OPPENHEIMER U.S. GOVERNMENT TRUST
Supplement dated May 1, 1997 to the
Prospectus dated November 1, 1996
The Prospectus is changed as follows:
1. The Supplement dated January 1, 1997 to the Prospectus is
replaced by this supplement.
2. The first footnote under the "Shareholder Transaction
Expenses" table on page 3 is replaced with the following:
(1) If you invest $1 million or more
($500,000 or more for purchases by "Retirement
Plans", as defined in "Class A Contingent
Deferred Sales Charge") in Class A shares, you
may have to pay a sales charge of up to 1% if
you sell your shares within 12 calendar months
(18 months for shares purchased prior to May
1, 1997) from the end of the calendar month
during which you purchased those shares. See
"How to Buy Shares - Buying Class A Shares",
below.
3. The first and second sentences in the sub-section captioned
"Class A Shares" in "How to Buy Shares-Classes of Shares" on page
24 are revised to read as follows:
If you buy Class A shares, you may pay an initial sales charge
on investments up to $1 million (up to $500,000 for purchases
by "Retirement Plans," as defined in "Class A Contingent
Deferred Sales Charge" on page 25). If you purchase Class A
shares as part of an investment of at least $1 million
($500,000 for Retirement Plans) in shares of one or more
Oppenheimer funds, you will not pay an initial sales charge,
but if you sell any of those shares within 12 months of buying
them (18 months if the shares were purchased prior to May 1,
1997), you may pay a contingent deferred sales charge.
4. The following sentence is added to the end of "Which Class of
Shares Should You Choose? - How Does It Affect Payments To My
Broker?" on page 26:
The Distributor may pay additional periodic compensation from
its own resources to securities dealers or financial
institutions based upon the value of shares of the Fund owned
by the dealer or financial institution for its own account or
for its customers.
5. The first and second paragraphs in the section captioned "Class A
Contingent Deferred Sales Charge" on page 28 are revised to read as
follows:
There is no initial sales charge on purchases of Class A shares of
any one or more of the Oppenheimer funds in the following cases:
Purchases aggregating $1 million or more;
Purchases by a retirement plan qualified under sections 401(a)
or 401(k) of the Internal Revenue Code, by a non-qualified
deferred compensation plan (not including Section 457 plans),
employee benefit plan, group retirement plan (see "How to Buy
Shares - Retirement Plans" in the Statement of Additional
Information for further details), an employee's 403(b)(7)
custodial plan account, SEP IRA, SARSEP, or SIMPLE plan (all of
these plans are collectively referred to as "Retirement Plans");
that: (1) buys shares costing $500,000 or more or (2) has, at the
time of purchase, 100 or more eligible participants, or (3)
certifies that it projects to have annual plan purchases of
$200,000 or more;
Purchases by an OppenheimerFunds Rollover IRA if the purchases
are made (1) through a broker, dealer, bank or registered
investment adviser that has made special arrangements with the
Distributor for these purchases, or (2) by a direct rollover of a
distribution from a qualified retirement plan if the administrator
of that plan has made special arrangements with the Distributor
for those purchases; or
Purchases by a retirement plan qualified under section
401(a) if the retirement plan has total plan assets of
$500,000 or more.
The Distributor pays dealers of record
commission on those purchases in an amount
equal to (i) 1.0% for non-Retirement Plan
accounts, and (ii) for Retirement Plan
accounts, 1.0% of the first $2.5 million, plus
0.50% of the next $2.5 million, plus 0.25% of
purchases over $5 million, calculated on a
calendar year basis. That commission will be
paid only on those purchases that were not
previously subject to a front-end sales charge
and dealer commission. No sales commission
will be paid to the dealer, broker or
financial institution on sales of Class A
shares purchased with the redemption proceeds
of shares of a mutual fund offered as an
investment option in a Retirement Plan in
which Oppenheimer funds are also offered as
investment options under a special arrangement
with the Distributor if the purchase occurs
more than 30 days after the addition of the
Oppenheimer funds as an investment option to
the Retirement Plan.
6. In the third paragraph of "Buying Class A Shares - Class A
Contingent Deferred Sales Charge" on page 29, the first sentence is
replaced by the following:
If you redeem any of those shares purchased prior to May
1, 1997, within 18 months of the end of the calendar
month of their purchase, a contingent deferred sales
charge (called the "Class A contingent deferred sales
charge") may be deducted from the redemption proceeds.
A Class A contingent deferred sales charge may be
deducted from the redemption proceeds of any of those
shares purchased on or after May 1, 1997 that are
redeemed within 12 months of the end of the calendar
month of their purchase.
7. The second sentence in the section captioned "Special
Arrangements with Dealers" on page 29 is deleted.
8. The third sentence of the second paragraph of "Reduced Sales
Charges for Class A Share Purchases - Right of Accumulation" on
page 29 is replaced by the following:
The Distributor will add the value, at current offering price,
of the shares you previously purchased and currently own to
the value of current purchases to determine the sales charge
rate that applies.
9. The seventh subparagraph under the section captioned "Waivers
of Class A Sales Charges - Waivers of Initial and Contingent
Deferred Sales Charges for Certain Purchasers" on page 30 is
deleted and replaced with the following subparagraph:
(1) investment advisors and financial planners who
charge an advisory, consulting or other fee for their
services and buy shares for their own accounts or the
accounts of their clients, (2) Retirement Plans and
deferred compensation plans and trusts used to fund those
Plans (including, for example, plans qualified or created
under sections 401(a), 403(b) or 457 of the Internal
Revenue Code), and "rabbi trusts" that buy shares for
their own accounts, in each case if those purchases are
made through a broker or agent or other financial
intermediary that has made special arrangements with the
Distributor for those purchases; and (3) clients of such
investment advisors or financial planners who buy shares
for their own accounts may also purchase shares without
sales charge but only if their accounts are linked to a
master account of their investment advisor or financial
planner on the books and records of the broker, agent or
financial intermediary with which the Distributor has
made such special arrangements (each of these investors
may be charged a fee by the broker, agent or financial
intermediary for purchasing shares);
10. The section captioned "Waivers of Class A Sales Charges -
Waivers of the Class A Contingent Deferred Sales Charge for Certain
Redemptions" on page 31 is revised to read as follows:
The Class A contingent deferred sales charge is also waived if
shares that would otherwise be subject to the contingent
deferred sales charge are redeemed in the following cases:
to make Automatic Withdrawal Plan payments that are
limited annually to no more than 12% of the original account
value;
involuntary redemptions of shares by operation of law
or involuntary redemptions of small accounts (see "Shareholder
Account Rules and Policies," below);
if, at the time of purchase of shares (prior to
May 1, 1997) the dealer agreed in writing to accept the
dealer's portion of the sales commission in installments
of 1/18th of the commission per month (and no further
commission will be payable if the shares are redeemed
within 18 months of purchase);
if, at the time of purchase of shares (on or
after May 1, 1997) the dealer agrees in writing to accept
the dealer's portion of the sales commission in
installments of 1/12th of the commission per month (and
no further commission will be payable if the shares are
redeemed within 12 months of purchase);
for distributions from a TRAC-2000 401(k) plan
sponsored by the Distributor due to the termination of the
TRAC-2000 program;
for distributions from Retirement Plans, deferred
compensation plans or other employee benefit plans for any of
the following purposes: (1) following the death or disability
(as defined in the Internal Revenue Code) of the participant
or beneficiary (the death or disability must occur after the
participant's account was established); (2) to return excess
contributions; (3) to return contributions made due to a
mistake of fact; (4) hardship withdrawals, as defined in the
plan; (5) under a Qualified Domestic Relations Order, as
defined in the Internal Revenue Code; (6) to meet the minimum
distribution requirements of the Internal Revenue Code; (7) to
establish "substantially equal periodic payments" as described
in Section 72(t) of the Internal Revenue Code; (8) for
retirement distributions or loans to participants or
beneficiaries; (9) separation from service; (10) participant-
directed redemptions to purchase shares of a mutual fund
(other than a fund managed by the Manager or its subsidiary)
offered as an investment option in a Retirement Plan in which
Oppenheimer funds are also offered as investment options under
a special arrangement with the Distributor; or (11) plan
termination or "in-service distributions", if the redemption
proceeds are rolled over directly to an OppenheimerFunds IRA;
for distributions from Retirement Plans having
500 or more eligible participants, except distributions
due to termination of all of the Oppenheimer funds as an
investment option under the Plan; and
for distributions from 401(k) plans sponsored by
broker-dealers that have entered into a special agreement
with the Distributor allowing this waiver.
11. The following sentence is added to the end of the fourth
paragraph in "Distribution and Service Plans for Class B and Class
C Shares" on page 35:
If a dealer has a special agreement with the Distributor,
the Distributor will pay the Class B service fee and the
asset-based sales charge to the dealer quarterly in lieu
of paying the sales commission and service fee advance at
the time of purchase.
12. The following is added as a new penultimate sentence to the
fifth paragraph of "Distribution and Service Plans for Class B and
Class C shares" on page 35:
If a dealer has a special agreement with the
Distributor, the Distributor shall pay the Class C
service fee and asset-based sales charge to the dealer
quarterly in lieu of paying the sales commission and
service fee advance at the time of purchase.
13. The introductory phrase in the sixth sub-paragraph of "Waivers
for Redemptions of Shares in Certain Cases" in "Waivers of Class B
and Class C Sales Charges" on page 36 is replaced with the
following and a new sub-section (6) is added as follows:
distributions from OppenheimerFunds prototype
401(k) plans and from certain Massachusetts Mutual Life
Insurance Company prototype 401(k) plans
. . . (6) for loans to participants or beneficiaries.
14. The following sub-paragraph is added at the end of "Waivers
for Redemptions of Shares in Certain Cases" in "Waivers of Class B
and Class C Sales Charges" on page 37:
Distributions from 401(k) plans sponsored by
broker-dealers that have entered into a special agreement
with the Distributor allowing this waiver.
15. The section captioned "Special Investor Services" is revised
by adding the following after the sub-section captioned "PhoneLink"
on page 37:
Shareholder Transactions by Fax. Beginning May 30, 1997,
requests for certain account transactions may be sent to
the Transfer Agent by fax (telecopier). Please call 1-
800-525-7048 for information about which transactions are
included. Transaction requests submitted by fax are
subject to the same rules and restrictions as written and
telephone requests described in this Prospectus.
May 1, 1997 PS0220.009
