SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the registrant / X /
Filed by a party other than the registrant / /
Check the appropriate box:
/ X / Preliminary proxy statement
/ / Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
OPPENHEIMER U.S. GOVERNMENT TRUST
- ------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
OPPENHEIMER U.S. GOVERNMENT TRUST
- ------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
/ X / $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1) or
14a-6(j)(2).
/ / $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: 1
- --------------------
1 - Set forth the amount on which the filing fee is calculated and state
how it was determined.
(4) Proposed maximum aggregate value of transaction:
/ / 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>
Preliminary Copy
OPPENHEIMER U.S. GOVERNMENT TRUST
Two World Trade Center, New York, New York 10048-0203
Notice Of Meeting Of Shareholders To Be Held
May 25, 1995
To The Class A & Class Shareholders of
Oppenheimer U.S. Government Trust
Notice is hereby given that a Meeting of the Class A and Class C
Shareholders of Oppenheimer U.S. Government Trust (the "Fund") will be
held at 3410 South Galena Street, Denver, Colorado, 80231, at 10:00 A.M.,
Denver time, on May 25, 1995, or any adjournments thereof, for the
following purposes:
To be voted on by holders of:
Class A Shares Class C Shares
X X
(a) To elect twelve 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
(b) To ratify the selection of KPMG Peat Marwick
LLP as the independent certified public
accountants and auditors of the Fund for the
fiscal year beginning June 30, 1994 (Proposal No.
1);
X X
(c) To approve changes in the Fund's fundamental
investment policies on investing in U.S.
government securities and in commodities
(Proposal No. 2);
X X
(d) To approve an Investment Advisory Agreement
between the Fund and Oppenheimer Management
Corporation (the "Manager") that would provide
for a decrease in management fee rates (Proposal
No. 3);
X
(e) To approve the Fund's Class C
12b-1 Distribution and Service Plan (Proposal No.
4); and
X X
(f) To transact such other business as may
properly come before the meeting, or any
adjournments thereof.
Shareholders of record at the close of business on March 24, 1995, are
entitled 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
April 13, 1995
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.
<PAGE>
OPPENHEIMER U.S. GOVERNMENT TRUST
Two World Trade Center, New York, New York 10048-0203
PROXY STATEMENT
Meeting of Shareholders
To Be Held May 25, 1995
This statement is furnished to the Class A and Class C shareholders of
Oppenheimer U.S. Government Trust (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 3410 South Galena
Street, Denver, Colorado, 80231, at 10:00 A.M., Denver time, on May 25,
1995, or any adjournments thereof. It is expected that the mailing of
this Proxy Statement will be made on or about April 21, 1995. For a free
copy of the annual and semi-annual reports covering the operations of the
Fund for the fiscal year ended June 30, 1994 and for the six months ended
December 31, 1994, respectively, call Oppenheimer Shareholder 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, 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.
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 Two World Trade Center, New York, New
York, 10048-0203; (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 telegraph; 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 March 24, 1995, the record
date, there were 34,079,041.310 shares of the Fund issued and outstanding,
consisting of 33,221,861.412 Class A shares and 857,179.898 Class C
shares. Each Class A 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 March 17, 1995, the only entities
owning of record or known by management of the Fund to be the beneficial
owner of 5% or more of the outstanding shares of either class of the
Fund's shares were (1) Merrill Lynch Pierce Fenner & Smith, 4800 Deer Lake
Drive, Jacksonville, FL 32246, 44,151 Class C shares (5.42%), and R.
Duffield and C.R. Player, Jr., Co-Trustees, Charitable Remainder Trusts
(the "Trusts"), P.O. Box 401, Barnesville, MD 20838, 106,837.606 shares
(13.1%). The Trusts are party to an agreement with the Fund that for so
long as the Trust holds shares of the Fund, it shall vote such shares at
shareholder meetings in the same proportion as the Fund's other
shareholders.
ELECTION OF TRUSTEES
At the Meeting, twelve 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.
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 shareholders meeting is called for the purpose of voting for
Trustees and until their successors are elected and shall qualify.
Each of the nominees is presently a Trustee and has agreed to be nominated
and, if elected, to continue to serve as a Trustee of the Fund. All
Trustees except Messrs. Galli, Regan and Yeutter have been elected by
shareholders of the Fund. Each of the Trustees is also a Trustee or
Director of Oppenheimer Fund, Oppenheimer Discovery Fund, Oppenheimer
Global Fund, Oppenheimer Global Emerging Growth Fund, Oppenheimer Global
Growth & Income Fund, Oppenheimer Growth Fund, Oppenheimer Time Fund,
Oppenheimer Target Fund, Oppenheimer Tax-Free Bond Fund, Oppenheimer Gold
& Special Minerals Fund, Oppenheimer Asset Allocation Fund, Oppenheimer
California Tax-Exempt Fund, Oppenheimer Multi-State Tax-Exempt Trust,
Oppenheimer Mortgage Income Fund, Oppenheimer Money Market Fund, Inc.,
Oppenheimer New York Tax-Exempt Fund, Oppenheimer Multi-Government Trust
and Oppenheimer Multi-Sector Income Trust (together with the Fund, the
"New York OppenheimerFunds"). Mr. Spiro is President of the Fund and each
of the other New York OppenheimerFunds.
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, Oppenheimer
Management Corporation (the "Manager") or its affiliates, or other
positions described. The year given below indicates when the nominee
first became a Trustee or Director of any of the New York OppenheimerFunds
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 March 24, 1995 the Trustees and officers of
the Fund as a group owned 499.382 Class A shares of the Fund in the
aggregate, which is less than 1% of the outstanding shares of that class.
<TABLE>
<CAPTION>
Shares
Beneficially
Name And Business Experience Owned as of
Other Information During the Past Five Years March 24, 1995
<S> <C> <C>
Leon Levy General Partner of Odyssey Partners, L.P. None
first became a (investment partnership); Chairman of
Trustee in 1959 Avatar Holdings, Inc. (real estate
Age: 69 development).
Leo Cherne Chairman Emeritus of the International Rescue None
first became a Committee (philanthropic organization);
Trustee in 1982 formerly Executive Director of the
Age: 82 Research Institute of America.
Robert G. Galli*
first became a Vice Chairman of the Manager; Vice None
Trustee in 1993 President and Counsel of Oppenheimer
Age: 61 Acquisition Corp., the Manager's
parent holding company; formerly he held the
following positions: a director of the Manager
and Oppenheimer Funds Distributor, Inc. (the
"Distributor"), Vice President and a director
of HarbourView Asset Management Corporation
("HarbourView") and Centennial Asset Management
Corporation ("Centennial"), investment adviser
subsidiaries of the Manager, a director of
Shareholder Financial Services, Inc. ("SFSI")
and Shareholder Services, Inc. ("SSI"),
transfer agent subsidiaries of the Manager,
an officer of other OppenheimerFunds and
Executive Vice President and General Counsel of
the Manager and the Distributor.
Benjamin Lipstein Professor Emeritus of Marketing, Stern None
first became a Graduate School of Business Administration,
Trustee in 1974 New York University; Director of Sussex Publishers,
Age: 71 Inc. (publishers of Psychology Today and Mother
Earth News) and Spy Magazine, L.P.
</TABLE>
* A nominee who is an "interested person" of the Fund or the Manager under
the Investment Company Act.
<TABLE>
<CAPTION> Shares Beneficially
Name And Business Experience Owned as of
Other Information During the Past Five Years March 24, 1995
<S> <C> <C>
Elizabeth B. Moynihan
first became a Author and architectural historian; a None
Trustee in 1992 trustee of the Freer Gallery of Art
Age: 65 (Smithsonian Institution), the Institute
of Fine Arts (New York University),
National Building Museum; a member of
the Trustees Council, Preservation League
of New York State; a member of the Indo-U.S.
Sub-Commission on Education and Culture.
Kenneth A. Randall A director of Dominion Resources, Inc. 272.610
first became a (electric utility holding company),
Trustee in 1980 Dominion Energy, Inc. (electric power and
Age: 67 oil & gas producer), Enron-Dominion Cogen
Corp. (cogeneration company), Kemper
Corporation (insurance and financial
services company) and Fidelity Life Association
(mutual life insurance company); formerly
Chairman of the Board of ICL, Inc.
(information systems), and President and
Chief Executive Officer of The Conference
Board, Inc. (international economic and
business research).
Edward V. Regan
first became a President of Jerome Levy Economics Institute; 226.772
Trustee in 1993 a member of the U.S. Competitiveness
Age: 64 Policy Council; a director of GranCare, Inc.
(health care provider); formerly New York State
Comptroller and trustee, New York State and Local
Retirement Fund.
Russell S. Reynolds, Founder Chairman of Russell Reynolds Associates, None
Jr. Inc. (executive recruiting); Chairman of Directors
first became a Publication, Inc. (consulting and publishing); a
Trustee in 1989 trustee of Mystic Seaport Museum, International House,
Age: 63 Greenwich Historical Society and Greenwich Hospital.
Sidney M. Robbins Chase Manhattan Professor Emeritus of None
first became a Financial Institutions, Graduate School of
Trustee in 1963 Business, Columbia University; Visiting
Age: 83 Professor of Finance, University of Hawaii;
a director of The Korea Fund, Inc. and The
Malaysia Fund, Inc. (closed-end investment
companies); member of the Board of Advisors
of Olympus Private Placement Fund, L.P.;
Professor Emeritus of Finance, Adelphi University.
Donald W. Spiro* Chairman Emeritus and a director of the Manager; None
first became a formerly Chairman of the Manager and the
Trustee in 1985 Distributor.
Age: 69
Pauline Trigere Chairman and Chief Executive Officer of
first became a Trigere, Inc. (design and sale of
Trustee in 1977 women's fashions).
Age: 82
Clayton K. Yeutter
first became a Of Counsel to Hogan & Hartson (a law firm); None
Trustee in 1993 a director of B.A.T. Industries, Ltd. (tobacco
Age: 64 and financial services), Caterpillar, Inc.
(machinery), ConAgra, Inc. (food and agricultural
products), Farmers Insurance Company (insurance),
FMC Corp. (chemicals and machinery), Lindsay
Manufacturing Co. (irrigation equipment)
Texas Instruments, Inc. (electronics) and
The Vigoro Corporation (fertilizer
manufacturer); formerly Counsellor to the
President (Bush) for Domestic Policy, Chairman
of the Republican National Committee, Secretary
of the U.S. Department of Agriculture, and U.S.
Trade Representative.
</TABLE>
* A nominee who is an "interested person" of the Fund or the Manager under
the Investment Company Act.
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 in the fiscal year ended June 30, 1994. Each of the
Trustees was present for at least 75% of the meetings held of the board
and of all committees on which that Trustee served. The Trustees of the
Fund have appointed an Audit Committee, comprised of Messrs. Randall
(Chairman), Robbins (Vice Chairman), Cherne and Regan, 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 (subject to shareholder ratification);
(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 four times during the fiscal year ended June
30, 1994, and all members attended at least 75% of the meetings held
during that period. 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 (Messrs. Galli and Spiro; Mr. Spiro is also an officer) receive
no salary or fee from the Fund. The Trustees of the Fund (including Mr.
Delaney, a former Trustee, but excluding Messrs. Galli and Spiro) received
the total amounts shown below (i) from the Fund, during its fiscal year
ended June 30, 1994, and (ii) from all 19 of the New York-based
OppenheimerFunds (including the Fund) listed in the first paragraph of
this section (and from Oppenheimer Global Environment Fund, a former New
York-based OppenheimerFund), for services in the positions shown:
<TABLE>
<CAPTION>
Aggregate Retirement Benefits Total Compensation
Compensation Accrued as Part From All
Name and from of Fund New York-based
Position Fund Expenses OppenheimerFunds1
<S> <C> <C> <C>
Leon Levy $5,785 $3,730 $141,000.00
Chairman and Trustee
Leo Cherne $2,823 $1,821 $ 68,800.00
Audit Committee
Member and Trustee
Edmund T. Delaney $3,537 $2,281 $ 86,200.00
Study Committee
Member and Trustee2
Benjamin Lipstein $3,537 $2,281 $ 86,200.00
Study Committee
Member and Trustee
Elizabeth B. Moynihan $2,486 $1,604 $ 60,625.00
Study Committee
Member3 and Trustee
Kenneth A. Randall $3,217 $2,075 $ 78,400.00
Audit Committee
Member and Trustee
Edward V. Regan $2,307 $1,488 $ 56,275.00
Audit Committee
Member and Trustee
Russell S. Reynolds, $2,140 $1,380 $ 52,100.00
Jr., Trustee
Sidney M. Robbins $5,008 $3,230 $122,100.00
Study Committee
Chairman, Audit
Committee Vice-Chairman
and Trustee
Pauline Trigere $2,140 $1,380 $ 52,100.00
Trustee
Clayton K. Yeutter $2,140 $1,380 $ 52,100.00
Trustee
</TABLE>
1. For the 1994 calendar year.
2. Board and committee positions held during a portion of the period
shown.
3. Committee position held during a portion of the period shown.
The Fund has adopted a retirement plan that provides for payment to a
retired Trustee of up to 80% of the average compensation paid during that
Trustee's five years of service in which the highest compensation was
received. A Trustee must serve in that capacity for any of the New York-
based OppenheimerFunds for at least 15 years to be eligible for the
maximum payment. Because retirement benefits are determined by future
compensation and length of service, such benefits and estimated credited
years of service are not presently determinable. No payments have been
made by the Fund under the plan as of June 30, 1994.
Officers of the Fund. Each officer of the Fund is elected by the Trustees
to serve an indefinite 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.
David Rosenberg, Vice President and Portfolio Manager, Age 36.
Vice President of the Manager; an officer of other OppenheimerFunds.
Andrew J. Donohue, Secretary; Age: 44.
Executive Vice President and General Counsel of the Manager and the
Distributor; an officer of other OppenheimerFunds; 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 and Treasurer; Age 58.
Senior Vice President and Treasurer of the Manager; Vice President and
Treasurer of the Distributor and HarbourView; Senior Vice President,
Treasurer, Assistant Secretary and a director of Centennial; Vice
President, Treasurer and Secretary of SSI and SFSI; an officer of other
OppenheimerFunds.
Robert G. Zack, Assistant Secretary; Age 46.
Senior Vice President and Associate General Counsel of the Manager;
Assistant Secretary of SSI and SFSI; an officer of other OppenheimerFunds.
Robert Bishop, Assistant Treasurer; Age 36.
Assistant Vice President of the Manager/Mutual Fund Accounting; an officer
of other OppenheimerFunds; previously a Fund Controller for the Manager,
prior to which he was an accountant for Yale & Seffinger, P.C., an
accounting firm, and previously an accountant and commissions supervisor
for Stuart James Company, Inc., a broker-dealer.
Scott Farrar, Assistant Treasurer; Age 29.
Assistant Vice President of the Manager/Mutual Fund Accounting; an officer
of other OppenheimerFunds; previously a Fund Controller for the Manager,
prior to which he was an international mutual fund supervisor for Brown
Brothers, Harriman & Co., a bank, and previously a senior fund accountant
for State Street Bank & Trust Company.
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 August 11, 1994, selected KPMG Peat
Marwick LLP ("Peat Marwick") as auditors of the Fund for the fiscal year
beginning July 1, 1994. Peat Marwick also serves as auditors for certain
other funds for which the Manager acts as investment adviser. At the
Meeting, a resolution will be presented for the Class A and Class C
shareholders' vote to ratify the selection of Peat Marwick as auditors.
Representatives of Peat Marwick 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
Peat Marwick as auditors of the Fund.
APPROVAL OF CHANGES TO THE FUND'S FUNDAMENTAL
INVESTMENT POLICIES WITH RESPECT TO INVESTMENT
IN U.S. GOVERNMENT SECURITIES AND COMMODITIES
(Proposal No. 2)
The Fund currently has certain investment policies with respect to its
investment in debt instruments issued or guaranteed by the U.S. Government
or its agencies or instrumentalities ("U.S. Government Securities"), and
in commodities. These investment policies have been designated as
"fundamental" policies, which are policies that may not be changed without
the requisite shareholder approval as described below.
As a matter of fundamental investment policy, the Fund is permitted to
invest only in U.S. Government Securities, and repurchase agreements on
such securities, and may write covered calls and use hedging instruments
as described in the Fund's Prospectus. If this Proposal is approved, the
Fund will adopt in its place a fundamental investment policy that under
normal market conditions, the Fund will invest at least 80% of its total
assets in U.S. Government Securities. It is the intention of the Fund's
Board of Trustees to adopt a non-fundamental investment policy limiting
investments by the Fund in debt securities other than U.S. Government
Securities to debt securities rated within the four highest rating
categories of Moody's Investors Service, Inc. or Standard & Poor's
Corporation, or, if unrated, judged by the Manager to be of comparable
quality to debt securities rated within such grades. Such ratings are
known as "investment grade" ratings. This limitation is being adopted as
a non-fundamental policy so that the Fund's Board of Trustees may further
revise it at some future date without securing shareholder approval and
without subjecting the Fund to the expense of holding a shareholder
meeting to obtain such approval.
The reason for the proposed change is that a portfolio made up entirely
of U.S. Government Securities is generally more sensitive to changes in
interest rates than a more diversified portfolio that invests primarily
(but not entirely) in U.S. Government Securities. Although the yield on
debt securities not issued or guaranteed by the U.S. Government or its
agencies or instrumentalities tends to be higher than on U.S. Government
Securities, and the potential for higher long-term returns may increase
if such investments are made, there is the increased credit risk potential
that issuers other than the U.S. Government or its agencies or
instrumentalities may not be able to make interest or principal payments
as they become due. Securities issued or guaranteed by the U.S.
Government are subject to little, if any, credit risk assuming they are
backed by the full faith and credit of the U.S. Government, its agencies
or instrumentalities. The Fund's investment adviser intends to determine
issuer creditworthiness, among other factors, in selecting securities for
the Fund's portfolio, and in determining from time to time whether a
portion (but not more than 20%) of the Fund's portfolio should be invested
in non-U.S. Government Securities.
In addition, as a matter of fundamental policy, the Fund presently cannot
invest in commodities or commodity contracts or invest in interests in
oil, gas or other mineral exploration or development programs; however,
the Fund may buy and sell any of the hedging instruments which it may use
as permitted by any of its other fundamental policies, whether or not any
such hedging instrument is considered to be a commodity or a commodity
contract. If this proposal is approved, the limitation on investment in
commodities would be eliminated as a fundamental policy. The Fund would
be allowed to purchase or sell options and futures contracts or invest in
securities or other instruments backed by physical or financial
commodities. It is the intention of the Fund's Board of Trustees to adopt
a non-fundamental investment policy not to invest in oil, gas or other
mineral leases.
This proposal would permit the Fund to invest in "derivative investments"
that offer the potential for increasing income and principal value, as
well as for hedging purposes. In general, a "derivative investment" is
a specially-designed investment whose performance is linked to the
performance of another investment or security, such as an option, future
or index. Derivative investments include exchange-traded options and
futures contracts and "index-linked" notes. On the maturity of such
notes, payment is made based on the performance of an underlying index.
One risk of investing in derivative investments is that the company
issuing the instrument may not pay the amount due on the maturity of the
instrument. There is also the risk that the underlying investment or
security might not perform the way the Fund's portfolio manager expected
it to perform. The performance of derivative investments may also be
influenced by interest rate changes in the U.S. and abroad. All of these
risks mean that the Fund can realize less income than expected from its
investments, or that it can lose part of the value of its investments,
which will affect the Fund's share price. Certain derivative investments
held by the Fund may trade in the over-the-counter markets and may be
illiquid. The Fund's investments in illiquid securities is limited to no
more than 10% of the Fund's total assets.
At a meeting of the Fund's Board of Trustees held on March 16, 1995, the
Manager presented the advantages of risks of allowing the Fund's portfolio
manager the flexibility to invest up to 20% of the Fund's portfolio in
non-U.S. Government Securities, in response to market, economic and other
conditions, and of removing restrictions on the Fund's ability to invest
in derivative investments. The Trustees approved and recommended, subject
to shareholder approval, the changes in fundamental investment policy
described in this Proposal. If approved, the effective date of this
Proposal can be delayed until the Fund's Prospectus is updated to reflect
these changes.
Vote Required. An affirmative vote of the holders of a "majority" (as
defined in the Investment Company Act) of all outstanding Class A and
Class C voting securities of the Fund is required for approval of the
Proposed Agreement; the classes do not vote separately. Such "majority"
vote is defined in the Investment Company Act as the vote of the holders
of the lesser of: (1) 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 PROPOSED INVESTMENT ADVISORY AGREEMENT
(Proposal No. 3)
The Fund has an Investment Advisory Agreement dated October 22, 1990, with
the Manager (the "Current Agreement") which was submitted to and approved
by the Fund's shareholders at a meeting held October 1, 1990.
At a meeting of the Fund's Board of Trustees held March 16, 1995, the
Board, 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 Current Agreement ("Independent Trustees"), approved the
terms of a new Investment Advisory Agreement (the "Proposed Agreement")
between the Fund and the Manager. If approved by the shareholders at this
meeting, the Proposed Agreement will be effective on such date and
continue in effect until December 31, 1995, and thereafter from year to
year unless terminated, but only so long as such continuance is approved
in accordance with the Investment Company Act. If the Proposed Agreement
is not approved by shareholders, the Current Agreement will continue in
effect.
The Proposed Agreement differs from the Current Agreement in the schedule
of fee rates paid by the Fund and results in a lower fee than under the
Current Agreement. Under the Current Agreement, the management fee
payable monthly to the Manager is computed on the net assets of the Fund
as of the close of business each day at the annual rates of 0.75% of the
first $200 million of net assets; 0.70% of the next $200 million; 0.65%
of the next $400 million; and 0.60% of net assets in excess of $800
million. Under the Proposed Agreement the management fee would be payable
monthly to the Manager and computed on the net assets of the Fund as of
the close of business each day at annual rates of 0.65% of the first $200
million; 0.60% of the next $100 million; 0.57% of the next $100 million;
0.55% of the next $400 million, and 0.50% of net assets in excess of $800
million. The management fee rates of the Proposed Agreement is lower at
all asset levels. The Manager has voluntarily reduced the management fee
to the rates of the Proposed Agreement.
For the fiscal year ended June 30, 1994, the Fund paid a management fee
of $2,515,934 under the Current Agreement and a voluntary reduction in its
management fee rate. If the Proposed Agreement had been in effect during
that period, the management fee would have been $2,224,675, a decrease of
approximately 11.58%. The Manager also acts as investment adviser to
three other funds that have similar investment objectives to the Fund at
the following advisory fee rates:
<TABLE>
<CAPTION>
Approximate Net Advisory Fee Rate as
Assets of 3/17/95 % of Average Annual
Name of Fund ($ Millions) Net Assets
<S> <C> <C>
Oppenheimer Limited-Term $339.5 .50% on the first $100 million,
Government Fund (open-end) .45% on the next $150 million,
.425% on the next $250 million, and
.40% of net assets in excess of $500
million.
Oppenheimer Mortgage $86.7 0.65% on the first $200 million,
Income Fund (open-end) .60% of the next $200 million,
.55% of the next $400 million and
.50% of net assets in excess of $800 million.
Oppenheimer Multi-
Government Trust $49.5 65%
(closed-end)
</TABLE>
The Proposed Agreement and the Current Agreement (hereinafter jointly
referred to as the "Agreements") are identical other than the change in
the management fee rates described above and the date of the Agreements.
Under the Agreements, 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 Agreements require
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 Agreements or by
the distributor of the Fund's shares are paid by the Fund. The Agreements
list 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 Agreements contain no expense limitation. However, independently of
the Agreements, the Manager has undertaken that the total expenses of the
Fund in any fiscal year (including the management fee but excluding taxes,
interest, brokerage fees and any extraordinary non-recurring expenses,
such as litigation) shall not exceed the most stringent applicable
regulatory limitation. 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. The Manager reserves the right
to change or eliminate this expense limitation at any time.
The Agreements provide that in the absence of willful misfeasance, bad
faith or gross negligence in the performance of its duties or reckless
disregard of its obligations under the Agreements, the Manager is not
liable for any loss sustained by reason of any investment, or the
purchase, sale or retention of any security, or for any act or omission
in performing the services required by the Agreements. The Agreements
permit 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 Agreements. One of the duties of the Manager
under the Agreements is to arrange the portfolio transactions for the
Fund. The Agreements contain 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 agreements to employ broker-
dealers, including "affiliated" brokers, as that term is defined in the
Investment Company Act, as may, in its best judgment based on all
relevant factors, implement the policy of the Fund to obtain, at
reasonable expense, the "best execution" (prompt and reliable execution
at the most favorable price obtainable) of such transactions. The Manager
need not seek competitive commission bidding but is expected to minimize
the commissions paid to the extent consistent with the interest and
policies of the Fund as established by its Board of Trustees.
Under the Agreements, 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 and the commission is fair and reasonable in
relation to the services provided. Subject to the foregoing
considerations, the Manager may also consider sales of shares of 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
Agreements, the procedures and rules described above, allocations of
brokerage are made by portfolio managers of the Manager under the
supervision of the Manager's executive officers. As most purchases made
by the Fund are principal transactions at net prices, the Fund incurs
little or no brokerage costs; no brokerage commissions were paid to any
broker affiliated with either the Fund or the Manager during the fiscal
year ended June 30, 1994. The Fund usually deals directly with the
selling or purchasing principal or market maker without incurring charges
for the services of a broker on its behalf unless it is determined that
better price or execution may be obtained by utilizing the services of a
broker. Purchases of portfolio 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.
The Fund seeks to obtain prompt execution of orders at the most favorable
net price.
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.
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 has permitted the Manager to
use concessions on fixed price offerings to obtain research in the same
manner as is permitted for agency transactions.
The research services provided by brokers broadens the scope and
supplement the research activities of the Manager, by making available
additional views for consideration and comparisons, and by enabling the
Manager to obtain market information for the valuation of securities held
in the Fund's portfolio or being considered for purchase. The Board of
Trustees, including the Independent Trustees, annually reviews information
furnished by the Manager as to the commissions paid to brokers furnishing
such services so that the Board may ascertain whether the amount of such
commissions was reasonably related to the value or benefit of such
services.
The Manager and the Distributor. 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. Oppenheimer Funds Distributor, Inc., a wholly-owned subsidiary
of the Manager, is the general distributor of the Fund's shares.
The Manager (including a subsidiary) currently manages investment
companies, including other OppenheimerFunds, with assets of more than $29
billion as of December 31, 1994, and with more than 2.4 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. It is the nation's twelfth largest life
insurance company by assets and has an A.M. Best Co. rating of "A++".
The common stock of OAC is divided into three classes. At December 31,
1994, MassMutual held (i) all of the 2,160,000 shares of Class A voting
stock, (ii) 422,023 shares of Class B voting stock, and (iii) 937,403
shares of Class B non-voting stock. This collectively represented 80.2%
of the outstanding common stock and 86.5% of the voting power of OAC as
of that date. Certain officers and/or directors of the Manager held (i)
706,286 shares of the Class B voting stock, representing 16.1% of the
outstanding common stock and 10.9% of the voting power, and (ii) options
acquired without cash payment which, when they become exercisable, allow
the holders to purchase up to 744,282 shares of Class B non-voting stock.
That group includes persons who serve as officers of the Fund (Messrs.
George C. Bowen, Andrew J. Donohue, David Rosenberg and Robert G. Zack)
and two of whom (Messrs. Donald W. Spiro and Robert G. Galli) 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, according to
a schedule that will commence on September 30, 1995. Since July 1, 1993,
the only transactions by persons who serve as Trustees of the Fund were
by Mr. Galli, who sold 10,000 shares of Class C OAC common stock to
MassMutual and surrendered to OAC 80,594 stock appreciation rights issued
in tandem with the Class B OAC options for an aggregate of $4,878,494, and
by Mr. Spiro, who sold 65,500 shares of Class C OAC common stock to
MassMutual and surrendered to OAC 173,680 stock appreciation rights issued
in tandem with the Class B OAC options for an aggregate of $12,094,068,
for cash payments by OAC or MassMutual to be made as follows: one-third
of the amount due (i) within 30 days of the transaction, (ii) by the first
anniversary following the transaction (with interest), and (iii) by the
second anniversary following the transaction (with interest).
The names and principal occupations of the executive officers and
directors of the Manager are as follows: Jon S. Fossel, Chairman, Chief
Executive Officer and a director; Bridget A. Macaskill, President and a
director; Donald W. Spiro, Chairman Emeritus and a director; Robert G.
Galli, Vice Chairman, James C. Swain, Vice Chairman and a director; Robert
C. Doll and O. Leonard Darling, Executive Vice Presidents; Tilghman G.
Pitts III, Executive Vice President and a director; Andrew J. Donohue,
Executive Vice President and General Counsel; Kenneth C. Eich, Executive
Vice President and Chief Financial Officer; George C. Bowen, Senior Vice
President and Treasurer; Victor Babin, Loretta McCarthy, Robert Patterson,
Nancy Sperte, Arthur Steinmetz, Ralph Stellmacher and Robert G. Zack,
Senior Vice Presidents.
Considerations by the Board of Trustees. In connection with the revision
in the investment management fee, the Manager provided extensive
information to the Independent Trustees. The Independent Trustees were
provided with data as to the qualifications of the Manager's personnel,
the quality and extent of the services rendered and its commitment to its
mutual fund advisory business. The Independent Trustees also considered
data presented by the Manager showing the extent to which it had expanded
its investment personnel and other services dedicated to the fixed-income
area of its mutual fund advisory activities. Information prepared
specifically for the purpose of assisting the Independent Trustees in
their evaluation of the Proposed Agreements included an analysis of the
performance and expenses of the Fund as compared to other similar funds.
The Independent Trustees relied upon information previously provided to
them in connection with their annual and ongoing review, on the nature,
quality and extent of the Manager's services to the Fund.
The Independent Trustees first examined the nature, quality and scope of
the services provided to the Fund by the Manager. Second, they reviewed
the basis for an adjustment in the management fee and analyzed the fee
proposed by the Manager in terms of management fees charged by the Manager
and other investment advisors for similar services. Finally, the
Independent Trustees examined the mutual fund related revenues and
expenses of the Manager.
Analysis of Nature, Quality and Extent of Services. The Independent
Trustees considered, among other factors: (1) the necessity of the Manager
maintaining and enhancing its ability to retain and attract capable
personnel to serve the Fund; (2) the investment record of the Manager in
managing the Fund, and the investment record of other investment companies
for which it acts as investment adviser; (3) the Manager's overall
profitability; (4) pro-forma profitability data giving effect to the
proposed revision in the investment management fee but before marketing
and promotional expenses anticipated to be paid by the Manager and its
affiliates; (5) the effect of the proposed investment management fee
revision on the expense ratio of the Fund; (6) possible economies of
scale; (7) data as to investment performance, advisory fees and expense
ratios of other investment companies not advised by the Manager but
believed to be in the same overall investment and size category as the
Fund; (8) other benefits to the Manager from serving as investment manager
to the Fund, as well as benefits to its affiliates acting as principal
underwriter and its division acting as transfer agent to the Fund; (9)
current and developing conditions in the financial services industry,
including the entry into the industry of larger and highly capitalized
companies which are spending and appear to be prepared to continue to
spend substantial sums to engage personnel and to provide services to
competing investment companies; and (10) the financial resources of the
Manager and the desirability of appropriate incentives to assure that the
Manager will continue to furnish high quality services to the Fund.
Analysis of Proposed Fee Adjustment. In their review of the proposed
adjustment in the level of the investment advisory fees, the Independent
Trustees considered the fact that the proposed investment advisory fee is
lower (and therefore more favorable to the Fund) than the fee in the
current Agreement, and that is would reduce expenses of the Fund in
comparison to the amount the Fund could pay under the Current Agreement.
Lower expenses can increase the amount of the Fund's net income available
for distribution to its shareholders. The Independent Trustees also
considered the fact that the proposed investment advisory fee is
comparable to that paid by many other investment companies that invest
primarily in U.S. Government Securities.
Analysis of Profitability of the Manager. The Independent Trustees were
advised that the Manager does not maintain its financial records on a
fund-by-fund basis. However, the Manager does provide the Independent
Trustee on an annual basis with its allocation of expenses on a fund-by-
fund basis. The Independent Trustees considered specific information
provided by the Manager regarding its profitability and also considered
comparative information relating to the profitability of other mutual fund
investment managers. The Independent Trustees also noted the substantial
marketing and promotional activities in which the Manager and its
affiliates engage and propose to engage on behalf of the Fund.
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
Proposed Agreement.
Vote Required. An affirmative vote of the holders of a "majority" (as
defined in the Investment Company Act) of all outstanding voting
securities of the Fund is required for approval of the Proposed Agreement;
the classes do not vote separately. The requirement for such "majority"
vote are described in Proposal No. 2. The Board of Trustees recommends
a vote in favor of approving the Proposed Investment Advisory Agreement.
APPROVAL OF THE FUND'S CLASS C 12b-1 DISTRIBUTION
AND SERVICE PLAN AND AGREEMENT
(Proposal No. 4)
NOTE: This Proposal applies to Class C Shareholders only.
Class C shares were first offered to the public on December 1, 1993. At
that time, the Fund had adopted a Distribution Plan and Agreement 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
assets as an asset-based sales charge. At a meeting of the Fund's Board
of Trustees held March 16, 1995, the Manager proposed the adoption of a
new Distribution and Service Plan and Agreement (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 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 new Distribution and Service Plan, subject to shareholder
approval, and determined to recommend the Distribution and Service Plan
and Agreement for approval by the shareholders. A copy of the new
Distribution and Service Plan is attached as Exhibit A to this proxy
statement.
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 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 ("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. 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 to any broker,
dealer, bank or other institution 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, and (iii) paying
or reimbursing the Distributor for interest and other borrowing costs
incurred on any unreimbursed expenses carried forward to subsequent fiscal
quarters. 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%. 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. 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
of up to 0.75% per annum 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 up to 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 year ended June 30, 1994 were $12,509 (1.00% of the Fund's
average net assets represented by Class C shares during that period),
which the Distributor retained as reimbursement for Class C sales
commissions and service fee advances, as well as financing costs. No
Recipient received 10% or more of such payments by the Fund in that
period.
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, 1995 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 did
not exceed a minimum amount, if any, that may be determined from time to
time by a majority of the Independent Trustees. Initially, 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 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 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 for its distribution
efforts rather than reimbursing it for its costs. It is possible for the
Fund's Class C 12b-1 payments to be increased or the period during which
payments to the Distributor are made extended when such payments are not
limited by the Distributor's expenses (including past expenses which were
not previously reimbursed, and which were, therefore, carried forward
with interest), as under the existing reimbursement-type plan. However,
under normal circumstances this is unlikely. Therefore, adoption of this
Proposal is not expected to materially increase the Fund's expenses under
normal circumstances. Under the existing proposed Distribution and
Service Plans, payments will remain subject to limits imposed on asset-
based sales charges by the NASD. The Board also noted that investors who
purchase Class C shares of the Fund reasonably expect that they will be
paying an asset-based sales charge of 0.75% per annum.
A second difference in the 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 C shares acquired either in exchange for other OppenheimerFund
shares or by reorganization with another fund. The Board formulated the
terms of the new Plan to assure that the Board has 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 C shares of the
Fund reasonably expect that they will be paying an asset-based sales
charge of 0.75% per annum despite any increase in Fund assets as a result
of share exchanges or the occurrences of reorganizations to which their
Fund is a party.
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 would likely 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 at the lower investment
advisory fee rate that is currently in effect. 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 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
as 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.
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
April 13, 1995
<PAGE>
Exhibit A
DISTRIBUTION AND SERVICE PLAN AND AGREEMENT
WITH
OPPENHEIMER FUNDS DISTRIBUTOR, INC.
FOR CLASS C SHARES OF
OPPENHEIMER U.S. GOVERNMENT TRUST
DISTRIBUTION AND SERVICE PLAN AND AGREEMENT (the "Plan") dated the 26th
day of May, 1995, by and between OPPENHEIMER U.S. GOVERNMENT TRUST (the
"Fund") and OPPENHEIMER FUNDS 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 (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 Distributor is authorized under the Plan to pay "Recipients," as
hereinafter defined, for rendering (1) distribution assistance in
connection with the sale of Shares and/or (2) administrative support
services with respect to Accounts. Such Recipients are intended to have
certain rights as third-party beneficiaries under 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) Article III, Section 26, of the Rules of Fair
Practice of the National Association of Securities Dealers, Inc., or its
successor (the "NASD Rules of Fair Practice") 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 Securities and Exchange Commission.
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
institution 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. Notwithstanding the
foregoing, a majority of the Fund's Board of Trustees (the "Board") who
are not "interested persons" (as defined in the 1940 Act) and who have
no direct or indirect financial interest in the operation of this Plan
or in any agreements relating to this Plan (the "Independent Trustees")
may remove any broker, dealer, bank or other institution as a
Recipient, whereupon such entity's rights as a third-party beneficiary
hereof shall terminate.
(b) "Qualified Holdings" shall mean, as to any Recipient, all Shares
owned beneficially or of record by: (i) such Recipient, or (ii) such
customers, clients and/or accounts as to which such Recipient is a
fiduciary or custodian or co-fiduciary or co-custodian (collectively,
the "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 two entities would otherwise qualify as Recipients as to the same
Shares, the Recipient which is the dealer of record on the Fund's books
shall be deemed the Recipient as to such Shares for purposes of this
Plan.
3. Payments for Distribution Assistance and Administrative Support
Services.
(a) The Fund will make payments to the Distributor, within forty-
five (45) days of the end of each calendar quarter, in the aggregate
amount of (i) 0.0625% (0.25% on an annual basis) of the average during
the calendar quarter of the aggregate net asset value of the Shares
computed as of the close of each business day (the "Service Fee"), plus
(ii) 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 (the "Asset-Based Sales Charge").
Such Service Fee payments received from the Fund will compensate the
Distributor and Recipients for providing administrative support
services of the type approved by the Board with respect to Accounts.
Such Asset-Based Sales Charge payments received from the Fund will
compensate the Distributor and Recipients for providing distribution
assistance in connection with the sales of Shares.
The administrative support services in connection with the Accounts
to be rendered by Recipients 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 Distributor and Recipients may include, but shall
not be limited to, the following: distributing sales literature and
prospectuses other than those furnished to current holders of the
Fund's Shares ("Shareholders"), and providing such other information
and services in connection with the distribution of Shares as the
Distributor or the Fund may reasonably request.
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 to 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 still is not satisfied, it may take
appropriate steps to terminate the Recipient's status as such under the
Plan, whereupon such entity's rights as a third-party beneficiary
hereunder shall terminate.
(b) The Distributor shall make service fee payments to any 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, to be set from time to
time by a majority of the Independent Trustees.
Alternatively, the Distributor may, at its sole option, make service
fee payments ("Advance Service Fee Payments") to any Recipient
quarterly, within forty-five (45) days of the end of each calendar
quarter, at a rate not to exceed (i) 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) 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, subject to reduction
or chargeback so that the Advance Service Fee Payments do not exceed
the limits on payments to Recipients that are, or may be, imposed by
Article III, Section 26, of the NASD Rules of Fair Practice. In the
event Shares are redeemed less than one year after the date such Shares
were sold, the Recipient is obligated and will repay to 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 Advance Service Fee Payments described in part (i) of this
paragraph (b) may, at the Distributor's sole option, be made more often
than quarterly, and sooner than the end of the calendar quarter. In
addition, the Distributor shall make asset-based sales charge payments
to any Recipient quarterly, within forty-five (45) days of 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. However, no such service fee or asset-based sales charge
payments (collectively, the "Recipient 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, to be set from time to time by
a majority of the Independent Trustees.
A majority of the Independent Trustees may at any time or from time
to time decrease and thereafter adjust 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 and Minimum Holding Period, if any, and the
rates of Recipient 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. The Distributor may
make Plan payments to any "affiliated person" (as defined in the 1940
Act) of the Distributor if such affiliated person qualifies as a
Recipient.
(c) The Distributor is entitled to retain from the payments
described in Section 3(a) the aggregate amount of (i) the Service Fee
on Shares outstanding for less than the Minimum Holding Period plus
(ii) the Asset-Based Sales Charge on Shares outstanding for not more
than the Maximum Holding Period, plus (iii) any additional Asset-Based
Sales Charge payment which no Recipient qualifies to receive, in each
case computed as of the close of each business day during that period
and subject to reduction or elimination of such amounts under the
limits to which the Distributor is, or may become, subject under
Article III, Section 26, of the NASD Rules of Fair Practice. The
distribution assistance and administrative support 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 institution that sells
Shares, and/or paying such persons Advance Service Fee Payments in
advance of, and/or greater than, the amount provided for in Section
3(a) of this Agreement; (ii) paying compensation to and expenses of
personnel of the Distributor who support distribution of Shares by
Recipients; (iii) paying of or reimbursing the Distributor for
interest and other borrowing costs on its unreimbursed expenses at the
rate paid by the Distributor or, if such amounts are financed by the
Distributor from its own resources or by an affiliate, at the rate of
1% per annum above the prime rate (which shall mean the most
preferential interest rate on corporate loans at large U.S. money
center commercial banks) then being reported in the Eastern edition of
the Wall Street Journal (or if such prime rate is no longer so
reported, such other rate as may be designated from time to time by the
Distributor with the approval of the Independent Trustees); (iv) other
direct distribution costs, including without limitation the costs of
sales literature, advertising and prospectuses (other than those
furnished to current Shareholders) and state "blue sky" registration
expenses; and (v) any service rendered by the Distributor that a
Recipient may render pursuant to part (a) of this Section 3. Such
services include distribution and administrative support services
rendered in connection with Shares acquired by the Fund (i) by
purchase, (ii) in exchange for shares of another investment company for
which the Distributor serves as distributor or sub-distributor, or (ii)
pursuant to a plan of reorganization to which the Fund is a party. In
the event that the Board should have reason to believe 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.
(d) Under the Plan, payments may be made to Recipients: (i) by
Oppenheimer Management Corporation ("OMC") 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 OMC), from
its own resources, from Asset-Based Sales Charge payments or from its
borrowings.
4. Selection and Nomination of Trustees. While this Plan is in effect,
the selection and nomination of those persons to be Trustees of the Fund
who are not "interested persons" of the Fund ("Disinterested Trustees")
shall be committed to the discretion of such Disinterested Trustees.
Nothing herein shall prevent the Disinterested Trustees from soliciting
the views or the involvement of others in such selection or nomination if
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 reports shall be provided in the frequency requested by the
Board, 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 voting securities of
the Class, on not more than sixty days written notice to any other party
to the agreement; (ii) such agreement shall automatically terminate in the
event of its assignment (as defined in the 1940 Act); (iii) it 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 (iv) it 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 March 16, 1995, for the purpose of voting
on this Plan, and shall take effect after approval by Class C shareholders
of the Fund, at which time it shall replace the Fund's Distribution and
Service Plan and Agreement for the Shares dated December 1, 1993. Unless
terminated as hereinafter provided, it shall continue in effect until
December 31, 1995 and from year to year thereafter or as the Board may
otherwise determine 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 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 voting securities of
the Class. 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 U.S. GOVERNMENT TRUST
By: /s/ Robert G. Zack
------------------------
Robert G. Zack, Assistant Secretary
OPPENHEIMER FUNDS DISTRIBUTOR, INC.
By: /s/ Katherine P. Feld
-----------------------------
Katherine P. Feld, Vice President
& Secretary
<PAGE>
Preliminary Copy
Oppenheimer U.S. Government Proxy for Shareholders Meeting To
Trust - Class A Shares Be Held May 25, 1995
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.
Oppenheimer U.S. Government Trust - Class A Shares
Proxy For Shareholders Meeting To Be Held May 25, 1995
The undersigned shareholder of Oppenheimer U.S. Government Trust (the
"Fund"), does hereby appoint Robert Bishop, George C. Bowen, Andrew J.
Donohue and Scott Farrar, and each of them, as attorneys-in-fact and
proxies of the undersigned, with full power of substitution, to attend the
Meeting of Shareholders of the Fund to be held May 25, 1995, at 3410 South
Galena Street, Denver, Colorado 80231 at 10:00 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.
Proxy solicited on behalf of the Board Of Trustees, which recommends a
vote FOR the election of all nominees for Trustee and FOR each Proposal
on the reverse side. The shares represented hereby will be voted as
indicated on the reverse side or FOR if no choice is indicated.
(over)
220
Oppenheimer U.S. Government Proxy for Shareholders Meeting To
Trust - Class A Shares Be Held May 25, 1995
Your shareholder Your prompt response can save your
vote is important! Fund money.
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.
Please detach at perforation before
mailing.
1. Election of Trustees
____ For all nominees listed _____ Withhold authority
except as marked to the vote for all nominees
contrary at left. listed at left.
L. Cherne R. Galli L. Levy B. Lipstein
(A) (B) (C) (D)
E. Moynihan K. Randall E. Regan R. Reynolds S. Robbins
(E) (F) (G) (H) (I)
D. Spiro P. Trigere C. Yeutter
(J) (K) (L)
Instruction: To withhold authority to vote for any individual nominee,
line out that nominee's name at left.
2. Ratification of selection of KPMG Peat Marwick LLP as independent
auditors (Proposal No. 1)
For ____ Against ____ Abstain ____
3. Approval of proposed changes in fundamental investment policies
(Proposal No. 2)
For ____ Against ____ Abstain ____
4. Approval of proposed Investment Advisory Agreement (Proposal No. 3)
For ____ Against ____ Abstain ____
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.
Dated: _______________________, 1995
(Month) (Day)
____________________________
Signature(s)
____________________________
Signature(s)
Please read both sides of this ballot.
220
<PAGE>
Preliminary Copy
Oppenheimer U.S. Government Proxy for Shareholders Meeting To
Trust - Class C Shares Be Held May 25, 1995
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.
Oppenheimer U.S. Government Trust - Class C Shares
Proxy For Shareholders Meeting To Be Held May 25, 1995
The undersigned shareholder of Oppenheimer U.S. Government Trust (the
"Fund"), does hereby appoint Robert Bishop, George C. Bowen, Andrew J.
Donohue and Scott Farrar, and each of them, as attorneys-in-fact and
proxies of the undersigned, with full power of substitution, to attend the
Meeting of Shareholders of the Fund to be held May 25, 1995, at 3410 South
Galena Street, Denver, Colorado 80231 at 10:00 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.
Proxy solicited on behalf of the Board Of Trustees, which recommends a
vote FOR the election of all nominees for Trustee and FOR each Proposal
on the reverse side. The shares represented hereby will be voted as
indicated on the reverse side or FOR if no choice is indicated.
(over)
222
Oppenheimer U.S. Government Proxy for Shareholders Meeting To
Trust - Class C Shares Be Held May 25, 1995
Your shareholder Your prompt response can save your
vote is important! Fund money.
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.
Please detach at perforation before
mailing.
1. Election of Trustees
____ For all nominees listed _____ Withhold authority
except as marked to the vote for all nominees
contrary at left. listed at left.
L. Cherne R. Galli L. Levy B. Lipstein
(A) (B) (C) (D)
E. Moynihan K. Randall E. Regan R. Reynolds S. Robbins
(E) (F) (G) (H) (I)
D. Spiro P. Trigere C. Yeutter
(J) (K) (L)
Instruction: To withhold authority to vote for any individual nominee,
line out that nominee's name at left.
2. Ratification of selection of KPMG Peat Marwick LLP as independent
auditors (Proposal No. 1)
For ____ Against ____ Abstain ____
3. Approval of proposed changes in fundamental investment policies
(Proposal No. 2)
For ____ Against ____ Abstain ____
4. Approval of proposed Investment Advisory Agreement (Proposal No. 3)
For ____ Against ____ Abstain ____
5. Approval of proposed Class C 12b-1 Distribution and Service Plan and
Agreement (Proposal No. 4)
For ____ Against ____ Abstain ____
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.
Dated: _______________________, 1995
(Month) (Day)
____________________________
Signature(s)
____________________________
Signature(s)
Please read both sides of this ballot.
