution and Service Plans
contain a provision which provides that the Board may allow the
Fund to continue payments to the Distributor for Class B shares
sold prior to termination of the Distribution and Service Plan.
Pursuant to this provision, payment of the asset-based sales charge
and service fee could be continued by the Board after termination.

The Distribution and Service Plan has the effect of increasing
annual expenses of Class B shares of the Fund by 1.00% of the
class's average annual net assets from what those expenses would
otherwise be. Payments by the Fund to the Distributor under the
current Class B Plan during the fiscal period ended June 30, 1996,
and the fiscal period from July 1, 1996 through August 31, 1996,
totalled $2,077,724 and $432,504, respectively (___% and ___% of
the Fund's average net assets represented by Class B shares during
those periods), of which $1,728,635 and $355,295 was retained by
the Distributor and $34,064 and $6,798 was paid to an affiliated
broker/dealer.

If the Class B shareholders approve this Proposal, the Distribution
and Service Plan shall, unless terminated as described below,
continue in effect until December 31, 1998 and from year to year
thereafter only so long as such continuance is specifically
approved, at least annually, by the Fund's Board of Trustees and
its Independent Trustees by a vote cast in person at a meeting
called for the purpose of voting on such continuance. The
Distribution and Service Plan may be terminated at any time by a
vote of a majority of the Independent Trustees or by a vote of the
holders of a "majority" pursuant to Rule 18f-2 under the Investment
Company Act of the Fund's outstanding Class B shares. The
Distribution and Service Plan may not be amended to increase
materially the amount of payments to be made without approval by
Class B shareholders. All material amendments must be approved by
a majority of the Independent Trustees. If the Class B
shareholders do not approve this Proposal, the current Class B
Distribution and Service Plan will remain in effect.

Additional Information. Both the proposed and current Distribution
and Service Plans provide that while it is in effect, the selection
and nomination of those Trustees of the Fund who are not
"interested persons" of the Fund is committed to the discretion of
the Independent Trustees. This does not prevent the involvement of
others in such selection and nomination if the final decision on
any such selection or nomination is approved by a majority of the
Independent Trustees.

Under either Distribution and Service Plan, no payment for service
fees will be made to any Recipient in any quarter if the aggregate
net asset value of all Fund shares held by the Recipient for itself
and its customers does not exceed a minimum amount, if any, that
may be determined from time to time by a majority of the
Independent Trustees. Under both Plans, the Board of Trustees has
set the fee at the maximum rate and set no minimum amount. The
Distribution and Service Plan permits the Distributor and the
Manager to make additional distribution payments to Recipients from
their own resources (including profits from management fees) at no
cost to the Fund. The Distributor and the Manager may, in their
sole discretion, increase or decrease the amount of distribution
assistance payments they make to Recipients from their own assets.

Analysis of the Proposed Distribution and Service Plan by the Board
of Trustees. In considering whether to recommend the Proposed
Distribution and Service Plan for approval, the Board requested and
evaluated information it deemed necessary to make an informed
determination. The Board found that there is a reasonable
likelihood that the Distribution and Service Plan benefits the Fund
and its Class B shareholders by providing financial incentives to
financial intermediaries to attract new Class B shareholders to the
Fund and by assisting the efforts of the Fund and the Distributor
to service and retain existing shareholders and attract new
investors. The Distribution and Service Plan enables the Fund to
be competitive with similar funds, including funds that impose
sales charges, provide financial incentives to institutions that
direct investors to such Fund, and provide shareholder servicing
and administrative services.

The Board also focused on the two principal differences in the
Distribution and Service Plan and its predecessor. First, the
proposed plan provides for compensating the Distributor at a flat
rate for its distribution efforts rather than reimbursing it for
its costs. While it was possible for the Fund's Class B 12b-1
payments to be reduced when limited by the Distributor's expenses
(including past expenses which were not previously reimbursed, and
which were, therefore, carried forward with interest) under a
reimbursement-type plan, under normal circumstances this is
unlikely. Therefore, adoption of this Proposal is not expected to
materially increase the Fund's expenses under normal circumstances.
Payments under the proposed Distribution and Service Plan still
remain subject to limits imposed on asset-based sales charges by
the NASD. The Board also noted that investors who purchase Class
B shares are subject to an asset-based sales charge of 0.75% per
annum regardless of the Distributor's actual distribution expenses.

The Board also recognized that current shareholders who purchased
Class B shares may have reasonably expected to pay the asset-based
sales charge for six years although they may also have reasonably
expected that the Fund's payments would reimburse the Distributor
within a reasonable time. The level of annual payments by the Fund
under the Proposed Plan will not increase over the amounts
currently paid by the Fund. Under the Proposed Plan, however, over
time, the Fund's Plan payments may exceed the amount which the Fund
might pay under the Current Plan. The length of time over which
the Fund's payments will continue under the Proposed Plan is not
limited by any reimbursement factor, and the Fund's payments may
thus continue for a longer period of time than under the Current
Plan, thus potentially increasing the amount of Plan payments which
reduce the dividends and total return on Fund shares. The Board
also recognized that Class B shares convert to Class A shares at
the end of 6 years after their purchase.

A second difference in the Proposed Distribution and Service Plan
over its predecessor is that the proposed Plan expressly provides
that distribution and administrative support services may be
rendered in connection with Class B shares acquired either in
exchange for shares of other Oppenheimer funds or by reorganization
with another fund. It occasionally happens that, for various
reasons, it is desirable for one fund to reorganize into another
fund when it is anticipated that such a reorganization will benefit
the funds involved. When reorganizations occur, the Distributor
currently must write off and thus is unable to recover previously
spent, but unrecovered, distribution expenses for the fund which
will go out of existence. The Board determined that although these
changes are less likely to have significance under a compensation-
type Plan, it should have the flexibility to approve
reorganizations among funds without concern that the transaction
would affect payments to the Distributor for its distribution
efforts. The Board also noted that investors who purchase Class B
shares of the Fund reasonably expect that they will be paying an
asset-based sales charge of 0.75% per annum regardless of share
exchanges or the occurrence of reorganizations to which their Fund
is a party.

The Board concluded that it is extremely difficult to predict
purchases, sales and exchanges by shareholders, and how future
individual, market and economic events may influence individual
investor decisions. The Board thus concluded that it is not
reasonably possible to determine with any degree of certainty at
this time whether the Fund will pay more under the Proposed Plan
than it would under the Current Plan. The Distributor has agreed
to provide the Board with certain quarterly reports as to the
amount of payments made by the Fund under the Proposed Plan and the
purpose for which payments were made (similar to what the Board now
receives under the Current Plan). The Distributor will provide
more extensive annual reports to the Board which set forth the
Distributor's allocated distribution-related expenses and recovery
of money by the Distributor from the asset-based sales charges and
contingent deferred sales charges, and information on sales,
redemptions and exchanges of Fund shares and related data. The
Board determined that under these quarterly and annual reports, the
Board will be provided with adequate information about the payments
which the Fund makes to the Distributor, about the payments which
the Distributor makes and receives in connection with the
distribution of the Fund's shares, and about the Distributor's
other distribution expenses. The Board anticipates that with this
information, the Board will be able to review each year the
benefits which the Fund is receiving from the Plan payments it
makes to determine if the Fund is benefiting at a level
commensurate with those payments.

The Board concluded that it is likely that because the Distribution
and Service Plan provides an alternative means for investors to
acquire Fund shares without paying an initial sales charge, it will
benefit Class B shareholders of the Fund by enabling the Fund to
maintain or increase its present asset base in the face of
competition from a variety of financial products. The Trustees
recognized that payments made pursuant to the Distribution and
Service Plan may be offset in part by economies of scale associated
with the growth of the Fund's assets. With larger assets, the
Class B shareholders as well as the Fund's other shareholders
should benefit as the Distribution and Service Plan should help
maintain Fund assets. Costs of shareholder administration and
transfer agency operations will be spread among a larger number of
shareholders as the Fund grows larger, thereby reducing the Fund's
expense ratio. The Manager has advised the Trustees that investing
larger amounts of money is made more readily, more efficiently, and
at lesser cost to the Fund. The Board found that a positive flow
of new investment money is desirable primarily to offset the
potentially adverse effects that might result from a pattern of net
redemptions. Net cash outflow increases the likelihood that the
Fund will have to dispose of portfolio securities for other than
investment purposes. Net cash inflow minimizes the need to sell
securities to meet redemptions when investment considerations would
dictate otherwise, reduces daily liquidity requirements, and may
assist in a prompt restructuring of the portfolio without the need
to dispose of present holdings.

Stimulation of distribution of mutual fund shares and providing for
shareholder services and account maintenance services by payments
to a mutual fund's distributor and to brokers, dealers, banks and
other financial institutions has become common in the mutual fund
industry. Competition among brokers and dealers for these types of
payments has intensified. The Trustees concluded that promotion,
sale and servicing of mutual fund shares and shareholders through
various brokers, dealers, banks and other financial institutions is
a successful way of distributing shares of a mutual fund. The
Trustees concluded that without an effective means of selling and
distributing Fund shares and servicing shareholders and providing
account maintenance, expenses may remain higher on a per share
basis than those of some competing funds. By providing an
alternative means of acquiring Fund shares, the Distribution and
Service Plan proposed for shareholder approval is designed to
stimulate sales by and services from many types of financial
institutions.

The Trustees recognize that the Manager will benefit from the
Distribution and Service Plan through larger investment advisory
fees resulting from an increase in Fund assets, since its fees are
based upon a percentage of net assets of the Fund. The Board,
including each of the Independent Trustees, determined that the
Proposed Distribution and Service Plan is in the best interests of
the Fund, and that its adoption has a reasonable likelihood of
benefiting the Fund and its Class B shareholders. In its annual
review of the Distribution and Service Plan, the Board will
consider the continued appropriateness of the Distribution and
Service Plan, including the level of payments provided for therein.

Vote Required. Pursuant to Rule 12b-1 under the Investment Company
Act, an affirmative vote of the holders of a "majority" (as defined
in the Investment Company Act) of the Fund's Class B voting
securities is required for approval of the Distribution and Service
Plan. The requirements for such "majority" vote under the
Investment Company Act are described in Proposal No. 2. A vote in
favor of this Proposal shall be deemed a vote to approve the prior
Plan and the Distribution and Service Plan. The Board of Trustees
recommends a vote in favor of approving this Proposal.

APPROVAL OF THE FUND'S CLASS C 12b-1 DISTRIBUTION
AND SERVICE PLAN AND AGREEMENT
(Proposal No. 5)

NOTE: This Proposal applies to Class C Shareholders only.

Class C shares were first offered to the public on _________. In
connection with the initial public offering of these shares, the
Fund had previously adopted a Distribution and Service Plan for
Class C shares pursuant to Rule 12b-1 of the Investment Company
Act, in conformity with the National Association of Securities
Dealers, Inc. ("NASD") Rule which permits the Fund to pay up to
0.25% of its average annual net assets as a service fee and up to
0.75% of its average annual net assets as an asset-based sales
charge. The Manager, as the sole initial shareholder of the Fund's
Class C shares, approved this Distribution and Service Plan for the
Class C shares of the Fund. At a meeting held ___________, the
Fund's Board of Trustees, including a majority of the Trustees who
are not "interested persons" (as defined in the Investment Company
Act) of the Fund or the Manager, and who have no direct or indirect
financial interest in the operation of the Fund's 12b-1 plans or in
any related agreements ("Independent Trustees"), approved the
Distribution and Service Plan dated ___________ and determined to
recommend it for approval by all shareholders.

At a meeting held October 22, 1996, the Fund's Board of Trustees,
including a majority of the Independent Trustees, approved and
renewed for an additional year the Distribution and Service Plan
for Class C shares with non-material changes. On February 25, 1997,
the Fund's Board reviewed its previous deliberations at the October
22, 1996 Board meeting and determined to submit the Distribution
and Service Plan to Class C shareholders for approval. A copy of
this Distribution and Service Plan for Class C shares (the
"Distribution and Service Plan") is attached as Exhibit D to this
proxy statement, and is hereby submitted to Class C shareholders
for approval.

Description of the Distribution and Service Plan. Under the
Distribution and Service Plan, the Fund compensates the Distributor
for its services in connection with the distribution of Class C
Shares and the personal service and maintenance of accounts that
hold Class C shares. The Fund pays the Distributor an asset-based
sales charge of 0.75% per annum of Class C shares, and also pays
the Distributor a service fee of 0.25% per annum, each of which is
computed on the average annual net assets of Class C shares of the
Fund.

The Distribution and Service Plan provides for payments for two
different distribution-related functions. The Distributor pays
certain brokers, dealers, banks or other institutions, persons or
entities ("Recipients") a service fee of 0.25% for personal
services to Class C shareholders and maintenance of shareholder
accounts by those Recipients. The services rendered by Recipients
in connection with personal services and the maintenance of Class
C shareholder accounts may include but shall not be limited to, the
following: answering routine inquiries from the Recipient's
customers concerning the Fund, providing such customers with
information on their investment in shares, assisting in the
establishment and maintenance of accounts or sub-accounts in the
Fund, making the Fund's investment plans and dividend payment
options available, and providing such other information and
customer liaison services and the maintenance of accounts as the
Distributor or the Fund may reasonably request. The Distributor is
permitted under the Distribution and Service Plan to retain service
fee payments to compensate it for rendering such services.

Service fee payments by the Distributor to Recipients are made (i)
in advance for the first year Class C shares are outstanding,
following the purchase of shares, in an amount equal to 0.25% of
the net asset value of the shares purchased by the Recipient or its
customers and (ii) thereafter, on a quarterly basis, computed as of
the close of business each day at an annual rate of 0.25% of the
net asset value of Class C shares held in accounts of the Recipient
or its customers. The Distributor retains the service fee during
the first year shares are outstanding. In the event Class C shares
are redeemed less than one year after the date such shares were
sold, the Recipient is obligated to repay to the Distributor on
demand a pro rata portion of such advance service fee payments,
based on the ratio of the remaining period to one year.

The Distribution and Service Plan also provides that the Fund will
pay the Distributor on a monthly basis an asset-based sales charge
at an annual rate of 0.75% of the net asset value of Class C shares
outstanding to compensate it for other services in connection with
the distribution of the Fund's Class C shares. The distribution
assistance and administrative support services rendered by the
Distributor in connection with the sales of Class C shares may
include: (i) paying sales commissions and advance service fee
payments to any broker, dealer, bank or other institution, person
or entity that sells the Fund's Class C shares, (ii) paying
compensation to and expenses of personnel of the Distributor who
support distribution of Class C shares by Recipients, (iii)
obtaining financing or providing such financing from its own
resources or from an affiliate, for the interest and other
borrowing costs of the Distributor's unreimbursed expenses incurred
in rendering distribution assistance for Class C shares, and (iv)
paying certain other distribution-related expenses. The other
distribution assistance in connection with the sale of Class C
shares rendered by the Distributor and Recipients may include, but
shall not be limited to, the following: distributing sales
literature and prospectuses other than those furnished to current
Class C shareholders, processing Class C share purchase and
redemption transactions, and providing such other information in
connection with the distribution of Class C shares as the
Distributor or the Fund may reasonably request.

The Distributor currently pays sales commissions from its own
resources to Recipients at the time of sale equal to 0.75% of the
purchase price of Fund shares sold by such Recipient, and advances
the first year service fee of 0.25%. Where the dealer has entered
into an agreement with the Distributor, the Distributor shall pay
to the dealer on a quarterly basis the service fee and asset-based
sales charge in lieu of paying the 0.75% sales commission and the
advance of the service fee at the time of purchase. The
Distributor retains the asset-based sales charge during the first
year shares are outstanding to recoup the sales commissions it
pays, the advances of service fee payments it makes, and its
financing costs. The Distributor plans to pay the asset-based
sales charge as an ongoing commission to Recipients on Class C
shares that have been outstanding for a year or more. Asset-based
sales charge payments are designed to permit an investor to
purchase shares of the Fund without the assessment of a front-end
sales load and at the same time permit the Distributor to
compensate Recipients in connection with the sale of shares of the
Fund.

The Distribution and Service Plan contains a provision which
provides that the Board may allow the Fund to continue payments to
the Distributor for Class C shares sold prior to termination of the
Distribution and Service Plan. Pursuant to this provision, payment
of the asset-based sales charge and service fee could be continued
by the Board after termination.

The Distribution and Service Plan has the effect of increasing
annual expenses of Class C shares of the Fund by 1.00% of the
class's average annual net assets from what those expenses would
otherwise be. Payments by the Fund to the Distributor under the
current Class C Plan for the fiscal period ended August 31, 1996
totalled $______ (___% of the Fund's average net assets represented
by Class C shares during that period), of which $_____ was retained
by the Distributor and $________ was paid to an affiliated
broker/dealer.

If the Class C shareholders approve this Proposal, the Distribution
and Service Plan shall, unless terminated as described below,
continue in effect until December 31, 1997 and from year to year
thereafter only so long as such continuance is specifically
approved, at least annually, by the Fund's Board of Trustees and
its Independent Trustees by a vote cast in person at a meeting
called for the purpose of voting on such continuance. The
Distribution and Service Plan may be terminated at any time by a
vote of a majority of the Independent Trustees or by a vote of the
holders of a "majority" (as defined in the Investment Company Act)
of the Fund's outstanding Class C shares. The Distribution and
Service Plan may not be amended to increase materially the amount
of payments to be made without approval by Class C shareholders.
All material amendments must be approved by a majority of the
Independent Trustees.

Additional Information. The Distribution and Service Plan provides
that while it is in effect, the selection and nomination of those
Trustees of the Fund who are not "interested persons" of the Fund
is committed to the discretion of the Independent Trustees. This
does not prevent the involvement of others in such selection and
nomination if the final decision on any such selection or
nomination is approved by a majority of the Independent Trustees.

Under the Distribution and Service Plan, no payment for service
fees will be made to any Recipient in any quarter if the aggregate
net asset value of all Fund shares held by the Recipient for itself
and its customers does not exceed a minimum amount, if any, that
may be determined from time to time by a majority of the
Independent Trustees. The Board of Trustees has set the fee at the
maximum rate and set no minimum amount. The Distribution and
Service Plan permits the Distributor and the Manager to make
additional distribution payments to Recipients from their own
resources (including profits from management fees) at no cost to
the Fund. The Distributor and the Manager may, in their sole
discretion, increase or decrease the amount of distribution
assistance payments they make to Recipients from their own assets.

Analysis of the Distribution and Service Plan by the Board of
Trustees. In considering whether to renew the Distribution and
Service Plan and to recommend the Distribution and Service Plan for
approval, the Board requested and evaluated information it deemed
necessary to make an informed determination. The Board found that
there is a reasonable likelihood that the Distribution and Service
Plan benefits the Fund and its Class C shareholders by providing
financial incentives to financial intermediaries to attract new
Class C shareholders to the Fund and by assisting the efforts of
the Fund and the Distributor to service and retain existing
shareholders and attract new investors. The Distribution and
Service Plan enables the Fund to be competitive with similar funds,
including funds that impose sales charges, provide financial
incentives to institutions that direct investors to such funds, and
provide shareholder servicing and administrative services.

The Board concluded that it is likely that because the Distribution
and Service Plan provides an alternative means for investors to
acquire Fund shares without paying an initial sales charge, it will
benefit Class C shareholders of the Fund by enabling the Fund to
maintain or increase its present asset base in the face of
competition from a variety of financial products. The Trustees
recognized that payments made pursuant to the Distribution and
Service Plan may be offset in part by economies of scale associated
with the growth of the Fund's assets. With larger assets, the
Class C shareholders should benefit as the Distribution and Service
Plan should help maintain Fund assets. Costs of shareholder
administration and transfer agency operations will be spread among
a larger number of shareholders as the Fund grows larger, thereby
reducing the Fund's expense ratio. The Manager has advised the
Trustees that investing larger amounts of money is made more
readily, more efficiently, and at lesser cost to the Fund. The
Board found that a positive flow of new investment money is
desirable primarily to offset the potentially adverse effects that
might result from a pattern of net redemptions. Net cash outflow
increases the likelihood that the Fund will have to dispose of
portfolio securities for other than investment purposes. Net cash
inflow minimizes the need to sell securities to meet redemptions
when investment considerations would dictate otherwise, reduces
daily liquidity requirements, and may assist in a prompt
restructuring of the portfolio without the need to dispose of
present holdings.

The Trustees recognize that the Manager will benefit from the
Distribution and Service Plan through larger investment advisory
fees resulting from an increase in Fund assets, since its fees are
based upon a percentage of net assets of the Fund. The Board,
including each of the Independent Trustees, determined that the
Distribution and Service Plan is in the best interests of the Fund,
and that its continuation has a reasonable likelihood of benefiting
the Fund and its Class C shareholders. In its annual review of the
Distribution and Service Plan, the Board will consider the
continued appropriateness of the Distribution and Service Plan,
including the level of payments provided for therein.

Vote Required. Pursuant to Rule 12b-1 under the Investment Company
Act, an affirmative vote of the holders of a "majority" (as defined
in the Investment Company Act) of the Fund's Class C voting
securities is required for approval of the Distribution and Service
Plan. The requirements for such "majority" vote under the
Investment Company Act are described in Proposal No. 2. A vote in
favor of this Proposal shall be deemed a vote to approve the
payments under the prior Plan and the Distribution and Service
Plan. The Board of Trustees recommends a vote in favor of
approving this Proposal.

RECEIPT OF SHAREHOLDER PROPOSALS

The Fund is not required to hold shareholder meetings on a regular
basis. Special meetings of shareholders may be called from time to
time by either the Fund or the shareholders (under special
conditions described in the Fund's Statement of Additional
Information). Under the proxy rules of the Securities and Exchange
Commission, shareholder proposals which meet certain conditions may
be included in the Fund's proxy statement and proxy for a
particular meeting. Those rules require that for future meetings
the shareholder must be a record or beneficial owner of Fund shares
with a value of at least $1,000 at the time the proposal is
submitted and for one year prior thereto, and must continue to own
such shares through the date on which the meeting is held. Another
requirement relates to the timely receipt by the Fund of any such
proposal. Under those rules, a proposal submitted for inclusion in
the Fund's proxy material for the next meeting after the meeting to
which this proxy statement relates must be received by the Fund a
reasonable time before the solicitation is made. The fact that the
Fund receives a proposal from a qualified shareholder in a timely
manner does not ensure its inclusion in the proxy material, since
there are other requirements under the proxy rules for such
inclusion.

OTHER BUSINESS

Management of the Fund knows of no business other than the matters
specified above that will be presented at the Meeting. Since
matters not known at the time of the solicitation may come before
the Meeting, the proxy as solicited confers discretionary authority
with respect to such matters as properly come before the Meeting,
including any adjournment or adjournments thereof, and it is the
intention of the persons named as attorneys-in-fact in the proxy to
vote the proxy in accordance with their judgment on such matters.

By Order of the Board of Trustees,

Andrew J. Donohue, Secretary
May 1, 1997

proxy\300-697.pre

<PAGE>

Exhibit A

INVESTMENT ADVISORY AGREEMENT

THIS AGREEMENT made as of the 22 day of October, 1990, by and
between OPPENHEIMER EQUITY INCOME FUND (hereinafter the "Fund"),
and OPPENHEIMER MANAGEMENT CORPORATION (hereinafter the "Manager"):

WHEREAS, the Fund is an open-end, diversified investment
company registered as such with the Securities and Exchange
Commission (the "Commission") pursuant to the Investment Company
Act of 1940, as amended (the "Investment Company Act") and the
Manager is a registered investment adviser;

NOW, THEREFORE, in consideration of the mutual promises and
covenants hereinafter set forth, it is agreed by and between the
parties, as follows:

1. GENERAL PROVISION.

The Fund hereby employs the Manager and the Manager hereby
undertakes to act as the investment adviser of the Fund and to
perform for the Fund such other duties and functions as are
hereinafter set forth. The Manager shall, in all matters, give to
the Fund and its Board of Trustees the benefit of its best
judgment, effort, advice and recommendations and shall, at all
times conform to, and use its best efforts to enable the Fund to
conform to (i) the provisions of the Investment Company Act and any
rules and regulations thereunder; (ii) any other applicable
provisions of state or federal law; (iii) the provisions of the
Declaration of Trust and By-Laws of the Fund as amended from time
to time; (iv) policies and determinations of the Board of Trustees
of the Fund; (v) the fundamental policies and investment
restrictions of the Fund as reflected in its registration statement
under the Investment Company Act and in the Fund's By-Laws, or as
such policies may, from time to time, be amended by the Fund's
shareholders; and (vi) the Prospectus of the Fund in effect from
time to time. The appropriate officers and employees of the Manager
shall be available upon reasonable notice for consultations with
any of the Trustees and officers of the Fund with respect to any
matters dealing with the business and affairs of the Fund including
the valuation of any of the Fund's portfolio securities which are
either not registered for public sale or not being traded on any
securities market.

2. INVESTMENT MANAGEMENT.

(a) The Manager shall, subject to the direction and control
by the Fund's Board of Trustees (i) regularly provide investment
advice and recommendations to the Fund with respect to its
investments, investment policies and the purchase and sale of
securities; (ii) supervise continuously the investment program of
the Fund and the composition of its portfolio and determine what
securities shall be purchased or sold by the Fund; and (iii)
arrange, subject to the provisions of paragraph "7" hereof, for the
purchase of securities and other investments for the Fund and the
sale of securities and other investments held in the portfolio of
the Fund. The Manager shall also conduct investigations and
research in the securities field and furnish to the Fund's Board of
Trustees statistical and other factual information and reports on
industries, businesses or corporations, to assist the Manager and
the Fund's Board of Trustees in furthering the investment policies
of the Fund; and the Manager shall compile, for its use and that of
the Fund, and furnish to the Fund's Board of Trustees, information
and advice on economic and business trends, and render such other
complete investment management services as may be necessary or
appropriate to effectuate the investment of the resources of the
Fund through the acquisition, holding and disposition of portfolio
securities.

(b) Provided that the Fund shall not be required to pay any
compensation other than as provided by the terms of this Agreement
and subject to the provisions of paragraph "7" hereof, the Manager
may obtain investment information, research or assistance from any
other person, firm or corporation to supplement, update or
otherwise improve its investment management services.

(c) So long as it shall have acted with due care and in good
faith, the Manager shall not be liable for any loss sustained by
reason of any investment, the adoption of any investment policy, or
the purchase, sale or retention of any security irrespective of
whether the determinations of the Manager relative thereto shall
have been based, wholly or partly, upon the investigation or
research of any other individual, firm or corporation believed by
it to be reliable. Nothing herein contained shall, however, be
construed to protect the Manager against any liability to the Fund
or its shareholders by reason of willful misfeasance, bad faith or
gross negligence in the performance of its duties, or by reason of
its reckless disregard of its obligations and duties under this
Agreement.

(d) Nothing in this Agreement shall prevent the Manager or any
officer thereof from acting as investment adviser or performing
management services for any other person, firm or corporation and
shall not in any way limit or restrict the Manager or any of its
directors, officers, shareholders or employees from buying, selling
or trading any securities for its or their own account or for the
account of others for whom it or they may be acting, provided that
such activities will not adversely affect or otherwise impair the
performance by the Manager of its duties and obligations under this
Agreement, nor adversely affect the Fund.

3. OTHER DUTIES OF THE MANAGER.

The Manager shall, at its own expense, provide and supervise the
activities of all executive, administrative and clerical personnel
as shall be required to provide effective corporate administration
for the Fund, including the compilation and maintenance of such
records with respect to its operations as may reasonably be
required; the preparation and filing of such reports with respect
thereto as shall be required by the Commission, and the laws of any
state, territory or possession of the United States or any foreign
country; composition of periodic reports with respect to its
operations for the shareholders of the Fund; composition of proxy
materials for meetings of the Fund's shareholders to be held at
least annually; and the composition of such registration statements
as may be required by federal securities laws and the laws of any
state, territory or possession of the United States or any foreign
country for continuous public sale of shares of the Fund. The
Manager shall, at its own cost and expense, provide such officers
for the Fund as the Fund's Board may request and shall also provide
the Fund's Trustees, at their request, with adequate office space,
and normal office equipment and secretarial assistance as may be
necessary for them to perform their functions as such, and the
Manager shall, at its own cost and expense, calculate the daily net
asset value of the Fund's shares and maintain the Fund's general
accounting books and records. The cost and expenses of the Manager
set forth in this paragraph 3 do not include the transfer agent and
other costs and expenses set forth in paragraph 4 following.

4. ALLOCATION OF EXPENSES TO THE FUND.

All other costs and expenses not expressly assumed by the
Manager under this Agreement, or to be paid by the General
Distributor of the shares of the Fund, shall be paid by the Fund,
including but not limited to (i) interest and taxes; (ii) brokerage
commissions; (iii) insurance premiums on fidelity and other
coverage requisite to its operations; (iv) compensation and
expenses of its Trustees except as qualified further in this
paragraph 4; (v) legal and audit expenses; (vi) custodian and
transfer agent fees and expenses; (vii) expenses incident to the
redemption of its shares; (viii) expenses incident to the issuance
of its shares against payment therefor by or on behalf of the
subscribers thereto; (ix) fees and expenses, other than as
hereinabove provided, incident to the registration of the "Funds
shares for public sale under federal securities laws or the laws of
any state, territory or possession of the United States or any
foreign country; (x) expenses of printing and mailing reports and
notices and proxy material to shareholders of the Fund; (xi) except
as noted in paragraph 3 hereof, all other expenses incidental to
holding any meetings of the Fund's shareholders; and (xii) such
extraordinary non-recurring expenses as may arise, including
litigation, affecting the Fund and the legal obligation or right
which the Fund may have to indemnify its officers and Trustees with
respect thereto unless the Fund has the right to recover said
indemnity payments from the Manager. Any officers or employees of
the Manager or any entity controlling, controlled by or under
common control with the Manager who may also serve as officers,
Trustees or employees of the Fund shall not receive any
compensation by the Fund for their services.

5. LIMITATION OF FUND EXPENSES.

Regardless of the provisions in the foregoing paragraph 4
hereof, the Manager guarantees that the total expenses of the Fund
in any calendar year, including the compensation of the Manager as
provided in paragraph 6 hereof but exclusive of taxes, interest,
brokerage commissions and extraordinary non-recurring expenses
shall not exceed, and the Manager undertakes to pay or refund to
the Fund any amount by which such expenses shall exceed the
aggregate of one and one-half percent of the first $30 million of
the Fund's average annual net assets plus one percent of the Fund's
average annual net assets in excess of $30 million.

6. COMPENSATION OF THE MANAGER.

The Fund agrees to pay the Manager and the Manager agrees to
accept as full compensation for the performance of all functions
and duties on its part to be performed pursuant to the provisions
hereof, a fee computed on the net asset value of the Fund as of the
close of each business day and payable monthly at the following
annual rates:

.75% of the first $100 million of net assets;
.70% of the next $100 million;
.65% of the next $100 million;
.60% of the next $100 million;
.55% of the next $100 million;
.50% of net assets in excess of $500 million.

7. PORTFOLIO TRANSACTIONS AND BROKERAGE.

(a) The Manager will render all services for the Fund in
connection with placing orders with brokers and dealers for the
purchase, sale or trade of securities for the Fund's portfolio.

(b) The Manager is authorized, in arranging the purchase and
sale of the fund's portfolio securities, to employ or deal with
such members of securities exchanges, brokers or dealers
(hereinafter "broker-dealers"), including "affiliated" broker-
dealers, as that term is defined in the Investment Company Act, as
may, in its best judgment, implement the policy of the Fund to
obtain, at reasonable expense, the "best execution" (prompt and
reliable execution at the most favorable security price obtainable)
of the Fund's portfolio transactions as well as to obtain,
consistent with provisions of subparagraph (c) of this paragraph 7,
the benefit of such investment information or research as will be
of significant assistance to the performance by the Manager of its
investment management functions.

(c) The Manager shall select broker-dealers to effect the
Fund's portfolio transactions on the basis of its estimate of their
ability to obtain best execution of particular and related
portfolio transactions. The abilities of a broker-dealer to obtain
best execution of particular portfolio transaction(s) will be
judged by the Manager on the basis of all relevant factors and
considerations including, insofar as feasible, the execution
capabilities required by the transaction or transactions; the
ability and willingness of the broker-dealer to facilitate the
Fund's portfolio transactions by participating therein for its own
account; the importance to the Fund of speed, efficiency or
confidentiality; the broker-dealer's apparent familiarity with
sources from or to whom particular securities might be purchased or
sold; as well as any other matters relevant to the selection of a
broker-dealer for particular and related transactions of the Fund.

(d) The Manager shall have discretion, in the interests of the
Fund, to allocate brokerage on the Fund's portfolio transactions to
broker-dealers (other than affiliated broker-dealers) qualified to
obtain best execution of such transactions and who provide
"brokerage and/or research services" (as such services are defined
in Section 28 (e) (3) of the Securities Exchange Act of 1934) for
the Fund and/or other accounts for which the Manager exercises
"investment discretion" (as that term is defined in Section 3 (a)
(35) of the Securities Exchange Act of 1934) and to cause the Fund
to pay such broker-dealers a commission for effecting a portfolio
transaction for the Fund that is in excess of the amount of
commission another broker-dealer adequately qualified to effect
such transaction would have charged for effecting that transaction,
if the Manager determines, in good faith, that such commission is
reasonable in relation to the value of the brokerage and/or
research services provided by such broker-dealer, viewed in terms
of either that particular transaction or the Manager's overall
responsibilities with respect to the accounts as to which it
exercises investment discretion. In reaching such determination,
the Manager will not be required to place or attempt to place a
specific dollar value on the brokerage and/or research services
provided or being provided by such broker-dealer. In demonstrating
that such determinations were made in good faith, the Manager shall
be prepared to show that all commissions were allocated for
purposes contemplated by this Agreement and that the total
commissions paid by the Fund over a representative period selected
by the Fund's Trustees were reasonable in relation to the benefits
to the Fund.

(e) The Manager shall have discretion in the interests of the
Fund and when consistent with the then effective rules of the
Commission and the National Association of Securities Dealers,
Inc., to consider the sales of shares of the Fund and other Funds
managed by the Manager and its affiliates as a factor in the
selection of broker-dealers to execute portfolio transactions for
the Fund. In doing so, the portfolio transactions must be (i)
consistent with obtaining the "best execution" of the Fund's
portfolio transactions (as defined in subparagraph (b) of this
paragraph), and (ii) the commissions paid to brokers selected
wholly or partly on this basis do not exceed the commissions
otherwise authorized by this Investment Advisory Agreement.

(f) The Manager shall have no duty or obligation to seek
advance competitive bidding for the most favorable commission rate
applicable to any particular portfolio transactions or to select
any broker-dealer on the basis of its purported or "posted"
commission rate but will, to the best of its ability, endeavor to
be aware of the current level of the charges of eligible broker-
dealers and to minimize the expense incurred by the Fund for
effecting, its portfolio transactions to the extent consistent with
the interests and policies of the Fund as established by the
determinations of its Board of Trustees and the provisions of this
paragraph 7.

(g) Transactions with affiliated broker-dealers are required
to conform to a number of restrictions and conditions: (1)
affiliated broker-dealers may effect portfolio transactions for the
Fund only if the commissions, fees or other remuneration received
or to be received by them are determined in accordance with
procedures contemplated by any rule, regulation or order adopted
under the Investment Company Act for determining the permissible
level of such commissions; and (2) if required by Section 11(a) of
the Securities Exchange Act of 1934, affiliated broker-dealers may
not receive compensation in connection with any portfolio
transaction effected on a national securities exchange for the Fund
if the affiliated broker-dealers are members of such exchange
unless there is an effective separate written contract between the
affiliated broker-dealers and the Fund expressly providing
otherwise and which refers to said Section 11(a) and the rules
promulgated thereunder and provides that any transactions executed
on an exchange of which the affiliated broker-dealers are members
must be executed on the floor of such exchange by a member which is
not an "associated person" of the affiliated broker-dealers.

8. DURATION.

This Agreement will take effect on the date first set forth
above and shall continue in effect until December 31, 1991, and
thereafter, from year to year, unless earlier terminated by
operation of law, so long as such continuance shall be approved
annually by the Fund's Board of Trustees, including the vote of a
majority of the Trustees of the Fund who are not parties to this
Agreement or interested persons of any such party, cast in person
at a meeting called for the purpose of voting on such approval, or
by the holders of a majority of the outstanding, voting securities
of the Fund and by such a vote of the Fund's Board of Trustees.

9. TERMINATION.

This Agreement may be terminated (i) by the Manager at any
time without penalty by giving sixty days' written notice (which
notice may be waived by the Fund); or (ii) by the Fund at any time
without penalty upon sixty days' written notice to the Manager
(which notice may be waived by the Manager), provided that such
termination by the Fund shall be directed or approved by the Board
of Trustees of the Fund or by the vote of the holders of a majority
of the outstanding voting securities of the Fund.

10. ASSIGNMENT OR AMENDMENT.

This Agreement may not be amended or the rights of the Manager
thereunder sold, transferred, pledged or otherwise in any manner
encumbered without the affirmative vote or written consent of the
holders of the majority of the outstanding voting securities of the
Fund; this Agreement shall automatically and immediately terminate
in the event of its assignment.

11. DISCLAIMER OF SHAREHOLDER LIABILITY.

The Manager understands that the obligations of the Fund under
this Agreement are not binding upon any Trustee or shareholder of
the Fund personally, but bind only the Fund and the Fund's
property. The Manager represents that it has notice of the
provisions of the Declaration of Trust of the Fund disclaiming
Trustee and shareholder liability for acts or obligations of the
Fund.

12. USE OF NAME "OPPENHEIMER".

The Manager hereby grants to the Fund a royalty-free, non-
exclusive license to use the name "Oppenheimer" in the name of the
Fund for the duration of this Agreement and any extensions or
renewals thereof. To the extent necessary to protect the Manager's
rights to the name "Oppenheimer" under applicable law, such
license shall allow the Manager to inspect and, subject to control
by the Fund's Board, control the nature and quality of services
offered by the Fund under such name. Such license may, upon
termination of this Agreement, be terminated by the Manager, in
which event the Fund shall promptly take whatever action may be
necessary to change its name and discontinue any further use of the
name "Oppenheimer" in the name of the Fund or otherwise. The name
"Oppenheimer" may be used by the Manager in connection with any of
its activities, or licensed by the Manager to any other party.

13. DEFINITIONS.

The terms and provisions of this Agreement shall be interpreted
and defined in a manner consistent with the provisions and
definitions of the Investment Company Act and other applicable
laws.

OPPENHEIMER EQUITY INCOME FUND
ATTEST:

/s/ Sara L. Badler /s/ Robert G. Galli
__________________ By:____________________________
Sara L. Badler Robert G. Galli

OPPENHEIMER MANAGEMENT
CORPORATION
ATTEST:

/s/ Sara L. Badler /s/ Robert G. Galli
__________________ B:_____________________________
Sara L. Badler Robert G. Galli

proxy\300-697.pre

<PAGE>

Exhibit B

<TABLE>
<CAPTION>
Approximate
Net Assets as
of 12/30/96 Advisory Fee Rate as % of
Name of Fund ($ Millions) Average Annual Net Assets
<S> <C> <C>
Oppenheimer Total Return $ .75% of the first $100 million of average
Fund, Inc. annual net assets,
.70% of the next $100 million,
Oppenheimer Equity Income $ .65% of the next $100 million,
Fund .60% of the next $100 million,
.55% of the next $100 million, and
.50% of average annual net assets in
excess
of $500 million

Oppenheimer Main Street $ .65% of the first $200 million of average
Income & Growth Fund, annual net assets,
a series of Oppenheimer .60% of the next $150 million,
Main Street Fund, Inc. .55% of the next $150 million, and
.45% of average annual net assets in
excess
of $500 million

Oppenheimer Growth $ .72% of the first $200 million of
a series of Oppenheimer average annual net assets,
Variable Account Funds .75% of the next $200 million,
.69% of the next $200 million,
.66% of the next $200 million, and
Oppenheimer Multiple $ .60% of average annual net assets in
excess
Strategies Fund, a series of of $800 million
Oppenheimer Variable
Account Funds

Oppenheimer Multiple Strategies $ 0.75% of the first $200 million of
average
Fund (formerly "Oppenheimer annual net assets,
Asset Allocation Fund") 0.72% of the next $200 million,
0.69% of the next $200 million,
0.66% of the next $200 million,
and 0.60% of average annual net assets in
excess of $800 million

</TABLE>

<PAGE>
Exhibit C

DISTRIBUTION AND SERVICE PLAN AND AGREEMENT

With

OppenheimerFunds Distributor, Inc.

For Class B Shares of

Oppenheimer Equity Income Fund

DISTRIBUTION AND SERVICE PLAN AND AGREEMENT (the "Plan") dated the
____ day of __________, 199___, by and between OPPENHEIMER EQUITY
INCOME FUND (the "Fund") and OppenheimerFunds Distributor, Inc.
(the "Distributor").

1. The Plan. This Plan is the Fund's written distribution and
service plan for Class B shares of the Fund (the "Shares"),
contemplated by Rule 12b-1 as it may be amended from time to time
(the "Rule") under the Investment Company Act of 1940 (the "1940
Act"), pursuant to which the Fund will compensate the Distributor
for its services in connection with the distribution of Shares, and
the personal service and maintenance of shareholder accounts that
hold Shares ("Accounts"). The Fund may act as distributor of
securities of which it is the issuer, pursuant to the Rule,
according to the terms of this Plan. The terms and provisions of
this Plan shall be interpreted and defined in a manner consistent
with the provisions and definitions contained in (i) the 1940 Act,
(ii) the Rule, (iii) Rule 2830 of the Conduct Rules of the National
Association of Securities Dealers, Inc., or any amendment or
successor to such rule (the "NASD Conduct Rules") and (iv) any
conditions pertaining either to distribution-related expenses or to
a plan of distribution to which the Fund is subject under any order
on which the Fund relies, issued at any time by the U.S. Securities
and Exchange Commission ("SEC").

2. Definitions. As used in this Plan, the following terms shall
have the following meanings:

(a) "Recipient" shall mean any broker, dealer, bank or other
person or entity which: (i) has rendered assistance (whether
direct, administrative or both) in the distribution of Shares or
has provided administrative support services with respect to Shares
held by Customers (defined below) of the Recipient; (ii) shall
furnish the Distributor (on behalf of the Fund) with such
information as the Distributor shall reasonably request to answer
such questions as may arise concerning the sale of Shares; and
(iii) has been selected by the Distributor to receive payments
under the Plan.

(b) "Independent Trustees" shall mean the members of the
Fund's Board of Trustees who are not "interested persons" (as
defined in the 1940 Act) of the Fund and who have no direct or
indirect financial interest in the operation of this Plan or in any
agreement relating to this Plan.

(c) "Customers" shall mean such brokerage or other customers
or investment advisory or other clients of a Recipient, and/or
accounts as to which such Recipient provides administrative support
services or is a custodian or other fiduciary.

(d) "Qualified Holdings" shall mean, as to any Recipient, all
Shares owned beneficially or of record by: (i) such Recipient, or
(ii) such Recipient's Customers, but in no event shall any such
Shares be deemed owned by more than one Recipient for purposes of
this Plan. In the event that more than one person or entity would
otherwise qualify as Recipients as to the same Shares, the
Recipient which is the dealer of record on the Fund's books as
determined by the Distributor shall be deemed the Recipient as to
such Shares for purposes of this Plan.

3. Payments for Distribution Assistance and Administrative
Support Services.

(a) Payments to the Distributor. In consideration of the
payments made by the Fund to the Distributor under this Plan, the
Distributor shall provide administrative support services and
distribution assistance services to the Fund. Such services
include distribution assistance and administrative support services
rendered in connection with Shares acquired (1) by purchase, (2) in
exchange for shares of another investment company for which the
Distributor serves as distributor or sub-distributor, or (3)
pursuant to a plan of reorganization to which the Fund is a party.
If the Board believes that the Distributor may not be rendering
appropriate distribution assistance or administrative support
services in connection with the sale of Shares, then the
Distributor, at the request of the Board, shall provide the Board
with a written report or other information to verify that the
Distributor is providing appropriate services in this regard. For
such services, the Fund will make the following payments to the
Distributor:

(i) Administrative Support Services Fees. Within forty-
five (45) days of the end of each calendar quarter, the Fund will
make payments in the aggregate amount of 0.0625% (0.25% on an
annual basis) of the average during that calendar quarter of the
aggregate net asset value of the Shares computed as of the close of
each business day (the "Service Fee"). Such Service Fee payments
received from the Fund will compensate the Distributor for
providing administrative support services with respect to Accounts.
The administrative support services in connection with Accounts may
include, but shall not be limited to, the administrative support
services that a Recipient may render as described in Section
3(b)(ii) below.

(ii) Distribution Assistance Fees (Asset-Based Sales
Charge). Within ten (10) days of the end of each month, the Fund
will make payments in the aggregate amount of 0.0625% (0.75% on an
annual basis) of the average during the month of the aggregate net
asset value of Shares computed as of the close of each business day
(the "Asset-Based Sales Charge") outstanding for six years or less
(the "Maximum Holding Period"). Such Asset-Based Sales Charge
payments received from the Fund will compensate the Distributor for
providing distribution assistance in connection with the sale of
Shares.

The distribution assistance to be rendered by the
Distributor in connection with the Shares may include, but shall
not be limited to, the following: (i) paying sales commissions to
any broker, dealer, bank or other person or entity that sells
Shares, and\or paying such persons "Advance Service Fee Payments"
(as defined below) in advance of, and\or in amounts greater than,
the amount provided for in Section 3(b) of this Agreement; (ii)
paying compensation to and expenses of personnel of the Distributor
who support distribution of Shares by Recipients; (iii) obtaining
financing or providing such financing from its own resources, or
from an affiliate, for the interest and other borrowing costs of
the Distributor's unreimbursed expenses incurred in rendering
distribution assistance and administrative support services to the
Fund; (iv) paying other direct distribution costs, including
without limitation the costs of sales literature, advertising and
prospectuses (other than those prospectuses furnished to current
holders of the Fund's shares ("Shareholders")) and state "blue
sky" registration expenses.

(b) Payments to Recipients. The Distributor is authorized
under the Plan to pay Recipients (1) distribution assistance fees
for rendering distribution assistance in connection with the sale
of Shares and/or (2) service fees for rendering administrative
support services with respect to Accounts. All fee payments made
by the Distributor hereunder are subject to reduction or chargeback
so that the aggregate service fee payments and Advance Service Fee
Payments do not exceed the limits on payments to Recipients that
are, or may be, imposed by the NASD Conduct Rules. The
Distributor may make Plan payments to any "affiliated person" (as
defined in the 1940 Act) of the Distributor or to the Distributor
if such affiliated person and/or the Distributor qualifies as a
Recipient.

(i) Service Fee. In consideration of the administrative
support services provided by a Recipient during a calendar quarter,
the Distributor shall make service fee payments to that Recipient
quarterly, within forty-five (45) days of the end of each calendar
quarter, at a rate not to exceed 0.0625% (0.25% on an annual basis)
of the average during the calendar quarter of the aggregate net
asset value of Shares, computed as of the close of each business
day, constituting Qualified Holdings owned beneficially or of
record by the Recipient or by its Customers for a period of more
than the minimum period (the "Minimum Holding Period"), if any,
that may be set from time to time by a majority of the Independent
Trustees.

Alternatively, the Distributor may, at its sole option,
make the following service fee payments to any Recipient
quarterly, within forty-five (45) days of the end of each calendar
quarter: (i) "Advance Service Fee Payments" at a rate not to exceed
0.25% of the average during the calendar quarter of the aggregate
net asset value of Shares, computed as of the close of business on
the day such Shares are sold, constituting Qualified Holdings, sold
by the Recipient during that quarter and owned beneficially or of
record by the Recipient or by its Customers, plus (ii) service fee
payments at a rate not to exceed 0.0625% (0.25% on an annual basis)
of the average during the calendar quarter of the aggregate net
asset value of Shares, computed as of the close of each business
day, constituting Qualified Holdings owned beneficially or of
record by the Recipient or by its Customers for a period of more
than one (1) year. At the Distributor's sole option, the Advance
Service Fee Payments may be made more often than quarterly, and
sooner than the end of the calendar quarter. However, no such
payments shall be made to any Recipient for any such quarter in
which its Qualified Holdings do not equal or exceed, at the end of
such quarter, the minimum amount ("Minimum Qualified Holdings"), if
any, that may be set from time to time by a majority of the
Independent Trustees. In the event Shares are redeemed less than
one year after the date such Shares were sold, the Recipient is
obligated to and will repay the Distributor on demand a pro rata
portion of such Advance Service Fee Payments, based on the ratio of
the time such Shares were held to one (1) year.

(ii) Services Provided by Recipients. The administrative
support services to be rendered by Recipients in connection with
the Accounts may include, but shall not be limited to, the
following: answering routine inquiries concerning the Fund,
assisting in the establishment and maintenance of accounts or sub-
accounts in the Fund and processing Share redemption transactions,
making the Fund's investment plans and dividend payment options
available, and providing such other information and services in
connection with the rendering of personal services and/or the
maintenance of Accounts, as the Distributor or the Fund may
reasonably request.

The distribution assistance in connection with the sale
of Shares to be rendered by the Recipients may include, but shall
not be limited to, the following: distributing sales literature
and prospectuses other than those furnished to current
Shareholders, and providing such other information and services in
connection with the distribution of Shares as the Distributor or
the Fund may reasonably request.

(c) A majority of the Independent Trustees may at any time or
from time to time increase or decrease the rate of fees to be paid
to the Distributor or to any Recipient, but not to exceed the rates
set forth above, and/or direct the Distributor to increase or
decrease the Maximum Holding Period, the Minimum Holding Period or
the Minimum Qualified Holdings. The Distributor shall notify all
Recipients of the Minimum Qualified Holdings, Maximum Holding
Period and Minimum Holding Period, if any, and the rate of payments
hereunder applicable to Recipients, and shall provide each
Recipient with written notice within thirty (30) days after any
change in these provisions. Inclusion of such provisions or a
change in such provisions in a revised current prospectus shall
constitute sufficient notice.

(d) The Service Fee and the Asset-Based Sales Charge on
Shares are subject to reduction or elimination under the limits to
which the Distributor is, or may become, subject under of the NASD
Conduct Rules.

(e) Under the Plan, payments may be made to Recipients: (i)
by OppenheimerFunds, Inc. ("OFI") from its own resources (which may
include profits derived from the advisory fee it receives from the
Fund), or (ii) by the Distributor (a subsidiary of OFI), from its
own resources, from Asset-Based Sales Charge payments or from the
proceeds of its borrowings.

(f) Recipients are intended to have certain rights as third-
party beneficiaries under this Plan, subject to the limitations set
forth below. It may be presumed that a Recipient has provided
distribution assistance or administrative support services
qualifying for payment under the Plan if it has Qualified Holdings
of Shares that entitle it to payments under the Plan. In the event
that either the Distributor or the Board should have reason to
believe that, notwithstanding the level of Qualified Holdings, a
Recipient may not be rendering appropriate distribution assistance
in connection with the sale of Shares or administrative support
services for Accounts, then the Distributor, at the request of the
Board, shall require the Recipient to provide a written report or
other information to verify that said Recipient is providing
appropriate distribution assistance and/or services in this regard.
If the Distributor or the Board of Trustees still is not satisfied
after the receipt of such report, either may take appropriate steps
to terminate the Recipient's status as such under the Plan,
whereupon such Recipient's rights as a third-party beneficiary
hereunder shall terminate. Additionally, in their discretion, a
majority of the Fund's Independent Trustees at any time may remove
any broker, dealer, bank or other person or entity as a Recipient,
where upon such person's or entity's rights as a third-party
beneficiary hereof shall terminate. Notwithstanding any other
provision of this Plan, this Plan does not obligate or in any way
make the Fund liable to make any payment whatsoever to any person
or entity other than directly to the Distributor.

4. Selection and Nomination of Trustees. While this Plan is in
effect, the selection and nomination of persons to be Trustees of
the Fund who are not "interested persons" of the Fund
("Disinterested Trustees") shall be committed to the discretion of
the incumbent Disinterested Trustees. Nothing herein shall prevent
the incumbent Disinterested Trustees from soliciting the views or
the involvement of others in such selection or nominations as long
as the final decision on any such selection and nomination is
approved by a majority of the incumbent Disinterested Trustees.

5. Reports. While this Plan is in effect, the Treasurer of the
Fund shall provide written reports to the Fund's Board for its
review, detailing services rendered in connection with the
distribution of the Shares, the amount of all payments made under
this Plan and the purpose for which the payments were made. The
reports shall be provided quarterly, and shall state whether all
provisions of Section 3 of this Plan have been complied with.

6. Related Agreements. Any agreement related to this Plan shall
be in writing and shall provide that: (i) such agreement may be
terminated at any time, without payment of any penalty, by a vote
of a majority of the Independent Trustees or by a vote of the
holders of a "majority" (as defined in the 1940 Act) of the Fund's
outstanding Class B voting shares; (ii) such termination shall be
on not more than sixty days' written notice to any other party to
the agreement; (iii) such agreement shall automatically terminate
in the event of its "assignment" (as defined in the 1940 Act); (iv)
such agreement shall go into effect when approved by a vote of the
Board and its Independent Trustees cast in person at a meeting
called for the purpose of voting on such agreement; and (v) such
agreement shall, unless terminated as herein provided, continue in
effect from year to year only so long as such continuance is
specifically approved at least annually by a vote of the Board and
its Independent Trustees cast in person at a meeting called for the
purpose of voting on such continuance.

7. Effectiveness, Continuation, Termination and Amendment. This
Plan has been approved by a vote of the Board and its Independent
Trustees cast in person at a meeting called on __________, 199___,
for the purpose of voting on this Plan, and shall take effect after
being approved by Class B shareholders of the Fund, at which time
it shall replace the Fund's Distribution and Service Plan for the
Shares dated ___________, 199___. Unless terminated as hereinafter
provided, it shall continue in effect until ___________, 199___
and thereafter from year to year or as the Board may otherwise
determine but only so long as such continuance is specifically
approved at least annually by a vote of the Board and its
Independent Trustees cast in person at a meeting called for the
purpose of voting on such continuance.

This Plan may not be amended to increase materially the amount
of payments to be made under this Plan, without approval of the
Class B Shareholders in the manner described above, and all
material amendments must be approved by a vote of the Board and of
the Independent Trustees.

This Plan may be terminated at any time by vote of a majority
of the Independent Trustees or by the vote of the holders of a
"majority" (as defined in the 1940 Act) of the Fund's outstanding
Class B voting shares. In the event of such termination, the Board
and its Independent Trustees shall determine whether the
Distributor shall be entitled to payment from the Fund of all or a
portion of the Service Fee and/or the Asset-Based Sales Charge in
respect of Shares sold prior to the effective date of such
termination.

8. Disclaimer of Shareholder and Trustee Liability. The
Distributor understands that the obligations of the Fund under this
Plan are not binding upon any Trustee or shareholder of the Fund
personally, but bind only the Fund and the Fund's property. The
Distributor represents that it has notice of the provisions of the
Declaration of Trust of the Fund disclaiming shareholder and
Trustee liability for acts or obligations of the Fund.

Oppenheimer Equity Income Fund

By:
---------------------------------------------

OppenheimerFunds Distributor, Inc.

By:
--------------------------------------------

<PAGE>

Exhibit D

DISTRIBUTION AND SERVICE PLAN AND AGREEMENT

with

OppenheimerFunds Distributor, Inc.

For Class C Shares of

Oppenheimer Equity Income Fund

DISTRIBUTION AND SERVICE PLAN AND AGREEMENT (the "Plan") dated the
____ day of ______, 199__, by and between Oppenheimer Equity Income
Fund (the "Fund") and OppenheimerFunds Distributor, Inc. (the
"Distributor").

1. The Plan. This Plan is the Fund's written distribution and
service plan for Class C shares of the Fund (the "Shares"),
contemplated by Rule 12b-1 as it may be amended from time to time
(the "Rule") under the Investment Company Act of 1940 (the "1940
Act"), pursuant to which the Fund will compensate the Distributor
for its services in connection with the distribution of Shares, and
the personal service and maintenance of shareholder accounts that
hold Shares ("Accounts"). The Fund may act as distributor of
securities of which it is the issuer, pursuant to the Rule,
according to the terms of this Plan. The terms and provisions of
this Plan shall be interpreted and defined in a manner consistent
with the provisions and definitions contained in (i) the 1940 Act,
(ii) the Rule, (iii) Rule 2830 of the Conduct Rules of the National
Association of Securities Dealers, Inc., or any applicable
amendment or successor to such rule (the "NASD Conduct Rules") and
(iv) any conditions pertaining either to distribution-related
expenses or to a plan of distribution to which the Fund is subject
under any order on which the Fund relies, issued at any time by the
U.S. Securities and Exchange Commission ("SEC").

2. Definitions. As used in this Plan, the following terms shall
have the following meanings:

3. Payments for Distribution Assistance and Administrative Support
Services.

(a) Payments to the Distributor. In consideration of the
payments made by the Fund to the Distributor under this Plan, the
Distributor shall provide administrative support services and
distribution services to the Fund. Such services include
distribution assistance and administrative support services
rendered in connection with Shares acquired (1) by purchase, (2) in
exchange for shares of another investment company for which the
Distributor serves as distributor or sub-distributor, or (3)
pursuant to a plan of reorganization to which the Fund is a party.
If the Board believes that the Distributor may not be rendering
appropriate distribution assistance or administrative support
services in connection with the sale of Shares, then the
Distributor, at the request of the Board, shall provide the Board
with a written report or other information to verify that the
Distributor is providing appropriate services in this regard. For
such services, the Fund will make the following payments to the
Distributor:

(ii) Distribution Assistance Fees (Asset-Based Sales
Charge). Within ten (10) days of the end of each month, the Fund
will make payments in the aggregate amount of 0.0625% (0.75% on an
annual basis) of the average during the month of the aggregate net
asset value of Shares computed as of the close of each business day
(the "Asset-Based Sales Charge"). Such Asset-Based Sales Charge
payments received from the Fund will compensate the Distributor for
providing distribution assistance in connection with the sale of
Shares.

The distribution assistance services to be rendered by
the Distributor in connection with the Shares may include, but
shall not be limited to, the following: (i) paying sales
commissions to any broker, dealer, bank or other person or entity
that sells Shares, and/or paying such persons "Advance Service Fee
Payments" (as defined below) in advance of, and/or in amounts
greater than, the amount provided for in Section 3(b) of this
Agreement; (ii) paying compensation to and expenses of personnel of
the Distributor who support distribution of Shares by Recipients;
(iii) obtaining financing or providing such financing from its own
resources, or from an affiliate, for the interest and other
borrowing costs of the Distributor's unreimbursed expenses incurred
in rendering distribution assistance and administrative support
services to the Fund; and (iv) paying other direct distribution
costs, including without limitation the costs of sales literature,
advertising and prospectuses (other than those prospectuses
furnished to current holders of the Fund's shares ("Shareholders"))
and state "blue sky" registration expenses.

(b) Payments to Recipients. The Distributor is authorized
under the Plan to pay Recipients (1) asset-based sales charge
payments for rendering distribution assistance in connection with
the sale of Shares and/or (2) administrative support services with
respect to Accounts. All fee payments made by the Distributor
hereunder are subject to reduction or chargeback so that the
aggregate service fee payments and Advance Service Fee Payments do
not exceed the limits on payments to Recipients that are, or may
be, imposed by the NASD Conduct Rules. The Distributor may make
Plan payments to any "affiliated person" (as defined in the 1940
Act) of the Distributor or to the Distributor if such affiliated
person and/or the Distributor qualifies as a Recipient.

In consideration of the services provided by Recipients, the
Distributor shall make the following payments to Recipients:

(i) Service Fee. In consideration of administrative
support services provided by a Recipient during a calendar quarter,
the Distributor shall make service fee payments to that Recipient
quarterly, within forty-five (45) days of the end of each calendar
quarter, at a rate not to exceed 0.0625% (0.25% on an annual basis)
of the average during the calendar quarter of the aggregate net
asset value of Shares, computed as of the close of each business
day, constituting Qualified Holdings owned beneficially or of
record by the Recipient or by its Customers for a period of more
than the minimum period (the "Minimum Holding Period"), if any,
that may be set from time to time by a majority of the Independent
Trustees.

Alternatively, the Distributor may, at its sole option,
make the following service fee payments to any Recipient
quarterly, within forty-five (45) days of the end of each calendar
quarter: (A) "Advance Service Fee Payments" at a rate not to
exceed 0.25% of the average during the calendar quarter of the
aggregate net asset value of Shares, computed as of the close of
business on the day such Shares are sold, constituting Qualified
Holdings, sold by the Recipient during that quarter and owned
beneficially or of record by the Recipient or by its Customers,
plus (B) service fee payments at a rate not to exceed 0.0625%
(0.25% on an annual basis) of the average during the calendar
quarter of the aggregate net asset value of Shares, computed as of
the close of each business day, constituting Qualified Holdings
owned beneficially or of record by the Recipient or by its
Customers for a period of more than one (1) year. At the
Distributor's sole option, Advance Service Fee Payments may be made
more often than quarterly, and sooner than the end of the calendar
quarter. In the event Shares are redeemed less than one year after
the date such Shares were sold, the Recipient is obligated to and
will repay the Distributor on demand a pro rata portion of such
Advance Service Fee Payments, based on the ratio of the time such
Shares were held to one (1) year.

The administrative support services to be rendered by
Recipients in connection with the Accounts may include, but shall
not be limited to, the following: answering routine inquiries
concerning the Fund, assisting in the establishment and maintenance
of accounts or sub-accounts in the Fund and processing Share
redemption transactions, making the Fund's investment plans and
dividend payment options available, and providing such other
information and services in connection with the rendering of
personal services and/or the maintenance of Accounts, as the
Distributor or the Fund may reasonably request.

(ii) Distribution Service Fee (Asset-Based Sales Charge
Payments). Irrespective of whichever alternative method of making
service fee payments to Recipients is selected by the Distributor,
in addition the Distributor shall make distribution service fee
payments to each Recipient quarterly, within forty-five (45) days
after the end of each calendar quarter, at a rate not to exceed
0.1875% (0.75% on an annual basis) of the average during the
calendar quarter of the aggregate net asset value of shares
computed as of the close of each business day constituting
"Qualified Holdings" owned beneficially or of record by the
Recipient or its Customers for a period of more than one (1) year.
Such payments shall be made only to Recipients that are registered
with the SEC as a broker-dealer or are exempt from registration.
However, no such payments shall be made to any Recipient for any
quarter in which its Qualified Holdings do not equal or exceed, at
the end of such quarter, the minimum amount ("Minimum Qualified
Holdings"), if any, that may be set from time to time by a majority
of the Independent Trustees.

(c) A majority of the Independent Trustees may at any time or
from time to time (i) increase or decrease the rate of fees to be
paid to the Distributor or to any Recipient, but not to exceed the
rates set forth above, and/or (ii) direct the Distributor to
increase or decrease the Minimum Holding Period, the Maximum
Holding Period or the Minimum Qualified Holdings. The Distributor
shall notify all Recipients of the Minimum Qualified Holdings,
Maximum Holding Period and Minimum Holding Period, if any, and the
rate of payments hereunder applicable to Recipients, and shall
provide each Recipient with written notice within thirty (30) days
after any change in these provisions. Inclusion of such provisions
or a change in such provisions in a supplement or amendment to or
revision of the prospectus of the Fund shall constitute sufficient
notice.

(d) The Service Fee and the Asset-Based Sales Charge on
Shares are subject to reduction or elimination under the limits to
which the Distributor is, or may become, subject under the NASD
Conduct Rules.

(f) Recipients are intended to have certain rights as third-
party beneficiaries under this Plan, subject to the limitations set
forth below. It may be presumed that a Recipient has provided
distribution assistance or administrative support services
qualifying for payment under the Plan if it has Qualified Holdings
of Shares that entitle it to payments under the Plan. If either
the Distributor or the Board believe that, notwithstanding the
level of Qualified Holdings, a Recipient may not be rendering
appropriate distribution assistance in connection with the sale of
Shares or administrative support services for Accounts, then the
Distributor, at the request of the Board, shall require the
Recipient to provide a written report or other information to
verify that said Recipient is providing appropriate distribution
assistance and/or services in this regard. If the Distributor or
the Board of Trustees still is not satisfied after the receipt of
such report, either may take appropriate steps to terminate the
Recipient's status as a Recipient under the Plan, whereupon such
Recipient's rights as a third-party beneficiary hereunder shall
terminate. Additionally, in their discretion a majority of the
Fund's Independent Trustees at any time may remove any broker,
dealer, bank or other person or entity as a Recipient, whereupon
such person's or entity's rights as a third-party beneficiary
hereof shall terminate. Notwithstanding any other provision of
this Plan, this Plan does not obligate or in any way make the Fund
liable to make any payment whatsoever to any person or entity other
than directly to the Distributor.

4. Selection and Nomination of Trustees. While this Plan is in
effect, the selection and nomination of persons to be Trustees of
the Fund who are not "interested persons" of the Fund
("Disinterested Trustees") shall be committed to the discretion of
the incumbent Disinterested Trustees. Nothing herein shall prevent
the incumbent Disinterested Trustees from soliciting the views or
the involvement of others in such selection or nomination as long
as the final decision on any such selection and nomination is
approved by a majority of the incumbent Disinterested Trustees.

6. Related Agreements. Any agreement related to this Plan shall
be in writing and shall provide that: (i) such agreement may be
terminated at any time, without payment of any penalty, by a vote
of a majority of the Independent Trustees or by a vote of the
holders of a "majority" (as defined in the 1940 Act) of the Fund's
outstanding voting Class C shares; (ii) such termination shall be
on not more than sixty days' written notice to any other party to
the agreement; (iii) such agreement shall automatically terminate
in the event of its "assignment" (as defined in the 1940 Act); (iv)
such agreement shall go into effect when approved by a vote of the
Board and its Independent Trustees cast in person at a meeting
called for the purpose of voting on such agreement; and (v) such
agreement shall, unless terminated as herein provided, continue in
effect from year to year only so long as such continuance is
specifically approved at least annually by a vote of the Board and
its Independent Trustees cast in person at a meeting called for the
purpose of voting on such continuance.

7. Effectiveness, Continuation, Termination and Amendment. This
Plan has been approved by a vote of the Board and its Independent
Trustees cast in person at a meeting called on ________, 199__, for
the purpose of voting on this Plan, and shall take effect as of the
date first set forth above, at which time it shall replace the
Fund's Distribution and Service Plan for the Shares dated _______,
199__. Unless terminated as hereinafter provided, it shall continue
in effect until _______, 199__ and thereafter from year to year or
as the Board may otherwise determine but only so long as such
continuance is specifically approved at least annually by a vote of
the Board and its Independent Trustees cast in person at a meeting
called for the purpose of voting on such continuance.

This Plan may not be amended to increase materially the amount
of payments to be made under this Plan, without approval of the
Class C Shareholders in the manner described above, and all
material amendments must be approved by a vote of the Board and of
the Independent Trustees.

This Plan may be terminated at any time by vote of a majority
of the Independent Trustees or by the vote of the holders of a
"majority" (as defined in the 1940 Act) of the Fund's outstanding
Class C voting shares. In the event of such termination, the Board
and its Independent Trustees shall determine whether the
Distributor shall be entitled to payment from the Fund of all or a
portion of the Service Fee and/or the Asset-Based Sales Charge in
respect of Shares sold prior to the effective date of such
termination.

Oppenheimer Equity Income Fund

By: _______________________________

OppenheimerFunds Distributor, Inc.

By: _______________________________

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