OPPENHEIMER GLOBAL FUND
Prospectus dated October 1, 1995
Oppenheimer Global Fund (the "Fund") is a mutual fund with the
investment objective of capital appreciation. Current income is not an
objective. The Fund invests primarily in common stocks of U.S. and
foreign companies and normally invests a substantial portion of its
assets in foreign stocks. The Fund emphasizes investments in "growth-
type" companies, in industry sectors that the portfolio manager
believes have appreciation possibilities. The Fund also uses "hedging"
instruments to try to reduce the risks of market and currency
fluctuations that affect the value of the securities the Fund holds.
Some of the Fund's investment techniques may be considered speculative.
Foreign investing involves special risks. These techniques may
increase the risks of investing in the Fund and the Fund's operating
costs. You should carefully review the risks associated with an
investment in the Fund. Please refer to "Investment Policies and
Strategies" for more information about the types of securities the Fund
invests in and the risks of investing in the Fund.
This Prospectus explains concisely what you should know before
investing in the Fund. Please read this Prospectus carefully and keep
it for future reference. You can find more detailed information about
the Fund in the October 1, 1995 Statement of Additional Information.
For a free copy, call Oppenheimer Shareholder Services, the Fund's
Transfer Agent, at 1-800-525-7048, or write to the Transfer Agent at
the address on the back cover. The Statement of Additional Information
has been filed with the Securities and Exchange Commission and is
incorporated into this Prospectus by reference (which means that it is
legally part of this Prospectus).
(logo) OppenheimerFunds
Shares of the Fund are not deposits or obligations of any bank, are not
guaranteed by any bank, are not insured by the F.D.I.C. or any other
agency, and involve investment risks, including the possible loss of
the principal amount invested.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<PAGE>
Contents
ABOUT THE FUND
3 Expenses
5 A Brief Overview of the Fund
7 Financial Highlights
10 Investment Objective and Policies
17 How the Fund is Managed
19 Performance of the Fund
ABOUT YOUR ACCOUNT
23 How to Buy Shares
Class A Shares
Class B Shares
Class C Shares
35 Special Investor Services
AccountLink
Automatic Withdrawal and Exchange Plans
Reinvestment Privilege
Retirement Plans
37 How to Sell Shares
By Mail
By Telephone
39 How to Exchange Shares
40 Shareholder Account Rules and Policies
42 Dividends, Capital Gains and Taxes
<PAGE>
ABOUT THE FUND
Expenses
The Fund pays a variety of expenses directly for management of its
assets, administration, distribution of its shares and other services,
and those expenses are subtracted from the Fund's assets to calculate
the Fund's net asset value per share. All shareholders therefore pay
those expenses indirectly. Shareholders pay other expenses directly,
such as sales charges and account transaction charges. The following
tables are provided to help you understand your direct expenses of
investing in the Fund and your share of the Fund's business operating
expenses that you will bear indirectly. The numbers below are based on
the Fund's expenses during its last fiscal year ended September 30,
1994.
- Shareholder Transaction Expenses are charges you pay when you
buy or sell shares of the Fund. Please refer to "About Your Account,"
from pages 23 through 35, for an explanation of how and when these
charges apply.
<TABLE>
<CAPTION>
Class A Class B Class C
------- ------- -------
<S> <C> <C> <C>
Maximum Sales Charge on Purchases
(as a % of offering price) 5.75% None None
Sales Charge on Reinvested Dividends None None None
Deferred Sales Charge
(as a % of the lower of the original
purchase price or redemption proceeds) None(1) 5% in the 1st 1% if redeemed
year, declining within 12
to 1% in the 6th months of
year and eliminated purchase(2)
thereafter(2)
Exchange Fee None None None
Redemption Fee None(3) None(3) None(3)
<FN>
_________________________
(1) If you invest $1 million or more ($500,000 or more for purchases by
OppenheimerFunds prototype 401(k) plans) in Class A shares, you may
have to pay a sales charge of up to 1% if you sell your shares within
18 calendar months from the end of the calendar month during which you
purchased those shares. See "How to Buy Shares - Class A Shares,"
below.
(2) For more information on contingent deferred sales charges, see "How
to Buy Shares-Class B Shares" and "How to Buy Shares-Class C Shares"
below.
(3) There is a $10 transaction fee for redemptions paid by Federal
Funds wire, but not for redemptions paid by ACH transfer through
AccountLink.
</TABLE>
- Annual Fund Operating Expenses are paid out of the Fund's
assets and represent the Fund's expenses in operating its business.
For example, the Fund pays management fees to its investment adviser,
Oppenheimer Management Corporation (which is referred to in this
Prospectus as the "Manager"). The rates of the Manager's fees are set
forth in "How the Fund is Managed," below. The Fund has other regular
expenses for services, such as transfer agent fees, custodial fees paid
to the bank that holds its portfolio securities, audit fees and legal
expenses. Those expenses are detailed in the Fund's Financial
Statements in the Statement of Additional Information.
The numbers in the table below are projections of the Fund's
business expenses based on the Fund's expenses in its last fiscal year.
These amounts are shown as a percentage of the average net assets of
each class of the Fund's shares for that year. The Management Fees and
Total Fund Operating Expenses have been restated to reflect the
increase in management fees approved by the Fund's shareholders at a
meeting held on June 27, 1994, as if those rates had been in effect for
the entire fiscal year. If the Management Fee had not been increased
during the fiscal year, the Fund's Management Fees for Class A shares
and Class B shares would have been 0.63% and the Total Fund Operating
Expenses would have been 1.12% and 2.05% for Class A and Class B
shares, respectively. The 12b-1 Plan Fees for Class A shares are
service fees (the maximum fee is 0.25% of average net assets of that
class). For Class B and Class C shares, the 12b-1 Distribution Plan
Fees are service fees (the maximum fee is 0.25% of average net assets
of that class) and the asset-based sales charge of 0.75%. Class C
shares were not publicly offered during the Fund's fiscal year ended
September 30, 1994. Accordingly, the Annual Fund Operating Expenses
for Class C shares are estimates based upon amounts that would have
been payable if Class C shares had been outstanding during that fiscal
year. These plans are described in greater detail in "How to Buy
Shares."
The actual expenses for each class of shares in future years may
be more or less than the numbers in the table, depending on a number of
factors, including changes in the actual value of the Fund's assets
represented by each class of shares.
<TABLE>
<CAPTION>
Class A Class B Class C
-------- ------- -------
<S> <C> <C> <C>
Management Fees (restated) 0.73% 0.73% 0.73%
12b-1 Distribution Plan Fees 0.18% 1.00% 1.00%
Other Expenses 0.31% 0.42% 0.42%
Total Fund Operating Expenses 1.22% 2.15% 2.15%
(Restated)
</TABLE>
- Examples - To try to show the effect of these expenses on an
investment over time, we have created the hypothetical examples shown
below. Assume that you make a $1,000 investment in each class of
shares of the Fund, that the Fund's annual return is 5%, and that its
operating expenses for each class are the ones shown in the Annual Fund
Operating Expenses table above (as restated). If you were to redeem
your shares at the end of each period shown below, your investment
would incur the following expenses by the end of 1, 3, 5 and 10 years:
<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years*
------ ------- ------- --------
<S> <C> <C> <C> <C>
Class A Shares $ 69 $ 94 $121 $197
Class B Shares $ 72 $ 97 $135 $203
Class C Shares $ 32 $ 67 $115 $248
If you did not redeem your investment, it would incur the
following expenses:
1 year 3 years 5 years 10 years*
------ ------- ------- --------
Class A Shares $ 69 $ 94 $121 $197
Class B Shares $ 22 $ 67 $115 $203
Class C Shares $ 22 $ 67 $115 $248
<FN>
_____________________
* The Class B expenses in years 7 through 10 are based on the Class A
expenses shown above, because the Fund automatically converts your
Class B shares into Class A shares after 6 years. Because of the
effect of the asset-based sales charge and contingent deferred sales
charge imposed on Class B and Class C shares, long-term holders of
Class B and Class C shares could pay the economic equivalent of more
than the maximum front-end sales charge allowed under applicable
regulations. For Class B shareholders, the automatic conversion of
Class B shares to Class A Shares is designed to minimize the likelihood
that this will occur. Please refer to "How to Buy Shares - Buying
Class B Shares" for more information.
</TABLE>
These examples show the effect of expenses on an investment, but
are not meant to state or predict actual or expected costs or
investment returns of the Fund, all of which will vary.
A Brief Overview of the Fund
Some of the important facts about the Fund are summarized below,
with references to the section of this Prospectus where more complete
information can be found. You should carefully read the entire
Prospectus before making a decision about investing in the Fund. Keep
the Prospectus for reference after you invest, particularly for
information about your account, such as how to sell or exchange shares.
- What Is The Fund's Investment Objective? The Fund's investment
objective is to seek capital appreciation. Current income is not an
objective.
- What Does the Fund Invest In? The Fund primarily invests in
foreign and domestic common or convertible stocks of "growth type"
companies considered to have appreciation possibilities. Investments
in debt securities may be made in uncertain market conditions. The
Fund may also use hedging instruments and some derivative investments
to try to manage investment risks. These investments are more fully
explained in "Investment Objective and Policies," starting on page 10.
- Who Manages the Fund? The Fund's investment adviser (the
Manager) is Oppenheimer Management Corporation. The Manager (including
a subsidiary) manages investment company portfolios having over $35
billion in assets. The Manager is paid an advisory fee by the Fund,
based on its net assets. The Fund has a portfolio manager, William
Wilby, who is employed by the Manager. He is primarily responsible for
the selection of the Fund's securities. The Fund's Board of Trustees,
elected by shareholders, oversees the investment adviser and the
portfolio manager. Please refer to "How the Fund is Managed," starting
on page 17 for more information about the Manager and its fees.
- How Risky is the Fund? All investments carry risks to some
degree. It is important to remember that the Fund is designed for
long-term investors. The Fund's investments in stocks and bonds are
subject to changes in their value from a number of factors such as
changes in general bond and stock market movements or the change in
value of particular stocks because of an event affecting the issuer.
The Fund's investments in foreign securities are subject to additional
risks associated with investing abroad, such as the effect of currency
rate changes on stock values. These changes affect the value of the
Fund's investments and its price per share. In the OppenheimerFunds
spectrum, the Fund is generally more volatile than the other stock
funds, the income and growth funds, and the more conservative income
funds. While the Manager tries to reduce risks by diversifying
investments, by carefully researching securities before they are
purchased for the portfolio, and in some cases by using hedging
techniques, there is no guarantee of success in achieving the Fund's
objective, and your shares may be worth more or less than their
original cost when you redeem them. Please refer to "Investment
Objective and Policies" starting on page 10 for a more complete
discussion of the Fund's investment risks.
- How Can I Buy Shares? You can buy shares through your dealer
or financial institution, or you can purchase shares directly through
the Distributor by completing an Application or by using an Automatic
Investment Plan under AccountLink. Please refer to "How to Buy Shares"
on page 23 for more details.
- Will I Pay a Sales Charge to Buy Shares? The Fund has three
classes of shares. Each class has the same investment portfolio but
different expenses. Class A shares are offered with a front-end sales
charge, starting at 5.75%, and reduced for larger purchases. Class B
and Class C shares are offered without a front-end sales charge, but
may be subject to a contingent deferred sales charge if redeemed within
6 years or 12 months, respectively, of purchase. There is also an
annual asset-based sales charge on Class B and Class C shares. Please
review "How To Buy Shares" starting on page 23 for more details,
including a discussion about which class may be appropriate for you.
- How Can I Sell My Shares? Shares can be redeemed by mail or by
telephone call to the Transfer Agent on any business day, or through
your dealer. Please refer to "How to Sell Shares" on page 37. The
Fund also offers exchange privileges to other Oppenheimer funds,
described in "How To Exchange Shares" on page 39.
- How Has the Fund Performed? The Fund measures its performance
by quoting its average annual total returns and cumulative total
returns, which measure historical performance. Those returns can be
compared to the returns (over similar periods) of other funds. Of
course, other funds may have different objectives, investments, and
levels of risk. The Fund's performance can also be compared to a broad
stock market index, which we have done on page 22. Please remember
that past performance does not guarantee future results.
<PAGE>
Financial Highlights
The table on the following pages presents selected financial
information about the Fund, including per share data, expense ratios
and other data based on the Fund's average net assets. This
information has been audited by KPMG Peat Marwick LLP, the Fund's
independent auditors, whose report on the financial statements of the
Fund for the fiscal year ended September 30, 1994, is included in the
Statement of Additional Information. The information for the six
months ended March 31, 1995 is unaudited. Class C shares were not
publicly offered during the periods shown, and consequently, no
information on Class C shares is included in the table on the following
pages or in the Fund's financial statements.
<TABLE>
<CAPTION>
Class A
------- --------------------------------------------------------------------------
Six Months
Ended
March 31,
1995 Year Ended September 30,
(Unaudited) 1994 1993 1992 1991 1990 1989
-------- -------- -------- -------- -------- -------- ------
<S> <C> <C> <C> <C> <C> <C>
<C>
Per Share Operating Data:
Net asset value, beginning
of period $ 37.69 $ 35.04 $ 30.03 $ 32.05 $ 27.63 $ 30.43 $ 22.94
-------- -------- -------- -------- -------- -------- ------
Income (loss) from
investment operations:
Net investment income (loss) .08 .17 .26 .17 .05 .02 .20
Net realized and unrealized
gain (loss) on investments
and foreign currency
transactions (1.47) 6.10 4.99 (1.50) 6.14 .29 9.11
-------- -------- -------- -------- -------- -------- ------
Total income (loss) from
investment operations 1.39 6.27 5.25 (1.33) 6.19 .31 9.31
Dividends and distributions
to shareholders:
Dividends from net
investment income -- (.25) (.12) (.11) (.08) (.11) (.09)
Distributions from net
realized gain on
investments and foreign
currency transactions (3.75) (3.37) (.12) (.58) (1.69) (3.00) (1.73)
-------- -------- -------- -------- -------- -------- ------
Total dividends and
distributions to
shareholders (3.75) (3.62) (.24) (.69) (1.77) (3.11) (1.82)
Net asset value, end of
period $ 32.55 $ 37.69 $ 35.04 $ 30.03 $ 32.05 $ 27.63 $ 30.43
======== ======== ======== ========
======== ======== ======
Total Return, at Net
Asset Value(2) (3.46)% 19.19% 17.67% (4.23)% 23.71% .79% 42.87%
-------- -------- -------- -------- -------- -------- ------
Ratios/Supplemental Data:
Net assets, end of period
(in millions) $ 1,921 $ 1,921 $ 1,389 $ 1,215 $ 1,076 $ 720 $ 523
-------- -------- -------- -------- -------- -------- ------
Average net assets
(in millions) $ 1,868 $ 1,711 $ 1,213 $ 1,194 $ 899 $ 672 $ 446
-------- -------- -------- -------- -------- -------- ------
Number of shares
outstanding at end of
period(in thousands) 59,006 50,955 39,632 40,441 33,585 26,056 17,183
-------- -------- -------- -------- -------- -------- ------
Amount of debt outstanding
at end of period
(in thousands) N/A N/A $-- $ 60,000 $ 60,000 $ 60,000 $ 30,000
-------- -------- -------- -------- -------- -------- ------
Average amount of debt
outstanding throughout
each period (in thousands) N/A N/A $ 18,247 $ 60,000 $ 60,000 $ 42,877 $30,000
-------- -------- -------- -------- -------- -------- ------
Average number of shares
outstanding throughout
each period (in thousands) N/A N/A 39,853 37,435 30,607 21,982 16,968
-------- -------- -------- -------- -------- -------- ------
Average amount of debt per
share outstanding
throughout each period N/A N/A $ .46 $ 1.60 $ 1.96 $ 1.95 $ 1.77
-------- -------- -------- -------- -------- -------- ------
Ratios to average net assets:
Net investment income (loss) .53%(3) .38% .84% .55% .22% .16% .73%
Expenses 1.17%(3) 1.15% 1.18% 1.36% 1.65% 1.68% 1.90%
-------- -------- -------- -------- -------- -------- ------
Portfolio turnover rate 43.4%(5) 78.3%(4) 86.9% 18.0% 19.9% 27.2% 62.6%
(Continued) Class B
------------------------------------------------------------------------------------------
Six Months
Ended
Year Ended September 30, March 31, Year Ended
1995 Sept. 30,
1988 1987 1986 1985 (Unaudited) 1994 1993(1)
-------- -------- -------- -------- -------- -------- ------
Per Share Operating Data:
Net asset value, beginning
of period $ 38.29 $ 28.88 $ 17.36 $ 16.47 $ 37.36 $ 34.99 $ 33.33
-------- -------- -------- -------- -------- -------- ------
Income (loss) from
investment operations:
Net investment income (loss) .04 .05 .12 .14 (.02) .08 .03
Net realized and unrealized
gain (loss) on investments
and foreign currency
transactions (9.70) 13.28 11.56 1.71 (1.50) 5.83 1.63
-------- -------- -------- -------- -------- -------- ------
Total income (loss) from
investment operations (9.66) 13.33 11.68 1.85 (1.52) 5.91 1.66
Dividends and distributions
to shareholders:
Dividends from net
investment income (.07) (.11) (.10) (.04) -- (.18) --
Distributions from net
realized gain on
investments and foreign
currency transactions (5.62) (3.81) (.06) (.92) (3.75) (3.36) --
-------- -------- -------- -------- -------- -------- ------
Total dividends and
distributions to
shareholders (5.69) (3.92) (.16) (.96) (3.75) (3.54) --
Net asset value, end of
period $ 22.94 $ 38.29 $ 28.88 $ 17.36 $ 32.09 $ 37.36 $34.99
======== ======== ======== ========
======== ======== ======
Total Return, at Net
Asset Value(2) (25.17)% 52.65% 67.63% 12.00% (3.86)% 18.10% 3.64%
-------- -------- -------- -------- -------- -------- ------
Ratios/Supplemental Data:
Net assets, end of period
(in millions) $ 371 $ 601 $ 372 $ 232 $ 247 $ 187 $ 6
-------- -------- -------- -------- -------- -------- ------
Average net assets
(in millions) $ 398 $ 473 $ 331 $ 226 $ 217 $ 88 $ 3
-------- -------- -------- -------- -------- -------- ------
Number of shares
outstanding at end of
period(in thousands) 16,191 15,708 12,891 13,347 7,682 4,993 172
-------- -------- -------- -------- -------- -------- ------
Amount of debt outstanding
at end of period
(in thousands) $ 30,000 $ 35,000 $ 22,000 $ 14,000 N/A N/A N/A
-------- -------- -------- -------- -------- -------- ------
Average amount of debt
outstanding throughout
each period (in thousands) $ 31,052 $ 26,290 $ 19,058 $ 3,877 N/A N/A N/A
-------- -------- -------- -------- -------- -------- ------
Average number of shares
outstanding throughout
each period (in thousands) 17,173 15,099 13,205 14,476 N/A N/A N/A
-------- -------- -------- -------- -------- -------- ------
Average amount of debt per
share outstanding
throughout each period $ 1.81 $ 1.74 $ 1.44 $ .27 N/A N/A N/A
-------- -------- -------- -------- -------- -------- ------
Ratios to average net assets:
Net investment income (loss) .15% .16% .47% .81% (.29)%(3) (.3)% 1.52%(3)
Expenses 1.89% 1.49% 1.60% 1.21% 2.01%(3) 2.08% 2.40%(3)
-------- -------- -------- -------- -------- -------- ------
Portfolio turnover rate 25.2% 37.0% 25.2% 29.0% 43.4%(5) 78.3%(4) 86.9%
</TABLE>
1. For the period from August 17, 1993 (inception of offering) to September
30, 1993.
2. Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period, with all dividends and distributions
reinvested in additional shares on the reinvestment date, and redemption at
the net asset value calculated on the last business day of the fiscal period.
Sales charges are not reflected in the total returns. Total returns are not
annualized for periods of less than one full year.
3. Annualized.
4. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities
owned during the period. Securities with a maturity or expiration date at the
time of acquisition of one year or less are excluded from the calculation.
Purchases and sales of investment securities (excluding short-term securities)
for the year ended September 30, 1994 were $1,557,137,514 and $1,318,260,043,
respectively.
5. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities
owned during the period. Securities with a maturity or expiration date at the
time of acquisition of one year or less are excluded from the calculation.
Purchases and sales of investment securities (excluding short-term securities)
for the six months ended March 31, 1995 were $946,610,899 and $816,913,633,
respectively.
<PAGE>
Investment Objective and Policies
Objective. The Fund invests its assets with the objective of capital
appreciation.
Investment Policies and Strategies. The Fund seeks capital
appreciation by emphasizing investments in common stocks or convertible
securities of "growth-type" companies. These may include securities of
U.S. companies or foreign companies, as discussed below. The Fund may
invest in securities of smaller, less well-known companies as well as
those of large, well-known companies (not generally included in the
definition of "growth-type" companies). The Fund may hold warrants and
rights. Current income is not a consideration in the selection of
portfolio securities. A portion of the Fund's assets may be invested in
securities for liquidity purposes.
As a matter of fundamental policy, under normal market conditions
(when the Manager believes that the securities markets are not in a
volatile or unstable period), the Fund invests in securities of issuers
traded in markets in at least three different countries (which may
include the United States). The Manager expects that the Fund will
normally invest a substantial portion of its assets in foreign
securities (discussed in "Foreign Securities," below).
The Fund's portfolio manager currently employs an investment
strategy in selecting foreign and domestic securities that considers
the effects of worldwide trends on the growth of various business
sectors. These trends or "global themes" currently include
telecommunications expansion, emerging consumer markets, infrastructure
development, natural resource use and development, corporate
restructuring, capital market development in foreign countries, health
care expansion, and global integration. These trends, which may affect
the growth of companies having businesses in these sectors or affected
by their development, may suggest opportunities for investing the
Fund's assets. The Manager does not invest a fixed or specific amount
of the Fund's assets in any one sector, and these themes or this
approach may change over time.
The Fund may also seek to take advantage of changes in the
business cycle by investing in companies that are sensitive to those
changes as well as in "special situations" the Manager believes present
opportunities for capital growth. For example, when a country's
economy is expanding, companies in the financial services and consumer
products industries may be in a position to benefit from changes in the
business cycle and may present long-term growth opportunities.
When investing the Fund's assets, the Manager considers many
factors, including the global themes discussed above, general economic
conditions abroad relative to the U.S. and the trends in foreign and
domestic stock markets. The Fund may try to hedge against losses in
the value of its portfolio of securities by using hedging strategies
and derivative investments described below.
When market conditions are unstable, the Fund may invest in debt
securities, such as rated or unrated bonds and debentures, cash
equivalents and preferred stocks. It is expected that short-term debt
securities (which are securities maturing in one year or less from date
of purchase) will be emphasized for defensive or liquidity purposes,
since those securities usually may be disposed of quickly and their
prices tend not to be as volatile as the prices of longer term debt
securities. When circumstances warrant, securities may be sold without
regard to the length of time held, although short-term trading may
increase brokerage costs borne by the Fund.
- What are "Growth-Type" Companies? These tend to be newer
companies that may be developing new products or services, or expanding
into new markets for their products. While they may have what the
Manager believes to be favorable prospects for the long-term, growth-
type companies normally retain a large part of their earnings for
research, development and investment in capital assets. Therefore,
they tend not to emphasize the payment of dividends.
- Can the Fund's Investment Objective and Policies Change? The
Fund has an investment objective, which is described above, as well as
investment policies it follows to try to achieve its objective.
Additionally, the Fund uses certain investment techniques and
strategies in carrying out those investment policies. The Fund's
investment policies and techniques are not "fundamental" unless this
Prospectus or the Statement of Additional Information says that a
particular policy is "fundamental." The Fund's investment objective is
a fundamental policy.
Fundamental policies are those that cannot be changed without the
approval of a "majority" of the Fund's outstanding voting shares. The
term "majority" is defined in the Investment Company Act to be a
particular percentage of outstanding voting shares (and this term is
explained in the Statement of Additional Information). The Fund's
Board of Trustees may change non-fundamental policies without
shareholder approval, although significant changes will be described in
amendments to this Prospectus.
- Stock Investment Risks. Because the Fund normally invests
most, or a substantial portion, of its assets in stocks, the value of
the Fund's portfolio will be affected by changes in the stock markets.
At times, the stock markets can be volatile, and stock prices can
change substantially. This market risk will affect the Fund's net
asset values per share, which will fluctuate as the values of the
Fund's portfolio securities change. Not all stock prices change
uniformly or at the same time, not all stock markets move in the same
direction at the same time, and other factors can affect a particular
stock's prices (for example, poor earnings reports by an issuer, loss
of major customers, major litigation against an issuer, or changes in
government regulations affecting an industry). Not all of these
factors can be predicted.
As discussed below, the Fund attempts to limit market risks by
diversifying its investments, that is, by not holding a substantial
amount of stock of any one company and by not investing too great a
percentage of the Fund's assets in any one company.
Because of the types of securities the Fund invests in and the
investment techniques the Fund uses, some of which may be speculative,
the Fund is designed for investors who are investing for the long-term
and who are willing to accept greater risks of loss of their investment
in the hope of achieving capital appreciation. It is not intended for
investors seeking assured income and preservation of capital.
Investing for capital appreciation entails the risk of loss of all or
part of your investment. Because changes in securities market prices
can occur at any time, there is no assurance that the Fund will achieve
its investment objective, and when you redeem your shares, they may be
worth more or less than what you paid for them.
- Foreign Securities. Under normal circumstances, as a matter of
fundamental policy, the Fund will invest in the United States and at
least three foreign countries. Otherwise, the Fund may invest its
assets without limit in equity (and debt) securities issued or
guaranteed by foreign companies or foreign governments or their
agencies in any country, developed or underdeveloped. Foreign
securities are those that are traded primarily on a foreign securities
exchange or in the foreign over-the-counter markets. As of September
30, 1994, approximately 71.2% of the Fund's net assets were invested in
foreign securities.
The Fund will hold foreign currency only in connection with the
purchase or sale of foreign securities. If the Fund's securities are
held abroad, the countries in which they are held and the sub-
custodians holding them must be approved by the Fund's Board of
Trustees.
- Foreign securities have special risks. There are special risks
in investing in foreign securities. Because the Fund may purchase
securities denominated in foreign currencies or traded primarily in
foreign markets, a change in the value of a foreign currency against
the U.S. dollar will result in a change in the U.S. dollar value of
those foreign securities. Foreign issuers are not required to use
generally-accepted accounting principals that apply to U.S. issuers.
If foreign securities are not registered for sale in the U.S. under
U.S. securities laws, the issuer does not have to comply with
disclosure requirements that U.S. companies are subject to. The value
of foreign investments may be affected by other factors, including
exchange control regulations, expropriation or nationalization of a
company's assets, foreign taxes, delays in settlement of transactions,
changes in governmental, economic or monetary policy in the U.S. or
abroad, or other political and economic factors.
In addition, it is generally more difficult to obtain court
judgements outside the U.S. if the Fund were to sue a foreign issuer or
broker. Additional costs may be incurred because foreign brokerage
commissions are generally higher than U.S. rates, and there are
additional custodial costs associated with holding securities abroad.
More information about the risks and potential rewards of investing in
foreign securities is contained in the Statement of Additional
Information.
- Portfolio Turnover. A change in the securities held by the
Fund is known as "portfolio turnover." The Fund ordinarily does not
engage in short-term trading to try to achieve its objective. As a
result, the Fund's portfolio turnover is not expected to be more than
100% each year. The "Financial Highlights," above, show the Fund's
portfolio turnover rate during past fiscal years.
Portfolio turnover affects brokerage costs, dealer markups and
other transaction costs, and results in the Fund's realization of
capital gains or losses for tax purposes. It may also affect the
Fund's ability to qualify as a "regulated investment company" under the
Internal Revenue Code for tax deductions for dividends and capital
gains distributions the Fund pays to shareholders. The Fund qualified
in its last fiscal year and intends to do so in the coming year,
although it reserves the right not to qualify.
- Derivative Investments. In general, a "derivative investment"
is a specially designed investment. Its performance is linked to the
performance of another investment or security, such as an option,
future, index, currency or commodity. The Fund can invest in a number
of different kinds of "derivative investments." They are used in some
cases for hedging purposes and in other cases to enhance total return.
In the broadest sense, exchange-traded options and futures contracts
(discussed in "Hedging," below) may be considered "derivative
investments."
There are special risks in investing in derivative investments.
The company issuing the instrument may fail to pay the amount due on
the maturity of the instrument. Also, the underlying investment or
security on which the derivative is based might not perform the way the
Manager expected it to perform. The performance of derivative
investments may also be influenced by interest rate and stock market
changes in the U.S. and abroad. All of this can mean that the Fund may
realize less principal or income from the investment than expected.
Certain derivative investments held by the Fund may trade in the over-
the-counter market and may be illiquid. Please refer to "Illiquid and
Restricted Securities" for an explanation.
- Repurchase Agreements. The Fund may enter into repurchase
agreements. In a repurchase transaction, the Fund buys a security and
simultaneously sells it to the vendor for delivery at a future date.
They are used primarily for cash liquidity purposes.
Repurchase agreements must be fully collateralized. However, if
the vendor fails to pay the resale price on the delivery date, the Fund
may incur costs in disposing of the collateral and may experience
losses if there is any delay in its ability to do so. The Fund will
not enter into a repurchase agreement that causes more than 10% of its
net assets to be subject to repurchase agreements having a maturity
beyond seven days. There is no limit on the amount of the Fund's net
assets that may be subject to repurchase agreements of seven days or
less.
Other Investment Techniques and Strategies
The Fund may also use the investment techniques and strategies
described below. These techniques involve certain risks. The
Statement of Additional Information contains more information about
these practices, including limitations on their use that may help to
reduce some of the risks.
- Loans of Portfolio Securities. The Fund has entered into a
Securities Lending Agreement and Guaranty with The Bank of New York.
Under that agreement portfolio securities of the Fund may be loaned to
brokers, dealers and other financial institutions. The Securities
Lending Agreement provides that loans must be adequately collateralized
and may be made only in conformity with the Fund's Securities Lending
Guidelines, adopted by the Fund's Board of Trustees. The value of the
securities loaned may not exceed 25% of the value of the Fund's total
assets. The Fund presently does not intend that the value of the
securities loaned in the current fiscal year will exceed 5% of the
value of the Fund's total assets.
In lending its securities, the Fund has certain risks, such as a
delay in receiving additional collateral, a delay in the return of the
loaned securities or loss of rights in the collateral if the borrower
fails financially. To try to reduce some of those risks, the Fund is
the beneficiary of a guaranty provided by The Bank of New York. See
"Loans of Portfolio Securities" in the Statement of Additional
Information for further information.
- Special Risks - Borrowing for Leverage. The Fund may borrow up
to 10% of the value of its net assets from banks on an unsecured basis
to buy securities. That percentage limit is a fundamental policy.
This is a speculative investment method known as "leverage." This
investing technique may subject the Fund to greater risks and costs
than funds that do not borrow. These risks may include the possibility
that the Fund's net asset value per share will fluctuate more than
funds that don't borrow, since the Fund pays interest on borrowings and
interest expense affects the Fund's share price. Borrowing for
leverage is subject to limits under the Investment Company Act,
described in more detail in "Borrowing for Leverage" in the Statement
of Additional Information.
- Warrants and Rights. Warrants basically are options to
purchase stock at set prices that are valid for a limited period of
time. Rights are similar to warrants but normally have a short
duration and are distributed directly by the issuer to its
shareholders. The Fund may invest up to 5% of its total assets in
warrants or rights. That 5% limitation does not apply to warrants the
Fund has acquired as part of units with other securities or that are
attached to other securities. No more than 2% of the Fund's total
assets may be invested in warrants that are not listed on either The
New York Stock Exchange or The American Stock Exchange. These
percentage limitations are fundamental policies. For further details,
see "Warrants and Rights" in the Statement of Additional Information.
- Special Situations. The Fund may invest in securities of
companies that are in "special situations" that the Manager believes
may present opportunities for capital growth. A "special situation"
may be an event such as a proposed merger, reorganization, or other
unusual development that is expected to occur and which may result in
an increase in the value of a company's securities, regardless of
general business conditions or the movement of prices in the securities
market as a whole. There is a risk that the price of the security may
decline if the anticipated development fails to occur.
- Investing In Small, Unseasoned Companies. The Fund may invest
in securities of small, unseasoned companies. These are companies that
have been in operation less than three years, including the operations
of any predecessors. Securities of these companies may have limited
liquidity (which means that the Fund may have difficulty selling them
at an acceptable price when it wants to) and the price of these
securities may be volatile. See "Investing in Small, Unseasoned
Companies" in the Statement of Additional Information for a further
discussion of the risks involved in such investments.
- Illiquid and Restricted Securities. Under the policies and
procedures established by the Fund's Board of Trustees, the Manager
determines the liquidity of certain of the Fund's investments.
Investments may be illiquid because of the absence of an active trading
market, making it difficult to value them or dispose of them promptly
at an acceptable price. A restricted security is one that has a
contractual restriction on its resale or which cannot be sold publicly
until it is registered under the Securities Act of 1933. The Fund will
not invest more than 10% of its net assets in illiquid or restricted
securities (that limit may increase to 15% if certain state laws are
changed or the Fund's shares are no longer sold in those states). The
Fund's percentage limitation on these investments does not apply to
certain restricted securities that are eligible for resale to qualified
institutional purchasers. See "Restricted and Illiquid Securities" in
the Statement of Additional Information for further details.
- Hedging. As described below, the Fund may purchase and sell
certain kinds of futures contracts, put and call options, forward
contracts, and options on futures and broadly-based stock indices.
These are all referred to as "hedging instruments." The Fund does not
use hedging instruments for speculative purposes, and has limits on the
use of them, described below. The hedging instruments the Fund may use
are described below and in greater detail in "Other Investment
Techniques and Strategies" in the Statement of Additional Information.
The Fund may buy and sell options, futures and forward contracts
for a number of purposes. It may do so to try to manage its exposure
to the possibility that the prices of its portfolio securities may
decline, or to establish a position in the securities market as a
temporary substitute for purchasing individual securities. Some of
these strategies, such as selling futures, buying puts and writing
covered calls, hedge the Fund's portfolio against price fluctuations.
Other hedging strategies, such as buying futures and call options,
tend to increase the Fund's exposure to the securities market. Forward
contracts are used to try to manage foreign currency risks on the
Fund's foreign investments. Foreign currency options are used to try
to protect against declines in the dollar value of foreign securities
the Fund owns, or to protect against an increase in the dollar cost of
buying foreign securities. Writing covered call options may also
provide income to the Fund for liquidity purposes.
- Futures. The Fund may buy and sell futures contracts that
relate to (1) broadly-based stock indices (these are referred to as
Stock Index Futures) or (2) foreign currencies (these are called
Forward Contracts and are discussed below).
- Put and Call Options. The Fund may buy and sell certain kinds
of put options (puts) and call options (calls). A call or put option
may not be purchased if the value of all of the Fund's put and call
options would exceed 5% of the Fund's total assets. Calls the Fund
buys or sells must be listed on a domestic securities or commodities
exchange, or quoted on the Automated Quotation System of the National
Association of Securities Dealers, Inc. In the case of puts and calls
on foreign currency, they must be traded on a securities or commodities
exchange, or be quoted by recognized dealers in those options.
The Fund may buy calls only on securities, broadly-based stock
indices, foreign currencies or Stock Index Futures, or to terminate its
obligation on a call the Fund previously wrote.
The Fund may write (that is, sell) call options. Each call the
Fund writes must be "covered" while it is outstanding. That means the
Fund must own the investment on which the call was written or it must
own other securities that are acceptable for the escrow arrangements
required for calls. The Fund may write calls on futures contracts it
owns, but these calls must be covered by securities or other liquid
assets the Fund owns and segregates to enable it to satisfy its
obligations if the call is exercised. When the Fund writes a call, it
receives cash (called a premium). The call gives the buyer the ability
to buy the investment on which the call was written from the Fund at
the call price during the period in which the call may be exercised.
If the value of the investment does not rise above the call price, it
is likely that the call will lapse without being exercised, while the
Fund keeps the cash premium (and the investment). After the Fund
writes a call, not more than 25% of the Fund's total assets may be
subject to calls.
The Fund may purchase put options. Buying a put on an investment
gives the Fund the right to sell the investment at a set price to a
seller of a put on that investment. The Fund can buy only those puts
that relate to securities that the Fund owns, broadly-based stock
indices, foreign currencies or Stock Index Futures. The Fund can buy a
put on a Stock Index Future whether or not the Fund owns the particular
Stock Index Future in its portfolio.
The Fund may write puts on securities, broadly-based stock
indices, foreign currencies or Stock Index Futures in an amount up to
50% of its total assets but only if those puts are covered by
segregated liquid assets. In writing puts, there is a risk that the
Fund may be required to buy the underlying security at a
disadvantageous price.
- Forward Contracts. Forward contracts are foreign currency
exchange contracts. They are used to buy or sell foreign currency for
future delivery at a fixed price. The Fund uses them to try to "lock
in" the U.S. dollar price of a security denominated in a foreign
currency that the Fund has bought or sold, or to protect against
possible losses from changes in the relative values of the U.S. dollar
and foreign currency. The Fund limits its net exposure under forward
contracts in a particular foreign currency to the amount of its assets
denominated in that currency or denominated in a closely-correlated
currency.
- Hedging Instruments can be volatile investments and may involve
special risks. The use of hedging instruments requires special skills
and knowledge of investment techniques that are different from what is
required for normal portfolio management. If the Manager uses a
hedging instrument at the wrong time or judges market conditions
incorrectly, hedging strategies may reduce the Fund's return. The Fund
could also experience losses if the prices of its futures and options
positions were not correlated with its other investments or if it could
not close out a position because of an illiquid market for the future
or option.
Options trading involves the payment of premiums and has special
tax effects on the Fund. There are also special risks in particular
hedging strategies. If a covered call written by the Fund is exercised
on a security that has increased in value, the Fund will be required to
sell the security at the call price and will not be able to realize any
profit if the security has increased in value above the call price.
The use of forward contracts may reduce the gain that would otherwise
result from a change in the relationship between the U.S. dollar and a
foreign currency. These risks and the hedging strategies the Fund may
use are described in greater detail in the Statement of Additional
Information.
- Short Sales Against-the-Box. In a short sale, the seller does
not own the security that is sold, but normally borrows the security to
fulfill its delivery obligation. The seller later buys the security to
repay the loan, in the expectation that the price of the security will
be lower when the purchase is made, resulting in a gain. The Fund may
not sell securities short except in collateralized transactions
referred to as "short sales against-the-box," where the Fund owns an
equivalent amount of the securities sold short. This technique is
primarily used for tax purposes. As a fundamental policy, no more than
15% of the Fund's net assets will be held as collateral for such short
sales at any one time.
Other Investment Restrictions
The Fund has certain investment restrictions that are fundamental
policies. Under these restrictions, the Fund cannot do any of the
following:
- Buy securities issued or guaranteed by any one issuer (except
the U.S. Government or any of its agencies or instrumentalities) if,
with respect to 75% of its total assets, more than 5% of the Fund's
total assets would be invested in securities of that issuer, or the
Fund would then own more than 10% of that issuer's voting securities.
- Concentrate investments in any particular industry. Therefore
the Fund will not purchase the securities of companies in any one
industry if, thereafter, more than 25% of the value of the Fund's
assets would consist of securities of companies in that industry.
All of the percentage limitations described above and elsewhere in
this Prospectus (other than the percentage limits that apply to
borrowing), apply only at the time the Fund purchases a security, and
the Fund need not dispose of a security merely because the size of the
Fund's assets has changed or the security has increased in value
relative to the size of the Fund. There are other fundamental policies
discussed in the Statement of Additional Information.
How the Fund is Managed
Organization and History. The Fund was originally incorporated in
Maryland in 1969 but was reorganized in 1986 as a Massachusetts
business trust. The Fund is an open-end, diversified management
investment company, with an unlimited number of authorized shares of
beneficial interest.
The Fund is governed by a Board of Trustees, which is responsible
for protecting the interests of shareholders under Massachusetts law.
The Trustees periodically meet throughout the year to oversee the
Fund's activities, review its performance, and review the actions of
the Manager. "Trustees and Officers of the Fund" in the Statement of
Additional Information names the Trustees and officers of the Fund and
provides more information about them. Although the Fund is not
required by law to hold annual meetings, it may hold shareholder
meetings from time to time on important matters, and shareholders have
the right to call a meeting to remove a Trustee or to take other action
described in the Fund's Declaration of Trust.
The Board of Trustees has the power, without shareholder approval,
to divide unissued shares of the Fund into two or more classes. The
Board has done so, and the Fund currently has three classes of shares,
Class A, Class B and Class C. Each class invests in the same
investment portfolio. Each class has its own dividends and
distributions and pays certain expenses, which may be different for the
different classes. Each class may have a different net asset value.
Each share has one vote at shareholder meetings, with fractional shares
voting proportionally. Only shares of a particular class vote as a
class on matters that affect that class alone. Shares are freely
transferrable.
The Manager and Its Affiliates. The Fund is managed by the Manager,
Oppenheimer Management Corporation, which is responsible for selecting
the Fund's investments and handles its day-to-day business. The
Manager carries out its duties, subject to the policies established by
the Board of Trustees, under an Investment Advisory Agreement which
states the Manager's responsibilities. The Agreement sets forth the
fees paid by the Fund to the Manager and describes the expenses that
the Fund is responsible to pay to conduct its business.
The Manager has operated as an investment adviser since 1959. The
Manager (including a subsidiary) currently manages investment
companies, including other OppenheimerFunds, with assets of more than
$35 billion as of June 30, 1995, and with more than 2.6 million
shareholder accounts. The Manager is owned by Oppenheimer Acquisition
Corp., a holding company that is owned in part by senior officers of
the Manager and controlled by Massachusetts Mutual Life Insurance
Company.
- Portfolio Manager. The Portfolio Manager of the Fund is
William L. Wilby. He is a Senior Vice President of the Manager. He
has been the person principally responsible for the day-to-day
management of the Fund's portfolio since December, 1992. During the
past five years, Mr. Wilby has also served as an officer and portfolio
manager for other OppenheimerFunds, prior to which he was an
international investment strategist at Brown Brothers, Harriman & Co.
and a Managing Director and Portfolio Manager at AIG Global Investors.
- Fees and Expenses. Under the Investment Advisory Agreement
that became effective June 27, 1994 the Fund pays the Manager the
following annual fees, which decline on additional assets as the Fund
grows: 0.80% of the first $250 million of aggregate net assets, 0.77%
of the next $250 million, 0.75% of the next $500 million, 0.69% of the
next $1 billion, and 0.67% of aggregate net assets in excess of $2
billion. The Manager has voluntarily agreed to reduce the management
fee to which it is entitled under the Agreement to 0.65% on assets in
excess of $3.5 billion. The management fee rates that were in effect
prior to June 27, 1994 were: 0.75% of the first $200 million of
aggregate net assets, 0.72% of the next $200 million, 0.69% of the next
$200 million, 0.66% of the next $200 million, 0.60% of the next $200
million and 0.57% of net assets over $1 billion. The Fund's management
fee for its last fiscal year ended September 30, 1994, was 0.73% of
average annual net assets for both its Class A and Class B shares.
These rates have been restated in the "Annual Fund Operating Expenses"
table on page 4 to reflect the fact that the fee rates were reduced
effective June 27, 1994.
The Fund pays expenses related to its daily operations, such as
custodian fees, Trustees' fees, transfer agency fees, legal fees and
auditing costs. Those expenses are paid out of the Fund's assets and
are not paid directly by shareholders. However, those expenses reduce
the net asset value of shares, and therefore are indirectly borne by
shareholders through their investment. More information about the
Investment Advisory Agreement and the other expenses paid by the Fund
is contained in the Statement of Additional Information.
There is also information about the Fund's brokerage policies and
practices in "Brokerage Policies of the Fund" in the Statement of
Additional Information. That section discusses how brokers and dealers
are selected for the Fund's portfolio transactions. When deciding
which brokers to use, the Manager is permitted by the Investment
Advisory Agreement to consider whether brokers have sold shares of the
Fund or any other funds for which the Manager serves as investment
adviser.
- The Distributor. The Fund's shares are sold through dealers
and brokers that have a sales agreement with Oppenheimer Funds
Distributor, Inc., a subsidiary of the Manager that acts as the Fund's
Distributor. The Distributor also distributes the shares of other
mutual funds managed by the Manager (the "OppenheimerFunds") and is
sub-distributor for funds managed by a subsidiary of the Manager.
- The Transfer Agent. The Fund's transfer agent is Oppenheimer
Shareholder Services, a division of the Manager, which acts as the
shareholder servicing agent for the Fund and the other OppenheimerFunds
on an "at-cost" basis. Shareholders should direct inquiries about their
accounts to the Transfer Agent at the address and toll-free number
shown below in this Prospectus and on the back cover.
Performance of the Fund
Explanation of Performance Terminology. The Fund uses the terms "total
return" and "average annual total return" to illustrate its
performance. The performance of each class of shares is shown
separately, because the performance of each class will usually be
different as a result of the different kinds of expenses each class
bears. These returns measure the performance of a hypothetical account
in the Fund over various periods, and do not show the performance of
each shareholder's account (which will vary if dividends are received
in cash, or shares are sold or purchased). The Fund's performance
information may help you see how well your Fund has done over time and
to compare it to other funds or market indices.
It is important to understand that the Fund's total returns
represent past performance and should not be considered to be
predictions of future returns or performance. This performance data is
described below, but more detailed information about how total returns
are calculated is contained in the Statement of Additional Information,
which also contains information about other ways to measure and compare
the Fund's performance. The Fund's investment performance will vary
over time, depending on market conditions, the composition of the
portfolio, expenses and which class of shares you purchase.
- Total Returns. There are different types of total returns used
to measure the Fund's performance. Total return is the change in value
of a hypothetical investment in the Fund over a given period, assuming
that all dividends and capital gains distributions are reinvested in
additional shares. The cumulative total return measures the change in
value over the entire period (for example, ten years). An average
annual total return shows the average rate of return for each year in a
period that would produce the cumulative total return over the entire
period. However, average annual total returns do not show the Fund's
actual year-by-year performance.
When total returns are quoted for Class A shares, they reflect the
payment of the current maximum initial sales charge. When total
returns are shown for Class B shares, they reflect the effect of the
contingent deferred sales charge that applies to the period for which
total return is shown. When total returns are shown for a one-year
period for Class C shares, they reflect the effect of the contingent
defined sales charge. Total returns may also be quoted "at net asset
value," without considering the effect of the sales charge, and those
returns would be reduced if sales charges were deducted.
How Has the Fund Performed? Below is a discussion by the Manager of the
Fund's performance during its last fiscal year ended September 30,
1994, followed by a graphical comparison of the Fund's performance to
an appropriate broad-based market index.
- Management's Discussion of Performance. During the last fiscal
year ended September 30, 1994, global stock markets were volatile. The
Fund's performance benefited from the Manager's emphasis in securities
of companies located in Asia, Australia and in Latin America during the
fourth quarter of 1993. However, the Manager reduced the Fund's
investments in Asia and Australia in early 1994 and invested a larger
portion of the Fund's assets defensively, in short-term debt
securities, because of concern that some global stocks were over-
priced. That strategy allowed the Fund to diminish the impact of the
market decline which occurred in Asia and Australia in the first
quarter of 1994. In the third quarter of 1994, the Manager increased
the Fund's investments in Asia and Australia and the Fund again
benefited from a rally in those markets. The Fund also emphasized
investments in companies with strong earnings potential driven by
strategic reorganizations, acquisitions, divestitures, and the
privatization of state-owned industries. The Manager also emphasized
investments in securities of U.S. companies in the technology sector.
The Fund's large investment in telecommunications and bank securities
of Mexican and Argentine companies during 1994 had a negative effect on
the Fund's performance because of downturns in those markets.
- Comparing the Fund's Performance to the Market. The graphs
below show the performance of a hypothetical $10,000 investment in
Class A and Class B shares of the Fund held until September 30, 1994.
In the case of Class A shares, performance is measured over a ten-year
period, and in the case of Class B shares, performance is measured from
the inception of the Class on August 17, 1993. Class C shares were not
publicly offered during the fiscal year ended September 30, 1994, and
consequently, no information on Class C shares is included.
The Fund's performance is compared to the performance of the
Morgan Stanley World Index, an unmanaged index of issuers listed on the
stock exchanges of 20 foreign countries and the United States. It is
widely recognized as a measure of global stock market performance.
Index performance reflects the reinvestment of dividends but does not
consider the effect of capital gains or transaction costs, and none of
the data below shows the effect of taxes. Also, the Fund's performance
reflects the deduction of the current maximum sales charge of 5.75% for
Class A shares, the maximum contingent deferred sales charge of 5% on
Class B shares, and reinvestment of all dividends and capital gains
distributions, and the effect of Fund business and operating expenses.
While index comparisons may be useful to provide a benchmark for the
Fund's performance, it must be noted that the Fund's investments are
not limited to the securities in the Morgan Stanley World Index.
Moreover, the index performance data does not reflect any assessment of
the risk of the investments included in the index.
Comparison of Change in Value
of $10,000 Hypothetical Investments in: Class A and Class B Shares of
Oppenheimer Global Fund And
Morgan Stanley World Index
(Graph)
Oppenheimer Global Fund
<TABLE>
<CAPTION>
Avg. Annual Total Returns Avg. Annual Total Returns
of Class A Shares of the Fund of Class B Shares of the
Fund at 9/30/94(1) at 9/30/94(2)
- ---------------------------- --------------------------
A Shares 1 Year 5 Year 10 Year B Shares 1 Year Life:
- -------- ------ ------ ------- -------- ------ -----
<S> <C> <C> <C> <C> <C> <C>
12.34% 9.55% 17.07% 13.10% 16.29%
<FN>
_____________________
(1) The inception date of the Fund (Class A shares) was 12/22/69. The
average annual total returns and the ending account value in the graph
reflect reinvestment of all dividends and capital gains distributions
and are shown net of the applicable 5.75% maximum initial sales charge.
(2) Class B shares of the Fund were first publicly offered on 8/17/93.
The average annual total returns reflect reinvestment of all dividends
and capital gains distributions and are shown net of the applicable 5%
and 4% contingent deferred sales charges, respectively, for the 1-year
period and the life-of-the-class. The ending account value in the
graph is net of the applicable 4% contingent deferred sales charge.
Past performance is not predictive of future performance.
Graphs are not drawn to same scale.
</TABLE>
ABOUT YOUR ACCOUNT
How to Buy Shares
Classes of Shares. The Fund offers investors three different classes
of shares. The different classes of shares represent investments in
the same portfolio of securities but are subject to different expenses
and will likely have different share prices.
- Class A Shares. If you buy Class A shares, you may pay an
initial sales charge on investments up to $1 million (up to $500,000
for purchases by OppenheimerFunds prototype 401(k) plans). If you
purchase Class A shares as part of an investment of at least $1 million
($500,000 for OppenheimerFunds prototype 401(k) plans) in shares of one
or more OppenheimerFunds, you will not pay an initial sales charge, but
if you sell any of those shares within 18 months of buying them, you
may pay a contingent deferred sales charge. The amount of that sales
charge will vary depending on the amount you invested. Sales charges
are described in "Buying Class A Shares" below.
- Class B Shares. If you buy Class B shares, you pay no sales
charge at the time of purchase, but if you sell your shares within six
years of buying them, you will normally pay a contingent deferred sales
charge. That sales charge varies depending on how long you own your
shares. It is described in "Buying Class B Shares" below.
- Class C Shares. If you buy Class C shares, you pay no sales
charge at the time of purchase, but if you sell your shares within 12
months of buying them, you will normally pay a contingent deferred
sales charge of 1%. It is described in "Buying Class C Shares" below.
Which Class of Shares Should You Choose? Once you decide that the
Fund is an appropriate investment for you, the decision as to which
class of shares is better suited to your needs depends on a number of
factors which you should discuss with your financial advisor. The
Fund's operating costs that apply to a class of shares and the effect
of the different types of sales charges on your investment will vary
your investment results over time. The most important factors are how
much you plan to invest, how long you plan to hold your investment, and
whether you anticipate exchanging your shares for shares of other
OppenheimerFunds (not all of which currently offer Class B and/or Class
C shares). If your goals and objectives change over time and you plan
to purchase additional shares, you should re-evaluate those factors to
see if you should consider another class of shares.
In the following discussion, to help provide you and your
financial advisor with a framework in which to choose a class, we have
made some assumptions using a hypothetical investment in the Fund. We
used the sales charge rates that apply to each class, considering the
effect of the annual asset-based sales charge on Class B and Class C
expenses (which, like all expenses, will affect your investment
return). For the sake of comparison, we have assumed that there is a
10% rate of appreciation in the investment each year. Of course, the
actual performance of your investment cannot be predicted and will
vary, based on the Fund's actual investment returns and the operating
expenses borne by each class of shares, and which class you invest in.
The factors discussed below are not intended to be investment advice or
recommendations, because each investor's financial considerations are
different. The discussion below of the factors to consider in
purchasing a particular class of shares assumes that you will purchase
only one class of shares and not a combination of shares of different
classes.
- How Long Do You Expect to Hold Your Investment? While future
financial needs cannot be predicted with certainty, knowing how long
you expect to hold your investment will assist you in selecting the
appropriate class of shares. Because of the effect of class-based
expenses, your choice will also depend on how much you plan to invest.
For example, the reduced sales charges available for larger purchases
of Class A shares may, over time, offset the effect of paying an
initial sales charge on your investment (which reduces the amount of
your investment dollars used to buy shares for your account), compared
to the effect over time of higher class-based expenses on Class B or
Class C shares for which no initial sales charge is paid.
- Investing for the Short Term. If you have a short-term
investment horizon (that is, you plan to hold your shares for not more
than six years), you should probably consider purchasing Class A or
Class C shares rather than Class B shares, because of the effect of the
Class B contingent deferred sales charge if you redeem in less than 7
years, as well as the effect of the Class B asset-based sales charge on
the investment return for that class in the short-term. Class C shares
might be the appropriate choice (especially for investments of less
than $100,000), because there is no initial sales charge on Class C
shares, and the contingent deferred sales charge does not apply to
amounts you sell after holding them one year.
However, if you plan to invest more than $100,000 for the shorter
term, then the more you invest and the more your investment horizon
increases toward six years, Class C shares might not be as advantageous
as Class A shares. That is because the annual asset-based sales charge
on Class C shares will have a greater impact on your account over the
longer term than the reduced front-end sales charge available for
larger purchases of Class A shares. For example, Class A might be more
advantageous than Class C (as well as Class B) for investments of more
than $100,000 expected to be held for 5 or 6 years (or more). For
investments over $250,000 expected to be held 4 to 6 years (or more),
Class A shares may become more advantageous than Class C (and B). If
investing $500,000 or more, Class A may be more advantageous as your
investment horizon approaches 3 years or more.
And for most investors who invest $1 million or more, in most
cases Class A shares will be the most advantageous choice, no matter
how long you intend to hold your shares. For that reason, the
Distributor normally will not accept purchase orders of $500,000 or $1
million or more of Class B or C shares, respectively, from a single
investor. Of course, these examples are based on approximations of the
effect of current sales charges and expenses on a hypothetical
investment over time, using the assumed annual performance return
stated above, and therefore should not be relied on as rigid
guidelines.
- Investing for the Longer Term. If you are investing for the
longer term, for example, for retirement, and do not expect to need
access to your money for seven years or more, Class B shares may be an
appropriate consideration, if you plan to invest less than $100,000. If
you plan to invest more than $100,000 over the long term, Class A
shares will likely be more advantageous than Class B shares or C
shares, as discussed above, because of the effect of the expected lower
expenses for Class A shares and the reduced initial sales charges
available for larger investments in Class A shares under the Fund's
Right of Accumulation.
Of course, these examples are based on approximations of the
effect of current sales charges and expenses on a hypothetical
investment over time, using the assumptions stated above. Therefore,
these examples should not be relied on as rigid guidelines.
- Are There Differences in Account Features That Matter to You?
Because some account features may not be available to Class B or Class
C shareholders, or other features (such as Automatic Withdrawal Plans)
might not be advisable (because of the effect of the contingent
deferred sales charge) for Class B or Class C shareholders, you should
carefully review how you plan to use your investment account before
deciding which class of shares to buy. Also, not all OppenheimerFunds
currently offer Class B or Class C shares, limiting exchange ability
from the Fund. Share certificates are not available for Class B or
Class C shares, and if you are considering using your shares as
collateral for a loan, that may be a factor to consider.
- How Does It Affect Payments to My Broker? A salesperson, such
as a broker, or any other person who is entitled to receive
compensation for selling Fund shares may receive different compensation
for selling one class than for selling another class. It is important
that investors understand that the purposes of the Class B and Class C
contingent deferred sales charges and asset-based sales charges are the
same as the purpose of the front-end sales charge on sales of Class A
shares: that is, to compensate the Distributor for commissions it pays
to dealers and financial institutions for selling shares.
How Much Must You Invest? You can open a Fund account with a minimum
initial investment of $1,000 and make additional investments at any
time with as little as $25. There are reduced minimum investments under
special investment plans.
With Asset Builder Plans, Automatic Exchange Plans, 403(b)(7)
custodial plans and military allotment plans, you can make initial and
subsequent investments of as little as $25; and subsequent purchases of
at least $25 can be made by telephone through AccountLink.
Under pension and profit-sharing plans and Individual Retirement
Accounts (IRAs), you can make an initial investment of as little as
$250 (if your IRA is established under an Asset Builder Plan, the $25
minimum applies), and subsequent investments may be as little as $25.
There is no minimum investment requirement if you are buying
shares by reinvesting dividends from the Fund or other OppenheimerFunds
(a list of them appears in the Statement of Additional Information, or
you can ask your dealer or call the Transfer Agent), or by reinvesting
distributions from unit investment trusts that have made arrangements
with the Distributor.
- How Are Shares Purchased? You can buy shares several ways --
through any dealer, broker or financial institution that has a sales
agreement with the Distributor, directly through the Distributor, or
automatically from your bank account through an Asset Builder Plan
under the OppenheimerFunds AccountLink service. When you buy shares,
be sure to specify Class A, Class B, or Class C shares. If you do not
choose, your investment will be made in Class A shares.
- Buying Shares Through Your Dealer. Your dealer will place your
order with the Distributor on your behalf.
- Buying Shares Through the Distributor. Complete an
OppenheimerFunds New Account Application and return it with a check
payable to "Oppenheimer Funds Distributor, Inc." Mail it to P.O.
Box 5270, Denver, Colorado 80217. If you don't list a dealer on the
application, the Distributor will act as your agent in buying the
shares. However, it is recommended that you discuss your investment
first with a financial advisor, to be sure that it is appropriate for
you.
- Buying Shares Through OppenheimerFunds AccountLink. You can
use AccountLink to link your Fund account with an account at a U.S.
bank or other financial institution that is an Automated Clearing House
(ACH) member. You can then transmit funds electronically to purchase
shares, to have the Transfer Agent send redemption proceeds, or to
transmit dividends and distributions.
Shares are purchased for your account on the regular business day
the Distributor is instructed by you to initiate the ACH transfer to
buy shares. You can provide those instructions automatically, under an
Asset Builder Plan, described below, or by telephone instructions using
OppenheimerFunds PhoneLink, also described below. You should request
AccountLink privileges on the application or dealer settlement
instructions used to establish your account. Please refer to
"AccountLink" below for more details.
- Asset Builder Plans. You may purchase shares of the Fund (and
up to four other OppenheimerFunds) automatically each month from your
account at a bank or other financial institution under an Asset Builder
Plan with AccountLink. Details are on the Application and in the
Statement of Additional Information.
- At What Price Are Shares Sold? Shares are sold at the public
offering price based on the net asset value (and any initial sales
charge that applies) that is next determined after the Distributor
receives the purchase order in Denver, Colorado. In most cases, to
enable you to receive that day's offering price, the Distributor must
receive your order by the time of day The New York Stock Exchange
closes, which is normally 4:00 P.M., New York time, but may be earlier
on some days (all references to time in this Prospectus mean "New York
time"). The net asset value of each class of shares is determined as
of that time on each day The New York Stock Exchange is open (which is
a "regular business day").
If you buy shares through a dealer, the dealer must receive your
order by the close of The New York Stock Exchange, on a regular
business day and transmit it to the Distributor so that it is received
before the Distributor's close of business that day, which is normally
5:00 P.M. The Distributor may reject any purchase order for the Fund's
shares, in its sole discretion.
Buying Class A Shares. Class A shares are sold at their offering
price, which is normally net asset value plus an initial sales charge.
However, in some cases, described below, purchases are not subject to
an initial sales charge, and the offering price will be the net asset
value. In some cases, reduced sales charges may be available, as
described below. Out of the amount you invest, the Fund receives the
net asset value to invest for your account. The sales charge varies
depending on the amount of your purchase. A portion of the sales
charge may be retained by the Distributor and allocated to your dealer.
The current sales charge rates and commissions paid to dealers and
brokers are as follows:
<TABLE>
<CAPTION>
Front-End Front-End
Sales Charge Sales Charge Commission
as Percentage as Percentage as Percentage
Amount of of Offering of Amount of Offering
Purchase Price Invested Price
- --------- ------------- ------------- -------------
<S> <C> <C> <C>
Less than $25,000 5.75% 6.10% 4.75%
$25,000 or more but
less than $50,000 5.50% 5.82% 4.75%
$50,000 or more but
less than $100,000 4.75% 4.99% 4.00%
$100,000 or more but
less than $250,000 3.75% 3.90% 3.00%
$250,000 or more but
less than $500,000 2.50% 2.56% 2.00%
$500,000 or more but
less than $1 million 2.00% 2.04% 1.60%
<FN>
- ---------------------
The Distributor reserves the right to reallow the entire commission to dealers. If that occurs, the dealer may be considered
an "underwriter" under Federal securities laws.
</TABLE>
- Class A Contingent Deferred Sales Charge. There is no initial
sales charge on purchases of Class A shares of any one or more of the
OppenheimerFunds in the following cases:
- Purchases aggregating $1 million or more; or
- Purchases by an OppenheimerFunds prototype 401(k) plan that:
(1) buys shares costing $500,000 or more, or (2) has, at the time of
purchase, 100 or more eligible participants, or (3) certifies that it
projects to have annual plan purchases of $200,000 or more.
Shares of any of the OppenheimerFunds that offers only one class
of shares that has no designation are considered "Class A" shares for
this purpose. The Distributor pays dealers of record commissions on
those purchases in an amount equal to the sum of 1.0% of the first $2.5
million, plus 0.50% of the next $2.5 million, plus 0.25% of purchases
over $5 million. That commission will be paid only on the amount of
those purchases in excess of $1 million ($500,000 for purchases by
OppenheimerFunds prototype 401(k) plans) that were not previously
subject to a front-end sales charge and dealer commission.
If you redeem any of those shares within 18 months of the end of
the calendar month of their purchase, a contingent deferred sales
charge (called the "Class A contingent deferred sales charge") may be
deducted from the redemption proceeds. That sales charge will be equal
to either (1) 1.0% of the aggregate net asset value of the redeemed
shares (not including shares purchased by reinvestment of dividends or
capital gain distributions) or (2) the original cost of the shares,
whichever is less. However, the Class A contingent deferred sales
charge will not exceed the aggregate amount of the commissions the
Distributor paid to your dealer on all Class A shares of all
OppenheimerFunds you purchased subject to the Class A contingent
deferred sales charge.
In determining whether a contingent deferred sales charge is
payable, the Fund will first redeem shares that are not subject to the
sales charge, including shares purchased by reinvestment of dividends
and capital gains, and then will redeem other shares in the order that
you purchased them. The Class A contingent deferred sales charge is
waived in certain cases described in "Waivers of Class A Sales Charges"
below.
No Class A contingent deferred sales charge is charged on
exchanges of shares under the Fund's exchange privilege (described
below). However, if the shares acquired by exchange are redeemed
within 18 months of the end of the calendar month of the purchase of
the exchanged shares, the sales charge will apply.
- Special Arrangements With Dealers. The Distributor may advance
up to 13 months' commissions to dealers that have established special
arrangements with the Distributor for Asset Builder Plans for their
clients. Dealers whose sales of Class A shares of OppenheimerFunds
(other than money market funds) under OppenheimerFunds-sponsored
403(b)(7) custodial plans exceed $5 million per year (calculated per
quarter), will receive monthly one-half of the Distributor's retained
commissions on those sales, and if those sales exceed $10 million per
year, those dealers will receive the Distributor's entire retained
commission on those sales.
Reduced Sales Charges for Class A Share Purchases. You may be eligible
to buy Class A shares at reduced sales charge rates in one or more of
the following ways:
- Right of Accumulation. To qualify for the lower sales charge
rates that apply to larger purchases of Class A shares, you and your
spouse can add together Class A and Class B shares you purchase for
your individual accounts, or jointly, or for trust or custodial
accounts on behalf of your children who are minors. A fiduciary can
count all shares purchased for a trust, estate or other fiduciary
account (including one or more employee benefit plans of the same
employer) that has multiple accounts.
Additionally, you can add together current purchases of Class A
and Class B shares of the Fund and other OppenheimerFunds to reduce the
sales charge rate that applies to current purchases of Class A shares.
You can also include Class A and Class B shares of OppenheimerFunds you
previously purchased subject to an initial or contingent deferred sales
charge to reduce the sales charge rate for current purchases of Class A
shares, provided that you still hold your investment in one of the
OppenheimerFunds. The value of those shares will be based on the
greater of the amount you paid for the shares or their current value
(at offering price). The OppenheimerFunds are listed in "Reduced Sales
Charges" in the Statement of Additional Information, or a list can be
obtained from the Distributor. The reduced sales charge will apply only
to current purchases and must be requested when you buy your shares.
- Letter of Intent. Under a Letter of Intent, if you purchase
Class A shares or Class A shares and Class B shares of the Fund and
other OppenheimerFunds during a 13-month period, you can reduce the
sales charge rate that applies to your purchases of Class A shares.
The total amount of your intended purchases of both Class A and Class B
shares will determine the reduced sales charge rate for the Class A
shares purchased during that period. This can include purchases made
up to 90 days before the date of the Letter. More information is
contained in the Application and in "Reduced Sales Charges" in the
Statement of Additional Information.
- Waivers of Class A Sales Charges. The Class A sales charges
are not imposed in the circumstances described below. There is an
explanation of this policy in "Reduced Sales Charges" in the Statement
of Additional Information.
Waivers of Initial and Contingent Deferred Sales Charges for
Certain Purchasers. Class A shares purchased by the following
investors are not subject to any Class A sales charges:
- the Manager or its affiliates;
- present or former officers, directors, trustees and employees
(and their "immediate families" as defined in "Reduced Sales Charges"
in the Statement of Additional Information) of the Fund, the Manager
and its affiliates, and retirement plans established by them for their
employees;
- registered management investment companies, or separate
accounts of insurance companies having an agreement with the Manager or
the Distributor for that purpose;
- dealers or brokers that have a sales agreement with the
Distributor, if they purchase shares for their own accounts or for
retirement plans for their employees;
- employees and registered representatives (and their spouses) of
dealers or brokers described above or financial institutions that have
entered into sales arrangements with such dealers or brokers (and are
identified to the Distributor) or with the Distributor; the purchaser
must certify to the Distributor at the time of purchase that the
purchase is for the purchaser's own account (or for the benefit of such
employee's spouse or minor children);
- dealers, brokers or registered investment advisers that have
entered into an agreement with the Distributor providing specifically
for the use of shares of the Fund in particular investment products
made available to their clients (those clients may be charged a
transaction fee by their dealer, broker or adviser for the purchase or
sale of Fund shares); or
- dealers, brokers or registered investment advisers that have
entered into an agreement with the Distributor to sell shares to
defined contribution employee retirement plans for which the dealer,
broker or investment adviser provides administration services.
Waivers of Initial and Contingent Deferred Sales Charges in
Certain Transactions. Class A shares issued or purchased in the
following transactions are not subject to Class A sales charges:
- shares issued in plans of reorganization, such as mergers,
asset acquisitions and exchange offers, to which the Fund is a party;
- shares purchased by the reinvestment of loan repayments by a
participant in a retirement plan for which the Manager or its
affiliates acts as sponsor;
- shares purchased by the reinvestment of dividends or other
distributions reinvested from the Fund or other OppenheimerFunds (other
than Oppenheimer Cash Reserves) or unit investment trusts for which
reinvestment arrangements have been made with the Distributor; or
- shares purchased and paid for with the proceeds of shares
redeemed in the past 12 months from a mutual fund (other than a fund
managed by the Manager or any of its subsidiaries) on which an initial
sales charge or contingent deferred sales charge was paid (this waiver
also applies to shares purchased by exchange of shares of Oppenheimer
Money Market Fund, Inc. that were purchased and paid for in this
manner); this waiver must be requested when the purchase order is
placed for your shares of the Fund, and the Distributor may require
evidence of your qualification for this waiver.
Waivers of the Class A Contingent Deferred Sales Charge for
Certain Redemptions . The Class A contingent deferred sales charge is
also waived if shares that would otherwise be subject to the contingent
deferred sales charge are redeemed in the following cases:
- for retirement distributions or loans to participants or
beneficiaries from qualified retirement plans, deferred compensation
plans or other employee benefit plans, including OppenheimerFunds
prototype 401(k) plans (these are all referred to as "Retirement
Plans");
- to return excess contributions made to Retirement Plans;
- to make Automatic Withdrawal Plan payments that are limited
annually to no more than 12% of the original account value;
- involuntary redemptions of shares by operation of law or
involuntary redemptions of small accounts (see "Shareholder Account
Rules and Policies," below);
- if, at the time a purchase order is placed for Class A shares
that would otherwise be subject to the Class A contingent deferred
sales charge, the dealer agrees in writing to accept the dealer's
portion of the commission payable on the sale in installments of 1/18th
of the commission per month (and no further commission will be payable
if the shares are redeemed within 18 months of purchase); or
- for distributions from OppenheimerFunds prototype 401(k) plans
for any of the following cases or purposes: (1) following the death or
disability (as defined in the Internal Revenue Code) of the participant
or beneficiary (the death or disability must occur after the
participant's account was established); (2) hardship withdrawals, as
defined in the plan; (3) under a Qualified Domestic Relations Order, as
defined in the Internal Revenue Code; (4) to meet the minimum
distribution requirements of the Internal Revenue Code; (5) to
establish "substantially equal periodic payments" as described in
Section 72(t) of the Internal Revenue Code, or (6) separation from
service.
- Service Plan for Class A Shares. The Fund has adopted a
Service Plan for Class A shares to reimburse the Distributor for a
portion of its costs incurred in connection with the personal service
and maintenance of shareholder accounts that hold Class A shares.
Reimbursement is made quarterly at an annual rate that may not exceed
0.25% of the average annual net assets of Class A shares of the Fund.
The Distributor uses all of those fees to compensate dealers, brokers,
banks and other financial institutions quarterly for providing personal
service and maintenance of accounts of their customers that hold Class
A shares and to reimburse itself (if the Fund's Board of Trustees
authorizes such reimbursements, which it has not yet done) for its
other expenditures under the Plan.
Services to be provided include, among others, answering customer
inquiries about the Fund, assisting in establishing and maintaining
accounts in the Fund, making the Fund's investment plans available and
providing other services at the request of the Fund or the Distributor.
Payments are made by the Distributor quarterly at an annual rate not to
exceed 0.25% of the average annual net assets of Class A shares held in
accounts of the dealer or its customers. The payments under the Plan
increase the annual expenses of Class A shares. For more details,
please refer to "Distribution and Service Plans" in the Statement of
Additional Information.
Buying Class B Shares. Class B shares are sold at net asset value per
share without an initial sales charge. However, if Class B shares are
redeemed within 6 years of their purchase, a contingent deferred sales
charge will be deducted from the redemption proceeds. That sales
charge will not apply to shares purchased by the reinvestment of
dividends or capital gains distributions. The charge will be assessed
on the lesser of the net asset value of the shares at the time of
redemption or the original purchase price. The contingent deferred
sales charge is not imposed on the amount of your account value
represented by an increase in net asset value over the initial purchase
price (including increases due to the reinvestment of dividends and
capital gains distributions). The Class B contingent deferred sales
charge is paid to the Distributor to reimburse its expenses of
providing distribution-related services to the Fund in connection with
the sale of Class B shares.
To determine whether the contingent deferred sales charge applies
to a redemption, the Fund redeems shares in the following order: (1)
shares acquired by reinvestment of dividends and capital gains
distributions, (2) shares held for over 6 years, and (3) shares held
the longest during the 6-year period.
The amount of the contingent deferred sales charge will depend on
the number of years since you invested and the dollar amount being
redeemed, according to the following schedule:
<TABLE>
<CAPTION>
Contingent Deferred Sales Charge
Years Since Beginning of Month In on Redemptions in that Year
Which Purchase Order Was Accepted (As % of Amount Subject to Charge)
- --------------------------------- ----------------------------------
<S> <C>
0 - 1 5.0%
1 - 2 4.0%
2 - 3 3.0%
3 - 4 3.0%
4 - 5 2.0%
5 - 6 1.0%
6 and following None
</TABLE>
In the table, a "year" is a 12-month period. All purchases are
considered to have been made on the first regular business day of the
month in which the purchase was made.
- Automatic Conversion of Class B Shares. 72 months after you
purchase Class B shares, those shares will automatically convert to
Class A shares. This conversion feature relieves Class B shareholders
of the asset-based sales charge that applies to Class B shares under
the Class B Distribution and Service Plan, described below. The
conversion is based on the relative net asset value of the two classes,
and no sales load or other charge is imposed. When Class B shares
convert, any other Class B shares that were acquired by the
reinvestment of dividends and distributions on the converted shares
will also convert to Class A shares. The conversion feature is subject
to the continued availability of a tax ruling described in "Alternative
Sales Arrangements - Class A, Class B and Class C Shares" in the
Statement of Additional Information.
- Distribution and Service Plan for Class B Shares. The Fund has
adopted a Distribution and Service Plan for Class B shares to reimburse
the Distributor for its services and costs in distributing Class B
shares and servicing accounts. Under the Plan, the Fund pays the
Distributor an annual "asset-based sales charge" of 0.75% per year on
Class B shares that are outstanding for 6 years or less. The
Distributor also receives a service fee of 0.25% per year. Both fees
are computed on the average annual net assets of Class B shares,
determined as of the close of each regular business day. The asset-
based sales charge allows investors to buy Class B shares without a
front-end sales charge while allowing the Distributor to compensate
dealers that sell Class B shares.
The Distributor uses the service fee to compensate dealers for
providing personal services for accounts that hold Class B shares.
Those services are similar to the services provided under the Class A
Service Plan, described above. The asset-based sales charge and
service fees increase Class B expenses by up to 1.00% of average net
assets per year.
The Distributor pays the 0.25% service fee to dealers in advance
for the first year, after Class B shares have been sold by the dealer.
After the shares have been held for a year, the Distributor pays the
fee on a quarterly basis. The Distributor pays sales commissions of
3.75% of the purchase price to dealers from its own resources at the
time of sale. The Distributor retains the asset-based sales charge to
recoup the sales commissions it pays, the advances of service fee
payments it makes, and its financing costs.
The Distributor's actual expenses in selling Class B shares may be
more than the payments it receives from contingent deferred sales
charges collected on redeemed shares and from the Fund under the
Distribution and Service Plan for Class B shares. Therefore, those
expenses may be carried over and paid in future years. At September
30, 1994, the end of the Plan year, the Distributor had incurred
unreimbursed expenses under the Plan of $7,186,104 (equal to 3.85% of
the Fund's net assets represented by Class B shares on that date),
which have been carried over into the present Plan year. If the Plan
is terminated by the Fund, the Board of Trustees may allow the Fund to
continue payments of the asset-based sales charge to the Distributor
for expenses it incurred before the Plan was terminated.
- Waivers of Class B and Class C Sales Charges. The Class B and
Class C contingent deferred sales charge will not be applied to shares
purchased in certain types of transactions nor will it apply to Class B
and Class C shares redeemed in certain circumstances as described
below. The reasons for this policy are in "Reduced Sales Charges" in
the Statement of Additional Information.
Waivers for Redemptions of Shares in Certain Cases. The Class B
and Class C contingent deferred sales charge will be waived for
redemptions of shares in the following cases:
- distributions to participants or beneficiaries from Retirement
Plans, if the distributions are made (a) under an Automatic Withdrawal
Plan after the participant reaches age 59-1/2, as long as the payments
are no more than 10% of the account value annually (measured from the
date the Transfer Agent receives the request), or (b) following the
death or disability (as defined in the Internal Revenue Code) of the
participant or beneficiary (the death or disability must have occurred
after the account was established);
- redemptions from accounts other than Retirement Plans following
the death or disability of the last surviving shareholder (the death or
disability must have occurred after the account was established and for
disability you must provide evidence of a determination of disability
by the Social Security Administration);
- returns of excess contributions to Retirement Plans, and
- distributions from IRAs (including SEP-IRAs and SAR/SEP
accounts) before the participant is age 591/2, and distributions from
403(b)(7) custodial plans or pension or profit sharing plans before the
participant is age 591/2 but only after the participant has separated
from service, if the distributions are made in substantially equal
periodic payments over the life (or life expectancy) of the participant
or the joint lives (or joint life and last survivor expectancy) of the
participant and the participant's designated beneficiary (and the
distributions must comply with other requirements for such
distributions under the Internal Revenue Code and may not exceed 10% of
the account value annually, measured from the date the Transfer Agent
receives the request);
- shares redeemed involuntarily, as described in "Shareholder
Account Rules and Policies," below; or
- distributions from OppenheimerFunds prototype 401(k) plans (1)
for hardship withdrawals; (2) under a Qualified Domestic Relations
Order, as defined in the Internal Revenue Code; (3) to meet minimum
distribution requirements as defined in the Internal Revenue Code; (4)
to make "substantially equal periodic payments" as described in Section
72(t) of the Internal Revenue Code; or (5) for separation from service.
Waivers for Shares Sold or Issued in Certain Transactions. The
contingent deferred sales charge is also waived on Class B and Class C
shares in the following cases:
- shares sold to the Manager or its affiliates;
- shares sold to registered management investment companies or
separate accounts of insurance companies having an agreement with the
Manager or the Distributor for that purpose; or
- shares issued in plans of reorganization to which the Fund is a
party.
Buying Class C Shares. Class C shares are sold at net asset value per
share without an initial sales charge. However, if Class C shares are
redeemed within 12 months of their purchase, a contingent deferred
sales charge of 1.0% will be deducted from the redemption proceeds.
That sales charge will not apply to shares purchased by the
reinvestment of dividends or capital gains distributions. The charge
will be assessed on the lesser of the net asset value of the shares at
the time of redemption or the original purchase price. The contingent
deferred sales charge is not imposed on the amount of your account
value represented by the increase in net asset value over the initial
purchase price (including increases due to the reinvestment of
dividends and capital gains distributions). The Class C contingent
deferred sales charge is paid to the Distributor to reimburse its
expenses of providing distribution-related services to the Fund in
connection with the sale of Class C shares.
To determine whether the contingent deferred sales charge applies
to a redemption, the Fund redeems shares in the following order: (1)
shares acquired by reinvestment of dividends and capital gains
distributions, (2) shares held for over 12 month, and (3) shares held
the longest during the 12-month period.
- Waivers of Class C Sales Charge. The Class C contingent
deferred sales charge will be waived if the shareholder requests it for
any of the redemptions or circumstances described above under "Waivers
of Class B and Class C Sales Charges."
- Distribution and Service Plan for Class C Shares. The Fund has
adopted a Distribution and Service Plan for Class C shares to
compensate the Distributor for distributing Class C shares and
servicing accounts. Under the Plan, the Fund pays the Distributor an
annual "asset-based sales charge" of 0.75% per year on Class C shares.
The Distributor also receives a service fee of 0.25% per year. Both
fees are computed on the average annual net assets of Class C shares,
determined as of the close of each regular business day. The asset-
based sales charge allows investors to buy Class C shares without a
front-end sales charge while allowing the Distributor to compensate
dealers that sell Class C shares.
The Distributor uses the service fee to compensate dealers for
providing personal services for accounts that hold Class C shares.
Those services are similar to those provided under the Class A Service
Plan, described above. The asset-based sales charge and service fees
increase Class C expenses by 1.00% of average net assets per year.
The Distributor pays the 0.25% service fee to dealers in advance
for the first year after Class C shares have been sold by the dealer.
After the shares have been held for a year, the Distributor pays the
fee on a quarterly basis. The Distributor pays sales commissions of
0.75% of the purchase price to dealers from its own resources at the
time of sale. The total up-front commission paid by the Distributor to
the dealer at the time of sale of Class C shares is 1.00% of the
purchase price. The Distributor plans to pay the asset-based sales
charge as an ongoing commission to the dealer on Class C shares that
have been outstanding for a year or more.
The Fund pays the asset-based sales charge to the Distributor for
its services rendered in connection with the distribution of Class C
shares. Those payments are at a fixed rate which is not related to the
Distributor's expenses. The services rendered by the Distributor
include paying and financing the payment of sales commissions, service
fees, and other costs of distributing and selling Class C shares,
including compensation of personnel of the Distributor who support
distribution of Class C shares. If the Plan is terminated by the Fund,
the Board of Trustees may allow the Fund to continue payments of the
asset-based sales charge to the Distributor for distributing Class C
shares before the Plan was terminated.
Special Investor Services
AccountLink. OppenheimerFunds AccountLink links your Fund account to
your account at your bank or other financial institution to enable you
to send money electronically between those accounts to perform a number
of types of account transactions. These include purchases of shares by
telephone (either through a service representative or by PhoneLink,
described below), automatic investments under Asset Builder Plans, and
sending dividends and distributions or Automatic Withdrawal Plan
payments directly to your bank account. Please refer to the Application
for details or call the Transfer Agent for more information.
AccountLink privileges must be requested on the Application you
use to buy shares, or on your dealer's settlement instructions if you
buy your shares through your dealer. After your account is established,
you can request AccountLink privileges by sending signature-guaranteed
instructions to the Transfer Agent. AccountLink privileges will apply
to each shareholder listed in the registration on your account as well
as to your dealer representative of record unless and until the
Transfer Agent receives written instructions terminating or changing
those privileges. After you establish AccountLink for your account, any
change of bank account information must be made by signature-guaranteed
instructions to the Transfer Agent signed by all shareholders who own
the account.
- Using AccountLink to Buy Shares. Purchases may be made by
telephone only after your account has been established. To purchase
shares in amounts up to $250,000 through a telephone representative,
call the Distributor at 1-800-852-8457. The purchase payment will be
debited from your bank account.
- PhoneLink. PhoneLink is the OppenheimerFunds automated
telephone system that enables shareholders to perform a number of
account transactions automatically using a touch-tone phone. PhoneLink
may be used on already-established Fund accounts after you obtain a
Personal Identification Number (PIN), by calling the special PhoneLink
number: 1-800-533-3310.
- Purchasing Shares. You may purchase shares in amounts up to
$100,000 by phone, by calling 1-800-533-3310. You must have
established AccountLink privileges to link your bank account with the
Fund, to pay for these purchases.
- Exchanging Shares. With the OppenheimerFunds Exchange
Privilege, described below, you can exchange shares automatically by
phone from your Fund account to another OppenheimerFunds account you
have already established by calling the special PhoneLink number.
Please refer to "How to Exchange Shares," below, for details.
- Selling Shares. You can redeem shares by telephone
automatically by calling the PhoneLink number and the Fund will send
the proceeds directly to your AccountLink bank account. Please refer
to "How to Sell Shares," below, for details.
Automatic Withdrawal and Exchange Plans. The Fund has several plans
that enable you to sell shares automatically or exchange them to
another OppenheimerFunds account on a regular basis:
- Automatic Withdrawal Plans. If your Fund account is worth
$5,000 or more, you can establish an Automatic Withdrawal Plan to
receive payments of at least $50 on a monthly, quarterly, semi-annual
or annual basis. The checks may be sent to you or sent automatically to
your bank account on AccountLink. You may even set up certain types of
withdrawals of up to $1,500 per month by telephone. You should consult
the Application and Statement of Additional Information for more
details.
- Automatic Exchange Plans. You can authorize the Transfer Agent
to exchange automatically an amount you establish in advance for shares
of up to five other OppenheimerFunds on a monthly, quarterly, semi-
annual or annual basis under an Automatic Exchange Plan. The minimum
purchase for each OppenheimerFunds account is $25. These exchanges are
subject to the terms of the Exchange Privilege, described below.
Reinvestment Privilege. If you redeem some or all of your Class A or
Class B shares of the Fund, you have up to 6 months to reinvest all or
part of the redemption proceeds in Class A shares of the Fund or other
OppenheimerFunds without paying a sales charge. This privilege applies
to Class A shares that you purchased with an initial sales charge and
to Class A or B shares on which you paid a contingent deferred sales
charge when you redeemed them. It does not apply to Class C shares.
You must be sure to ask the Distributor for this privilege when you
send your payment. Please consult the Statement of Additional
Information for more details.
Retirement Plans. Fund shares are available as an investment for your
retirement plans. If you participate in a plan sponsored by your
employer, the plan trustee or administrator must make the purchase of
shares for your retirement plan account. The Distributor offers a
number of different retirement plans that can be used by individuals
and employers:
- Individual Retirement Accounts including rollover IRAs, for
individuals and their spouses
- 403(b)(7) Custodial Plans for employees of eligible tax-exempt
organizations, such as schools, hospitals and charitable organizations
- SEP-IRAs (Simplified Employee Pension Plans) for small business
owners or people with income from self-employment, including SAR/SEP-
IRAs
- Pension and Profit-Sharing Plans for self-employed persons and
other employers
- 401(k) prototype retirement plans for businesses
Please call the Distributor for the OppenheimerFunds plan
documents, which contain important information and applications.
How to Sell Shares
You can arrange to take money out of your account on any regular
business day by selling (redeeming) some or all of your shares. Your
shares will be sold at the next net asset value calculated after your
order is received and accepted by the Transfer Agent. The Fund offers
you a number of ways to sell your shares: in writing or by telephone.
You can also set up Automatic Withdrawal Plans to redeem shares on a
regular basis, as described above. If you have questions about any of
these procedures, and especially if you are redeeming shares in a
special situation, such as due to the death of the owner, or from a
retirement plan, please call the Transfer Agent first, at 1-800-525-
7048, for assistance.
- Retirement Accounts. To sell shares in an OppenheimerFunds
retirement account in your name, call the Transfer Agent for a
distribution request form. There are special income tax withholding
requirements for distributions from retirement plans and you must
submit a withholding form with your request to avoid delay. If your
retirement plan account is held for you by your employer, you must
arrange for the distribution request to be sent by the plan
administrator or trustee. There are additional details in the Statement
of Additional Information.
- Certain Requests Require a Signature Guarantee. To protect you
and the Fund from fraud, certain redemption requests must be in writing
and must include a signature guarantee in the following situations
(there may be other situations also requiring a signature guarantee):
- You wish to redeem more than $50,000 worth of shares and
receive a check
- The redemption check is not payable to all shareholders
listed on the account statement
- The redemption check is not sent to the address of record on
your statement
- Shares are being transferred to a Fund account with a
different owner or name
- Shares are redeemed by someone other than the owners (such as
an Executor)
- Where Can I Have My Signature Guaranteed? The Transfer Agent
will accept a guarantee of your signature by a number of financial
institutions, including: a U.S. bank, trust company, credit union or
savings association, or by a foreign bank that has a U.S. correspondent
bank, or by a U.S. registered dealer or broker in securities, municipal
securities or government securities, or by a U.S. national securities
exchange, a registered securities association or a clearing agency. If
you are signing on behalf of a corporation, partnership or other
business, or as a fiduciary, you must also include your title in the
signature.
Selling Shares by Mail. Write a "letter of instructions" that
includes:
- Your name
- The Fund's name
- Your Fund account number (from your account statement)
- The dollar amount or number of shares to be redeemed
- Any special payment instructions
- Any share certificates for the shares you are selling,
- The signatures of all registered owners exactly as the account
is registered, and
- Any special requirements or documents requested by the Transfer
Agent to assure proper authorization of the person asking to sell
shares.
Use the following address for requests by mail:
Oppenheimer Shareholder Services
P.O. Box 5270, Denver, Colorado 80217
Send courier or Express Mail requests to:
Oppenheimer Shareholder Services
10200 E. Girard Avenue, Building D
Denver, Colorado 80231
Selling Shares by Telephone. You and your dealer representative of
record may also sell your shares by telephone. To receive the
redemption price on a regular business day, your call must be received
by the Transfer Agent by the close of The New York Stock Exchange that
day, which is normally 4:00 P.M., but may be earlier on some days. You
may not redeem shares held in an OppenheimerFunds retirement plan or
under a share certificate by telephone.
- To redeem shares through a service representative, call 1-800-
852-8457
- To redeem shares automatically on PhoneLink, call 1-800-533-3310
Whichever method you use, you may have a check sent to the address
on the account statement, or, if you have linked your Fund account to
your bank account on AccountLink, you may have the proceeds wired to
that bank account.
- Telephone Redemptions Paid by Check. Up to $50,000 may be
redeemed by telephone, once in any 7-day period. The check must be
payable to all owners of record of the shares and must be sent to the
address on the account statement. This service is not available within
30 days of changing the address on an account.
- Telephone Redemptions Through AccountLink or By Wire. There
are no dollar limits on telephone redemption proceeds sent to a bank
account designated when you establish AccountLink. Normally the ACH
wire to your bank is initiated on the business day after the
redemption. You do not receive dividends on the proceeds of the shares
you redeemed while they are waiting to be wired.
Shareholders may also have the Transfer Agent send redemption
proceeds of $2,500 or more by Federal Funds wire to a designated
commercial bank account. The bank must be a member of the Federal
Reserve wire system. There is a $10 fee for each Federal Funds wire.
To place a wire redemption request, call the Transfer Agent at 1-800-
852-8457. The wire will normally be transmitted on the next bank
business day after the shares are redeemed. There is a possibility
that the wire may be delayed up to seven days to enable the Fund to
sell securities to pay the redemption proceeds. No dividends are
accrued or paid on the proceeds of shares that have been redeemed and
are awaiting transmittal by wire. To establish wire redemption
privileges on an account that is already established, please contact
the Transfer Agent for instructions.
Selling Shares Through Your Dealer. The Distributor has made
arrangements to repurchase Fund shares from dealers and brokers on
behalf of their customers. Brokers or dealers may charge for that
service. Please refer to "Special Arrangements for Repurchase of
Shares from Dealers and Brokers" in the Statement of Additional
Information for more details.
How to Exchange Shares
Shares of the Fund may be exchanged for shares of certain
OppenheimerFunds at net asset value per share at the time of exchange,
without sales charge. To exchange shares, you must meet several
conditions:
- Shares of the fund selected for exchange must be available
for sale in your state of residence
- The prospectuses of this Fund and the fund whose shares you
want to buy must offer the exchange privilege
- You must hold the shares you buy when you establish your
account for at least 7 days before you can exchange them;
after the account is open 7 days, you can exchange shares
every regular business day
- You must meet the minimum purchase requirements for the fund
you purchase by exchange
- Before exchanging into a fund, you should obtain and read its
prospectus
Shares of a particular class may be exchanged only for shares of
the same class in the other OppenheimerFunds. For example, you can
exchange Class A shares of this Fund only for Class A shares of another
fund. At present, not all of the OppenheimerFunds offer Class B and
Class C shares. A list showing which funds offer which classes can be
obtained by calling the Distributor at 1-800-525-7048. If a fund has
only one class of shares that does not have a class designation, they
are "Class A" shares for exchange purposes. In some cases, sales
charges may be imposed on exchange transactions. Please refer to "How
to Exchange Shares" in the Statement of Additional Information for more
details.
Exchanges may be requested in writing or by telephone:
- Written Exchange Requests. Submit an OppenheimerFunds Exchange
Request form, signed by all owners of the account. Send it to the
Transfer Agent at the addresses listed in "How to Sell Shares."
- Telephone Exchange Requests. Telephone exchange requests may be
made either by calling a service representative at 1-800-852-8457 or by
using PhoneLink for automated exchanges, by calling 1-800-533-3310.
Telephone exchanges may be made only between accounts that are
registered with the same name(s) and address. Shares held under
certificates may not be exchanged by telephone.
You can find a list of OppenheimerFunds currently available for
exchanges in the Statement of Additional Information or obtain one by
calling a service representative at 1-800-525-7048. That list can
change from time to time.
There are certain exchange policies you should be aware of:
- Shares are normally redeemed from one fund and purchased from
the other fund in the exchange transaction on the same regular business
day on which the Transfer Agent receives an exchange request that is in
proper form by the close of The New York Stock Exchange that day, which
is normally 4:00 P.M., but may be earlier on some days. However,
either fund may delay the purchase of shares of the fund you are
exchanging into up to seven days if it determines it would be
disadvantaged by a same-day transfer of the proceeds to buy shares. For
example, the receipt of multiple exchange requests from a dealer in a
"market-timing" strategy might require the sale of portfolio securities
at a time or price disadvantageous to the Fund.
- Because excessive trading can hurt fund performance and harm
shareholders, the Fund reserves the right to refuse any exchange
request that will disadvantage it, or to refuse multiple exchange
requests submitted by a shareholder or dealer.
- The Fund may amend, suspend or terminate the exchange privilege
at any time. Although the Fund will attempt to provide you notice
whenever it is reasonably able to do so, it may impose these changes at
any time.
- For tax purposes, exchanges of shares involve a redemption of
the shares of the fund you own and a purchase of shares of the other
fund, which may result in a capital gain or loss. For more information
about taxes affecting exchanges, please refer to "How to Exchange
Shares" in the Statement of Additional Information.
- If the Transfer Agent cannot exchange all the shares you
request because of a restriction cited above, only the shares eligible
for exchange will be exchanged.
The Distributor has entered into agreements with certain dealers
and investment advisers permitting them to exchange their clients'
shares by telephone. These privileges are limited under those
agreements and the Distributor has the right to reject or suspend those
privileges. As a result, those exchanges may be subject to notice
requirements, delays and other limitations that do not apply to
shareholders who exchange their shares directly by calling or writing
to the Transfer Agent.
Shareholder Account Rules and Policies
- Net Asset Value Per Share is determined for each class of
shares as of the close of The New York Stock Exchange on each regular
business day by dividing the value of the Fund's net assets
attributable to a class by the number of shares of that class that are
outstanding. The Fund's Board of Trustees has established procedures
to value the Fund's securities to determine net asset value. In
general, securities values are based on market value. There are
special procedures for valuing illiquid and restricted securities,
obligations for which market values cannot be readily obtained, and
call options and hedging instruments. These procedures are described
more completely in the Statement of Additional Information.
- The offering of shares may be suspended during any period in
which the determination of net asset value is suspended, and the
offering may be suspended by the Board of Trustees at any time the
Board believes it is in the Fund's best interest to do so.
- Telephone Transaction Privileges for purchases, redemptions or
exchanges may be modified, suspended or terminated by the Fund at any
time. If an account has more than one owner, the Fund and the Transfer
Agent may rely on the instructions of any one owner. Telephone
privileges apply to each owner of the account and the dealer
representative of record for the account unless and until the Transfer
Agent receives cancellation instructions from an owner of the account.
- The Transfer Agent will record any telephone calls to verify
data concerning transactions and has adopted other procedures to
confirm that telephone instructions are genuine, by requiring callers
to provide tax identification numbers and other account data or by
using PINs, and by confirming such transactions in writing. If the
Transfer Agent does not use reasonable procedures it may be liable for
losses due to unauthorized transactions, but otherwise neither it nor
the Fund will be liable for losses or expenses arising out of telephone
instructions reasonably believed to be genuine. If you are unable to
reach the Transfer Agent during periods of unusual market activity, you
may not be able to complete a telephone transaction and should consider
placing your order by mail.
- Redemption or transfer requests will not be honored until the
Transfer Agent receives all required documents in proper form. From
time to time, the Transfer Agent in its discretion may waive certain of
the requirements for redemptions stated in this Prospectus.
- Dealers that can perform account transactions for their clients
by participating in NETWORKING through the National Securities Clearing
Corporation are responsible for obtaining their clients' permission to
perform those transactions and are responsible to their clients who are
shareholders of the Fund if the dealer performs any transaction
erroneously or improperly.
- The redemption price for shares will vary from day to day
because the values of the securities in the Fund's portfolio fluctuate,
and the redemption price, which is the net asset value per share, will
normally be different for Class A, Class B and Class C shares.
Therefore, the redemption value of your shares may be more or less than
their original cost.
- Payment for redeemed shares is made ordinarily in cash and
forwarded by check or through AccountLink (as elected by the
shareholder under the redemption procedures described above) within 7
days after the Transfer Agent receives redemption instructions in
proper form, except under unusual circumstances determined by the
Securities and Exchange Commission delaying or suspending such
payments. For accounts registered in the name of a broker/dealer,
payment will be forwarded within 3 business days. The Transfer Agent
may delay forwarding a check or processing a payment via AccountLink
for recently purchased shares, but only until the purchase payment has
cleared. That delay may be as much as 10 days from the date the shares
were purchased. That delay may be avoided if you purchase shares by
certified check or arrange with your bank to provide telephone or
written assurance to the Transfer Agent that your purchase payment has
cleared.
- Involuntary redemptions of small accounts may be made by the
Fund if the account value has fallen below $500 for reasons other than
the fact that the market value of shares has dropped, and in some cases
involuntary redemptions may be made to repay the Distributor for losses
from the cancellation of share purchase orders.
- Under unusual circumstances, shares of the Fund may be redeemed
"in kind", which means that the redemption proceeds will be paid with
securities from the Fund's portfolio. Please refer to "How to Sell
Shares" in the Statement of Additional Information for more details.
- "Backup Withholding" of Federal income tax may be applied at
the rate of 31% from dividends, distributions and redemption proceeds
(including exchanges) if you fail to furnish the Fund a certified
Social Security or Employer Identification Number when you sign your
application, or if you violate Internal Revenue Service regulations on
tax reporting of income.
- The Fund does not charge a redemption fee, but if your dealer
or broker handles your redemption, they may charge a fee. That fee can
be avoided by redeeming your Fund shares directly through the Transfer
Agent. Under the circumstances described in "How To Buy Shares," you
may be subject to a contingent deferred sales charge when redeeming
certain Class A, Class B and Class C shares.
- To avoid sending duplicate copies of materials to households,
the Fund will mail only one copy of each annual and semi-annual report
to shareholders having the same last name and address on the Fund's
records. However, each shareholder may call the Transfer Agent at 1-
800-525-7048 to ask that copies of those materials be sent personally
to that shareholder.
Dividends, Capital Gains and Taxes
Dividends. The Fund declares dividends separately for Class A, Class B
and Class C shares from net investment income, if any, on an annual
basis and normally pays those dividends to shareholders in December,
but the Board of Trustees can change that date. The Board may also
cause the Fund to declare dividends after the close of the Fund's
fiscal year (which ends September 30th). Because the Fund does not
have an objective of seeking current income, the amounts of dividends
it pays, if any, will likely be small. Dividends paid on Class A
shares will generally be higher than for Class B or Class C shares
because expenses allocable to Class B and Class C shares will generally
be higher than for Class A shares. There is no fixed dividend rate and
there can be no assurance that the Fund will pay any dividends.
Capital Gains. The Fund may make distributions annually in December
out of any net short-term or long-term capital gains, and the Fund may
make supplemental distributions of capital gains following the end of
its fiscal year. Long-term capital gains will be separately identified
in the tax information the Fund sends you after the end of the year.
Short-term capital gains are treated as dividends for tax purposes.
There can be no assurance that the Fund will pay any capital gains
distributions in a particular year.
Distribution Options. When you open your account, specify on your
application how you want to receive your distributions. For
OppenheimerFunds retirement accounts, all distributions are reinvested.
For other accounts, you have four options:
- Reinvest All Distributions in the Fund. You can elect to
reinvest all dividends and long-term capital gains distributions in
additional shares of the Fund.
- Reinvest Long-Term Capital Gains Only. You can elect to
reinvest long-term capital gains in the Fund while receiving dividends
by check or sent to your bank account on AccountLink.
- Receive All Distributions in Cash. You can elect to receive a
check for all dividends and long-term capital gains distributions or
have them sent to your bank on AccountLink.
- Reinvest Your Distributions in Another OppenheimerFunds
Account. You can reinvest all distributions in another OppenheimerFunds
account you have established.
Taxes. If your account is not a tax-deferred retirement account, you
should be aware of the following tax implications of investing in the
Fund. Long-term capital gains are taxable as long-term capital gains
when distributed to shareholders. It does not matter how long you held
your shares. Dividends paid from short-term capital gains and net
investment income are taxable as ordinary income. Distributions are
subject to federal income tax and may be subject to state or local
taxes. Your distributions are taxable when paid, whether you reinvest
them in additional shares or take them in cash. Every year the Fund
will send you and the IRS a statement showing the amount of all taxable
distributions you received in the previous year.
When more than 50% of its assets are invested in foreign
securities at the end of any fiscal year, the Fund may elect that
Section 853 of the Internal Revenue Code will apply to it to permit
shareholders to take a credit (or a deduction) on their own federal
income tax returns for foreign taxes paid by the Fund. "Dividends,
Capital Gains and Taxes" in the Statement of Additional Information
contains further information about this tax provision.
- "Buying a Dividend": When a fund goes ex-dividend, its share
price is reduced by the amount of the distribution. If you buy shares
on or just before the ex-dividend date, or just before the Fund
declares a capital gains distribution, you will pay the full price for
the shares and then receive a portion of the price back as a taxable
dividend or capital gain.
- Taxes on Transactions: Share redemptions, including redemptions
for exchanges, are subject to capital gains tax. Generally speaking, a
capital gain or loss is the difference between the price you paid for
the shares and the price you received when you sold them.
- Returns of Capital: In certain cases distributions made by the
Fund may be considered a non-taxable return of capital to shareholders.
If that occurs, it will be identified in notices to shareholders. A
non-taxable return of capital may reduce your tax basis in your Fund
shares.
This information is only a summary of certain federal tax
information about your investment. More information is contained in
the Statement of Additional Information, and in addition you should
consult with your tax adviser about the effect of an investment in the
Fund on your particular tax situation.
<PAGE>
APPENDIX TO PROSPECTUS OF
OPPENHEIMER GLOBAL FUND
Graphic material included in Prospectus of Oppenheimer Global
Fund: "Comparison of Change in Value of $10,000 Hypothetical
Investments in Class A and Class B shares of Oppenheimer Global Fund
and the Morgan Stanley World Index."
Linear graphs will be included in the Prospectus of Oppenheimer
Global Fund (the "Fund") depicting the initial subsequent account
values of hypothetical $10,000 investments in (I) Class A shares of
the Fund during the past 10 fiscal years and (ii) Class B shares of the
Fund during the period August 17, 1993 (first public offering of Class
B shares) to September 30, 1994, in each case comparing such values
with the same investment over the same time periods in the Morgan
Stanley World Index. Set forth below are the relevant data points that
will appear on the linear graph. Additional information with respect
to the foregoing, including a description of the Morgan Stanley World
Index, is set forth in the Prospectus under "Performance of the Fund -
Management's Discussion of Performance."
<TABLE>
<CAPTION>
Fiscal Year Oppenheimer Morgan Stanley
Ended Global Fund World Index
----------- ----------- --------------
<S> <C> <C>
Class A
-------
09/30/84 9,425 10,000
09/30/85 10,556 12,406
09/30/86 17,695 19,625
09/30/87 27,011 28,187
09/30/88 20,214 26,369
09/30/89 28,879 33,004
09/30/90 29,107 25,888
09/30/91 36,007 32,239
09/30/92 34,466 31,913
09/30/93 40,557 38,372
09/30/94 48,341 41,273
Class B
-------
08/17/93 10,000 10,000
09/30/93 10,364 9,813
09/30/94 11,841 10,555
</TABLE>
Oppenheimer Global Fund
Two World Trade Center
New York, New York 10048-0203
1-800-525-7048
Investment Adviser
Oppenheimer Management Corporation
Two World Trade Center
New York, New York 10048-0203
Distributor
Oppenheimer Funds Distributor, Inc.
Two World Trade Center
New York, New York 10048-0203
Transfer Agent and Shareholder Servicing Agent
Oppenheimer Shareholder Services
P.O. Box 5270
Denver, Colorado 80217
1-800-525-7048
Custodian of Portfolio Securities
The Bank of New York
One Wall Street
New York, New York 10015
Independent Auditors
KPMG Peat Marwick LLP
707 Seventeenth Street
Denver, Colorado 80202
Legal Counsel
Gordon Altman Butowsky
Weitzen Shalov & Wein
114 West 47th Street
New York, New York 10036
No dealer, broker, salesperson or any other person has been authorized
to give any information or to make any representations other than those
contained in this Prospectus or the Statement of Additional
Information, and if given or made, such information and representations
must not be relied upon as having been authorized by the Fund,
Oppenheimer Management Corporation, Oppenheimer Funds Distributor, Inc.
or any affiliate thereof. This Prospectus does not constitute an offer
to sell or a solicitation of an offer to buy any of the securities
offered hereby in any state to any person to whom it is unlawful to
make such an offer in such state.
PR0330.001.1095 *Printed on recycled paper
<PAGE>
OPPENHEIMER
Global Fund
Prospectus
Effective October 1, 1995
(OppenheimerFunds Logo)
<PAGE>
Oppenheimer Global Fund
Two World Trade Center, New York, New York 10048-0203
1-800-525-7048
Statement of Additional Information dated October 1, 1995
This Statement of Additional Information of Oppenheimer Global
Fund is not a Prospectus. This document contains additional
information about the Fund and supplements information in the
Prospectus dated October 1, 1995. It should be read together with the
Prospectus, which may be obtained by writing to the Fund's Transfer
Agent, Oppenheimer Shareholder Services at P.O. Box 5270, Denver,
Colorado 80217 or by calling the Transfer Agent at the toll-free number
shown above.
Table of Contents
Page
About the Fund
Investment Objective and Policies
Investment Policies and Strategies
Other Investment Techniques and Strategies
Other Investment Restrictions
How the Fund is Managed
Organization and History
Trustees and Officers of the Fund
The Manager and Its Affiliates
Brokerage Policies of the Fund
Performance of the Fund
Distribution and Service Plans
About Your Account
How to Buy Shares
How to Sell Shares
How to Exchange Shares
Dividends, Capital Gains and Taxes
Additional Information About the Fund
Financial Information About the Fund
Independent Auditors' Report
Financial Statements
Appendix: Industry Classifications A-1
<PAGE>
About the Fund
Investment Objective and Policies
Investment Policies and Strategies. The investment objective and
policies of the Fund are described in the Prospectus. Set forth below
is supplemental information about those policies and the types of
securities in which the Fund may invest, as well as the strategies the
Fund may use to try to achieve its objective. Capitalized terms used
in this Statement of Additional Information have the same meanings as
those terms have in the Prospectus.
In selecting securities for the Fund's portfolio, the Fund's
investment advisor, Oppenheimer Management Corporation (the "Manager"),
evaluates the merits of securities primarily through the exercise of
its own investment analysis. This may include, among other things,
evaluation of the history of the issuer's operations, prospects for the
industry of which the issuer is part, the issuer's financial condition,
the issuer's pending product developments and developments by
competitors, the effect of general market and economic conditions on
the issuer's business, and legislative proposals or new laws that might
affect the issuer. Current income is not a consideration in the
selection of portfolio securities for the Fund, whether for
appreciation, defensive or liquidity purposes. The fact that a
security has a low yield or does not pay current income will not be an
adverse factor in selecting securities to try to achieve the Fund's
investment objective of capital appreciation unless the Manager
believes that the lack of yield might adversely affect appreciation
possibilities.
The portion of the Fund's assets allocated to securities selected
for capital appreciation and the investment techniques used will depend
upon the judgment of the Fund's Manager as to the future movement of
the equity securities markets. If the Manager believes that economic
conditions favor a rising market, the Fund will emphasize securities
and investment methods selected for high capital growth. If the
Manager believes that a market decline is likely, defensive securities
and investment methods may be emphasized.
- Investing in Securities of Growth-Type Companies. The Fund may
emphasize securities of "growth-type" companies. Such issuers
typically are those the goods or services of which have relatively
favorable long-term prospects for increasing demand, or ones which
develop new products, services or markets and normally retain a
relatively large part of their earnings for research, development and
investment in capital assets. They may include companies in the
natural resources fields or those developing industrial applications
for new scientific knowledge having potential for technological
innovation, such as nuclear energy, oceanography, business services and
new customer products.
- Investing in Small, Unseasoned Companies. The securities of
small, unseasoned companies may have a limited trading market, which
may adversely affect the Fund's ability to sell them and can reduce the
price the Fund might be able to obtain for them. If other investors
holding the same securities as the Fund sell them when the Fund
attempts to dispose of its holdings, the Fund may receive lower prices
than might otherwise be obtained, because of the thinner market for
such securities.
- Foreign Securities. "Foreign securities" include equity and
debt securities of companies organized under the laws of countries
other than the United States and debt securities of foreign
governments, that are traded on foreign securities exchanges or in the
foreign over-the-counter markets. Securities of foreign issuers that
are represented by American Depository Receipts or that are listed on a
U.S. securities exchange or traded in the U.S. over-the-counter markets
are not considered "foreign securities" for the purpose of the Fund's
investment allocations, because they are not subject to many of the
special considerations and risks, discussed below, that apply to
foreign securities traded and held abroad.
Investing in foreign securities offers the Fund potential benefits
not available from investing solely in securities of domestic issuers,
such as the opportunity to invest in foreign issuers that appear to
offer growth potential, or in foreign countries with economic policies
or business cycles different from those of the U.S., or to reduce
fluctuations in portfolio value by taking advantage of foreign stock
markets that do not move in a manner parallel to U.S. markets. If the
Fund's portfolio securities are held abroad, the countries in which
such securities may be held and the sub-custodians holding them must be
approved by the Fund's Board of Trustees under applicable rules of the
Securities and Exchange Commission. In buying foreign securities, the
Fund may convert U.S. dollars into foreign currency, but only to effect
securities transactions on foreign securities exchanges and not to hold
such currency as an investment.
- Risks of Foreign Investing. Investing in foreign securities
involves special additional risks and considerations not typically
associated with investing in securities of issuers traded in the U.S.
These include: reduction of income by foreign taxes; fluctuation in
value of foreign portfolio investments due to changes in currency rates
and control regulations (e.g., currency blockage); transaction charges
for currency exchange; lack of public information about foreign
issuers; lack of uniform accounting, auditing and financial reporting
standards comparable to those applicable to domestic issuers; less
volume on foreign exchanges than on U.S. exchanges; greater volatility
and less liquidity in foreign markets than in the U.S.; less regulation
of foreign issuers, stock exchanges and brokers than in the U.S.;
greater difficulties in commencing lawsuits against foreign issuers;
higher brokerage commission rates than in the U.S.; increased risks of
delays in settlement of portfolio transactions or loss of certificates
for portfolio securities; possibilities in some countries of
expropriation or nationalization of assets, confiscatory taxation,
political, financial or social instability or adverse diplomatic
developments; and unfavorable differences between the U.S. economy and
foreign economies. In the past, U.S. Government policies have
discouraged certain investments abroad by U.S. investors, through
taxation or other restrictions, and it is possible that such
restrictions could be re-imposed.
A number of current significant political demographic and economic
developments may affect investments in foreign securities and in
securities of companies with operations overseas. Such developments
include dramatic political changes in government and economic policies
in several Eastern European countries, Germany and the republics
comprising the former Soviet Union, as well as unification of the
European Economic Community. The course of any of one or more of these
events and the effect on trade barriers, competition and markets for
consumer goods and services is uncertain. With roughly two-thirds of
all outstanding equity securities now traded outside of the United
States (source: Morgan Stanley), the Fund's global scope enables it to
attempt to take advantage of other world markets and companies and seek
to protect itself against declines in any single economy.
- Convertible Securities. While convertible securities are a form
of debt security in many cases, their conversion feature (allowing
conversion into equity securities) causes them to be regarded more as
"equity equivalents." As a result, the rating assigned to the security
has less impact on the Manager's investment decision with respect to
convertible securities than in the case of non-convertible fixed-income
securities. To determine whether convertible securities should be
regarded as "equity equivalents," the Manager examines the following
factors: (1) whether, at the option of the investor, the convertible
security can be exchanged for a fixed number of shares of common stock
of the issuer, (2) whether the issuer of the convertible securities has
restated its earnings per share of common stock on a fully diluted
basis (considering the effect of converting the convertible
securities), and (3) the extent to which the convertible security may
be a defensive "equity substitute," providing the ability to
participate in any appreciation in the price of the issuer's common
stock.
- Warrants and Rights. Warrants basically are options to purchase
equity securities at specified prices valid for a specific period of
time. Their prices do not necessarily move in a manner parallel to the
prices of the underlying securities. The price paid for a warrant will
be lost unless the warrant is exercised prior to expiration. Rights
are similar to warrants, but normally have a short duration and are
distributed directly by the issuer to its shareholders. Warrants and
rights have no voting rights, receive no dividends and have no rights
with respect to the assets of the issuer.
- Illiquid and Restricted Securities. To enable the Fund to sell
restricted securities not registered under the Securities Act of 1933,
the Fund may have to cause those securities to be registered. The
expenses of registration of restricted securities may be negotiated by
the Fund with the issuer at the time such securities are purchased by
the Fund, if such registration is required before such securities may
be sold publicly. When registration must be arranged because the Fund
wishes to sell the security, a considerable period may elapse between
the time the decision is made to sell the securities and the time the
Fund would be permitted to sell them. The Fund would bear the risks of
any downward price fluctuation during that period. The Fund may also
acquire, through private placements, securities having contractual
restrictions on their resale, which might limit the Fund's ability to
dispose of such securities and might lower the amount realizable upon
the sale of such securities.
The Fund has percentage limitations that apply to purchases of
restricted securities, as stated in the Prospectus. Those percentage
restrictions do not limit purchases of restricted securities that are
eligible for sale to qualified institutional purchasers pursuant to
Rule 144A under the Securities Act of 1933, provided that those
securities have been determined to be liquid by the Board of Trustees
of the Fund or by the Manager under Board-approved guidelines. Those
guidelines take into account the trading activity for such securities
and the availability of reliable pricing information, among other
factors. If there is a lack of trading interest in a particular Rule
144A security, the Fund's holding of that security may be deemed to be
illiquid.
- Repurchase Agreements. The Fund may acquire securities subject
to repurchase agreements for liquidity purposes to meet anticipated
redemptions, or pending the investment of the proceeds from sales of
Fund shares, or pending the settlement of purchases of portfolio
securities.
In a repurchase transaction, the Fund acquires a security from, and
simultaneously resells it to, an approved vendor. An "approved vendor"
is a commercial bank or the U.S. branch of a foreign bank, or a broker-
dealer which has been designated a primary dealer in government
securities, which must meet credit requirements set by the Fund's Board
of Trustees from time to time. The resale price exceeds the purchase
price by an amount that reflects an agreed-upon interest rate effective
for the period during which the repurchase agreement is in effect. The
majority of these transactions run from day to day, and delivery
pursuant to the resale typically will occur within one to five days of
the purchase. Repurchase agreements are considered "loans" under the
Investment Company Act of 1940, as amended (the "Investment Company
Act"), collateralized by the underlying security. The Fund's
repurchase agreements require that at all times while the repurchase
agreement is in effect, the value of the collateral must equal or
exceed the repurchase price to fully collateralize the repayment
obligation. Additionally, the Fund's Manager will impose
creditworthiness requirements to confirm that the vendor is financially
sound and will continuously monitor the collateral's value.
- Loans of Portfolio Securities. The Fund may lend its portfolio
securities pursuant to the Securities Lending Agreement and Guaranty
(the "Securities Lending Agreement") with The Bank of New York, subject
to the restrictions stated in the Prospectus. The Fund will lend such
portfolio securities to attempt to increase the Fund's income. Under
the Securities Lending Agreement and applicable regulatory requirements
(which are subject to change), the loan collateral must, on each
business day, be at least equal to the value of the loaned securities
and must consist of cash, bank letters of credit or securities of the
U.S. Government (or its agencies or instrumentalities), or other cash
equivalents in which the Fund is permitted to invest. To be acceptable
as collateral, letters of credit must obligate a bank to pay to The
Bank of New York, as agent, amounts demanded by the Fund if the demand
meets the terms of the letter. Such terms of the letter and the
issuing bank must be satisfactory to The Bank of New York and the Fund.
The Fund will receive, pursuant to the Securities Lending Agreement,
the following: (a) all income, dividends and distributions received in
respect of loaned securities; (b) an annual securities lending fee of
$500,000; and (c) 25% of all annual net income from securities lending
transactions exceeding $1,500,000. The Bank of New York has agreed, in
general, to guarantee the obligations of borrowers to return loaned
securities and to be responsible for expenses relating to securities
lending. The Fund will be responsible for risks associated with the
investment of cash collateral. The term of the Securities Lending
Agreement is thirty-six months subject to termination by The Bank of
New York or the Fund. The Fund may incur a termination fee if it
terminates the Securities Lending Agreement during this term. The
terms of the Fund's loans must also meet applicable tests under the
Internal Revenue Code and permit the Fund to reacquire loaned
securities on five business days' notice or in time to vote on any
important matter.
- Borrowing For Leverage. From time to time, the Fund may
increase its ownership of securities by borrowing from banks on an
unsecured basis and investing the borrowed funds, subject to the
restrictions stated in the Prospectus. Any such borrowing will be made
only from banks, and pursuant to the requirements of the Investment
Company Act, will be made only to the extent that the value of the
Fund's assets, less its liabilities other than borrowings, is equal to
at least 300% of all borrowings including the proposed borrowing. If
the value of the Fund's assets, when computed in that manner, should
fail to meet the 300% asset coverage requirement, the Fund is required
within three days to reduce its bank debt to the extent necessary to
meet that coverage requirement. To do so, the Fund may have to sell a
portion of its investments at a time when it would otherwise not want
to sell the securities. Interest on money the Fund borrows is an
expense the Fund would not otherwise incur, so that during periods of
substantial borrowings, its expenses may increase more than the
expenses of funds that do not borrow.
Other Investment Techniques and Strategies
- Hedging With Options and Futures Contracts. The Fund may use
hedging instruments for the purposes described in the Prospectus. When
hedging to attempt to protect against declines in the market value of
the Fund's portfolio, or to permit the Fund to retain unrealized gains
in the value of portfolio securities which have appreciated, or to
facilitate selling securities for investment reasons, the Fund may: (I)
sell Futures, (ii) buy puts on such Futures or securities, or (iii)
write covered calls on securities or on Futures. When hedging to
establish a position in the equity securities markets as a temporary
substitute for the purchase of individual equity securities the Fund
may: (I) buy Futures, or (ii) buy calls on such Futures or securities
held by it. Normally, the Fund would then purchase the equity
securities and terminate the hedging position.
The Fund's strategy of hedging with Futures and options on Futures
will be incidental to the Fund's investment activities in the
underlying cash market. In the future, the Fund may employ hedging
instruments and strategies that are not presently contemplated but
which may be developed, to the extent such investment methods are
consistent with the Fund's investment objective, and are legally
permissible and disclosed in the Prospectus. Additional information
about the hedging instruments the Fund may use is provided below.
- Stock Index Futures, Financial Futures and Interest Rate
Futures. The Fund may buy and sell futures contracts relating to a
securities index ("Financial Futures"), including "Stock Index
Futures," a type of Financial Future for which the index used as the
basis for trading is a broadly-based stock index (including stocks that
are not limited to issuers in a particular industry or group of
industries). A stock index assigns relative values to the common
stocks included in the index and fluctuates with the changes in the
market value of those stocks. Stock indices cannot be purchased or
sold directly. Financial futures are contracts based on the future
value of the basket of securities that comprise the underlying index.
The contracts obligate the seller to deliver, and the purchaser to
take, cash to settle the futures transaction or to enter into an
offsetting contract. No physical delivery of the securities underlying
the index is made on settling the futures obligation. No monetary
amount is paid or received by the Fund on the purchase or sale of a
Financial Future or Stock Index Future.
The Fund may also buy Futures relating to debt securities
("Interest Rate Futures"). An Interest Rate Future obligates the
seller to deliver and the purchaser to take a specific type of debt
security at a specific future date for a fixed price to settle the
futures transaction, or to enter into an offsetting contract. As with
Financial Futures, no monetary amount is paid or received by the Fund
on the purchase of an Interest Rate Future.
Upon entering into a Futures transaction, the Fund will be required
to deposit an initial margin payment, in cash or U.S. Treasury bills,
with the futures commission merchant (the "futures broker"). Initial
margin payments will be deposited with the Fund's Custodian in an
account registered in the futures broker's name; however, the futures
broker can gain access to that account only under certain specified
conditions. As the Future is marked to market (that is, its value on
the Fund's books is changed) to reflect changes in its market value,
subsequent margin payments, called variation margin, will be paid to or
by the futures broker on a daily basis.
At any time prior to the expiration of the Future, the Fund may
elect to close out its position by taking an opposite position, at
which time a final determination of variation margin is made and
additional cash is required to be paid by or released to the Fund. Any
gain or loss is then realized by the Fund on the Future for tax
purposes. Although Financial Futures and Stock Index Futures by their
terms call for settlement by the delivery of cash, and Interest Rate
Futures call for the delivery of a specific debt security, in most
cases the settlement obligation is fulfilled without such delivery by
entering into an offsetting transaction. All Futures transactions are
effected through a clearinghouse associated with the exchange on which
the contracts are traded.
- Writing Covered Calls. As described in the Prospectus, the Fund
may write covered calls. When the Fund writes a call on an investment,
it receives a premium and agrees to sell the callable investment to a
purchaser of a corresponding call during the call period (usually not
more than 9 months) at a fixed exercise price (which may differ from
the market price of the underlying investment) regardless of market
price changes during the call period. To terminate its obligation on a
call it has written, the Fund may purchase a corresponding call in a
"closing purchase transaction." A profit or loss will be realized,
depending upon whether the net of the amount of option transaction
costs and the premium received on the call the Fund has written is more
or less than the price of the call the Fund subsequently purchased. A
profit may also be realized if the call lapses unexercised, because the
Fund retains the underlying investment and the premium received. Those
profits are considered short-term capital gains for Federal income tax
purposes, as are premiums on lapsed calls, and when distributed by the
Fund are taxable as ordinary income. If the Fund could not effect a
closing purchase transaction due to the lack of a market, it would have
to hold the callable investment until the call lapsed or was exercised.
The Fund may also write calls on Futures without owning a futures
contract or deliverable securities, provided that at the time the call
is written, the Fund covers the call by segregating in escrow an
equivalent dollar value of deliverable securities or liquid assets. The
Fund will segregate additional liquid assets if the value of the
escrowed assets drops below 100% of the current value of the Future.
In no circumstances would an exercise notice as to a Future put the
Fund in a short futures position.
The Fund's Custodian, or a securities depository acting for the
Custodian, will act as the Fund's escrow agent, through the facilities
of the Options Clearing Corporation ("OCC"), as to the investments on
which the Fund has written options that are traded on exchanges, or as
to other acceptable escrow securities, so that no margin will be
required from the Fund for such option transactions. OCC will release
the securities covering a call on the expiration of the call or when
the Fund enters into a closing purchase transaction. Call writing
affects the Fund's turnover rate and the brokerage commissions it pays.
Commissions, normally higher than on general securities transactions,
are payable on writing or purchasing a call.
- Purchasing Puts and Calls. The Fund may purchase calls to
protect against the possibility that the Fund's portfolio will not
participate in an anticipated rise in the securities market. When the
Fund purchases a call, it pays a premium (other than in a closing
purchase transaction) and, except as to calls on stock indices, has the
right to buy the underlying investment from a seller of a corresponding
call on the same investment during the call period at a fixed exercise
price. In purchasing a call, the Fund benefits only if the call is
sold at a profit or if, during the call period, the market price of the
underlying investment is above the sum of the call price, transaction
costs, and the premium paid, and the call is exercised. If the call is
not exercised or sold (whether or not at a profit), it will become
worthless at its expiration date and the Fund will lose its premium
payment and the right to purchase the underlying investment. When the
Fund purchases a call on a stock index, it pays a premium, but
settlement is in cash rather than by delivery of the underlying
investment to the Fund.
When the Fund purchases a put, it pays a premium and, except as to
puts on stock indices, has the right to sell the underlying investment
to a seller of a corresponding put on the same investment during the
put period at a fixed exercise price. Buying a put on an investment
the Fund owns (a "protective put") enables the Fund to attempt to
protect itself during the put period against a decline in the value of
the underlying investment below the exercise price by selling the
underlying investment at the exercise price to a seller of a
corresponding put. If the market price of the underlying investment is
equal to or above the exercise price and as a result the put is not
exercised or resold, the put will become worthless at its expiration
and the Fund will lose the premium payment and the right to sell the
underlying investment. However, the put may be sold prior to
expiration (whether or not at a profit).
Puts and calls on broadly-based stock indices or Stock Index
Futures are similar to puts and calls on securities or futures
contracts except that all settlements are in cash and gain or loss
depends on changes in the index in question (and thus on price
movements in the stock market generally) rather than on price movements
of individual securities or futures contracts. When the Fund buys a
call on a stock index or Stock Index Future, it pays a premium. If the
Fund exercises the call during the call period, a seller of a
corresponding call on the same investment will pay the Fund an amount
of cash to settle the call if the closing level of the stock index or
Future upon which the call is based is greater than the exercise price
of the call. That cash payment is equal to the difference between the
closing price of the call and the exercise price of the call times a
specified multiple (the "multiplier") which determines the total dollar
value for each point of difference. When the Fund buys a put on a
stock index or Stock Index Future, it pays a premium and has the right
during the put period to require a seller of a corresponding put, upon
the Fund's exercise of its put, to deliver cash to the Fund to settle
the put if the closing level of the stock index or Stock Index Future
upon which the put is based is less than the exercise price of the put.
That cash payment is determined by the multiplier, in the same manner
as described above as to calls.
When the Fund purchases a put on a stock index, or on a Stock Index
Future not owned by it, the put protects the Fund to the extent that
the index moves in a similar pattern to the securities the Fund holds.
The Fund can either resell the put or, in the case of a put on a Stock
Index Future, buy the underlying investment and sell it at the exercise
price. The resale price of the put will vary inversely with the price
of the underlying investment. If the market price of the underlying
investment is above the exercise price, and as a result the put is not
exercised, the put will become worthless on the expiration date. In
the event of a decline in price of the underlying investment, the Fund
could exercise or sell the put at a profit to attempt to offset some or
all of its loss on its portfolio securities.
The Fund's option activities may affect its portfolio turnover rate
and brokerage commissions. The exercise of calls written by the Fund
may cause the Fund to sell related portfolio securities, thus
increasing its turnover rate. The exercise by the Fund of puts on
securities will cause the sale of underlying investments, increasing
portfolio turnover. Although the decision whether to exercise a put it
holds is within the Fund's control, holding a put might cause the Fund
to sell the related investments for reasons that would not exist in the
absence of the put. The Fund will pay a brokerage commission each time
it buys or sells a call, put or an underlying investment in connection
with the exercise of a put or call. Those commissions may be higher
than the commissions for direct purchases or sales of the underlying
investments.
Premiums paid for options are small in relation to the market value
of the underlying investments and, consequently, put and call options
offer large amounts of leverage. The leverage offered by trading in
options could result in the Fund's net asset value being more sensitive
to changes in the value of the underlying investments.
- Options on Foreign Currency. The Fund intends to write and
purchase calls on foreign currencies. The Fund may purchase and write
puts and calls on foreign currencies that are traded on a securities or
commodities exchange or over-the-counter markets or are quoted by major
recognized dealers in such options. It does so to protect against
declines in the dollar value of foreign securities and against
increases in the dollar cost of foreign securities to be acquired. If
the Manager anticipates a rise in the dollar value of a foreign
currency in which securities to be acquired are denominated, the
increased cost of such securities may be partially offset by purchasing
calls or writing puts on that foreign currency. If a decline in the
dollar value of a foreign currency is anticipated, the decline in value
of portfolio securities denominated in that currency may be partially
offset by writing calls or purchasing puts on that foreign currency.
However, in the event of currency rate fluctuations adverse to the
Fund's position, it would lose the premium it paid and transactions
costs.
A call written on a foreign currency by the Fund is covered if the
Fund owns the underlying foreign currency covered by the call or has an
absolute and immediate right to acquire that foreign currency without
additional cash consideration (or for additional cash consideration
held in a segregated account by its custodian) upon conversion or
exchange of other foreign currency held in its portfolio. A call may
be written by the Fund on a foreign currency to provide a hedge against
a decline due to an expected adverse change in the exchange rate in the
U.S. dollar value of a security which the Fund owns or has the right to
acquire and which is denominated in the currency underlying the option.
This is a cross-hedging strategy. In such circumstances, the Fund
collateralizes the option by maintaining in a segregated account with
the Fund's custodian, cash or U.S. Government Securities in an amount
not less than the value of the underlying foreign currency in U.S.
dollars marked-to-market daily.
- Forward Contracts. The Fund may enter into foreign currency
exchange contracts ("Forward Contracts"), which obligate the seller to
deliver and the purchaser to take a specific amount of foreign currency
at a specific future date for a fixed price. A Forward Contract
involves bilateral obligations of one party to purchase, and another
party to sell, a specific currency at a future date (which may be any
fixed number of days from the date of the contract agreed upon by the
parties), at a price set at the time the contract is entered into.
These contracts are generally traded in the interbank market conducted
directly between currency traders (usually large commercial banks) and
their customers. The Fund may enter into a Forward Contract in order
to "lock in" the U.S. dollar price of a security denominated in a
foreign currency which it has purchased or sold but which has not yet
settled, or to protect against a possible loss resulting from an
adverse change in the relationship between the U.S. dollar and a
foreign currency.
There is a risk that use of Forward Contracts may reduce the gain
that would otherwise result from a change in the relationship between
the U.S. dollar and a foreign currency. Forward contracts include
standardized foreign currency futures contracts which are traded on
exchanges and are subject to procedures and regulations applicable to
other Futures. The Fund may also enter into a forward contract to sell
a foreign currency denominated in a currency other than that in which
the underlying security is denominated. This is done in the
expectation that there is a greater correlation between the foreign
currency of the forward contract and the foreign currency of the
underlying investment than between the U.S. dollar and the foreign
currency of the underlying investment. This technique is referred to
as "cross hedging." The success of cross hedging is dependent on many
factors, including the ability of the Manager to correctly identify and
monitor the correlation between foreign currencies and the U.S. dollar.
To the extent that the correlation is not identical, the Fund may
experience losses or gains on both the underlying security and the
cross currency hedge.
The Fund may use Forward Contracts to protect against uncertainty
in the level of future exchange rates. The use of Forward Contracts
does not eliminate fluctuations in the prices of the underlying
securities the Fund owns or intends to acquire, but it does fix a rate
of exchange in advance. In addition, although Forward Contracts limit
the risk of loss due to a decline in the value of the hedged
currencies, at the same time they limit any potential gain that might
result should the value of the currencies increase.
There is no limitation as to the percentage of the Fund's assets
that may be committed to foreign currency exchange contracts. The Fund
does not enter into such forward contracts or maintain a net exposure
in such contracts to the extent that the Fund would be obligated to
deliver an amount of foreign currency in excess of the value of the
Fund's assets denominated in that currency, or enter into a "cross
hedge," unless it is denominated in a currency or currencies that the
Manager believes will have price movements that tend to correlate
closely with the currency in which the investment being hedged is
denominated. See "Tax Aspects of Covered Calls and Hedging
Instruments" below for a discussion of the tax treatment of foreign
currency exchange contracts
The Fund may enter into Forward Contracts with respect to specific
transactions. For example, when the Fund enters into a contract for
the purchase or sale of a security denominated in a foreign currency,
or when the Fund anticipates receipt of dividend payments in a foreign
currency, the Fund may desire to "lock-in" the U.S. dollar price of the
security or the U.S. dollar equivalent of such payment by entering into
a Forward Contract, for a fixed amount of U.S. dollars per unit of
foreign currency, for the purchase or sale of the amount of foreign
currency involved in the underlying transaction ("transaction hedge").
The Fund will thereby be able to protect itself against a possible loss
resulting from an adverse change in the relationship between the
currency exchange rates during the period between the date on which the
security is purchased or sold, or on which the payment is declared, and
the date on which such payments are made or received.
The Fund may also use Forward Contracts to lock in the U.S. dollar
value of portfolio positions ("position hedge"). In a position hedge,
for example, when the Fund believes that foreign currency may suffer a
substantial decline against the U.S. dollar, it may enter into a
forward sale contract to sell an amount of that foreign currency
approximating the value of some or all of the Fund's portfolio
securities denominated in such foreign currency, or when the Fund
believes that the U.S. dollar may suffer a substantial decline against
a foreign currency, it may enter into a forward purchase contract to
buy that foreign currency for a fixed dollar amount. In this situation
the Fund may, in the alternative, enter into a forward contract to sell
a different foreign currency for a fixed U.S. dollar amount where the
Fund believes that the U.S. dollar value of the currency to be sold
pursuant to the forward contract will fall whenever there is a decline
in the U.S. dollar value of the currency in which portfolio securities
of the Fund are denominated ("cross hedge").
The Fund's Custodian will place cash or U.S. Government securities
or other liquid high-quality debt securities in a separate account of
the Fund having a value equal to the aggregate amount of the Fund's
commitments under forward contracts to cover its short positions. If
the value of the securities placed in the separate account declines,
additional cash or securities will be placed in the account on a daily
basis so that the value of the account will equal the amount of the
Fund's net commitments with respect to such contracts. As an
alternative to maintaining all or part of the separate account, the
Fund may purchase a call option permitting the Fund to purchase the
amount of foreign currency being hedged by a forward sale contract at a
price no higher than the forward contract price, or the Fund may
purchase a put option permitting the Fund to sell the amount of foreign
currency subject to a forward purchase contract at a price as high or
higher than the forward contract price. Unanticipated changes in
currency prices may result in poorer overall performance for the Fund
than if it had not entered into such contracts.
The precise matching of the Forward Contract amounts and the value
of the securities involved will not generally be possible because the
future value of such securities in foreign currencies will change as a
consequence of market movements in the value of these securities
between the date the Forward Contract is entered into and the date it
is sold. Accordingly, it may be necessary for the Fund to purchase
additional foreign currency on the spot (i.e., cash) market (and bear
the expense of such purchase), if the market value of the security is
less than the amount of foreign currency the Fund is obligated to
deliver and if a decision is made to sell the security and make
delivery of the foreign currency. Conversely, it may be necessary to
sell on the spot market some of the foreign currency received upon the
sale of the portfolio security if its market value exceeds the amount
of foreign currency the Fund is obligated to deliver. The projection
of short-term currency market movements is extremely difficult, and the
successful execution of a short-term hedging strategy is highly
uncertain. Forward Contracts involve the risk that anticipated
currency movements will not be accurately predicted, causing the Fund
to sustain losses on these contracts and transactions costs.
At or before the maturity of a Forward Contract requiring the Fund
to sell a currency, the Fund may either sell a portfolio security and
use the sale proceeds to make delivery of the currency or retain the
security and offset its contractual obligation to deliver the currency
by purchasing a second contract pursuant to which the Fund will obtain,
on the same maturity date, the same amount of the currency that it is
obligated to deliver. Similarly, the Fund may close out a Forward
Contract requiring it to purchase a specified currency by entering into
a second contract entitling it to sell the same amount of the same
currency on the maturity date of the first contract. The Fund would
realize a gain or loss as a result of entering into such an offsetting
Forward Contract under either circumstance to the extent the exchange
rate or rates between the currencies involved moved between the
execution dates of the first contract and offsetting contract.
The cost to the Fund of engaging in Forward Contracts varies with
factors such as the currencies involved, the length of the contract
period and the market conditions then prevailing. Because Forward
Contracts are usually entered into on a principal basis, no fees or
commissions are involved. Because such contracts are not traded on an
exchange, the Fund must evaluate the credit and performance risk of
each particular counterparty under a Forward Contract.
Although the Fund values its assets daily in terms of U.S. dollars,
it does not intend to convert all of its holdings of foreign currency
deposits into U.S. dollars on a daily basis. The Fund may convert
foreign currency from time to time, and investors should be aware of
the costs of currency conversion. Foreign exchange dealers do not
charge a fee for conversion, but they do seek to realize a profit based
on the difference between the prices at which they buy and sell various
currencies. Thus, a dealer may offer to sell a foreign currency to the
Fund at one rate, while offering a lesser rate of exchange should the
Fund desire to resell that currency to the dealer.
- Regulatory Aspects of Hedging Instruments. The Fund is required
to operate within certain guidelines and restrictions with respect to
its use of Futures and options on Futures established by the Commodity
Futures Trading Commission ("CFTC"). In particular the Fund is
exempted from registration with the CFTC as a "commodity pool operator"
if the Fund complies with the requirements of Rule 4.5 adopted by the
CFTC. The Rule does not limit the percentage of the Fund's assets that
may be used for Futures margin and related options premiums for a bona
fide hedging position. However, under the Rule the Fund must limit its
aggregate initial Futures margin and related option premiums to no more
than 5% of the Fund's net assets for hedging purposes that are not
considered bona fide hedging strategies under the Rule. Under the
Rule, the Fund also must use short Futures and Futures options
positions solely for "bona fide hedging purposes" within the meaning
and intent of the applicable provisions of the Commodity Exchange Act.
Transactions in options by the Fund are subject to limitations
established by option exchanges governing the maximum number of options
that may be written or held by a single investor or group of investors
acting in concert, regardless of whether the options were written or
purchased on the same or different exchanges or are held in one or more
accounts or through one or more different exchanges or through one or
more brokers. Thus the number of options which the Fund may write or
hold may be affected by options written or held by other entities,
including other investment companies having the same adviser as the
Fund (or an adviser that is an affiliate of the Fund's adviser). The
exchanges also impose position limits on Futures transactions. An
exchange may order the liquidation of positions found to be in
violation of those limits and may impose certain other sanctions.
Due to requirements under the Investment Company Act, when the Fund
purchases a Future, the Fund will maintain, in a segregated account or
accounts with its Custodian, cash or readily-marketable, short-term
(maturing in one year or less) debt instruments in an amount equal to
the market value of the securities underlying such Future, less the
margin deposit applicable to it.
- Tax Aspects of Covered Calls and Hedging Instruments. The Fund
intends to qualify as a "regulated investment company" under the
Internal Revenue Code (although it reserves the right not to qualify).
That qualification enables the Fund to "pass through" its income and
realized capital gains to shareholders without having to pay tax on
them. This avoids a "double tax" on that income and capital gains,
since shareholders normally will be taxed on the dividends and capital
gains they receive from the Fund (unless the Fund's shares are held in
a retirement account or the shareholder is otherwise exempt from tax).
One of the tests for the Fund's qualification as a regulated investment
company is that less than 30% of its gross income must be derived from
gains realized on the sale of securities held for less than three
months. To comply with this 30% cap, the Fund will limit the extent to
which it engages in the following activities, but will not be precluded
from them: (i) selling investments, including Stock Index Futures, held
for less than three months, whether or not they were purchased on the
exercise of a call held by the Fund; (ii) purchasing options which
expire in less than three months; (iii) effecting closing transactions
with respect to calls or puts written or purchased less than three
months previously; (iv) exercising puts or calls held by the Fund for
less than three months; or (v) writing calls on investments held less
than three months.
Certain foreign currency exchange contracts (Forward Contracts) in
which the Fund may invest are treated as "section 1256 contracts."
Gains or losses relating to section 1256 contracts generally are
characterized under the Internal Revenue Code as 60% long-term and 40%
short-term capital gains or losses. However, foreign currency gains or
losses arising from certain section 1256 contracts (including Forward
Contracts) generally are treated as ordinary income or loss. In
addition, section 1256 contracts held by the Fund at the end of each
taxable year are "marked-to-market" with the result that unrealized
gains or losses are treated as though they were realized. These
contracts also may be marked-to-market for purposes of the excise tax
applicable to investment company distributions and for other purposes
under rules prescribed pursuant to the Internal Revenue Code. An
election can be made by the Fund to exempt these transactions from this
marked-to-market treatment.
Certain Forward Contracts entered into by the Fund may result in
"straddles" for Federal income tax purposes. The straddle rules may
affect the character of gains (or losses) realized by the Fund on
straddle positions. Generally, a loss sustained on the disposition of
a position(s) making up a straddle is allowed only to the extent such
loss exceeds any unrecognized gain in the offsetting positions making
up the straddle. Disallowed loss is generally allowed at the point
where there is no unrecognized gain in the offsetting positions making
up the straddle, or the offsetting position is disposed of.
Under the Internal Revenue Code, gains or losses attributable to
fluctuations in exchange rates which occur between the time the Fund
accrues interest or other receivables or accrues expenses or other
liabilities denominated in a foreign currency and the time the Fund
actually collects such receivables or pays such liabilities generally
are treated as ordinary income or ordinary loss. Similarly, on
disposition of debt securities denominated in a foreign currency and on
disposition of foreign currency forward contracts, gains or losses
attributable to fluctuations in the value of a foreign currency between
the date of acquisition of the security or contract and the date of
disposition also are treated as an ordinary gain or loss. Currency
gains and losses are offset against market gains and losses on each
trade before determining a net "section 988" gain or loss under the
Internal Revenue Code, which may ultimately increase or decrease the
amount of the Fund's investment company income available for
distribution to its shareholders.
- Risks of Hedging With Options and Futures. An option position
may be closed out only on a market that provides secondary trading for
options of the same series, and there is no assurance that a liquid
secondary market will exist for any particular option. In addition to
the risks associated with hedging that are discussed in the Prospectus
and above, there is a risk in using short hedging by (i) selling Stock
Index Futures or (ii) purchasing puts on stock indices or Stock Index
Futures to attempt to protect against declines in the value of the
Fund's equity securities. The risk is that the prices of Stock Index
Futures will correlate imperfectly with the behavior of the cash (i.e.,
market value) prices of the Fund's equity securities. The ordinary
spreads between prices in the cash and futures markets are subject to
distortions, due to differences in the natures of those markets.
First, all participants in the futures markets are subject to margin
deposit and maintenance requirements. Rather than meeting additional
margin deposit requirements, investors may close out futures contracts
through offsetting transactions which could distort the normal
relationship between the cash and futures markets. Second, the
liquidity of the futures markets depends on participants entering into
offsetting transactions rather than making or taking delivery. To the
extent participants decide to make or take delivery, liquidity in the
futures markets could be reduced, thus producing distortion. Third,
from the point of view of speculators, the deposit requirements in the
futures markets are less onerous than margin requirements in the
securities markets. Therefore, increased participation by speculators
in the futures markets may cause temporary price distortions.
The risk of imperfect correlation increases as the composition of
the Fund's portfolio diverges from the securities included in the
applicable index. To compensate for the imperfect correlation of
movements in the price of the equity securities being hedged and
movements in the price of the hedging instruments, the Fund may use
hedging instruments in a greater dollar amount than the dollar amount
of equity securities being hedged if the historical volatility of the
prices of the equity securities being hedged is more than the
historical volatility of the applicable index. It is also possible
that if the Fund has used hedging instruments in a short hedge, the
market may advance and the value of equity securities held in the
Fund's portfolio may decline. If that occurred, the Fund would lose
money on the hedging instruments and also experience a decline in value
in its portfolio securities. However, while this could occur for a
very brief period or to a very small degree, over time the value of a
diversified portfolio of equity securities will tend to move in the
same direction as the indices upon which the hedging instruments are
based.
If the Fund uses hedging instruments to establish a position in the
equities markets as a temporary substitute for the purchase of
individual equity securities (long hedging) by buying Stock Index
Futures and/or calls on such Futures, on securities or on stock
indices, it is possible that the market may decline. If the Fund then
concludes not to invest in equity securities at that time because of
concerns as to a possible further market decline or for other reasons,
the Fund will realize a loss on the hedging instruments that is not
offset by a reduction in the price of the equity securities purchased.
- Short Sales Against-the-Box. In this type of short sale, while
the short position is open, the Fund must own an equal amount of the
securities sold short, or by virtue of ownership of other securities
have the right, without payment of further consideration, to obtain an
equal amount of the securities sold short. Short sales against-the-box
may be made to defer, for Federal income tax purposes, recognition of
gain or loss on the sale of securities "in the box" until the short
position is closed out. They may also be used to protect a gain on the
security "in-the-box" when the Fund does not want to sell it and
recognize a capital gain.
Other Investment Restrictions
The Fund's significant investment restrictions are described in the
Prospectus. The following are also fundamental policies, and together
with the Fund's fundamental policies described in the Prospectus,
cannot be changed without the approval of a "majority" of the Fund's
outstanding voting securities. Such a "majority" vote is defined in
the Investment Company Act as the vote of the holders of the lesser of:
(I) 67% or more of the shares present or represented by proxy at a
shareholders meeting, if the holders of more than 50% of the
outstanding shares are present or represented by proxy; or (ii) more
than 50% of the outstanding shares.
Under these additional restrictions, the Fund cannot:
- invest in companies for the primary purpose of acquiring control
or management thereof;
- invest in commodities or in commodities contracts; other than the
hedging instruments 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;
- invest in real estate or in interests in real estate, but may
purchase readily marketable securities of companies holding real estate
or interests therein;
- purchase securities on margin; however, the Fund may make margin
deposits in connection with any of the hedging instruments permitted by
any of its other fundamental policies;
- lend money, but the Fund may invest in all or a portion of an
issue of bonds, debentures, commercial paper, or other similar
corporate obligations of the types that are usually purchased by
institutions, whether or not publicly distributed, provided that such
obligations which are not publicly distributed shall be subject to the
limits on the amount set forth in the Prospectus under the caption
"Illiquid and Restricted Securities"; the Fund may also make loans of
portfolio securities, subject to the restrictions set forth in the
Prospectus and above under the caption "Loans of Portfolio Securities";
- mortgage or pledge any of its assets; such prohibition against
mortgaging or pledging does not prohibit the escrow arrangements
contemplated by the writing of covered call options or other collateral
or margin arrangements in connection with any of the Hedging
Instruments permitted by any of its other fundamental policies;
- underwrite securities of other companies, except insofar as it
might be deemed to be an underwriter for purposes of the Securities Act
of 1933 in the resale of any securities held in its own portfolio;
- invest or hold securities of any issuer if those officers and
directors or trustees of the Fund or its adviser owning individually
more than 1/2 of 1% of the securities of such issuer together own more
than 5% of the securities of such issuer; or
- invest in other open-end investment companies, or invest more than
5% of its net assets at the time of purchase in closed-end investment
companies, including small business investment companies, nor make any
such investments at commission rates in excess of normal brokerage
commissions. The percentage restrictions described above and in the
Prospectus apply only at the time of investment and require no action
by the Fund as a result of subsequent changes in relative values.
In connection with the qualification of its shares in certain
states, the Fund has undertaken that in addition to the above, it will
not: (1) invest more than 5% of its assets in securities of issuers,
including their predecessors, which have been in continuous operation
for less than three continuous years; or (2) invest any part of its
assets in oil, gas or other mineral exploration or development
programs. In the event that the Fund's shares cease to be qualified
under such laws or if such undertaking(s) otherwise cease to be
operative, the Fund would not be subject to such restrictions.
For purposes of the Fund's policy not to concentrate its assets,
described in "Other Investment Restrictions" in the Prospectus, the
Fund has adopted the industry classifications set forth in the Appendix
to this Statement of Additional Information. This is not a fundamental
policy.
How the Fund Is Managed
Organization and History. As a Massachusetts business trust, the Fund
is not required to hold, and does not plan to hold, regular annual
meetings of shareholders. The Fund will hold meetings when required to
do so by the Investment Company Act or other applicable law, or when a
shareholder meeting is called by the Trustees or upon proper request of
the shareholders. Shareholders have the right, upon the declaration in
writing or vote of two-thirds of the outstanding shares of the Fund, to
remove a Trustee. The Trustees will call a meeting of shareholders to
vote on the removal of a Trustee upon the written request of the record
holders of 10% of its outstanding shares. In addition, if the Trustees
receive a request from at least 10 shareholders (who have been
shareholders for at least six months) holding shares of the Fund valued
at $25,000 or more or holding at least 1% of the Fund's outstanding
shares, whichever is less, stating that they wish to communicate with
other shareholders to request a meeting to remove a Trustee, the
Trustees will then either make the Fund's shareholder list available to
the applicants or mail their communication to all other shareholders at
the applicants' expense, or the Trustees may take such other action as
set forth under Section 16(c) of the Investment Company Act.
The Fund's Declaration of Trust contains an express disclaimer of
shareholder or Trustee liability for the Fund's obligations, and
provides for indemnification and reimbursement of expenses out of its
property for any shareholder held personally liable for its
obligations. The Declaration of Trust also provides that the Fund
shall, upon request, assume the defense of any claim made against any
shareholder for any act or obligation of the Fund and satisfy any
judgment thereon. Thus, while Massachusetts law permits a shareholder
of a business trust (such as the Fund) to be held personally liable as
a "partner" under certain circumstances, the risk of a Fund shareholder
incurring financial loss on account of shareholder liability is limited
to the relatively remote circumstances in which the Fund would be
unable to meet its obligations described above. Any person doing
business with the Trust, and any shareholder of the Trust, agrees under
the Trust's Declaration of Trust to look solely to the assets of the
Trust for satisfaction of any claim or demand which may arise out of
any dealings with the Trust, and the Trustees shall have no personal
liability to any such person, to the extent permitted by law.
Trustees and Officers of the Fund. The Fund's Trustees and officers
and their principal occupations and business affiliations during the
past five years are set forth below. The address for each Trustee and
officer is Two World Trade Center, New York, New York 10048-0203,
unless another address is listed below. All of the Trustees are also
trustees of Oppenheimer Fund, Oppenheimer Growth Fund, Oppenheimer Tax-
Free Bond Fund, Oppenheimer Money Market Fund, Inc., Oppenheimer Target
Fund, Oppenheimer U.S. Government Trust, Oppenheimer New York Tax-
Exempt Fund, Oppenheimer California Tax-Exempt Fund, Oppenheimer Multi-
State Tax-Exempt Trust, Oppenheimer Asset Allocation Fund, Oppenheimer
Gold & Special Minerals Fund, Oppenheimer Discovery Fund, Oppenheimer
Global Growth & Income Fund, Oppenheimer Global Emerging Growth Fund,
Oppenheimer Multi-Sector Income Trust and Oppenheimer Multi-Government
Trust (collectively, the "New York-based Oppenheimer funds"). Messrs.
Spiro, Bishop, Bowen, Donohue, Farrar and Zack, respectively, hold the
same offices with the other New York-based Oppenheimer funds as with
the Fund. As of July 7, 1995, the Trustees and officers of the Fund as
a group owned of record or beneficially less than 1% of each class of
shares of the Fund. The foregoing statement does not reflect shares
held of record by an employee benefit plan for employees of the Manager
for which an officer of the Fund (Andrew J. Donohue) is a trustee,
other than the shares beneficially owned under that plan by officers of
the Fund listed below.
Leon Levy, Chairman of the Board of Trustees; Age 69
31 West 52nd Street, New York, New York 10019
General Partner of Odyssey Partners, L.P. (investment partnership) and
Chairman of Avatar Holdings, Inc. (real estate development).
Leo Cherne, Trustee; Age 82
#122 East 42nd Street, New York, New York 10168
Chairman Emeritus of the International Rescue Committee (philanthropic
organization); formerly Executive Director of The Research Institute of
America.
Robert G. Galli, Trustee*; Age 62
Vice Chairman of the Manager and Vice President and Counsel of
Oppenheimer Acquisition Corp. ("OAC"), 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 Oppenheimer funds and Executive Vice
President and General Counsel of the Manager and the Distributor.
Benjamin Lipstein, Trustee; Age 72
591 Breezy Hill Road, Hillsdale, New York 12529
Professor Emeritus of Marketing, Stern Graduate School of Business
Administration, New York University; a director of Sussex Publishers,
Inc. (Publishers of Psychology Today and Mother Earth News) and of Spy
Magazine, L.P.
______________________________________
*A Trustee who is an "interested person" of the Fund as defined in the
Investment Company Act.
Elizabeth B. Moynihan, Trustee; Age 65
801 Pennsylvania Avenue, N.W., Washington, D.C. 20004
Author and architectural historian; a trustee of the Freer Gallery of
Art (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, Trustee; Age 68
6 Whittaker's Mill, Williamsburg, Virginia 23185
A Director of Dominion Resources, Inc. (electric utility holding
company), Dominion Energy, Inc. (electric power and oil & gas
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, Trustee; Age 65
40 Park Avenue, New York, New York 10016
President of Jerome Levy Economics Institute; a member of the U.S.
Competitiveness Policy Council; a director of GranCare, Inc. (health
care provider); formerly New York State Comptroller and a trustee, New
York State and Local Retirement Fund.
Russell S. Reynolds, Jr., Trustee; Age 63
200 Park Avenue, New York, New York 10166
Founder and Chairman of Russell Reynolds Associates, Inc. (executive
recruiting); Chairman of Directors Publication, Inc. (consulting and
publishing); a trustee of Mystic Seaport Museum, International House,
the Greenwich Historical Society and Greenwich Hospital.
Sidney M. Robbins, Trustee; Age 83
50 Overlook Road, Ossining, New York 10562
Chase Manhattan Professor Emeritus of Financial Institutions, Graduate
School of Business, Columbia University; Visiting Professor of Finance,
University of Hawaii; a director of The Korea Fund, Inc. (a closed-end
investment company); a member of the Board of Advisors, Olympus Private
Placement Fund, L.P.; Professor Emeritus of Finance, Adelphi
University.
Donald W. Spiro, President and Trustee*; Age 69
Chairman Emeritus and a director of the Manager; formerly Chairman of
the Manager and the Distributor.
Pauline Trigere, Trustee; Age 82
498 Seventh Avenue, New York, New York 10018
Chairman and Chief Executive Officer of Trigere, Inc. (design and sale
of women's fashions).
________________________________________
*A Trustee who is an "interested person" of the Fund as defined in the
Investment Company Act.
Clayton K. Yeutter, Trustee; Age 64
1325 Merrie Ridge Road, McLean, Virginia 22101
Of Counsel to Hogan & Hartson (a law firm); a director of B.A.T.
Industries, Ltd. (tobacco and financial services), Caterpillar, Inc.
(machinery), ConAgra, Inc. (food and agricultural products), Farmers
Insurance Company (insurance), FMC Corp. (chemicals and machinery),
Lindsay Manufacturing Co. (irrigation equipment), Texas Instruments,
Inc. (electronics) and The Vigoro Corporation (fertilizer
manufacturer); formerly (in descending chronological order) Counsellor
to the President (Bush) for Domestic Policy; Chairman of the Republican
National Committee, Secretary of the U.S. Department of Agriculture,
and U.S. Trade Representative.
William L. Wilby, Vice President and Portfolio Manager; Age 50
Senior Vice President of the Manager and HarbourView; an officer of
other Oppenheimer funds; formerly international investment strategist
at Brown Brothers, Harriman & Co., prior to which he was a Managing
Director and Portfolio Manager at AIG Global Investors.
Andrew J. Donohue, Secretary; Age 45
Executive Vice President and General Counsel of the Manager and the
Distributor; an officer of other Oppenheimer funds; formerly Senior
Vice President and Associate General Counsel of the Manager and the
Distributor, partner in Kraft & McManimon (a law firm), an officer of
First Investors Corporation (a broker-dealer) and First Investors
Management Company, Inc. (broker-dealer and investment adviser); and
director and an officer of First Investors Family of Funds and First
Investors Life Insurance Company.
George C. Bowen, Treasurer; Age 58
3410 South Galena Street, Denver, Colorado 80231
Senior Vice President and Treasurer of the Manager; Vice President and
Treasurer of the Distributor and HarbourView; Senior Vice President,
Treasurer and Assistant Secretary and a director of Centennial; Vice
President, Treasurer and Secretary of SSI and SFSI; an officer of other
Oppenheimer funds.
Robert G. Zack, Assistant Secretary; Age 47
Senior Vice President and Associate General Counsel of the Manager;
Assistant Secretary of SSI and SFSI; an officer of other Oppenheimer
funds.
Robert J. Bishop, Assistant Treasurer; Age 36
3410 South Galena Street, Denver, Colorado 80231
Assistant Vice President of the Manager/Mutual Fund Accounting; an
officer of other Oppenheimer funds; previously a Fund Controller of 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
3410 South Galena Street, Denver, Colorado 80231
Assistant Vice President of the Manager/Mutual Fund Accounting; an
officer of other Oppenheimer funds; previously a Fund Controller for
the Manager, prior to which he was an International Mutual Fund
Supervisor for Brown Brothers Harriman & Co. (a bank) and previously a
Senior Fund Accountant for State Street Bank & Trust Company, before
which he was a sales representative for Central Colorado Planning.
- 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 from (I) the
Fund during its fiscal year ended September 30, 1994, and (ii) from all
17 of the New York-based Oppenheimer funds (including the Fund) listed
in the first paragraph of this section (and from Oppenheimer Global
Environment Fund, Oppenheimer Time Fund and Oppenheimer Mortgage Income
Fund, former New York-based Oppenheimer funds), for services in the
positions shown:
<TABLE>
<CAPTION>
Retirement
Benefits Total Compensation
Aggregate Accrued as From All
Compensation Part of New York-based
Name and Position From Fund Fund Expenses Oppenheimer Funds1
<S> <C> <C> <C>
Leon Levy, Chairman and Trustee 26,187 27,813 $141,000.00
Leo Cherne, Audit Committee 12,783 13,577 $ 68,800.00
Member and Trustee
Edmund T. Delaney, 16,011 17,005 $ 86,200
Study Committee
Member and Trustee2
Benjamin Lipstein, 16,011 17,005 $ 86,200.00
Study Committee
Member and Trustee
Elizabeth B. Moynihan, 11,257 11,956 $ 60,625.00
Study Committee
Member and3 Trustee
Kenneth A. Randall, 14,564 15,468 $ 78,400.00
Audit Committee Member
and Trustee
Edward V. Regan, 10,466 11,095 $ 56,275.00
Audit Committee
Member3 and Trustee
Russell S. Reynolds, Jr.,Trustee 9,683 10,284 $ 52,100.00
Sidney M. Robbins, Study 22,689 24,098 $122,100.00
Committee Chairman, Audit
Committee Vice-Chairman
and Trustee
Pauline Trigere, Trustee 9,683 10,284 $ 52,100.00
Clayton K. Yeutter, Trustee 9,683 10,284 $ 52,100.00
<FN>
______________________
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.
</TABLE>
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 Oppenheimer funds for at least 15 years to be
eligible for the maximum payment. Because each Trustee's Retirement
benefits will depend on the amount of the Trustee's future compensation
and length of service, the amount of those benefits cannot be
determined at this time, nor can the Fund estimate the number of years
of credited service that will be used to determine those benefits. No
payments had been made by the Fund under the plan as of September 30,
1994.
- Major Shareholders. As of July 7, 1995, the only person who
owned of record or was known by the Fund to own beneficially 5% or more
of the Fund's outstanding Class A or Class B shares was Nationwide
Insurance Company ("Nationwide"), P.O. Box 182029, Columbus, OH 43218-
2029; on that date Nationwide's Qualified Plan Variable ("QPVA") owned
4,435,981.670 Class B shares (7.47% of the Class B shares then
outstanding).
The Manager and Its Affiliates. The Manager is wholly-owned by
Oppenheimer Acquisition Corp. ("OAC"), a holding company controlled by
Massachusetts Mutual Life Insurance Company. OAC is also owned in part
by certain of the Manager's directors and officers, some of whom also
serve as officers of the Fund, and two of whom (Messrs. Spiro and
Galli) serve as Trustees of the Fund.
The Manager and the Fund have a Code of Ethics. It is designed to
detect and prevent improper personal trading by certain employees,
including portfolio managers, that would compete with or take advantage
of the Fund's portfolio transactions. Compliance with the Code of
Ethics is carefully monitored and strictly enforced by the Manager.
- The Investment Advisory Agreement. A management fee is payable
monthly to the Manager under the terms of the investment advisory
agreement between the Manager and the Fund and is computed on the
aggregate net assets of the Fund as of the close of business each day.
The investment advisory agreement requires the Manager, at its expense,
to provide the Fund with adequate office space, facilities and
equipment, and to provide and supervise the activities of all
administrative and clerical personnel required to provide effective
corporate administration for 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. On June 27, 1994, shareholders of the Fund approved a new
Agreement providing for the current management fee rates stated in the
Prospectus.
Expenses not expressly assumed by the Manager under the advisory
agreement or by the Distributor under the General Distributor's
Agreement are paid by the Fund. The advisory agreement lists examples
of expenses paid by the Fund, the major categories of which relate to
interest, taxes, brokerage commissions, fees to certain Trustees, legal
and audit expenses, custodian and transfer agent expenses, share
issuance costs, certain printing and registration costs and non-
recurring expenses, including litigation costs. For the Fund's fiscal
years ended September 30, 1992, 1993, and 1994, the management fees
paid by the Fund to the Manager were $7,949,934, $8,063,451, and
$11,927,942, respectively.
The Agreement contains no expense limitation. However,
independently of the Agreement, the Manager has undertaken that the
total expenses of the Fund in any fiscal year (including the management
fee but excluding taxes, interest, brokerage commissions, distribution
assistance payments and extraordinary expenses, such as litigation
costs) shall not exceed the most stringent expense limitation imposed
under state law applicable to the Fund. Pursuant of the undertaking,
the Manager's fee will be reduced at the end of a month so that there
will not be any accrued but unpaid liability under this undertaking.
Currently, the most stringent state expense limitation is imposed by
California and limits the Fund's expenses (with specified exclusions)
to 2.5% of the first $30 million of average annual net assets, 2.0% of
the next $70 million of average annual net assets and 1.5% of average
annual net assets in excess of $100 million. In addition, the Manager
has voluntarily agreed to reduce the management fee to which it is
entitled under the Agreement to 0.65% of net assets in excess of $3.5
billion. Any assumption of the Fund's expenses under these limitations
would lower the Fund's overall expense ratio and increase its total
return during any period during which expenses are limited. The
Manager reserves the right to amend or terminate these expense
undertakings at any time.
The Agreement provides that in the absence of willful misfeasance,
bad faith, gross negligence in the performance of its duties, or
reckless disregard for its obligations and duties thereunder, the
Manager is not liable for any loss sustained by reason of good faith
errors or omissions in connection with any matters to which the
Agreement relates. The Agreement permits the Manager to act as
investment adviser for any other person, firm or corporation and to use
the name "Oppenheimer" in connection with other investment companies
for which it may act as investment adviser or general distributor. 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.
- The Distributor. Under its General Distributor's Agreement
with the Fund, the Distributor acts as the Fund's principal underwriter
in the continuous public offering of the Fund's Class A, Class B and
Class C shares but is not obligated to sell a specific number of
shares. Expenses normally attributable to sales, (excluding payments
under the Distribution and Service Plans but including advertising and
the cost of printing and mailing prospectuses, other than those
furnished to existing shareholders), are borne by the Distributor.
During the Fund's fiscal years ended September 30, 1992, 1993, and
1994, the aggregate sales charges on sales of the Fund's Class A shares
were $12,026,496, $4,864,818, and $8,458,588, respectively, of which
the Distributor and an affiliated broker-dealer retained in the
aggregate $3,494,475, $1,356,117, and $2,717,037 in those respective
years. During the Fund's fiscal year ended September 30, 1994, the
contingent deferred sales charges collected on the Fund's Class B
shares totaled $113,861, all of which the Distributor retained. During
the same period, Class C shares were not publicly offered, and no
contingent deferred sales charges were collected. For additional
information about distribution of the Fund's shares and the payments
made by the Fund to the Distributor in connection with such activities,
please refer to "Distribution and Service Plans," below.
- The Transfer Agent. Oppenheimer Shareholder Services, the
Fund's Transfer Agent, is responsible for maintaining the Fund's
shareholder registry and shareholder accounting records, and for
shareholder servicing and administrative functions.
Brokerage Policies of the Fund
Brokerage Provisions of the Investment Advisory Agreement. One of the
duties of the Manager under the advisory agreement is to arrange the
portfolio transactions for the Fund. The advisory agreement contains
provisions relating to the employment of broker-dealers ("brokers") to
effect the Fund's portfolio transactions. In doing so, the Manager is
authorized by the advisory agreement 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. Purchases of securities from underwriters include a
commission or concession paid by the issuer to the underwriter, and
purchases from dealers include a spread between the bid and asked
price.
Under the advisory agreement, the Manager is authorized to select
brokers that provide brokerage and/or research services for the Fund
and/or the other accounts over which the Manager or its affiliates have
investment discretion. The commissions paid to such brokers may be
higher than another qualified broker would have charged if a good faith
determination is made by the Manager that the 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 Followed by the Manager. Subject
to the provisions of the advisory agreement, and the procedures and
rules described above, allocations of brokerage are generally made by
the Manager's portfolio traders based upon recommendations from the
Manager's portfolio managers. In certain instances, portfolio managers
may directly place trades and allocate brokerage, also subject to the
provisions of the advisory agreement and the procedures and rules
described above. In either case, brokerage is allocated under the
supervision of the Manager's executive officers. Transactions in
securities other than those for which an exchange is the primary market
are generally done with principals or market makers. Brokerage
commissions are paid primarily for effecting transactions in listed
securities or for certain fixed-income agency transactions in the
secondary market, and are otherwise paid only if it appears likely that
a better price or execution can be obtained. When the Fund engages in
an option transaction, ordinarily the same broker will be used for the
purchase or sale of the option and any transaction in the securities to
which the option relates. When possible, concurrent orders to purchase
or sell the same security by more than one of the accounts managed by
the Manager or its affiliates are combined. The transactions effected
pursuant to such combined orders are averaged as to price and allocated
in accordance with the purchase or sale orders actually placed for each
account. Option commissions may be relatively higher than those which
would apply to direct purchases and sales of portfolio securities.
The research services provided by a particular broker may be
useful only to one or more of the advisory accounts of the Manager and
its affiliates, and investment research received for the commissions of
those other accounts may be useful both to the Fund and one or more of
such other accounts. Such research, which may be supplied by a third
party at the instance of a broker, includes information and analyses on
particular companies and industries as well as market or economic
trends and portfolio strategy, receipt of market quotations for
portfolio evaluations, information systems, computer hardware and
similar products and services. If a research service also assists the
Manager in a non-research capacity (such as bookkeeping or other
administrative functions), then only the percentage or component that
provides assistance to the Manager in the investment decision-making
process may be paid for 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 Board has also permitted the Manager to use stated
commissions on secondary fixed-income agency trades to obtain research
where the broker has represented to the Manager that: (I) the trade is
not from or for the broker's own inventory, (ii) the trade was
executed by the broker on an agency basis at the stated commission, and
(iii) the trade is not a riskless principal transaction.
The research services provided by brokers broaden the scope and
supplement the research activities of the Manager, by making available
additional views for consideration and comparisons, and by enabling the
Manager to obtain market information for the valuation of securities
held in the Fund's portfolio or being considered for purchase. The
Board of Trustees, including the "independent" Trustees of the Fund
(those Trustees of the Fund who are not "interested persons" as defined
in the Investment Company Act, and who have no direct or indirect
financial interest in the operation of the advisory agreement or the
Distribution Plans described below) 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.
During the Fund's fiscal years ended September 30, 1992, 1993, and
1994, total brokerage commissions paid by the Fund (not including
spreads or concessions on principal transactions on a net trade basis)
were $2,082,406, $11,654,448, and $7,714,396, respectively. During the
fiscal year ended September 30, 1994, $3,318,815 was paid to brokers as
commissions in return for research services; the aggregate dollar
amount of those transactions was $1,004,723,570. The transactions
giving rise to those commissions were allocated in accordance with the
Manager's internal allocation procedures.
Performance of the Fund
Total Return Information. As described in the Prospectus, from time to
time the "average annual total return," "cumulative total return,"
"average annual total return at net asset value" and "total return at
net asset value" of an investment in a class of shares of the Fund may
be advertised. An explanation of how these total returns are
calculated for each class and the components of those calculations is
set forth below. No total return calculations are presented below for
Class C shares because no shares of that class were publicly issued
during the fiscal year ended September 30, 1994.
The Fund's advertisements of its performance data must, under
applicable rules of the Securities and Exchange Commission, include the
average annual total returns for each class of shares of the Fund for
the 1, 5, and 10-year periods (or the life of the class, if less)
ending as of the most recently-ended calendar quarter prior to the
publication of the advertisement. This enables an investor to compare
the Fund's performance to the performance of other funds for the same
periods. However, a number of factors should be considered before using
such information as a basis for comparison with other investments. An
investment in the Fund is not insured; its returns and share prices are
not guaranteed and normally will fluctuate on a daily basis. When
redeemed, an investor's shares may be worth more or less than their
original cost. Returns for any given past period are not a prediction
or representation by the Fund of future returns. The returns of each
class of shares of the Fund are affected by portfolio quality, the type
of investments the Fund holds and its operating expenses allocated to
the particular class.
- Average Annual Total Returns. The "average annual total return"
of each class is an average annual compounded rate of return for each
year in a specified number of years. It is the rate of return based on
the change in value of a hypothetical initial investment of $1,000 ("P"
in the formula below) held for a number of years ("n") to achieve an
Ending Redeemable Value ("ERV") of that investment, according to the
following formula:
( ERV ) 1/n
(-----) -1 = Average Annual Total Return
( P )
- Cumulative Total Returns. The cumulative "total return"
calculation measures the change in value of a hypothetical investment
of $1,000 over an entire period of years. Its calculation uses
some of the same factors as average annual total return, but it does
not average the rate of return on an annual basis. Cumulative total
return is determined as follows:
ERV - P
- ------- = Total Return
P
In calculating total returns for Class A shares, the current
maximum sales charge of 5.75% (as a percentage of the offering price)
is deducted from the initial investment ("P") (unless the return is
shown at net asset value, as described below). For Class B shares, the
payment of the applicable contingent deferred sales charge (5.0% for
the first year, 4.0% for the second year, 3.0% for the third and fourth
years, 2.0% in the fifth year, 1.0% in the sixth year and none
thereafter) is applied to the investment result for the period shown
(unless the total return is shown at net asset value, as described
below). For Class C shares, the payment of the 1.0% contingent
deferred sales charge is applied to the investment result for the one-
year period (or less). Total returns also assume that all dividends
and capital gains distributions during the period are reinvested to buy
additional shares at net asset value per share, and that the investment
is redeemed at the end of the period. The "average annual total
returns" on an investment in Class A shares of the Fund for the one,
five and ten year periods ended September 30, 1994 were 12.34%, 9.55%
and 17.07%, respectively. During a portion of the periods for which
total returns are shown for Class A shares, the Fund's maximum initial
sales charge rate was higher. As a result, performance of an actual
investment during those periods would be less than the results shown.
The cumulative "total return" on Class A shares for the ten year period
ended September 30, 1994 was 383.41%. The cumulative total return on
Class B shares for the period from August 17, 1993 (the commencement of
the offering of the shares) through September 30, 1994 was 18.41%.
- Total Returns at Net Asset Value. From time to time the Fund
may also quote an average annual total return at net asset value or a
cumulative total return at net asset value for Class A, Class B, or
Class C shares. Each is based on the difference in net asset value per
share at the beginning and the end of the period for a hypothetical
investment in that class of shares (without considering front-end or
contingent deferred sales charges) and takes into consideration the
reinvestment of dividends and capital gains distributions. The
cumulative total return at net asset value of the Fund's Class A shares
for the ten-year period ended September 30, 1994 was 412.90%. The
average annual total returns at net asset value for the one, five and
ten-year periods ended September 30, 1994, for Class A shares were
19.19%, 10.85% and 17.76%, respectively. The cumulative total return
at net asset value on the Fund's Class B shares for the fiscal period
from August 17, 1993 through September 30, 1994 was 22.41%.
Total return information may be useful to investors in reviewing
the performance of the Fund's Class A, Class B or Class C shares.
However, when comparing total return of an investment in shares of the
Fund with that of other alternatives, investors should understand that
as the Fund is an aggressive equity fund seeking capital appreciation,
its shares are subject to greater market risks and volatility than
shares of funds having other investment objectives and that the Fund is
designed for investors who are willing to accept greater risk of loss
in the hopes of realizing greater gains.
Other Performance Comparisons. From time to time the Fund may publish
the ranking of its Class A, Class B or Class C shares by Lipper
Analytical Services, Inc. ("Lipper"), a widely-recognized independent
mutual fund monitoring service. Lipper monitors the performance of
regulated investment companies, including the Fund, and ranks their
performance for various periods based on categories relating to
investment objectives. The performance of the Fund's classes is ranked
against (I) all other funds, (ii) all other "global" funds and (iii)
all other "global" funds in a specific size category. The Lipper
performance rankings are based on total returns that include the
reinvestment of capital gain distributions and income dividends but do
not take sales charges or taxes into consideration.
From time to time the Fund may publish the ranking of the
performance of its Class A, Class B or Class C shares by Morningstar,
Inc., an independent mutual fund monitoring service that ranks mutual
funds, including the Fund, monthly in broad investment categories
(equity, taxable bond, municipal bond and hybrid) based on risk-
adjusted investment return. Investment return measures a fund's three,
five and ten-year average annual total returns (when available) in
excess of 90-day U.S. Treasury bill returns after considering sales
charges and expenses. Risk measures fund performance below 90-day U.S.
Treasury bill monthly returns. Risk and investment return are combined
to produce star rankings reflecting performance relative to the average
fund in a fund's category. Five stars is the "highest" ranking (top
10%), four stars is "above average" (next 22.5%), three stars is
"average" (next 35%), two stars is "below average" (next 22.5%) and one
star is "lowest" (bottom 10%). Morningstar ranks the Class A, Class B
and Class C shares of the Fund in relation to other equity funds.
Rankings are subject to change.
From time to time, the Fund may include in its advertisements and
sales literature performance information about the Fund cited in other
newspapers and periodicals, such as The New York Times, which may
include performance quotations from other sources, including Lipper.
The total return on an investment in the Fund's Class A, Class B
or Class C shares may be compared with performance for the same period
of the Morgan Stanley World Index, an unmanaged index of issuers on the
stock exchanges of 20 foreign countries and the United States and
widely recognized as a measure of global stock market performance. The
performance of such Index includes a factor for the reinvestment of
dividends but does not reflect expenses or taxes. The performance of
the Fund's Class A, Class B or Class C shares may also be compared in
publications to (I) the performance of various market indices or to
other investments for which reliable performance data is available, and
(ii) to averages, performance rankings or other benchmarks prepared by
recognized mutual fund statistical services.
From time to time, the Fund's Manager may publish rankings or
ratings of the Manager (or Transfer Agent) or the investor services
provided by them to shareholders of the Oppenheimer funds, other than
performance rankings of the Oppenheimer funds themselves. Those
ratings or rankings of shareholder/investor services by third parties
may compare the Oppenheimer funds' services to those of other mutual
fund families selected by the rating or ranking services and may be
based upon the opinions of the rating or ranking service itself, based
on its research or judgment, or based upon surveys of investors,
brokers, shareholders or others.
Distribution and Service Plans
The Fund has adopted a Service Plan for Class A shares and
Distribution and Service Plans for Class B and Class C shares of the
Fund under Rule 12b-1 of the Investment Company Act, pursuant to which
the Fund makes payments to the Distributor in connection with the
distribution and/or servicing of the shares of that class, as described
in the Prospectus. Each Plan has been approved by a vote of (I) the
Board of Trustees of the Fund, including a majority of the Independent
Trustees, cast in person at a meeting called for the purpose of voting
on that Plan, and (ii) the holders of a "majority" (as defined in the
Investment Company Act) of the shares of each class. For the
Distribution and Service Plans for Class B and Class C shares, that
vote was cast by the Manager as the sole initial holder of Class B and
Class C shares of the Fund.
In addition, under the Plans the Manager and the Distributor, in
their sole discretion, from time to time may use their own resources
(which, in the case of the Manager, may include profits from the
advisory fee it receives from the Fund) to make payments to brokers,
dealers or other financial institutions (each is referred to as a
"Recipient" under the Plans) for distribution and administrative
services they perform, at no cost to the Fund. The Distributor and the
Manager may, in their sole discretion, increase or decrease the amount
of payments they make to Recipients from their own resources.
Unless terminated as described below, each Plan continues in
effect from year to year but only as long as its 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. Any Plan may be
terminated at any time by the vote of a majority of the Independent
Trustees or by the vote of the holders of a "majority" (as defined in
the Investment Company Act) of the outstanding shares of that class.
None of the Plans may be amended to increase materially the amount of
payments to be made unless such amendment is approved by shareholders
of the class affected by the amendment. In addition, because Class B
shares of the Fund automatically convert into Class A shares after six
years, the Fund is required by an exemptive order issued by the
Securities and Exchange Commission to obtain the approval of Class B as
well as Class A shareholder for a proposed amendment to the Class A
Plan that would materially increase the amount to be paid by Class A
shares under the Class A Plan. Such approval must be by a "majority"
of the Class A and Class B shares (as defined in the Investment Company
Act), voting separately by class. All material amendments must be
approved by the Independent Trustees.
While the Plans are in effect, the Treasurer of the Fund shall
provide separate written reports to the Fund's Board of Trustees at
least quarterly on the amount of all payments made pursuant to each
Plan, the purpose for which each payment was made and the identity of
each Recipient that received any payment. The report for the Class B
and Class C Plan shall also include the distribution costs for that
quarter, and such costs for previous fiscal periods that have been
carried forward, as explained in the Prospectus and below. Those
reports, including the allocations on which they are based, will be
subject to the review and approval of the Independent Trustees in the
exercise of their fiduciary duty. Each Plan further 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 selection or nomination is approved by a majority of the
Independent Trustees.
Under the Plans, no payment 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 Fund's Independent Trustees. Initially, the Board of Trustees
has set the fees at the maximum rate and set no minimum amount of the
assets.
For the fiscal year ended September 30, 1994, payments under the
Plan for Class A shares totaled $3,004,364, all of which was paid by
the Distributor to Recipients, including $147,794 paid to MML Investor
Services, Inc., an affiliate of the Distributor. Any unreimbursed
expenses incurred by the Distributor with respect to Class A shares for
any fiscal year may not be recovered in subsequent years. Payments
received by the Distributor under the Plan for Class A shares will not
be used to pay any interest expense, carrying charge, or other
financial costs, or allocation of overhead by the Distributor.
The Class B Plan and the Class C Plan allow the service fee
payment to be paid by the Distributor to Recipients in advance for the
first year such shares are outstanding, and thereafter on a quarterly
basis, as described in the Prospectus. The advance payment is based on
the net asset valued Class B and Class C shares sold. An exchange of
shares does not entitle the Recipient to an advance service fee
payment. In the event Class B or Class C shares are redeemed during
the first year that the shares are outstanding, the Recipient will be
obligated to repay a pro rata portion of the advance payment for those
shares to the Distributor. Payments made under the Class B Plan during
the fiscal year ended September 30, 1994 totaled $886,625, all of which
was paid by the Distributor to Recipients, including $286 paid to a
dealer affiliated with the Distributor. Since no Class C shares were
outstanding during the Fund's fiscal year ended September 30, no
payments were made under the Class C Plan.
Although the Class B and Class C Plans permit the Distributor to
retain both the asset-based sales charges and the service fees on such
shares, or to pay Recipients the service fee on a quarterly basis,
without payment in advance, the Distributor presently intends to pay
the service fee to Recipients in the manner described above. A minimum
holding period may be established from time to time under the Class B
Plan and the Class C Plan by the Board. Initially, the Board has set
no minimum holding period. All payments under the Class B Plan and the
Class C Plan are subject to the limitations imposed by the Rules of
Fair Practice of the National Association of Securities Dealers, Inc.,
on payments of asset-based sales charges and service fees.
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 brokers and dealers in connection with the sale of Class B
and Class C shares of the Fund. The Distributor's actual distribution
expenses for any given year may exceed the aggregate of payments
received pursuant to the Class B Plan and Class C Plan and from
contingent deferred sales charges, and such expenses will be carried
forward and paid in future years. The Fund will be charged only for
interest expenses, carrying charges or other financial costs that are
directly related to the carry-forward of actual distribution expenses.
For example, if the Distributor incurred distribution expenses of $4
million in a given fiscal year, of which $2,000,000 was recovered in
the form of contingent deferred sales charges paid by investors and
$1,600,000 was reimbursed in the form of payments made by the Fund to
the Distributor under the Class B Plan, the balance of $400,000 (plus
interest) would be subject to recovery in future fiscal years from such
sources.
The Class B and Class C Plans provide for the distributor to be
compensated at a flat rate, whether the Distributor's distribution
expenses are more or less than the amounts paid by the Fund during that
period. Such payments are made in recognition that the Distributor (I)
pays sales commissions to authorized brokers and dealers at the time of
sale and pays service fees as described in the Prospectus, (ii) may
finance such commissions and/or the advance of the service fee payment
to Recipients under those Plans, or may provide such financing from its
own resources, or from an affiliate, (iii) employs personnel to support
distribution of shares, and (iv) may bear the costs of sales
literature, advertising and prospectuses (other than those furnished to
current shareholders), state "blue sky" registration fees and certain
other distribution expenses.
ABOUT YOUR ACCOUNT
How To Buy Shares
Alternative Sales Arrangements - Class A, Class B and Class C Shares.
The availability of three classes of shares permits an investor to
choose the method of purchasing shares that is more beneficial to the
investor depending on the amount of the purchase, the length of time
the investor expects to hold shares and other relevant circumstances.
Investors should understand that the purpose and function of the
deferred sales charge and asset-based sales charge with respect to
Class B and Class C shares are the same as those of the initial sales
charge with respect to Class A shares. Any salesperson or other person
entitled to receive compensation for selling Fund shares may receive
different compensation with respect to one class of shares than the
other. The Distributor normally will not accept any order for $500,000
or more of Class B shares or $1 million or more of Class C shares on
behalf of a single investor (not including dealer "street name" or
omnibus accounts) because generally it will be more advantageous for
that investor to purchase Class A shares of the Fund instead.
The three classes of shares each represent an interest in the same
portfolio investments of the Fund. However, each class has different
shareholder privileges and features. The net income attributable to
Class B and Class C shares and the dividends payable on such shares
will be reduced by incremental expenses borne solely by those classes,
including the asset-based sales charge to which both classes of shares
are subject.
The conversion of Class B shares to Class A shares after six years
is subject to the continuing availability of a private letter ruling
from the Internal Revenue Service, or an opinion of counsel or tax
adviser, to the effect that the conversion of B shares does not
constitute a taxable event for the holder under Federal income tax law.
If such a revenue ruling or opinion is no longer available, the
automatic conversion feature may be suspended, in which event no
further conversions of Class B shares would occur while such suspension
remained in effect. Although Class B shares could then be exchanged
for Class A shares on the basis of relative net asset value of the two
classes, without the imposition of a sales charge or fee, such exchange
could constitute a taxable event for the holder, and absent such
exchange, Class B shares might continue to be subject to the asset-
based sales charge for longer than six years.
The methodology for calculating the net asset value, dividends and
distributions of the Fund's Class A, Class B and Class C shares
recognizes two types of expenses. General expenses that do not pertain
specifically to either class are allocated pro rata to the shares of
each class, based on the percentage of the net assets of such class to
the Fund's total assets, and then equally to each outstanding share
within a given class. Such general expenses include (I) management
fees, (ii) legal, bookkeeping and audit fees, (iii) printing and
mailing costs of shareholder reports, Prospectuses, Statements of
Additional Information and other materials for current shareholders,
(iv) fees to Independent Trustees, (v) custodian expenses, (vi) share
issuance costs, (vii) organization and start-up costs, (viii) interest,
taxes and brokerage commissions, and (ix) non-recurring expenses, such
as litigation costs. Other expenses that are directly attributable to
a class are allocated equally to each outstanding share within that
class. Such expenses include (I) Distribution Plan fees, (ii)
incremental transfer and shareholder servicing agent fees and expenses,
(iii) registration fees and (iv) shareholder meeting expenses, to the
extent that such expenses pertain to a specific class rather than to
the Fund as a whole.
Determination of Net Asset Values Per Share. The net asset values per
share of Class A, Class B and Class C shares of the Fund are
determined as of the close of business of The New York Stock Exchange
(the "NYSE") on each day that the NYSE is open, by dividing the value
of the Fund's net assets attributable to that class by the number of
shares of that class that are outstanding. The NYSE normally closes at
4:00 P.M. New York time, but may close earlier on some days (for
example, in case of weather emergencies or on days falling before a
holiday). The NYSE's most recent annual announcement (which is subject
to change) states that it will close on New Year's Day, Presidents'
Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day. It may also close on other days.
The Fund may invest a substantial portion of its assets in foreign
securities primarily listed on foreign exchanges which may trade on
Saturdays or customary U.S. business holidays on which the NYSE is
closed. Because the Fund's net asset value will not be calculated on
those days, the Fund's net asset values per share of Class A, Class B
and Class C shares of the Fund may be significantly affected at times
when shareholders cannot purchase or redeem shares.
The Fund's Board of Trustees has established procedures for the
valuation of the Fund's securities, generally as follows: (I) equity
securities traded on a securities exchange or on the NASDAQ National
Market System ("NASDAQ") are valued at the last reported sale prices on
their primary exchange or NASDAQ that day (or, in the absence of sales
that day, at values based on the last sale prices of the preceding
trading day, or closing bid and asked prices); (ii) securities actively
traded on a foreign securities exchange are valued at the last sales
price available to the pricing service approved by the Fund's Board of
Trustees or to the Manager as reported by the principal exchange on
which the security is traded; (iii) unlisted foreign securities or
listed foreign securities not actively traded are valued as in (I)
above, if available, or at the mean between "bid" and "asked" prices
obtained from active market makers in the security on the basis of
reasonable inquiry; (iv) long-term debt securities having a remaining
maturity in excess of 60 days are valued at the mean between the "bid"
and "asked" prices determined by a portfolio pricing service approved
by the Fund's Board of Trustees or obtained from active market makers
in the security on the basis of reasonable inquiry; (v) debt
instruments having a maturity of more than one year when issued, and
non-money market type instruments having a maturity of one year or less
when issued, which have a remaining maturity of 60 days or less are
valued at the mean between "bid" and "asked" prices determined by a
pricing service approved by the Fund's Board of Trustees or obtained
from active market makers in the security on the basis of reasonable
inquiry; (vi) money market-type debt securities having a maturity of
less than one year when issued that having a remaining maturity of 60
days or less are valued at cost, adjusted for amortization of premiums
and accretion of discounts; and (vii) securities (including restricted
securities) not having readily-available market quotations are valued
at fair value under the Board's procedures.
In the case of U.S. Government Securities, mortgage-backed
securities, foreign securities and corporate bonds, when last sale
information is not generally available, such pricing procedures may
include "matrix" comparisons to the prices for comparable instruments
on the basis of quality, yield, maturity and other special factors
involved. The Fund's Board of Trustees has authorized the Management
to employ a pricing service to price U.S. Government Securities,
mortgage-backed securities, foreign government securities and corporate
bonds. The Trustees will monitor the accuracy of such pricing services
by comparing prices used for portfolio evaluation to actual sales
prices of selected securities.
Trading in securities on European and Asian exchanges and over-
the-counter markets is normally completed before the close of the NYSE.
Events affecting the values of foreign securities traded in stock
markets that occur between the time their prices are determined and the
close of the NYSE will not be reflected in the Fund's calculation of
net asset value unless the Board of Trustees or the Manager, under
procedures established by the Board of Trustees, determines that the
particular event would materially affect the Fund's net asset value, in
which case an adjustment would be made. Foreign currency will be
valued as close to the time fixed for the valuation date as is
reasonably practicable. The values of securities denominated in
foreign currency will be converted to U.S. dollars at the prevailing
rates of exchange at the time of valuation.
Puts, calls and Futures are valued at the last sales price on the
principal exchange on which they are traded, or on NASDAQ, as
applicable, or, if there are no sales that day, in accordance with (I),
above. Forward currency contracts are valued at the closing price on
the London foreign exchange market. When the Fund writes an option, an
amount equal to the premium received by the Fund is included in the
Fund's Statement of Assets and Liabilities as an asset, and an
equivalent deferred credit is included in the liability section. The
deferred credit is "marked-to-market" to reflect the current market
value of the option. In determining the Fund's gain on investments, if
a call written by the Fund is exercised, the proceeds are increased by
the premium received. If a call or put written by the Fund expires,
the Fund has a gain in the amount of the premium; if the Fund enters
into a closing purchase transaction, it will have a gain or loss
depending on whether the premium received was more or less than the
cost of the closing transaction. If the Fund exercises a put it holds,
the amount the Fund receives on its sale of the underlying investment
is reduced by the amount of premium paid by the Fund.
AccountLink. When shares are purchased through AccountLink, each
purchase must be at least $25.00. Shares will be purchased on the
regular business day the Distributor is instructed to initiate the
Automated Clearing House ("ACH") transfer to buy the shares. Dividends
will begin to accrue on such shares on the day the Fund receives
Federal Funds for such purchase through the ACH system before the close
of the NYSE that day, which is normally three days after the ACH
transfer is initiated. The Distributor and the Fund are not
responsible for any delays. If the Federal Funds are received after
the close of the NYSE, dividends will begin to accrue on the next
regular business day after such Federal Funds are received.
Reduced Sales Charges. As discussed in the Prospectus, a reduced sales
charge rate may be obtained for Class A shares under Right of
Accumulation and Letters of Intent because of the economies of sales
efforts and reduction in expenses realized by the Distributor, dealers
and brokers making such sales. No sales charge is imposed in certain
other circumstances described in the Prospectus because the Distributor
incurs little or no selling expenses. The term "immediate family"
refers to one's spouse, children, grandchildren, grandparents, parents,
parents-in-law, brothers and sisters, sons- and daughters-in-law, a
sibling's spouse and a spouse's siblings.
- The Oppenheimer Funds. The Oppenheimer funds are those mutual
funds for which the Distributor acts as the distributor or the sub-
distributor and include the following:
Oppenheimer Tax-Free Bond Fund
Oppenheimer New York Tax-Exempt Fund
Oppenheimer California Tax-Exempt Fund
Oppenheimer Intermediate Tax-Exempt Fund
Oppenheimer Insured Tax-Exempt Fund
Oppenheimer Main Street California Tax-Exempt Fund
Oppenheimer Florida Tax-Exempt Fund
Oppenheimer Pennsylvania Tax-Exempt Fund
Oppenheimer New Jersey Tax-Exempt Fund
Oppenheimer Fund
Oppenheimer Discovery Fund
Oppenheimer Target Fund
Oppenheimer Growth Fund
Oppenheimer Equity Income Fund
Oppenheimer Value Stock Fund
Oppenheimer Asset Allocation Fund
Oppenheimer Total Return Fund, Inc.
Oppenheimer Main Street Income & Growth Fund
Oppenheimer New Enterprises Fund
Oppenheimer High Yield Fund
Oppenheimer Champion Income Fund
Oppenheimer Bond Fund
Oppenheimer U.S. Government Trust
Oppenheimer Limited-Term Government Fund
Oppenheimer Global Fund
Oppenheimer Global Emerging Growth Fund
Oppenheimer Global Growth & Income Fund
Oppenheimer Gold & Special Minerals Fund
Oppenheimer Strategic Income Fund
Oppenheimer Investment Grade Bond Fund
Oppenheimer Strategic Income & Growth Fund
Oppenheimer International Bond Fund
and the following "Money Market Funds":
Oppenheimer Money Market Fund, Inc.
Oppenheimer Cash Reserves
Centennial Money Market Trust
Centennial Tax Exempt Trust
Centennial Government Trust
Centennial New York Tax Exempt Trust
Centennial California Tax Exempt Trust
Centennial America Fund, L.P.
Daily Cash Accumulation Fund, Inc.
There is an initial sales charge on the purchase of Class A shares
of each of the Oppenheimer funds except Money Market Funds (under
certain circumstances described herein, redemption proceeds of Money
Market Fund shares may be subject to a contingent deferred sales
charge).
Letters of Intent. A Letter of Intent (referred to as a "Letter") is
an investor's statement in writing to the Distributor of the intention
to purchase Class A shares or Class A and Class B shares of the Fund
(and other Oppenheimer funds) during a 13-month period (the "Letter of
Intent period"), which may, at the investor's request, include
purchases made up to 90 days prior to the date of the Letter. The
Letter states the investor's intention to make the aggregate amount of
purchases of shares which, when added to the investor's holdings of
shares of those funds, will equal or exceed the amount specified in the
Letter. Purchases made by reinvestment of dividends or distributions
of capital gains and purchases made at net asset value without sales
charge do not count toward satisfying the amount of the Letter. A
Letter enables an investor to count the Class A and Class B shares
purchased under the Letter to obtain the reduced sales charge rate on
purchases of Class A shares of the Fund (and other Oppenheimer funds)
that applies under the Right of Accumulation to current purchases of
Class A shares. Each purchase of Class A shares under the Letter will
be made at the public offering price applicable to a single lump-sum
purchase of shares in the amount intended to be purchased as described
in the Prospectus.
In submitting a Letter, the investor makes no commitment to purchase
shares, but if the investor's purchases of shares within the Letter of
Intent period, when added to the value (at offering price) of the
investor's holdings of shares on the last day of that period, do not
equal or exceed the intended purchase amount, the investor agrees to
pay the additional amount of sales charge applicable to such purchases,
as set forth in "Terms of Escrow," below (as those terms may be amended
from time to time). The investor agrees that shares equal in value to
5% of the intended purchase amount will be held in escrow by the
Transfer Agent subject to the Terms of Escrow. Also, the investor
agrees to be bound by the terms of the Prospectus, this Statement of
Additional Information and the Application used for such Letter of
Intent, and if such terms are amended, as they may be from time to time
by the Fund, that those amendments will apply automatically to existing
Letters of Intent.
For purchases of shares of the Fund and other Oppenheimer funds by
OppenheimerFunds prototype 401(k) plans under a Letter of Intent, the
Transfer Agent will not hold shares in escrow. If the intended
purchases amount under the Letter entered into by an OppenheimerFunds
prototype 401(k) plan is not purchased by the plan by the end of the
Letter of Intent period, there will be no adjustment of commission paid
to the broker-dealer or financial institution of record for accounts
held in the name of that plan.
If the total eligible purchases made during the Letter of Intent
period do not equal or exceed the intended purchase amount, the
commissions previously paid to the dealer of record for the account and
the amount of sales charge retained by the Distributor will be adjusted
to the rates applicable to actual purchases. If total eligible
purchases during the Letter of Intent period exceed the intended
purchase amount and exceed the amount needed to qualify for the next
sales charge rate reduction set forth in the applicable prospectus, the
sales charges paid will be adjusted to the lower rate, but only if and
when the dealer returns to the Distributor the excess of the amount of
commissions allowed or paid to the dealer over the amount of
commissions that apply to the actual amount of purchases. The excess
commissions returned to the Distributor will be used to purchase
additional shares for the investor's account at the net asset value per
share in effect on the date of such purchase, promptly after the
Distributor's receipt thereof.
In determining the total amount of purchases made under a Letter,
shares redeemed by the investor prior to the termination of the Letter
of Intent period will be deducted. It is the responsibility of the
dealer of record and/or the investor to advise the Distributor about
the Letter in placing any purchase orders for the investor during the
Letter of Intent period. All of such purchases must be made through
the Distributor.
- Terms of Escrow That Apply to Letters of Intent.
1. Out of the initial purchase (or subsequent purchases if
necessary) made pursuant to a Letter, shares of the Fund equal in value
to 5% of the intended purchase amount specified in the Letter shall be
held in escrow by the Transfer Agent. For example, if the intended
purchase amount is $50,000, the escrow shall be shares valued in the
amount of $2,500 (computed at the public offering price adjusted for a
$50,000 purchase). Any dividends and capital gains distributions on
the escrowed shares will be credited to the investor's account.
2. If the intended purchase amount specified under the Letter is
completed within the thirteen-month Letter of Intent period, the
escrowed shares will be promptly released to the investor.
3. If, at the end of the thirteen-month Letter of Intent period the
total purchases pursuant to the Letter are less than the intended
purchase amount specified in the Letter, the investor must remit to the
Distributor an amount equal to the difference between the dollar amount
of sales charges actually paid and the amount of sales charges which
would have been paid if the total amount purchased had been made at a
single time. Such sales charge adjustment will apply to any shares
redeemed prior to the completion of the Letter. If such difference in
sales charges is not paid within twenty days after a request from the
Distributor or the dealer, the Distributor will, within sixty days of
the expiration of the Letter, redeem the number of escrowed shares
necessary to realize such difference in sales charges. Full and
fractional shares remaining after such redemption will be released from
escrow. If a request is received to redeem escrowed shares prior to
the payment of such additional sales charge, the sales charge will be
withheld from the redemption proceeds.
4. By signing the Letter, the investor irrevocably constitutes and
appoints the Transfer Agent as attorney-in-fact to surrender for
redemption any or all escrowed shares.
5. The shares eligible for purchase under the Letter (or the holding
of which may be counted toward completion of a Letter) include (a)
Class A shares sold with a front-end sales charge or subject to a Class
A contingent deferred sales charge, (b) Class B shares acquired subject
to a contingent deferred sales charge, and (c) Class A or B shares
acquired by reinvestment of dividends and distributions or acquired in
exchange for either (I) Class A shares of one of the other Oppenheimer
funds that were acquired subject to a Class A initial or contingent
deferred sales charge or (ii) Class B shares of one of the other
Oppenheimer funds that were acquired subject to a contingent deferred
sales charge.
6. Shares held in escrow hereunder will automatically be exchanged
for shares of another fund to which an exchange is requested, as
described in the section of the Prospectus entitled "Exchange
Privilege," and the escrow will be transferred to that other fund.
Asset Builder Plans. To establish an Asset Builder Plan from a bank
account, a check (minimum $25) for the initial purchase must accompany
the application. Shares purchased by Asset Builder Plan payments from
bank accounts are subject to the redemption restrictions for recent
purchases described in "How To Sell Shares," in the Prospectus. Asset
Builder Plans also enable shareholders of Oppenheimer Cash Reserves to
use those accounts for monthly automatic purchases of shares of up to
four other Oppenheimer funds.
There is a front-end sales charge on the purchase of certain
Oppenheimer funds, or a contingent deferred sales charge may apply to
shares purchased by Asset Builder payments. An application should be
obtained from the Distributor, completed and returned, and a prospectus
of the selected fund(s) should be obtained from the Distributor or your
financial advisor before initiating Asset Builder payments. The amount
of the Asset Builder investment may be changed or the automatic
investments may be terminated at any time by writing to the Transfer
Agent. A reasonable period (approximately 15 days) is required after
the Transfer Agent's receipt of such instructions to implement them.
The Fund reserves the right to amend, suspend, or discontinue offering
such plans at any time without prior notice.
Cancellation of Purchase Orders. Cancellation of purchase orders for
the Fund's shares (for example, when a purchase check is returned to
the Fund unpaid) causes a loss to be incurred when the net asset value
of the Fund's shares on the cancellation date is less than on the
purchase date. That loss is equal to the amount of the decline in the
net asset value per share multiplied by the number of shares in the
purchase order. The investor is responsible for that loss. If the
investor fails to compensate the Fund for the loss, the Distributor
will do so. The Fund may reimburse the Distributor for that amount by
redeeming shares from any account registered in that investor's name,
or the Fund or the Distributor may seek other redress.
How to Sell Shares
Information on how to sell shares of the Fund is stated in the
Prospectus. The information below supplements the terms and conditions
for redemptions set forth in the Prospectus.
- Involuntary Redemptions. The Fund's Board of Trustees has the
right to cause the involuntary redemption of the shares held in any
account if the aggregate net asset value of those shares is less than
$500 or such lesser amount as the Board may fix. The Board of Trustees
will not cause the involuntary redemption of shares in an account if
the aggregate net asset value of the shares has fallen below the stated
minimum solely as a result of market fluctuations. Should the Board
elect to exercise this right, it may also fix, in accordance with the
Investment Company Act, the requirements for any notice to be given to
the shareholders in question (not less than 30 days), or the Board may
set requirements for granting permission to the Shareholder to increase
the investment, and set other terms and conditions so that the shares
would not be involuntarily redeemed.
- Payments "In Kind". The Prospectus states that payment for
shares tendered for redemption is ordinarily made in cash. However,
the Board of Trustees of the Fund may determine that it would be
detrimental to the best interests of the remaining shareholders of the
Fund to make payment of a redemption order wholly or partly in cash.
In that case the Fund may pay the redemption proceeds in whole or in
part by a distribution "in kind" of securities from the portfolio of
the Fund, in lieu of cash, in conformity with applicable rules of the
Securities and Exchange Commission. The Fund has elected to be
governed by Rule 18f-1 under the Investment Company Act, pursuant to
which the Fund is obligated to redeem shares solely in cash up to the
lesser of $250,000 or 1% of the net assets of the Fund during any 90-
day period for any one shareholder. If shares are redeemed in kind,
the redeeming shareholder might incur brokerage or other costs in
selling the securities for cash. The method of valuing securities used
to make redemptions in kind will be the same as the method the Fund
uses to value its portfolio securities described above under the
"Determination of Net Asset Values Per Share" and that valuation will
be made as of the time the redemption price is determined.
Reinvestment Privilege. Within six months of a redemption, a
shareholder may reinvest all or part of the redemption proceeds of (I)
Class A shares that you purchased subject to an initial sales charge,
or (ii) Class B shares on which you paid a contingent deferred sales
charge when you redeemed them, without sales charge. This privilege
does not apply to Class C shares. The reinvestment may be made without
sales charge only in Class A shares of the Fund or any of the other
Oppenheimer funds into which shares of the Fund are exchangeable as
described below, at the net asset value next computed after the
Transfer Agent receives the reinvestment order. The shareholder must
ask the Distributor for that privilege at the time of reinvestment.
Any capital gain that was realized when the shares were redeemed is
taxable, and reinvestment will not alter any capital gains tax payable
on that gain. If there has been a capital loss on the redemption, some
or all of the loss may not be tax deductible, depending on the timing
and amount of the reinvestment. Under the Internal Revenue Code, if
the redemption proceeds of Fund shares on which a sales charge was paid
are reinvested in shares of the Fund or another of the Oppenheimer
funds within 90 days of payment of the sales charge, the shareholder's
basis in the shares of the Fund that were redeemed may not include the
amount of the sales charge paid. That would reduce the loss or
increase the gain recognized from the redemption. However, in that
case the sales charge would be added to the basis of the shares
acquired by the reinvestment of the redemption proceeds. The Fund may
amend, suspend or cease offering this reinvestment privilege at any
time as to shares redeemed after the date of such amendment, suspension
or cessation.
Transfers of Shares. Shares are not subject to the payment of a
contingent deferred sales charge of either class at the time of
transfer to the name of another person or entity (whether the transfer
occurs by absolute assignment, gift or bequest, not involving, directly
or indirectly, a public sale). The transferred shares will remain
subject to the contingent deferred sales charge, calculated as if the
transferee shareholder had acquired the transferred shares in the same
manner and at the same time as the transferring shareholder. If less
than all shares held in an account are transferred, and some but not
all shares in the account would be subject to a contingent deferred
sales charge if redeemed at the time of transfer, the priorities
described in the Prospectus under "How to Buy Shares" for the
imposition of the Class B or the Class C contingent deferred sales
charge will be followed in determining the order in which shares are
transferred.
Distributions From Retirement Plans. Requests for distributions from
OppenheimerFunds-sponsored IRAs, 403(b)(7) custodial plans, 401(k)
plans, or pension or profit-sharing plans should be addressed to
"Trustee, Oppenheimer funds Retirement Plans," c/o the Transfer Agent
at its address listed in "How To Sell Shares" in the Prospectus or on
the back cover of this Statement of Additional Information. The
request must: (I) state the reason for the distribution; (ii) state the
owner's awareness of tax penalties if the distribution is premature;
and (iii) conform to the requirements of the plan and the Fund's other
redemption requirements. Participants (other than self-employed
persons maintaining a plan account in their own name) in
OppenheimerFunds-sponsored prototype pension, profit-sharing plans or
401(k) plans may not directly redeem or exchange shares held for their
accounts under those plans. The employer or plan administrator must
sign the request. Distributions from pension and profit sharing plans
are subject to special requirements under the Internal Revenue Code and
certain documents (available from the Transfer Agent) must be completed
before the distribution may be made. Distributions from retirement
plans are subject to withholding requirements under the Internal
Revenue Code, and IRS Form W-4P (available from the Transfer Agent)
must be submitted to the Transfer Agent with the distribution request,
or the distribution may be delayed. Unless the shareholder has
provided the Transfer Agent with a certified tax identification number,
the Internal Revenue Code requires that tax be withheld from any
distribution even if the shareholder elects not to have tax withheld.
The Fund, the Manager, the Distributor, the Trustee and the Transfer
Agent assume no responsibility to determine whether a distribution
satisfies the conditions of applicable tax laws and will not be
responsible for any tax penalties assessed in connection with a
distribution.
Special Arrangements for Repurchase of Shares from Dealers and Brokers.
The Distributor is the Fund's agent to repurchase its shares from
authorized dealers or brokers. The repurchase price per share will be
the net asset value next computed after the Distributor receives the
order placed by the dealer or broker, except that if the Distributor
receives a repurchase order from a dealer or broker after the close of
The New York Stock Exchange on a regular business day, it will be
processed at that day's net asset value if the order was received by
the dealer or broker from its customers prior to the time the Exchange
closed (normally that is 4:00 P.M., but may be earlier some days) and
the order was transmitted to and received by the Distributor prior to
its close of business that day (normally 5:00 P.M.). Ordinarily, for
accounts redeemed by a broker-dealer under this procedure, payment will
be made within three business days after the shares have been redeemed
upon the Distributor's receipt of the required redemption documents in
proper form, with the signature(s) of the registered owners guaranteed
on the redemption document as described in the Prospectus.
Automatic Withdrawal and Exchange Plans. Investors owning shares of
the Fund valued at $5,000 or more can authorize the Transfer Agent to
redeem shares (minimum $50) automatically on a monthly, quarterly,
semi-annual or annual basis under an Automatic Withdrawal Plan. Shares
will be redeemed three business days prior to the date requested by the
shareholder for receipt of the payment. Automatic withdrawals of up to
$1,500 per month may be requested by telephone if payments are to be
made by check payable to all shareholders of record and sent to the
address of record for the account (and if the address has not been
changed within the prior 30 days). Required minimum distributions from
OppenheimerFunds-sponsored retirement plans may not be arranged on this
basis. Payments are normally made by check, but shareholders having
AccountLink privileges (see "How To Buy Shares") may arrange to have
Automatic Withdrawal Plan payments transferred to the bank account
designated on the OppenheimerFunds New Account Application or
signature-guaranteed instructions. The Fund cannot guarantee receipt
of a payment on the date requested and reserves the right to amend,
suspend or discontinue offering such plans at any time without prior
notice. Because of the sales charge assessed on Class A share
purchases, shareholders should not make regular additional Class A
share purchases while participating in an Automatic Withdrawal Plan.
Class B and Class C shareholders should not establish withdrawal plans,
because of the imposition of the contingent deferred sales charge on
such withdrawals (except where the Class B or the Class C contingent
deferred sales charge is waived as described in the Prospectus in
"Waivers of Class B and Class C Sales Charges").
By requesting an Automatic Withdrawal or Exchange Plan, the
shareholder agrees to the terms and conditions applicable to such
plans, as stated below and in the provisions of the OppenheimerFunds
Application relating to such Plans, as well as the Prospectus. These
provisions may be amended from time to time by the Fund and/or the
Distributor. When adopted, such amendments will automatically apply to
existing Plans.
- Automatic Exchange Plans. Shareholders can authorize the
Transfer Agent (on the OppenheimerFunds Application or signature-
guaranteed instructions) to exchange a pre-determined amount of shares
of the Fund for shares (of the same class) of other Oppenheimer funds
automatically on a monthly, quarterly, semi-annual or annual basis
under an Automatic Exchange Plan. The minimum amount that may be
exchanged to each other fund account is $25. Exchanges made under
these plans are subject to the restrictions that apply to exchanges as
set forth in "How to Exchange Shares" in the Prospectus and below in
this Statement of Additional Information.
- Automatic Withdrawal Plans. Fund shares will be redeemed as
necessary to meet withdrawal payments. Shares acquired without a sales
charge will be redeemed first and shares acquired with reinvested
dividends and capital gains distributions will be redeemed next,
followed by shares acquired with a sales charge, to the extent
necessary to make withdrawal payments. Depending upon the amount
withdrawn, the investor's principal may be depleted. Payments made
under withdrawal plans should not be considered as a yield or income on
your investment.
The Transfer Agent will administer the investor's Automatic
Withdrawal Plan (the "Plan") as agent for the investor (the
"Planholder") who executed the Plan authorization and application
submitted to the Transfer Agent. Neither the Fund nor the Transfer
Agent shall incur any liability to the Planholder for any action taken
or omitted by the Transfer Agent in good faith to administer the Plan.
Certificates will not be issued for shares of the Fund purchased for
and held under the Plan, but the Transfer Agent will credit all such
shares to the account of the Planholder on the records of the Fund.
Any share certificates held by a Planholder may be surrendered
unendorsed to the Transfer Agent with the Plan application so that the
shares represented by the certificate may be held under the Plan.
For accounts subject to Automatic Withdrawal Plans, distributions of
capital gains must be reinvested in shares of the Fund, which will be
done at net asset value without a sales charge. Dividends on shares
held in the account may be paid in cash or reinvested.
Redemptions of shares needed to make withdrawal payments will be
made at the net asset value per share determined on the redemption
date. Checks or AccountLink payments of the proceeds of Plan
withdrawals will normally be transmitted three business days prior to
the date selected for receipt of the payment (receipt of payment on the
date selected cannot be guaranteed), according to the choice specified
in writing by the Planholder.
The amount and the interval of disbursement payments and the address
to which checks are to be mailed or AccountLink payments are to be sent
may be changed at any time by the Planholder by writing to the Transfer
Agent. The Planholder should allow at least two weeks' time in mailing
such notification for the requested change to be put in effect. The
Planholder may, at any time, instruct the Transfer Agent by written
notice (in proper form in accordance with the requirements of the then-
current Prospectus of the Fund) to redeem all, or any part of, the
shares held under the Plan. In that case, the Transfer Agent will
redeem the number of shares requested at the net asset value per share
in effect in accordance with the Fund's usual redemption procedures and
will mail a check for the proceeds to the Planholder.
The Plan may be terminated at any time by the Planholder by writing
to the Transfer Agent. A Plan may also be terminated at any time by
the Transfer Agent upon receiving directions to that effect from the
Fund. The Transfer Agent will also terminate a Plan upon receipt of
evidence satisfactory to it of the death or legal incapacity of the
Planholder. Upon termination of a Plan by the Transfer Agent or the
Fund, shares that have not been redeemed from the account will be held
in uncertificated form in the name of the Planholder, and the account
will continue as a dividend-reinvestment, uncertificated account unless
and until proper instructions are received from the Planholder or his
or her executor or guardian, or other authorized person.
To use Class A shares held under the Plan as collateral for a debt,
the Planholder may request issuance of a portion of the Class A shares
in certificated form. Share certificates are not issued for Class B
shares or Class C shares. Upon written request from the Planholder,
the Transfer Agent will determine the number of Class A shares for
which a certificate may be issued without causing the withdrawal checks
to stop because of exhaustion of uncertificated shares needed to
continue payments. However, should such uncertificated shares become
exhausted, Plan withdrawals will terminate.
If the Transfer Agent ceases to act as transfer agent for the Fund,
the Planholder will be deemed to have appointed any successor transfer
agent to act as agent in administering the Plan.
How To Exchange Shares
As stated in the Prospectus, shares of a particular class of
Oppenheimer funds having more than one class of shares may be exchanged
only for shares of the same class of other Oppenheimer funds. Shares
of the Oppenheimer funds that have a single class without a class
designation are deemed "Class A" shares for this purpose. All
Oppenheimer funds offer Class A shares, but certain other Oppenheimer
funds do not presently offer either or both of Class B or Class C
shares. A list showing which funds offer which class can be obtained
by calling the Distributor at 1-800-525-7048.
Class A shares of Oppenheimer funds may be exchanged at net asset
value for shares of any Money Market Fund. Shares of any Money Market
Fund purchased without a sales charge may be exchanged for shares of
Oppenheimer funds offered with a sales charge upon payment of the sales
charge (or, if applicable, may be used to purchase shares of
Oppenheimer funds subject to a contingent deferred sales charge).
However, shares of Oppenheimer Money Market Fund, Inc., purchased with
the redemption proceeds of shares of other mutual funds (other than
funds managed by the Manager or its subsidiaries) redeemed within the
12 months prior to that purchase may subsequently be exchanged for
shares of other Oppenheimer funds without being subject to an initial
or contingent deferred sales charge, whichever is applicable. To
qualify for this privilege, the investor or the investor's dealer must
notify the Distributor of eligibility for this privilege at the time
the shares of Oppenheimer Money Market Fund, Inc., are purchased, and,
if requested, must supply proof of entitlement to this privilege.
However, if the Distributor receives, at the time of purchase, notice
that shares of Oppenheimer Money Market Fund, Inc. are being purchased
with the redemption proceeds of shares of other mutual funds (other
than other money market funds) that are not part of the Oppenheimer
funds family, those shares of Oppenheimer Money Market Fund, Inc. may
be exchanged for shares of other Oppenheimer funds at net asset value
without paying a sales charge.
Shares of this Fund acquired by reinvestment of dividends or
distributions from any other of the Oppenheimer funds or from any unit
investment trust for which reinvestment arrangements have been made
with the Distributor may be exchanged at net asset value for shares of
any of the Oppenheimer funds. No contingent deferred sales charge is
imposed on exchanges of shares of either class purchased subject to a
contingent deferred sales charge. However, when Class A shares
acquired by exchange of Class A shares of other Oppenheimer funds
purchased subject to a Class A contingent deferred sales charge are
redeemed within 18 months of the end of the calendar month of the
initial purchase of the exchanged Class A shares, the Class A
contingent deferred sales charge is imposed on the redeemed shares (see
"Class A Contingent Deferred Sales Charge" in the Prospectus). The
Class B contingent deferred sales charge is imposed on Class B shares
acquired by exchange if they are redeemed within 6 years of the initial
purchase of the exchanged Class B shares. The Class C contingent
deferred sales charge is imposed on Class C shares acquired by exchange
if they are redeemed within 12 months of the initial purchase of the
exchanged Class C shares.
When Class B shares or Class C shares are redeemed to effect an
exchange, the priorities described in "How To Buy Shares" in the
Prospectus for the imposition of the Class B or the Class C contingent
deferred sales charge will be followed in determining the order in
which the shares are exchanged. Shareholders should take into account
the effect of any exchange on the applicability and rate of any
contingent deferred sales charge that might be imposed in the
subsequent redemption of remaining shares. Shareholders owning shares
of more than one class must specify whether they intend to exchange
Class A, Class B or Class C shares.
The Fund reserves the right to reject telephone or written exchange
requests submitted in bulk by anyone on behalf of 10 or more accounts.
The Fund may accept requests for exchanges of up to 50 accounts per day
from representatives of authorized dealers that qualify for this
privilege. In connection with any exchange request, the number of
shares exchanged may be less than the number requested if the exchange
or the number requested would include shares subject to a restriction
cited in the Prospectus or this Statement of Additional Information or
would include shares covered by a share certificate that is not
tendered with the request. In those cases, only the shares available
for exchange without restriction will be exchanged.
When exchanging shares by telephone, a shareholder must either have
an existing account in, or obtain and acknowledge receipt of a
prospectus of, the fund to which the exchange is to be made. For full
or partial exchanges of an account made by telephone, any special
account features such as Asset Builder Plans, Automatic Withdrawal
Plans, and retirement plan contributions will be switched to the new
account unless the Transfer Agent is instructed otherwise. If all
telephone lines are busy (which might occur, for example, during
periods of substantial market fluctuations), shareholders might not be
able to request exchanges by telephone and would have to submit written
exchange requests.
Shares to be exchanged are redeemed on the regular business day the
Transfer Agent receives an exchange request in proper form (the
"Redemption Date"). Normally, shares of the fund to be acquired are
purchased on the Redemption Date, but such purchases may be delayed by
either fund up to five business days if it determines that it would be
disadvantaged by an immediate transfer of the redemption proceeds. The
Fund reserves the right, in its discretion, to refuse any exchange
request that may disadvantage it (for example, if the receipt of
multiple exchange requests from a dealer might require the disposition
of portfolio securities at a time or at a price that might be
disadvantageous to the Fund).
The different Oppenheimer funds available for exchange have different
investment objectives, policies and risks, and a shareholder should
assure that the Fund selected is appropriate for his or her investment
and should be aware of the tax consequences of an exchange. For
federal income tax purposes, an exchange transaction is treated as a
redemption of shares of one fund and a purchase of shares of another.
"Reinvestment Privilege," above, discusses some of the tax consequences
of reinvestment of redemption proceeds in such cases. The Fund, the
Distributor, and the Transfer Agent are unable to provide investment,
tax or legal advice to a shareholder in connection with an exchange
request or any other investment transaction.
Dividends, Capital Gains and Taxes
Tax Status of the Fund's Dividends and Distributions. The Federal tax
treatment of the Fund's dividends and capital gains distributions is
explained in the Prospectus under the caption "Dividends, Capital Gains
and Taxes." Special provisions of the Internal Revenue Code govern the
eligibility of the Fund's dividends for the dividends-received
deduction for corporate shareholders. Long-term capital gains
distributions are not eligible for the deduction. In addition, the
amount of dividends paid by the Fund which may qualify for the
deduction is limited to the aggregate amount of qualifying dividends
that the Fund derives from its portfolio investments that the Fund has
held for a minimum period, usually 46 days. A corporate shareholder
will not be eligible for the deduction on dividends paid on Fund shares
held for 45 days or less. To the extent the Fund's dividends are
derived from gross income from option premiums, interest income or
short-term gains from the sale of securities or dividends from foreign
corporations, those dividends will not qualify for the deduction.
Under the Internal Revenue Code, by December 31 each year, the Fund
must distribute 98% of its taxable investment income earned from
January 1 through December 31 of that year and 98% of its capital gains
realized in the period from November 1 of the prior year through
October 31 of the current year, or else the Fund must pay an excise tax
on the amounts not distributed. While it is presently anticipated that
the Fund will meet those requirements, the Fund's Board of Trustees and
the Manager might determine in a particular year that it would be in
the best interest of shareholders for the Fund not to make such
distributions at the required levels and to pay the excise tax on the
undistributed amounts. That would reduce the amount of income or
capital gains available for
distribution to shareholders.
If the Fund has more than 50% of its total assets invested in
foreign securities at the end of its fiscal year, it may elect the
application of Section 853 of the Internal Revenue Code to permit
shareholders to take a credit (or, at their option, a deduction) for
foreign taxes paid by the Fund. Under Section 853, shareholders would
be entitled to treat the foreign taxes withheld from interest and
dividends paid to the Fund from its foreign investments as a credit on
their federal income taxes. As an alternative, shareholders could, if
to their advantage, treat the foreign tax withheld as a deduction from
gross income in computing taxable income rather than as a tax credit.
In substance, the Fund's election would enable shareholders to benefit
from the same foreign tax credit or deduction that would be received if
they had been the record owners of the Fund's foreign securities and
had paid foreign taxes on the income received.
If the Fund qualifies as a "regulated investment company" under the
Internal Revenue Code, it will not be liable for Federal income taxes
on amounts paid by it as dividends and distributions. The Fund
qualified during its last fiscal year, and intends to qualify in
current and future years, but reserves the right not to do so. The
Internal Revenue Code contains a number of complex tests relating to
such qualification in which the Fund derives 30% or more of its gross
income from the sale of securities held less than three months, it may
fail to qualify (see "Tax Aspects of Covered Calls and Hedging
Instruments," above). If it did not so qualify, the Fund would be
treated for tax purposes as an ordinary corporation and receive no tax
deduction for payments made to shareholders.
Dividends, distributions and the proceeds of the redemption of Fund
shares represented by checks returned to the Transfer Agent by the
Postal Service as undeliverable will be invested in shares of
Oppenheimer Money Market Fund, Inc., as promptly as possible after the
return of such checks to the Transfer Agent to enable the investor to
earn a return on otherwise idle funds.
Dividend Reinvestment in Another Fund. Shareholders of the Fund may
elect to reinvest all dividends and/or capital gains distributions in
shares of the same class of any of the other Oppenheimer funds listed
in "Reduced Sales Charges," above, at net asset value without sales
charge. Class B and Class C shareholders should be aware that as of
the date of this Statement of Additional Information, not all of the
Oppenheimer funds offer Class B and/or Class C shares. To elect this
option, a shareholder must notify the Transfer Agent in writing and
either have an existing account in the fund selected for reinvestment
or must obtain a prospectus for that fund and an application from the
Distributor to establish an account. The investment will be made at
the net asset value per share in effect at the close of business on the
payable date of the dividend or distribution. Dividends and/or
distributions from shares of other Oppenheimer funds may be invested in
shares of this Fund on the same basis.
Additional Information About the Fund
The Custodian. The Bank of New York is the Custodian of the Fund's
assets. The Custodian's responsibilities include safeguarding and
controlling the Fund's portfolio securities, collecting income on the
portfolio securities and handling the delivery of such securities to
and from the Fund. The Manager has represented to the Fund that the
banking relationships between the Manager and the Custodian have been
and will continue to be unrelated to and unaffected by the relationship
between the Fund and the Custodian. It will be the practice of the
Fund to deal with the Custodian in a manner uninfluenced by any banking
relationship the Custodian may have with the Manager and its
affiliates.
Independent Auditors. The independent auditors of the Fund audit the
Fund's financial statements and perform other related audit services.
They also act as auditors for certain other funds advised by the
Manager and its affiliates.
<PAGE>
- ---------------------------------------
INDEPENDENT AUDITORS' REPORT
- ---------------------------------------
The Board of Trustees and Shareholders of Oppenheimer Global Fund:
We have audited the accompanying statements of investments and assets and
liabilities of Oppenheimer Global Fund as of September 30, 1994, and the
related statement of operations for the year then ended, the statements
of changes in net assets for each of the years in the two-year period then
ended and the financial highlights for each of the years in the ten-year
period then ended. These financial statements and financial highlights are
the responsibility of the Fund's management. Our responsibility is to express
an opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements and financial highlights. Our procedures included
confirmation of securities owned as of September 30, 1994, by correspondence
with the custodian and brokers; and where confirmations were not received from
brokers, we performed other auditing procedures. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of Oppenheimer Global Fund as of September 30, 1994, the results of
its operations for the year then ended, the changes in its net assets for
each of the years in the two-year period then ended, and the financial
highlights for each of the years in the ten-year period then ended, in
conformity with generally accepted accounting principles.
KPMG PEAT MARWICK LLP
Denver, Colorado
October 21, 1994
<PAGE>
------------------------------------------------------------
------------------------------------------------------------
STATEMENT OF INVESTMENTS September 30, 1994
<TABLE>
<CAPTION>
FACE MARKET VALUE
AMOUNT SEE NOTE 1
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
REPURCHASE AGREEMENT--10.1%
- ----------------------------------------------------------------------------------------------------------------------------------
Repurchase agreement with First Chicago Capital Markets,
4.95%, dated 9/30/94, to be repurchased at $212,987,821
on 10/3/94, collateralized by U.S. Treasury Nts.,
4.25%--8.50%, 4/15/95-- 7/15/98, with a value of $120,387,791
and U.S. Treasury Bills, 0%, 3/16/95--3/23/95, with a value
of $96,967,742 (Cost $212,900,000) $212,900,000 $212,900,000
- -------------------------------------------------------------------------------------------------------------------------------
CORPORATE BONDS AND NOTES--0.4%
- -------------------------------------------------------------------------------------------------------------------------------
Banco Nacional de Mexico SA, 7% Exch. Sub. Debs., 12/15/99(1) 4,500,000 5,225,625
-------------------------------------------------------------------------------------------------
International Container Terminal Services, Inc., 6% Cv. Sr. Nts.,
2/19/00(1) 2,000,000 2,800,000
-------------------------------------------------------------------------------------------------
Total Corporate Bonds and Notes (Cost $6,500,000) 8,025,625
- -------------------------------------------------------------------------------------------------------------------------------
UNITS
- -------------------------------------------------------------------------------------------------------------------------------
RIGHTS AND WARRANTS--0.0% China Aerospace International Holdings Ltd. Wts., Exp. 12/95 40
2
-------------------------------------------------------------------------------------------------
Total Rights and Warrants (Cost $3) 2
- -------------------------------------------------------------------------------------------------------------------------------
SHARES
- -------------------------------------------------------------------------------------------------------------------------------
PREFERRED STOCKS--2.8%
- -------------------------------------------------------------------------------------------------------------------------------
Fiat SpA 5,714,500 14,579,300
-------------------------------------------------------------------------------------------------
Rhoen Klinikum AG(2)(4) 31,814 19,889,466
-------------------------------------------------------------------------------------------------
Sap AG 23,200 11,827,626
-------------------------------------------------------------------------------------------------
Spar Handels AG, Non-Vtg. 53,000 11,955,755
-------------------------------------------------------------------------------------------------
Total Preferred Stocks (Cost $40,248,622) 58,252,147
- -------------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS--86.7%
- -------------------------------------------------------------------------------------------------------------------------------
BASIC MATERIALS--6.7%
- -------------------------------------------------------------------------------------------------------------------------------
CHEMICALS--1.3% Minerals Technologies, Inc. 600,000 17,775,000
-------------------------------------------------------------------------------------------------
Mitsubishi Petrochemical Co. Ltd.(2) 1,500,000 10,503,175
------------
28,278,175
- -------------------------------------------------------------------------------------------------------------------------------
PAPER AND FOREST Corticeira Amorim, SA 259,100 4,389,303
PRODUCTS--2.5% -------------------------------------------------------------------------------------------------
Hansol Paper Ltd., Sponsored GDR(1)(3) 500,659 14,519,111
-------------------------------------------------------------------------------------------------
Indah Kiat 10,480,400 13,726,311
-------------------------------------------------------------------------------------------------
P.T. Pabrik Kertas Tjiwi Kimia 2,500,000 6,089,014
-------------------------------------------------------------------------------------------------
Stora Kopparbergs Bergslags AB(2) 235,350 13,529,318
------------
52,253,057
- -------------------------------------------------------------------------------------------------------------------------------
STEEL--2.9% Dofasco, Inc. 619,600 10,797,491
-------------------------------------------------------------------------------------------------
Kangwon Industrial Co. Ltd. 264,599 5,764,394
-------------------------------------------------------------------------------------------------
Maanshan Iron and Steel Company 19,915,000 6,546,236
-------------------------------------------------------------------------------------------------
Pohang Iron & Steel Co. Ltd. 125,000 18,369,692
-------------------------------------------------------------------------------------------------
Tung Ho Steel Enterprise Corp., GDR(1) 450,000 7,650,000
-------------------------------------------------------------------------------------------------
Ugine SA 150,000 11,514,285
------------
60,642,098
</TABLE>
4 Oppenheimer Global Fund
<PAGE>
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
CONSUMER CYCLICALS--12.8%
- -------------------------------------------------------------------------------------------------------------------------------
AIRLINES--0.3% Vienna International Airport(4) 150,000 $ 6,374,493
- -------------------------------------------------------------------------------------------------------------------------------
AUTOMOBILES--3.8% CIADEA SA 442,016 6,430,940
-------------------------------------------------------------------------------------------------
Consorcio Grupo Dina SA Sponsored ADR(2) 292,000 3,504,000
-------------------------------------------------------------------------------------------------
Consorcio Grupo Dina SA Sponsored ADR, L Series(3) 103,660 1,075,473
-------------------------------------------------------------------------------------------------
Kia Motors Corp. GDS(1)(3) 200,000 4,700,000
-------------------------------------------------------------------------------------------------
Nissan Motor Co. 1,250,000 10,217,736
-------------------------------------------------------------------------------------------------
Volkswagen AG 80,000 21,939,294
-------------------------------------------------------------------------------------------------
Volvo AB, Series B Free(2) 1,772,500 32,345,370
------------
80,212,813
- -------------------------------------------------------------------------------------------------------------------------------
BROADCAST MEDIA--2.7% Comcast Corp., Cl. A Special(3) 500,000
7,656,250
-------------------------------------------------------------------------------------------------
Grupo Televisa SA, Sponsored ADR(1) 150,000 8,681,250
-------------------------------------------------------------------------------------------------
Rogers Communications, Inc., Cl. B(3) 800,000 12,151,991
-------------------------------------------------------------------------------------------------
Scandinavian Broadcasting System SA(3) 315,000 8,268,750
-------------------------------------------------------------------------------------------------
TeleCommunications, Inc., Cl. A(3) 390,000 8,653,125
-------------------------------------------------------------------------------------------------
Television Broadcast 1,500,000 6,968,886
-------------------------------------------------------------------------------------------------
Television Francaise I 41,678 4,077,826
------------
56,458,078
- -------------------------------------------------------------------------------------------------------------------------------
ENTERTAINMENT--0.2% Euro Disney(3) 3,000,000 4,533,183
- -------------------------------------------------------------------------------------------------------------------------------
HOUSEHOLD FURNISHINGS AND Philips Gloeilamp NV 1,800,000
55,000,797
APPLIANCES--3.2% -------------------------------------------------------------------------------------------------
Sony Corp.(2) 207,400 12,070,558
------------
67,071,355
- -------------------------------------------------------------------------------------------------------------------------------
RETAIL: SPECIALTY--1.2% Benetton SpA 700,000 9,423,076
-------------------------------------------------------------------------------------------------
PT Modern Photo Film Co. 1,000,000 5,606,489
-------------------------------------------------------------------------------------------------
Toys 'R' Us, Inc.(3) 300,000 10,687,500
------------
25,717,065
- -------------------------------------------------------------------------------------------------------------------------------
RETAIL STORES: GENERAL Rinascente SpA, Ordinary 836,000
4,922,217
MERCHANDISE CHAINS--0.9% -------------------------------------------------------------------------------------------------
Sears Roebuck de Mexico SA(3) 500,000 6,469,624
-------------------------------------------------------------------------------------------------
Sonae Industria E. Investimentos(3) 378,000 8,372,386
------------
19,764,227
- -------------------------------------------------------------------------------------------------------------------------------
TEXTILES:
- -------------------------------------------------------------------------------------------------------------------------------
APPAREL MANUFACTURERS--0.5% Tokyo Style Co. 565,000
10,104,570
- -------------------------------------------------------------------------------------------------------------------------------
CONSUMER NON-CYCLICALS--8.8%
- -------------------------------------------------------------------------------------------------------------------------------
BEVERAGES: ALCOHOLIC--1.1% Foster's Brewing Group Ltd. 200
169
-------------------------------------------------------------------------------------------------
Jinro Ltd. 219,729 5,722,252
-------------------------------------------------------------------------------------------------
LVMH Moet Hennessy Louis Vuitton 100,000 16,470,566
------------
22,192,987
</TABLE>
5 Oppenheimer Global Fund
<PAGE>
------------------------------------------------------------
------------------------------------------------------------
STATEMENT OF INVESTMENTS (Continued)
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
DRUGS--1.4% Astra AB Free, Series A 700,000 $ 16,797,928
-------------------------------------------------------------------------------------------------
Takeda Chemical Industries Ltd. 434,000 5,086,790
-------------------------------------------------------------------------------------------------
WPP Group PLC(1) 2,233,000 3,838,373
-------------------------------------------------------------------------------------------------
WPP Group PLC 2,737,000 4,704,714
------------
30,427,805
- -------------------------------------------------------------------------------------------------------------------------------
FOOD PROCESSING--0.4% Molinos Rio de la Plata SA(3) 276,800 2,643,273
-------------------------------------------------------------------------------------------------
PT Sinar Mass Agro Resources & Technology 3,720,000 6,282,484
------------
8,925,757
- -------------------------------------------------------------------------------------------------------------------------------
HEALTHCARE: DIVERSIFIED--0.9% Schering AG 30,800
18,937,916
- -------------------------------------------------------------------------------------------------------------------------------
HEALTHCARE: MISCELLANEOUS--4.3%
Amgen, Inc.(3) 270,700 14,414,775
-------------------------------------------------------------------------------------------------
Chiron Corp. 144,600 9,615,900
-------------------------------------------------------------------------------------------------
Genzyme Corp.(3) 600,000 20,550,000
-------------------------------------------------------------------------------------------------
K-V Pharmaceutical Co., Cl. A(3)(4) 376,800 2,731,800
-------------------------------------------------------------------------------------------------
K-V Pharmaceutical Co., Cl. B(3)(4) 264,900 1,953,638
-------------------------------------------------------------------------------------------------
Neozyme II Corp., Units(3)(4) 146,000 4,964,000
-------------------------------------------------------------------------------------------------
Plant Genetics Systems International NV(1)(3) 637,280 5,943,099
-------------------------------------------------------------------------------------------------
Quintiles Transnational Corp.(1)(3) 318,473 7,703,066
-------------------------------------------------------------------------------------------------
Sumitomo Chemical Co. Ltd. 1,800,000 10,203,085
-------------------------------------------------------------------------------------------------
Takare PLC 4,000,000 13,309,889
------------
91,389,252
- -------------------------------------------------------------------------------------------------------------------------------
HOSPITAL MANAGEMENT--0.5% Community Psychiatric Centers 735,000
10,014,375
- -------------------------------------------------------------------------------------------------------------------------------
MEDICAL PRODUCTS--0.2% Circon Corp.(2)(3) 50,000 600,000
-------------------------------------------------------------------------------------------------
Stryker Corp.(2) 112,900 3,923,275
------------
4,523,275
- -------------------------------------------------------------------------------------------------------------------------------
ENERGY--6.0%
- -------------------------------------------------------------------------------------------------------------------------------
OIL: INTEGRATED
INTERNATIONAL--4.3% British Petroleum Co. PLC 180,000 13,635,000
-------------------------------------------------------------------------------------------------
Compagnie Francaise de Petroleum Total 175,000 10,286,548
-------------------------------------------------------------------------------------------------
Chilectra Metropolitana SA 95,100 4,786,715
-------------------------------------------------------------------------------------------------
OeMV AG(3) 150,000 13,518,321
-------------------------------------------------------------------------------------------------
Repsol SA 325,000 9,908,608
-------------------------------------------------------------------------------------------------
YPF Sociedad Anonima, Sponsored ADR 1,035,300 26,141,325
-------------------------------------------------------------------------------------------------
YuKong Ltd. 249,886 12,608,494
------------
90,885,011
</TABLE>
6 Oppenheimer Global Fund
<PAGE>
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
OIL AND GAS DRILLING--1.4% Global Marine, Inc.(3) 2,135,000 $
9,073,750
-------------------------------------------------------------------------------------------------
Petroleum Geo-Services AS(2)(3) 922,000 18,065,413
-------------------------------------------------------------------------------------------------
Transocean Drilling AS(3) 410,000 2,657,675
------------
29,796,838
- -------------------------------------------------------------------------------------------------------------------------------
OIL WELL SERVICES AND McDermott International, Inc. 260,000 6,695,000
EQUIPMENT--0.3%
- -------------------------------------------------------------------------------------------------------------------------------
FINANCIAL--10.5%
- -------------------------------------------------------------------------------------------------------------------------------
FINANCIAL SERVICES: American Express Co. 440,000 13,365,000
MISCELLANEOUS--2.4% -------------------------------------------------------------------------------------------------
Clinica y Maternidad Suizo Argentina SA(1)(3) 1,800 7,490,592
-------------------------------------------------------------------------------------------------
Coryo Securities Corp. 200,000 3,330,411
-------------------------------------------------------------------------------------------------
Industrial Finance Corporation of Thailand (The) 4,930,000 12,238,631
-------------------------------------------------------------------------------------------------
Industrial Finance Corporation of Thailand (The) 570,000 1,415,014
-------------------------------------------------------------------------------------------------
Merrill Lynch & Co., Inc. 125,000 4,328,125
-------------------------------------------------------------------------------------------------
Ssangyong Investment & Securities Co. Ltd. 226,622 5,135,667
-------------------------------------------------------------------------------------------------
Taipei Fund, Cl.B, IDR(1) 44 4,147,000
------------
51,450,440
- -------------------------------------------------------------------------------------------------------------------------------
INSURANCE--1.2% American International Group, Inc. 200,000 17,775,000
-------------------------------------------------------------------------------------------------
National Mutual Asia Ltd. 13,000,000 8,411,840
------------
26,186,840
- -------------------------------------------------------------------------------------------------------------------------------
MAJOR BANKS: Other--5.6% Banco de Galicia, Series B 523,000 4,105,291
-------------------------------------------------------------------------------------------------
Banco Frances del Rio de la Plata SA(3) 818,100 8,181,000
-------------------------------------------------------------------------------------------------
Banco LatinoAmericano de Exportaciones SA, Cl. E 250,000 8,000,000
-------------------------------------------------------------------------------------------------
Banco Portugues de Investimento 280,000 4,389,379
-------------------------------------------------------------------------------------------------
Bank Bali 3,000,000 8,547,597
-------------------------------------------------------------------------------------------------
BankAmerica Corp. 125,000 5,515,625
-------------------------------------------------------------------------------------------------
C.S. Holdings 31,764 12,973,707
-------------------------------------------------------------------------------------------------
Korea First Bank 400,000 6,660,823
-------------------------------------------------------------------------------------------------
PT Lippo Bank 4,066,700 12,147,491
-------------------------------------------------------------------------------------------------
PT Panin Bank(1) 4,000,000 7,306,817
-------------------------------------------------------------------------------------------------
Shin Han Bank Ltd. 238,330 5,460,671
-------------------------------------------------------------------------------------------------
Skandinaviska Enskilda Banken Group(3) 3,480,000 21,075,150
-------------------------------------------------------------------------------------------------
Standard Chartered Bank PLC 3,206,468 13,273,584
------------
117,637,135
- -------------------------------------------------------------------------------------------------------------------------------
MONEY CENTER BANKS--1.3% Citicorp 632,300 26,872,750
- -------------------------------------------------------------------------------------------------------------------------------
INDUSTRIAL--20.6%
- -------------------------------------------------------------------------------------------------------------------------------
BUILDING MATERIALS Ceramica Carabobo CA Sponsored ADR, Cl. B (3)(4) 770,000
5,208,047
GROUP--0.7% -------------------------------------------------------------------------------------------------
Cimentos De Portugal SA 240,000 4,247,786
-------------------------------------------------------------------------------------------------
Thai-German Ceramic Industry Company Ltd. 1,000,000 5,045,042
------------
14,500,875
</TABLE>
7 Oppenheimer Global Fund
<PAGE>
------------------------------------------------------------
------------------------------------------------------------
STATEMENT OF INVESTMENTS (Continued)
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
CONGLOMERATES--3.1% Commercial del Plata 1,921,200 $6,666,144
-------------------------------------------------------------------------------------------------
Hutchison Whampoa Ltd. 2,000,000 9,447,143
-------------------------------------------------------------------------------------------------
Jardine Matheson Holdings Ltd.(2) 3,000,000 25,429,638
-------------------------------------------------------------------------------------------------
Kinnevik Investments AB, Series B Free(2) 800,000 23,261,755
------------
64,804,680
- -------------------------------------------------------------------------------------------------------------------------------
ELECTRICAL EQUIPMENT--1.4% BBC Brown Boveri AG 20,000
17,238,367
-------------------------------------------------------------------------------------------------
LEM Holdings SA(4) 27,300 6,783,530
-------------------------------------------------------------------------------------------------
Sumitomo Electric Industries Ltd. 400,000 5,900,774
------------
29,922,671
- -------------------------------------------------------------------------------------------------------------------------------
ENGINEERING AND BAU Holdings AF, Preference(4) 70,000 5,673,848
CONSTRUCTION--4.9% -------------------------------------------------------------------------------------------------
Dong-AH Construction Industrial Co. 201,735 8,537,175
-------------------------------------------------------------------------------------------------
Empresas ICA Sociedad Controladora SA de C.V.(2) 248,500 8,014,125
-------------------------------------------------------------------------------------------------
Foster Wheeler Corp. 200,000 6,875,000
-------------------------------------------------------------------------------------------------
Grontmij NV(4) 205,612 7,323,877
-------------------------------------------------------------------------------------------------
Grupo Tribasa, SA de C.V.(3) 229,350 8,428,613
-------------------------------------------------------------------------------------------------
IHC Caland NV 450,000 10,694,599
-------------------------------------------------------------------------------------------------
Juan Minetti SA(3) 869,069 5,561,691
-------------------------------------------------------------------------------------------------
Leighton Holdings Ltd.(4) 9,128,500 13,915,365
-------------------------------------------------------------------------------------------------
Raito Kogyo Co. Ltd. 306,000 7,265,833
-------------------------------------------------------------------------------------------------
Trafalgar House PLC 10,369,000 13,735,616
-------------------------------------------------------------------------------------------------
VA Technologie AG(1)(3) 75,000 7,480,412
------------
103,506,154
- -------------------------------------------------------------------------------------------------------------------------------
MACHINERY: DIVERSIFIED--1.4% Bobst Bearers AG 11,180
14,237,338
-------------------------------------------------------------------------------------------------
Daifuku 600,000 8,729,912
-------------------------------------------------------------------------------------------------
Powerscreen International PLC 552,000 2,746,442
-------------------------------------------------------------------------------------------------
Tampella AB(3) 942,000 3,234,981
------------
28,948,673
- -------------------------------------------------------------------------------------------------------------------------------
MANUFACTURING:
- -------------------------------------------------------------------------------------------------------------------------------
DIVERSIFIED INDUSTRIALS--3.9% Autoliv AB(3) 503,000 15,130,168
-------------------------------------------------------------------------------------------------
CBI Industries, Inc. 385,000 10,443,125
-------------------------------------------------------------------------------------------------
Duewag AG(3) 2,774 699,063
-------------------------------------------------------------------------------------------------
Madeco SA, ADR 100,000 3,325,000
-------------------------------------------------------------------------------------------------
Mitsubishi Heavy Industries Ltd. 1,784,000 13,879,752
-------------------------------------------------------------------------------------------------
Nylex Malaysia Berhad 1,500,000 3,451,320
-------------------------------------------------------------------------------------------------
Stewart & Stevenson Services, Inc. 400,000 15,200,000
-------------------------------------------------------------------------------------------------
Valmet Corp., Cl. A(3) 520,000 9,784,277
-------------------------------------------------------------------------------------------------
Vitro Sociedad Anonima, A 400,000 10,350,000
------------
82,262,705
</TABLE>
8 Oppenheimer Global Fund
<PAGE>
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
POLLUTION CONTROL--0.5% Elco Looser Holdings Inhaber 12,740 $
7,271,097
-------------------------------------------------------------------------------------------------
WMX Technologies, Inc. 125,000 3,609,375
------------
10,880,472
- -------------------------------------------------------------------------------------------------------------------------------
RAILROADS--0.4% Voest-Alpine Eisenbahnsysteme AG(1) 67,333 8,294,432
- -------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION:
- -------------------------------------------------------------------------------------------------------------------------------
MISCELLANEOUS--4.3% Brambles Industries Ltd. 1,450,000 14,699,973
-------------------------------------------------------------------------------------------------
Kvaerner Industrier AS(2)(4) 849,230 35,906,457
-------------------------------------------------------------------------------------------------
Lisnave-Estaleiros Navais de Lisbona SA(3) 350,000 1,688,052
-------------------------------------------------------------------------------------------------
Malaysian Helicopter Services 1,000,000 3,100,339
-------------------------------------------------------------------------------------------------
Malaysian International Shipping Corp. 1,999,666 6,667,542
-------------------------------------------------------------------------------------------------
Sembawang Shipyard Ltd. 1,500,000 12,040,488
-------------------------------------------------------------------------------------------------
Singmarine Industries Ltd. 2,500,000 6,475,557
-------------------------------------------------------------------------------------------------
Unitor Ships Service AS(2) 600,000 10,916,503
------------
91,494,911
- -------------------------------------------------------------------------------------------------------------------------------
TECHNOLOGY--12.0%
- -------------------------------------------------------------------------------------------------------------------------------
COMPUTER SOFTWARE AND Microsoft Corp.(3) 480,600
26,973,675
SERVICES--2.0% -------------------------------------------------------------------------------------------------
Oracle Systems Corp. 250,000 10,750,000
-------------------------------------------------------------------------------------------------
SHL Systemhouse, Inc.(3) 718,000 4,038,750
------------
41,762,425
- -------------------------------------------------------------------------------------------------------------------------------
COMPUTER SYSTEMS--0.6% First Data Corp. 92,500 4,648,125
-------------------------------------------------------------------------------------------------
International Business Machines Corp. 100,000 6,950,000
------------
11,598,125
- -------------------------------------------------------------------------------------------------------------------------------
ELECTRONICS: Solectron Corp.(2)(3) 124,000 3,270,500
INSTRUMENTATION--0.2%
- -------------------------------------------------------------------------------------------------------------------------------
ELECTRONICS: Advanced Micro Devices, Inc.(3) 558,300 16,609,425
SEMICONDUCTORS--2.3% -------------------------------------------------------------------------------------------------
Applied Materials, Inc.(3) 150,000 7,012,500
-------------------------------------------------------------------------------------------------
Motorola, Inc. 100,000 5,275,000
-------------------------------------------------------------------------------------------------
National Semiconductor Corp.(3) 500,000 7,812,500
-------------------------------------------------------------------------------------------------
Tokyo Ohka Kogyo 300,000 11,215,512
------------
47,924,937
</TABLE>
9 Oppenheimer Global Fund
<PAGE>
------------------------------------------------------------
------------------------------------------------------------
STATEMENT OF INVESTMENTS (Continued)
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
OFFICE EQUIPMENT AND Canon, Inc. 500,000 $ 8,790,536
SUPPLIES--0.4%
- -------------------------------------------------------------------------------------------------------------------------------
TELECOMMUNICATIONS--6.5% A T & T Corp. 400,000
21,600,000
-------------------------------------------------------------------------------------------------
AirTouch Communications, Inc.(3) 600,000 17,175,000
-------------------------------------------------------------------------------------------------
Korea Mobile Telecommunications 12,519 11,283,870
-------------------------------------------------------------------------------------------------
L.M. Ericsson Telephone Co. Sponsored ADR 100,000 5,375,000
-------------------------------------------------------------------------------------------------
Millicom International Cellular SA(3) 751,256 16,809,353
-------------------------------------------------------------------------------------------------
Nippon Telegraph & Telephone Corp. 1,200 10,669,892
-------------------------------------------------------------------------------------------------
Pakistan Telecommunications, GDR(1)(3) 64,800 12,538,800
-------------------------------------------------------------------------------------------------
Shinawatra Computer Company Ltd. 400,000 12,108,100
-------------------------------------------------------------------------------------------------
Technology Resources Industries(3) 2,500,000 10,236,967
-------------------------------------------------------------------------------------------------
Vodafone Group 6,242,655 19,443,230
------------
137,240,212
- -------------------------------------------------------------------------------------------------------------------------------
UTILITIES--9.3%
- -------------------------------------------------------------------------------------------------------------------------------
ELECTRIC COMPANIES--3.5% AES Corp. (The) 174,472 3,445,822
-------------------------------------------------------------------------------------------------
Central Costanera SA Cl. B 250,000 899,943
-------------------------------------------------------------------------------------------------
Korea Electric Power Co. 500,000 23,162,636
-------------------------------------------------------------------------------------------------
Sithe Energies, Inc.(3) 315,000 3,898,125
-------------------------------------------------------------------------------------------------
Veba AG 125,000 41,450,378
------------
72,856,904
- -------------------------------------------------------------------------------------------------------------------------------
TELEPHONE--5.8% Compania de Telefonos de Chile SA 194,100 17,032,275
-------------------------------------------------------------------------------------------------
Societa Finanziora Telefonica SpA(2) 2,913,000 9,028,432
-------------------------------------------------------------------------------------------------
Telecommunication de Argentina, Cl. B 1,500,000 10,019,369
</TABLE>
10 Oppenheimer Global Fund
<PAGE>
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
TELEPHONE (continued) Telecomunicazioni SpA 12,463,000 $ 35,152,047
--------------------------------------------------------------------------------------------------
Telefonica de Argentina SA, ADR, Cl. B(2) 130,000 9,002,500
--------------------------------------------------------------------------------------------------
Telefonica de Espana, ADS 1,400,000 18,891,686
--------------------------------------------------------------------------------------------------
Telefonos de Mexico SA, Sponsored ADR 375,000 23,437,500
--------------
122,563,809
--------------------------------------------------------------------------------------------------
Total Common Stocks (Cost $1,533,425,663) 1,827,967,516
--------------------------------------------------------------------------------------------------
Total Investments, at Value (Cost $1,793,074,288) 100.0% 2,107,145,290
--------------------------------------------------------------------------------------------------
Liabilities in Excess of Other Assets 0.0 (34,263)
------ --------------
Net Assets 100.0% $2,107,111,027
------ --------------
------ --------------
<FN>
1. Restricted security--See Note 6 of Notes to Financial Statements.
2. Loaned security--See Note 5 of Notes to Financial Statements.
3. Non-income producing security.
4. Affiliated company. Represents ownership of at least 5% of the voting securities of the issuer and is or was an affiliate, as
defined in the Investment Company Act of 1940, at or during the year ended September 30, 1994. The aggregate fair value
of all
securities of affiliated companies as of September 30, 1994 amounted to $64,871,349. Transactions during the period in
which the
issuer was an affiliate are as follows:
Balance Balance
September 30, 1993 Gross Additions Gross Reductions September 30, 1994 Dividend
------------------ --------------- ---------------- ------------------ --------
Shares Cost Shares Cost Shares Cost Shares Cost Income
- -------------------------------------------------------------------------------------------------------------------------------
BAU Holdings AF,
Preference(5) 151,400 $ 16,382,522 2,000 $ 198,960 83,400 $9,811,042 70,000 $6,770,440 $
114,137
- -------------------------------------------------------------------------------------------------------------------------------
Boskalis
Westminster
Koniniije(5) 300,000 4,598,990 -- -- 300,000 4,598,990 0 0 --
- -------------------------------------------------------------------------------------------------------------------------------
Ceramica
Carabobo CA
Sponsored ADR,
Cl. B 770,000 4,229,354 -- -- -- -- 770,000 4,229,354 --
- -------------------------------------------------------------------------------------------------------------------------------
Grontmij NV 287,212 7,922,778 4,032 21 85,632 2,263,497 205,612 5,659,302
173,996
- -------------------------------------------------------------------------------------------------------------------------------
Kvaerner
Industrier AS 500,000 15,252,354 425,000 18,507,156 75,770 2,621,473 849,230 31,138,037
278,630
- -------------------------------------------------------------------------------------------------------------------------------
K-V
Pharmaceutical
Co., Cl. A 441,800 2,382,650 -- -- 65,000 262,300 376,800 2,120,350 --
- -------------------------------------------------------------------------------------------------------------------------------
K-V
Pharmaceutical
Co., Cl. B 335,900 1,210,273 3,700 15,011 74,700 296,563 264,900 928,721 --
- -------------------------------------------------------------------------------------------------------------------------------
Leighton
Holdings
Ltd.(5) 11,665,353 10,717,234 428,500 724,625 2,965,353 2,991,591 9,128,500 8,450,268
632,211
- -------------------------------------------------------------------------------------------------------------------------------
LEM
Holdings SA 25,200 5,066,252 2,100 514,563 -- -- 27,300 5,580,815 243,716
- -------------------------------------------------------------------------------------------------------------------------------
Neozyme II
Corp., Units 146,000 2,205,987 -- -- -- -- 146,000 2,205,987 --
- -------------------------------------------------------------------------------------------------------------------------------
PT Kabelmetal
Indonesia 810,000 1,781,696 430,000 384,800 1,240,000 2,166,496 0 0 --
- -------------------------------------------------------------------------------------------------------------------------------
Rhoen Klinikum
AG,
Preference(5) 26,511 8,593,699 5,303 161,893 -- -- 31,814 8,755,592 260,217
- -------------------------------------------------------------------------------------------------------------------------------
Schaerf AG,
Preference(5) 16,400 4,429,604 -- -- 16,400 4,429,604 0 0 --
- -------------------------------------------------------------------------------------------------------------------------------
Signalbau Huber
AG,
Preference(5) 20,607 7,285,543 -- -- 20,607 7,285,543 0 0 --
- -------------------------------------------------------------------------------------------------------------------------------
Vienna
International
Airport(5) 290,000 13,734,848 -- -- 140,000 6,640,372 150,000 7,094,476 175,720
---------- ------------ ------- ----------- --------- ----------- --------- ----------- ----------
$105,793,784 $20,507,029 $43,367,471 $82,933,342 $1,878,627
---------- ------------ ------- ----------- --------- ----------- --------- ----------- ----------
---------- ------------ ------- ----------- --------- ----------- --------- ----------- ----------
5. Not an affiliate as of September 30, 1994.
</TABLE>
See accompanying Notes to Financial Statements.
11 Oppenheimer Global Fund
<PAGE>
<TABLE>
<CAPTION>
--------------------------------------------------------------------------
--------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES September 30, 1994
- -------------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS Investments, at value (including repurchase agreements
of $212,900,000) (cost $1,793,074,288)--see accompanying
statement $2,107,145,290
--------------------------------------------------------------------------
Collateral for securities loaned, at value--Note 5 132,497,560
--------------------------------------------------------------------------
Receivables:
Investments sold 16,494,205
Shares of beneficial interest sold 5,531,691
Dividends and interest 2,781,233
--------------------------------------------------------------------------
Other 107,076
--------------
Total assets 2,264,557,055
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
LIABILITIES Collateral for securities loaned--Note 5 132,497,560
--------------------------------------------------------------------------
Bank overdraft 6,305,451
--------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased 12,423,431
Shares of beneficial interest redeemed 4,158,946
Distribution and service plan fees--Note 4 950,578
Custodian fees 326,544
Other 783,518
--------------
Total liabilities 157,446,028
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
NET ASSETS $2,107,111,027
--------------
--------------
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
COMPOSITION OF Paid-in capital $1,580,693,639
NET ASSETS --------------------------------------------------------------------------
Overdistributed net investment income (4,537,834)
--------------------------------------------------------------------------
Accumulated net realized gain from investment and
foreign currency transactions 216,912,136
--------------------------------------------------------------------------
Net unrealized appreciation on investments and
translation of assets and liabilities
denominated in foreign currencies 314,043,086
--------------
Net assets $2,107,111,027
--------------
--------------
- -------------------------------------------------------------------------------------------------------
NET ASSET VALUE Class A Shares:
PER SHARE Net asset value and redemption price per share (based on
net assets of $1,920,564,896 and 50,954,880 shares of
beneficial interest outstanding) $37.69
Maximum offering price per share (net asset value plus
sales charge of 5.75% of offering price) $39.99
--------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price and offering price per
share (based on net assets of $186,546,131 and 4,993,283
shares of beneficial interest outstanding) $37.36
</TABLE>
See accompanying Notes to Financial Statements.
12 Oppenheimer Global Fund
<PAGE>
<TABLE>
<CAPTION>
--------------------------------------------------------------------------
--------------------------------------------------------------------------
STATEMENT OF OPERATIONS For the Year Ended September 30, 1994
- -------------------------------------------------------------------------------------------------------
<S> <C> <C>
INVESTMENT INCOME Dividends:
Unaffiliated companies (net of withholding taxes of
$2,931,621) $19,565,961
Affiliated companies (net of withholding taxes of $152,158) 1,878,627
--------------------------------------------------------------------------
Interest 5,826,894
--------------------------------------------------------------------------
Securities lending fees--Note 5 497,168
--------------------------------------------------------------------------
Total income 27,768,650
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
EXPENSES Management fees--Note 4 11,927,942
--------------------------------------------------------------------------
Distribution and service plan fees:
Class A--Note 4 3,044,364
Class B--Note 4 886,625
--------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 4 2,285,983
--------------------------------------------------------------------------
Custodian fees and expenses 1,555,028
--------------------------------------------------------------------------
Shareholder reports 1,068,116
--------------------------------------------------------------------------
Trustees' fees and expenses 168,907
--------------------------------------------------------------------------
Legal and auditing fees 78,281
--------------------------------------------------------------------------
Registration and filing fees:
Class A 64,300
Class B 61,525
--------------------------------------------------------------------------
Other 398,964
--------------------------------------------------------------------------
Total expenses 21,540,035
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME 6,228,615
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED Net realized gain (loss) from:
GAIN (LOSS) ON INVESTMENTS Investments:
AND FOREIGN CURRENCY Unaffiliated companies 216,715,062
TRANSACTIONS Affiliated companies 5,569,243
Foreign currency transactions 649,651
--------------------------------------------------------------------------
Net realized gain 222,933,956
--------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on:
Investments 12,393,060
Translation of assets and liabilities denominated in foreign
currencies 32,271,748
--------------------------------------------------------------------------
Net change 44,664,808
--------------------------------------------------------------------------
Net realized and unrealized gain on investments and foreign
currency transactions 267,598,764
--------------------------------------------------------------------------
Net Increase in Net Assets Resulting From Operations $273,827,379
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying Notes to Financial Statements.
13 Oppenheimer Global Fund
<PAGE>
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS Year Ended September 30,
1994 1993
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
OPERATIONS Net investment income $6,228,615 $10,207,156
----------------------------------------------------------------------------------------------------
Net realized gain on investments and foreign currency
transactions 222,933,956 135,381,724
----------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on
investments and translation of assets and liabilities
denominated in foreign currencies 44,664,808 60,465,689
----------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 273,827,379 206,054,569
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
DIVIDENDS AND Dividends from net investment income:
DISTRIBUTIONS TO Class A ($.251 and $.119 per share, respectively) (10,150,479)
(4,821,327)
SHAREHOLDERS Class B ($.178 per share) (81,844) --
----------------------------------------------------------------------------------------------------
Distributions from net realized gain on investments and
foreign currency transactions:
Class A ($3.365 and $.122 per share, respectively) (135,248,957) (4,976,171)
Class B ($3.365 per share) (1,541,613) --
----------------------------------------------------------------------------------------------------
Beneficial Interest
Transactions
Net increase (decrease) in net assets resulting from Class
A beneficial interest transactions--Note 2 407,788,581 (22,024,735)
----------------------------------------------------------------------------------------------------
Net increase in net assets resulting from Class B beneficial
interest transactions--Note 2 177,716,315 5,954,666
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSETS Total increase 712,309,382 180,187,002
----------------------------------------------------------------------------------------------------
Beginning of year 1,394,801,645 1,214,614,643
----------------------------------------------------------------------------------------------------
End of year [including undistributed (overdistributed)
net investment income of ($4,537,834) and $9,918,309,
respectively] $2,107,111,027 $1,394,801,645
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying Notes to Financial Statements.
14 Oppenheimer Global Fund
<PAGE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
CLASS A CLASS B
- -----------------------------------------------------------------------------------------------------------------------------
YEAR ENDED YEAR ENDED
SEPTEMBER 30, SEPT. 30,
1994 1993 1992 1991 1990 1989 1988 1987 1986 1985 1994 1993(1)
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
<C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning
of period $35.04 $30.03 $32.05 $27.63 $30.43 $22.94 $38.29 $28.88 $17.36 $16.47 $34.99
$33.33
- -----------------------------------------------------------------------------------------------------------------------------
Income (loss) from
investment operations:
Net investment income .17 .26 .17 .05 .02 .20 .04 .05 .12 .14 .08 .03
Net realized and unrealized
gain (loss) on investments and
foreign currency transactions 6.10 4.99 (1.50) 6.14 .29 9.11 (9.70) 13.28 11.56 1.71 5.83 1.63
- -----------------------------------------------------------------------------------------------------------------------------
Total income (loss) from
investment operations 6.27 5.25 (1.33) 6.19 .31 9.31 (9.66) 13.33 11.68 1.85 5.91 1.66
- -----------------------------------------------------------------------------------------------------------------------------
Dividends and distributions
to shareholders:
Dividends from net investment
income (.25) (.12) (.11) (.08) (.11) (.09) (.07) (.11) (.10) (.04) (.18) --
Distributions from net realized
gain on investments and foreign
currency transactions (3.37) (.12) (.58) (1.69) (3.00) (1.73) (5.62) (3.81) (.06) (.92) (3.36) --
- -----------------------------------------------------------------------------------------------------------------------------
Total dividends and
distributions to
shareholders (3.62) (.24) (.69) (1.77) (3.11) (1.82) (5.69) (3.92) (.16) (.96) (3.54) --
- -----------------------------------------------------------------------------------------------------------------------------
Net asset value, end of
period $37.69 $35.04 $30.03 $32.05 $27.63 $30.43 $22.94 $38.29 $28.88 $17.36 $37.36
$34.99
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET
VALUE(2) 19.19% 17.67% (4.23)% 23.71% .79% 42.87% (25.17)% 52.65% 67.63% 12.00%
18.10% 3.64%
- -----------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in millions) $1,921 $1,389 $1,215 $1,076 $720 $523 $371 $601 $372 $232 $187 $6
- -----------------------------------------------------------------------------------------------------------------------------
Average net assets (in
millions) $1,711 $1,213 $1,194 $899 $672 $446 $398 $473 $331 $226 $88 $3
- -----------------------------------------------------------------------------------------------------------------------------
Number of shares outstanding
at end of period (in
thousands) 50,955 39,632 40,441 33,585 26,056 17,183 16,191 15,708 12,891 13,347 4,993
172
- -----------------------------------------------------------------------------------------------------------------------------
Amount of debt outstanding at
end of period (in thousands) N/A $-- $60,000 $60,000 $60,000 $30,000 $30,000 $35,000 $22,000 $14,000 N/A
N/A
- -----------------------------------------------------------------------------------------------------------------------------
Average amount of debt
outstanding throughout each
period (in thousands) N/A $18,247 $60,000 $60,000 $42,877 $30,000 $31,052 $26,290 $19,058 $3,877 N/A
N/A
- -----------------------------------------------------------------------------------------------------------------------------
Average number of shares
outstanding throughout each
period (in thousands) N/A 39,853 37,435 30,607 21,982 16,968 17,173 15,099 13,205 14,476 N/A
N/A
- -----------------------------------------------------------------------------------------------------------------------------
Average amount of debt per
share outstanding throughout
each period N/A $.46 $1.60 $1.96 $1.95 $1.77 $1.81 $1.74 $1.44 $.27 N/A N/A
- -----------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss) .38% .84% .55% .22% .16% .73% .15% .16% .47% .81% (.3%)
1.52%(3)
Expenses 1.15% 1.18% 1.36% 1.65% 1.68% 1.90% 1.89% 1.49% 1.60% 1.21% 2.08%
2.40%(3)
- -----------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(4) 78.3% 86.9% 18.0% 19.9% 27.2% 62.6% 25.2% 37.0% 25.2% 29.0%
78.3% 86.9%
<FN>
1. For the period from August 17, 1993 (inception of offering) to September 30,
1993.
2. Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period, with all dividends and distributions reinvested
in additional shares on the reinvestment date, and redemption at the net asset
value calculated on the last business day of the fiscal period. Sales charges
are not reflected in the total returns.
3. Annualized.
4. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities
owned during the period. Securities with a maturity or expiration date at the
time of acquisition of one year or less are excluded from the calculation.
Purchases and sales of investment securities (excluding short-term securities)
for the year ended September 30, 1994 were $1,557,137,514 and $1,318,260,043,
respectively. See accompanying Notes to Financial Statements.
</TABLE>
15 Oppenheimer Global Fund
<PAGE>
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------------------
1. SIGNIFICANT Oppenheimer Global Fund (the Fund) is registered
ACCOUNTING POLICIES under the Investment Company Act of 1940, as
amended, as a diversified, open-end management
investment company. The Fund's investment advisor
is Oppenheimer Management Corporation (the
Manager). The Fund offers both Class A and Class B
shares. Class A shares are sold with a front-end
sales charge. Class B shares may be subject to a
contingent deferred sales charge. Both classes of
shares have identical rights to earnings, assets
and voting privileges, except that each class has
its own distribution and/or service plan, expenses
directly attributable to a particular class and
exclusive voting rights with respect to matters
affecting a single class. Class B shares will
automatically convert to Class A shares six years
after the date of purchase. The following is a
summary of significant accounting policies
consistently followed by the Fund.
- -------------------------------------------------------------------------------
INVESTMENT VALUATION. Portfolio securities are
valued at 4:00 p.m. (New York time) on each
trading day. Listed and unlisted securities for
which such information is regularly reported are
valued at the last sale price of the day or, in
the absence of sales, at values based on the
closing bid or asked price or the last sale price
on the prior trading day. Long-term debt
securities are valued by a portfolio pricing
service approved by the Board of Trustees.
Long-term debt securities which cannot be valued
by the approved portfolio pricing service are
valued by averaging the mean between the bid and
asked prices obtained from two active market
makers in such securities. Short-term debt
securities having a remaining maturity of 60 days
or less are valued at cost (or last determined
market value) adjusted for amortization to
maturity of any premium or discount. Securities
for which market quotes are not readily available
are valued under procedures established by the
Board of Trustees to determine fair value in good
faith. Forward foreign currency contracts are
valued at the forward rate on a daily basis.
- -------------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The accounting
records of the Fund are maintained in U.S.
dollars. Prices of securities denominated in
foreign currencies are translated into U.S.
dollars at the closing rates of exchange. Amounts
related to the purchase and sale of securities and
investment income are translated at the rates of
exchange prevailing on the respective dates of
such transactions.
The Fund generally enters into forward
foreign currency exchange contracts as a hedge,
upon the purchase or sale of a security
denominated in a foreign currency. In addition,
the Fund may enter into such contracts as a hedge
against changes in foreign currency exchange rates
on portfolio positions. A forward exchange
contract is a commitment to purchase or sell a
foreign currency at a future date, at a negotiated
rate. Risks may arise from the potential inability
of the counterparty to meet the terms of the
contract and from unanticipated movements in the
value of a foreign currency relative to the U.S.
dollar.
The effect of changes in foreign currency
exchange rates on investments is separately
identified from the fluctuations arising from
changes in market values of securities held and
reported with all other foreign currency gains
and losses in the Fund's results of operations.
- -------------------------------------------------------------------------------
REPURCHASE AGREEMENTS. The Fund requires the
custodian to take possession, to have legally
segregated in the Federal Reserve Book Entry
System or to have segregated within the
custodian's vault, all securities held as
collateral for repurchase agreements. If the
seller of the agreement defaults and the value of
the collateral declines, or if the seller enters
an insolvency proceeding, realization of the value
of the collateral by the Fund may be delayed or
limited.
- -------------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES AND GAINS AND
LOSSES. Income, expenses (other than those
attributable to a specific class) and gains and
losses are allocated daily to each class of
shares based upon the relative proportion of net
assets represented by such class. Operating
expenses directly attributable to a specific class
are charged against the operations of that class.
- -------------------------------------------------------------------------------
FEDERAL INCOME TAXES. The Fund intends to
continue to comply with provisions of the
Internal Revenue Code applicable to regulated
investment companies and to distribute all of its
taxable income, including any net realized gain on
investments not offset by loss carryovers, to
shareholders. Therefore, no federal income tax
provision is required.
- -------------------------------------------------------------------------------
TRUSTEES' FEES AND EXPENSES. The Fund has adopted
a nonfunded retirement plan for the Fund's
independent trustees. Benefits are based on years
of service and fees paid to each trustee during
the years of service. During the year ended
September 30, 1994, a provision of $9,909 was made
for the Fund's projected benefit obligations
resulting in an accumulated liability of $168,869.
No payments have been made under the plan.
- -------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS. Dividends and
distributions to shareholders are recorded on the
ex-dividend date.
16 Oppenheimer Global Fund
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
1. SIGNIFICANT Change in Accounting for Distributions to
ACCOUNTING POLICIES Shareholders. Effective October 1, 1993, the
(CONTINUED) Fund adopted Statement of Position 93--2:
Determination, Disclosure, and Financial
Statement Presentation of Income, Capital
Gain, and Return of Capital Distributions
by Investment Companies. As a result, the
Fund changed the classification of
distributions to shareholders to better
disclose the differences between financial
statement amounts and distributions
determined in accordance with income tax
regulations. Accordingly, subsequent to
September 30, 1993, amounts have been
reclassified to reflect an increase in
paid-in capital of $37,660,570, a decrease
in undistributed net investment income of
$10,130,636, and a decrease in undistributed
capital gain on investments of $27,529,934.
During the year ended September 30, 1994, in
accordance with Statement of Position 93--2,
undistributed net investment loss was
increased by $321,799 and undistributed
capital gain was increased by $321,799.
- -------------------------------------------------------------------------------
OTHER. Investment transactions are accounted
for on the date the investments are purchased
or sold (trade date) and dividend income is
recorded on the ex-dividend date. Discount on
securities purchased is amortized over the
life of the respective securities, in
accordance with federal income tax
requirements. Realized gains and losses on
investments and unrealized appreciation and
depreciation are determined on an identified
cost basis, which is the same basis used for
federal income tax purposes.
- -------------------------------------------------------------------------------
2. SHARES OF The Fund has authorized an unlimited number
BENEFICIAL INTEREST of no par value shares of beneficial interest
of each class. Transactions in shares of
beneficial interest were as follows:
<TABLE>
<CAPTION>
Year Ended September 30, 1994 Year Ended September 30, 1993(1)
----------------------------- --------------------------------
Shares Amount Shares Amount
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A:
Sold 17,855,832 $660,092,556 9,261,030 $281,817,220
Dividends and distributions
reinvested 4,104,346 137,249,235 324,902 9,233,707
Redeemed (10,636,826) (389,553,210) (10,395,776) (313,075,662)
------------ ------------- ------------ -------------
Net increase (decrease) 11,323,352 $407,788,581 (809,844) $(22,024,735)
------------ ------------- ------------ -------------
------------ ------------- ------------ -------------
- -----------------------------------------------------------------------------------------------------------------------
Class B:
Sold 5,282,343 $194,604,861 174,932 $6,018,401
Dividends and distributions
reinvested 46,691 1,559,020 -- --
Redeemed (508,033) (18,447,566) (2,650) (63,735)
---------- ------------- -------- -----------
Net increase 4,821,001 $177,716,315 172,282 $5,954,666
---------- ------------- -------- -----------
<FN>
1. For the year ended September 30, 1993 for Class A shares and for the period
from August 17, 1993 (inception of offering) to September 30, 1993 for Class B
shares.
</TABLE>
- -------------------------------------------------------------------------------
3. UNREALIZED GAINS AND At September 30, 1994, net unrealized
LOSSES ON INVESTMENTS appreciation on investments of $314,071,002
was composed of gross appreciation of
$348,141,897, and gross depreciation of
$34,070,895.
- -------------------------------------------------------------------------------
4. MANAGEMENT FEES AND Management fees paid to the Manager were in
OTHER TRANSACTIONS accordance with the investment advisory
WITH AFFILIATES agreement with the Fund which provides for an
annual fee of .80% on the first $250 million
of net assets, .77% on the next $250 million,
.75% on the next $500 million, .69% on the
next $1 billion and .67% on net assets in
excess of $2 billion. Prior to June 27, 1994,
management fees were as follows: .75% on the
first $200 million of net assets with a
reduction of .03% on each $200 million
thereafter to $800 million, .60% on the next
$200 million and .57% on net assets in excess
of $1 billion. The Manager has agreed to
reimburse the Fund if aggregate expenses
(with specified exceptions) exceed the most
stringent applicable regulatory limit on Fund
expenses.
For the year ended September 30, 1994,
commissions (sales charges paid by investors)
on sales of Class A shares totaled $8,458,588,
of which $2,717,037 was retained by
Oppenheimer Funds Distributor, Inc. (OFDI),
a subsidiary of the Manager, as general
distributor, and by an affiliated
broker/dealer. During the year ended
September 30, 1994, OFDI received contingent
deferred sales charges of $113,861 upon
redemption of Class B shares, as reimbursement
for sales commissions advanced by OFDI at the
time of sale of such shares.
Oppenheimer Shareholder Services (OSS),
a division of the Manager, is the transfer and
shareholder servicing agent for the Fund, and
for other registered investment companies.
OSS's total costs of providing such services
are allocated ratably to these companies.
Under separate approved plans, each
class may expend up to .25% of its net assets
annually to reimburse OFDI for costs incurred
in connection with the personal service and
maintenance of
17 Oppenheimer Global Fund
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Continued)
- -------------------------------------------------------------------------------
4. MANAGEMENT FEES AND OTHER accounts that hold shares of the Fund,
TRANSACTIONS WITH AFFILIATES including amounts paid to brokers, dealers,
(CONTINUED) banks and other financial institutions. In
addition, Class B shares are subject to
an asset-based sales charge of .75% of net
assets annually, to reimburse OFDI for sales
commissions paid from its own resources at
the time of sale and associated financing
costs. In the event of termination or
discontinuance of the Class B plan, the
Board of Trustees may allow the Fund to
continue payment of the asset-based sales
charge to OFDI for distribution expenses
incurred on Class B shares sold prior to
termination or discontinuance of the plan.
During the year ended September 30, 1994,
OFDI paid $147,794 and $286, respectively,
to an affiliated broker/dealer as
reimbursement for Class A and Class B
personal service and maintenance expenses
and retained $940,937 as reimbursement for
Class B sales commissions and service fee
advances, as well as financing costs.
- -------------------------------------------------------------------------------
5. SECURITIES LOANED The Fund has entered into a securities
lending arrangement with the custodian.
Under the terms of the agreement, the Fund
receives an annual fee of $500,000, plus 25%
of the annual net income from lending
transactions in excess of $1,500,000. In
exchange for such fees, the custodian is
authorized to loan securities on behalf of
the Fund, against receipt of cash collateral
at least equal in value to the value of the
securities loaned. The collateral is invested
by the custodian in money market instruments
approved by the Manager. As of September 30,
1994, the Fund had on loan securities valued
at $132,497,560. Cash of $129,191,075 was
received as collateral for the loans, and has
been invested in the approved instruments
identified below. U.S. Treasury Notes valued
at $3,306,485 were also received as
collateral. The Fund bears the risk of any
deficiency in the amount of collateral
available for return to a borrower due to a
loss in an approved investment.
<TABLE>
<CAPTION>
Valuation as of
Security September 30, 1994
- ----------------------------------------------------------------------------------------------------------------------
<S> <C>
Repurchase agreement with First Boston Corp., 5.08%, dated 9/27/94 and maturing
on 12/30/94, collateralized by U.S. Treasury Bonds, STRIPS, 0%, 11/15/11, with
a value of $24,472,000 $24,472,000
- -----------------------------------------------------------------------------------------------------------------------
Repurchase agreement with Merrill Lynch, 5.25%, dated 9/30/94 and maturing
10/3/94, collateralized by U.S. Treasury Bonds, STRIPS, 0%, 8/15/11--8/15/14,
with a value of $103,529,000 $103,529,000
U.S. Treasury Nts., 5.875%, 3/31/99 3,306,485
Cash on hand 1,190,075
- -----------------------------------------------------------------------------------------------------------------------
Collateral for securities loaned and cash on hand $132,497,560
- -----------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
6. RESTRICTED SECURITIES The Fund owns securities purchased in private
placement transactions, without registration
under the Securities Act of 1933 (the Act).
The securities are valued under methods
approved by the Board of Trustees as
reflecting fair value. The Fund intends to
invest no more than 10% of its net assets
(determined at the time of purchase) in
restricted and illiquid securities, excluding
securities eligible for resale pursuant to
Rule 144A of the Act that are determined to
be liquid by the Board of Trustees or by the
Manager under Board-approved guidelines.
Restricted and illiquid securities, excluding
securities eligible for resale pursuant to
Rule 144A of the Act amount to $25,283,757,
or 1.2% of the Fund's net assets, at
September 30, 1994. Illiquid and/or
restricted securities, including those
restricted securities that are transferable
under Rule 144A of the Act are listed below.
<TABLE>
<CAPTION>
Valuation Per Unit as
Security Acquisition Date Cost Per Unit of September 30, 1994
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Banco Nacional de Mexico SA, 7% Exch.
Sub. Debs., 12/15/99(1) 12/1/92 $100.00 $116.13
- -----------------------------------------------------------------------------------------------------------------------
Clinica y Maternidad Suizo Argentina SA 4/12/94 $3,883.33 $4,161.44
- -----------------------------------------------------------------------------------------------------------------------
Grupo Televisa SA, Sponsored ADR(1) 3/26/93--4/22/93 $38.37 $57.88
- -----------------------------------------------------------------------------------------------------------------------
Hansol Paper Ltd., Sponsored GDR(1) 2/4/93 $13.46 $29.00
- -----------------------------------------------------------------------------------------------------------------------
International Container Terminal
Services, Inc., 6% Cv. Sr. Nts., 2/19/00(1) 2/19/93 $100.00 $140.00
- -----------------------------------------------------------------------------------------------------------------------
Kia Motors Corp. GDS(1) 5/6/94--8/11/94 $27.39 $23.50
- -----------------------------------------------------------------------------------------------------------------------
PT Panin Bank(1) 7/28/93--9/22/94 $1.02 $1.83
- -----------------------------------------------------------------------------------------------------------------------
Pakistan Telecommunications, GDR(1) 9/19/94--9/30/94 $185.30 $193.50
- -----------------------------------------------------------------------------------------------------------------------
Plant Genetics Systems International NV 5/27/92 $11.18 $9.33
- -----------------------------------------------------------------------------------------------------------------------
Quintiles Transnational Corp. 8/2/93 $17.27 $24.19
- -----------------------------------------------------------------------------------------------------------------------
Taipei Fund Cl. B, IDR 12/20/93--3/4/94 $71,203.69 $94,250.00
- -----------------------------------------------------------------------------------------------------------------------
Tung Ho Steel Enterprise Corp., GDR(1) 9/9/94 $17.20 $17.00
- -----------------------------------------------------------------------------------------------------------------------
VA Technologie AG(1) 8/26/94--9/13/94 $105.45 $99.74
- -----------------------------------------------------------------------------------------------------------------------
Voest-Alpine Eisenbahnsysteme AG(1) 7/19/93--12/20/93 $104.51 $123.19
- -----------------------------------------------------------------------------------------------------------------------
WPP Group PLC(1) 9/5/94 $1.79 $1.72
<FN>
1. Transferable under Rule 144A of the Act.
</TABLE>
<PAGE>
<PAGE> 6
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS March 31, 1995 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FACE MARKET VALUE
AMOUNT SEE NOTE 1
==========================================================
=====================================================
<S> <C> <C>
FOREIGN GOVERNMENT OBLIGATIONS--2.2%
- ---------------------------------------------------------------------------------------------------------------
Argentina (Republic of) Par Bonds, 4.25%, 3/31/23 (Cost $49,078,441)(1) $118,000,000 $ 48,158,750
==========================================================
=====================================================
CONVERTIBLE CORPORATE BONDS AND NOTES--0.1%
- ---------------------------------------------------------------------------------------------------------------
International Container Terminal Services, Inc., 6% Cv. Sr. Nts.,
2/19/00 (Cost $2,000,000)(2) 2,000,000 1,900,000
</TABLE>
<TABLE>
<CAPTION>
SHARES
==========================================================
=====================================================
<S> <C> <C>
COMMON STOCKS--83.6%
- ---------------------------------------------------------------------------------------------------------------
BASIC MATERIALS--4.7%
- ---------------------------------------------------------------------------------------------------------------
CHEMICALS--0.9%
Minerals Technologies, Inc. 615,000 19,833,750
- ---------------------------------------------------------------------------------------------------------------
METALS--1.8%
Dofasco, Inc. 619,600 7,840,242
- ---------------------------------------------------------------------------------------------------------------
Kangwon Industrial Co. Ltd. 264,599 5,209,042
- ---------------------------------------------------------------------------------------------------------------
Pohang Iron & Steel Co. Ltd. 100,000 9,950,945
- ---------------------------------------------------------------------------------------------------------------
Tung Ho Steel Enterprise Corp., GDR 300,000 6,450,000
- ---------------------------------------------------------------------------------------------------------------
Ugine SA 150,000 10,164,752
--------------
39,614,981
- ---------------------------------------------------------------------------------------------------------------
PAPER--2.0%
Corticeira Amorim, SA 496,100 7,904,602
- ---------------------------------------------------------------------------------------------------------------
Hansol Paper Ltd., Sponsored GDR(2) 463,238 10,649,470
- ---------------------------------------------------------------------------------------------------------------
Stora Kopparbergs Bergslags AB(7) 235,350 14,050,695
- ---------------------------------------------------------------------------------------------------------------
Svenska Cellulosa AB(7) 600,000 9,525,067
--------------
42,129,834
- ---------------------------------------------------------------------------------------------------------------
CONSUMER CYCLICALS--13.1%
- ---------------------------------------------------------------------------------------------------------------
AUTOS AND HOUSING--4.3%
General Motors Corp. 750,000 33,187,500
- ---------------------------------------------------------------------------------------------------------------
Philips Electronics NV 1,249,600 42,801,290
- ---------------------------------------------------------------------------------------------------------------
PT Astra International 327,000 474,866
- ---------------------------------------------------------------------------------------------------------------
Volvo AB, Series B Free(7) 1,000,000 17,299,801
--------------
93,763,457
- ---------------------------------------------------------------------------------------------------------------
LEISURE AND ENTERTAINMENT--3.4%
Euro Disneyland SCA(3)(7) 3,000,000 8,069,250
- ---------------------------------------------------------------------------------------------------------------
Genting Berhad 1,000,000 9,003,040
- ---------------------------------------------------------------------------------------------------------------
King World Productions, Inc.(3) 265,200 10,442,250
- ---------------------------------------------------------------------------------------------------------------
Nintendo Co.(7) 641,600 39,283,125
- ---------------------------------------------------------------------------------------------------------------
Vienna International Airport 150,000 6,915,290
--------------
73,712,955
MEDIA--4.4%
Carlton Communications PLC 1,500,000 22,501,869
- ---------------------------------------------------------------------------------------------------------------
Comcast Corp. 850,200 13,231,238
- ---------------------------------------------------------------------------------------------------------------
Comcast Corp., Cl. A Special 406,000 6,343,750
- ---------------------------------------------------------------------------------------------------------------
News Corp. Ltd., ADR(7) 1,400,100 26,776,913
- ---------------------------------------------------------------------------------------------------------------
Scandinavian Broadcasting System SA 325,000 7,475,000
- ---------------------------------------------------------------------------------------------------------------
Telewest Communications PLC, ADR 399,400 10,933,575
- ---------------------------------------------------------------------------------------------------------------
WPP Group PLC 2,737,000 4,547,185
- ---------------------------------------------------------------------------------------------------------------
WPP Group PLC(2) 2,233,000 3,709,852
--------------
95,519,382
</TABLE>
6 Oppenheimer Global Fund
<PAGE> 7
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
==========================================================
=====================================================
<S> <C> <C>
RETAIL: GENERAL--0.7%
Cifra SA de C.V. 500,000 $ 629,933
- ---------------------------------------------------------------------------------------------------------------
Rinascente SpA, Ordinary(7) 557,000 2,783,195
- ---------------------------------------------------------------------------------------------------------------
Sonae Industria E. Investimentos(3) 489,000 11,839,654
--------------
15,252,782
- ---------------------------------------------------------------------------------------------------------------
RETAIL: SPECIALTY--0.3%
Giordano Holdings Ltd. 3,763,200 2,506,466
- ---------------------------------------------------------------------------------------------------------------
Vereinigte Baubeschlag 10,000 3,244,447
--------------
5,750,913
- ---------------------------------------------------------------------------------------------------------------
CONSUMER NON-CYCLICALS--12.0%
- ---------------------------------------------------------------------------------------------------------------
BEVERAGES--1.2%
Jinro Ltd. 219,729 6,773,151
- ---------------------------------------------------------------------------------------------------------------
LVMH Moet Hennessy Louis Vuitton 100,000 19,662,280
--------------
26,435,431
- ---------------------------------------------------------------------------------------------------------------
FOOD--0.9%
Dairy Farm International Holdings Ltd. 8,000,000 10,240,000
- ---------------------------------------------------------------------------------------------------------------
Molinos Rio de la Plata SA, Cl. B(3) 326,700 1,650,241
- ---------------------------------------------------------------------------------------------------------------
PT Indofood Sukses Makmur 1,392,500 4,790,996
- ---------------------------------------------------------------------------------------------------------------
PT Sinar Mass Agro Resources & Technology 3,000,000 3,250,670
--------------
19,931,907
- ---------------------------------------------------------------------------------------------------------------
HEALTHCARE/DRUGS--7.4%
Amgen, Inc.(3) 200,000 13,475,000
- ---------------------------------------------------------------------------------------------------------------
Astra AB Free, Series A(7) 700,000 18,615,943
- ---------------------------------------------------------------------------------------------------------------
Genzyme Corp.(3) 700,435 27,141,856
- ---------------------------------------------------------------------------------------------------------------
Gillette Co. 150,000 12,243,750
- ---------------------------------------------------------------------------------------------------------------
Johnson & Johnson 400,000 23,800,000
- ---------------------------------------------------------------------------------------------------------------
K-V Pharmaceutical Co., Cl. A(4) 376,800 2,496,300
- ---------------------------------------------------------------------------------------------------------------
K-V Pharmaceutical Co., Cl. B(4) 264,900 1,754,963
- ---------------------------------------------------------------------------------------------------------------
Plant Genetics Systems International NV(3)(6) 637,280 3,934,095
- ---------------------------------------------------------------------------------------------------------------
Plant Genetics Systems International NV(3)(6) 250,000 3,204,588
- ---------------------------------------------------------------------------------------------------------------
Quintiles Transnational Corp.(6) 318,473 10,390,182
- ---------------------------------------------------------------------------------------------------------------
Schering AG 30,820 22,858,957
- ---------------------------------------------------------------------------------------------------------------
Sumitomo Chemical Co. Ltd. 1,800,000 9,583,328
- ---------------------------------------------------------------------------------------------------------------
Takeda Chemical Industries Ltd. 886,000 11,690,270
--------------
161,189,232
- ---------------------------------------------------------------------------------------------------------------
HEALTHCARE/SUPPLIES & SERVICES--2.5%
Clinica y Maternidad Suizo Argentino(6) 1,800 8,034,318
- ---------------------------------------------------------------------------------------------------------------
Community Psychiatric Centers 100,000 1,287,500
- ---------------------------------------------------------------------------------------------------------------
Pharmacia AB 967,400 17,195,243
- ---------------------------------------------------------------------------------------------------------------
Stryker Corp. 300,000 13,725,000
- ---------------------------------------------------------------------------------------------------------------
Takare PLC 4,000,000 13,681,918
--------------
53,923,979
</TABLE>
7 Oppenheimer Global Fund
<PAGE> 8
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS (Unaudited) (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
ENERGY--7.2%
- ---------------------------------------------------------------------------------------------------------------
ENERGY SERVICES & PRODUCERS--1.9%
Baker Hughes, Inc. 500,000 $ 10,187,500
- ---------------------------------------------------------------------------------------------------------------
Global Marine, Inc.(3) 2,135,000 9,073,750
- ---------------------------------------------------------------------------------------------------------------
McDermott International, Inc. 260,000 7,117,500
- ---------------------------------------------------------------------------------------------------------------
Petroleum Geo-Services AS(3) 506,500 11,357,430
- ---------------------------------------------------------------------------------------------------------------
Transocean Drilling AS(3) 410,000 4,346,054
--------------
42,082,234
- ---------------------------------------------------------------------------------------------------------------
OIL--INTEGRATED--5.3%
British Petroleum Co. PLC 181,000 15,181,375
- ---------------------------------------------------------------------------------------------------------------
Chilectra Metropolitana SA 95,100 4,583,554
- ---------------------------------------------------------------------------------------------------------------
Compagnie Francaise de Petroleum Total 175,000 10,465,004
- ---------------------------------------------------------------------------------------------------------------
OeMV AG(3) 150,000 15,123,302
- ---------------------------------------------------------------------------------------------------------------
Repsol SA 325,000 9,259,916
- ---------------------------------------------------------------------------------------------------------------
Royal Dutch Petroleum Co. 237,100 28,452,000
- ---------------------------------------------------------------------------------------------------------------
YPF Sociedad Anonima, Sponsored ADR 1,035,300 19,670,700
- ---------------------------------------------------------------------------------------------------------------
YuKong Ltd. 250,000 11,073,694
--------------
113,809,545
- ---------------------------------------------------------------------------------------------------------------
FINANCIAL--12.6%
- ---------------------------------------------------------------------------------------------------------------
BANKS--7.6%
Banco Bradesco SA 983,520,000 6,589,392
- ---------------------------------------------------------------------------------------------------------------
Banco de Galicia, Series B 500,000 1,925,474
- ---------------------------------------------------------------------------------------------------------------
Banco Frances del Rio de la Plata SA 300,000 1,830,450
- ---------------------------------------------------------------------------------------------------------------
Banco Latinoamericano de Exportaciones SA, Cl. E 250,000 6,375,000
- ---------------------------------------------------------------------------------------------------------------
Banco Portugues de Investimento 649,800 11,569,000
- ---------------------------------------------------------------------------------------------------------------
Bank Bali 1,815,500 3,407,104
- ---------------------------------------------------------------------------------------------------------------
BankAmerica Corp. 250,000 12,062,500
- ---------------------------------------------------------------------------------------------------------------
Chase Manhattan Corp. 300,000 10,687,500
- ---------------------------------------------------------------------------------------------------------------
Chemical Banking Corp. 300,000 11,325,000
- ---------------------------------------------------------------------------------------------------------------
Citicorp 632,300 26,872,750
- ---------------------------------------------------------------------------------------------------------------
Credit Local de France 150,000 12,604,293
- ---------------------------------------------------------------------------------------------------------------
Industrial Finance Corp. 4,679,999 9,492,903
- ---------------------------------------------------------------------------------------------------------------
J.P. Morgan & Co., Inc. 170,000 10,370,000
- ---------------------------------------------------------------------------------------------------------------
Korea First Bank 518,889 5,483,919
- ---------------------------------------------------------------------------------------------------------------
Northern Trust Corp. 300,000 10,537,500
- ---------------------------------------------------------------------------------------------------------------
PT Lippo Bank 2,995,000 4,014,745
- ---------------------------------------------------------------------------------------------------------------
PT Panin Bank(2) 3,975,000 5,061,997
- ---------------------------------------------------------------------------------------------------------------
Turkiye Garanti Bankasi AS, Sponsored ADR(2) 4,692,750 15,568,199
--------------
165,777,726
- ---------------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL--2.3%
American Express Co. 440,000 15,345,000
- ---------------------------------------------------------------------------------------------------------------
First NIS Regional Fund(8) 1,320,000 4,620,000
- ---------------------------------------------------------------------------------------------------------------
H & R Block Inc. 200,000 8,675,000
- ---------------------------------------------------------------------------------------------------------------
Merrill Lynch & Co., Inc. 300,000 12,787,500
- ---------------------------------------------------------------------------------------------------------------
SG Warburg & Co., Inc. Ords. 760,000 8,875,656
--------------
50,303,156
</TABLE>
8 Oppenheimer Global Fund
<PAGE> 9
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INSURANCE--2.7%
American International Group, Inc. 200,000 $ 20,850,000
- ---------------------------------------------------------------------------------------------------------------
Marschollek, Lautenschlaeger und Partner AG 9,500 5,671,571
- ---------------------------------------------------------------------------------------------------------------
National Mutual Asia Ltd.(3) 7,001,000 4,323,452
- ---------------------------------------------------------------------------------------------------------------
Swiss Reinsurance 40,000 26,748,511
--------------
57,593,534
- ---------------------------------------------------------------------------------------------------------------
INDUSTRIAL--15.1%
- ---------------------------------------------------------------------------------------------------------------
ELECTRICAL EQUIPMENT--0.3%
LEM Holdings SA(4) 27,300 7,806,622
- ---------------------------------------------------------------------------------------------------------------
INDUSTRIAL MATERIALS--1.4%
Cimentos de Portugal SA 574,000 10,796,046
- ---------------------------------------------------------------------------------------------------------------
International de Ceramica--UB(4) 770,000 1,032,017
- ---------------------------------------------------------------------------------------------------------------
Juan Minetti SA 1,179,400 4,010,947
- ---------------------------------------------------------------------------------------------------------------
Stone Container Corp. 600,000 13,725,000
--------------
29,564,010
- ---------------------------------------------------------------------------------------------------------------
INDUSTRIAL SERVICES--4.6%
Adia SA 65,000 11,948,911
- ---------------------------------------------------------------------------------------------------------------
First Data Corp. 92,500 4,798,438
- ---------------------------------------------------------------------------------------------------------------
Foster Wheeler Corp. 200,000 6,775,000
- ---------------------------------------------------------------------------------------------------------------
Grontmij NV(4) 205,612 7,916,228
- ---------------------------------------------------------------------------------------------------------------
IHC Caland NV 555,700 13,912,133
- ---------------------------------------------------------------------------------------------------------------
ISS International Service System AS, Series B 800,000 21,820,786
- ---------------------------------------------------------------------------------------------------------------
Raito Kogyo Co. Ltd. 770,000 18,537,027
- ---------------------------------------------------------------------------------------------------------------
WMX Technologies, Inc. 500,000 13,750,000
--------------
99,458,523
- ---------------------------------------------------------------------------------------------------------------
MANUFACTURING--5.7%
Autoliv AB(3) 253,000 9,577,577
- ---------------------------------------------------------------------------------------------------------------
Bobst Bearers AG 11,180 15,488,560
- ---------------------------------------------------------------------------------------------------------------
Bombardier, Inc. 26,200 504,295
- ---------------------------------------------------------------------------------------------------------------
Buderus AG(7) 32,000 16,836,050
- ---------------------------------------------------------------------------------------------------------------
CBI Industries, Inc. 385,000 9,865,625
- ---------------------------------------------------------------------------------------------------------------
Commercial del Plata 1,921,200 4,170,030
- ---------------------------------------------------------------------------------------------------------------
Compagnie Generale des Eaux 150,000 15,275,277
- ---------------------------------------------------------------------------------------------------------------
Jardine Matheson Holdings(7) 1,168,000 10,512,000
- ---------------------------------------------------------------------------------------------------------------
Madeco SA, ADR(7) 100,000 2,350,000
- ---------------------------------------------------------------------------------------------------------------
Mitsubishi Heavy Industries Ltd. 1,784,000 12,863,789
- ---------------------------------------------------------------------------------------------------------------
Plettac AG 5,500 3,074,552
- ---------------------------------------------------------------------------------------------------------------
Powerscreen International PLC 920,000 3,746,240
- ---------------------------------------------------------------------------------------------------------------
Tampella AB(3) 942,000 2,038,088
- ---------------------------------------------------------------------------------------------------------------
VAE Eisenbahnsysteme AG(2) 50,733 4,925,364
- ---------------------------------------------------------------------------------------------------------------
Valmet Corp., Cl. A(3) 620,000 12,116,020
--------------
123,343,467
</TABLE>
9 Oppenheimer Global Fund
<PAGE> 10
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS (Unaudited) (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
TRANSPORTATION--3.1%
Brambles Industries Ltd.(7) 1,450,000 $ 13,443,504
- ---------------------------------------------------------------------------------------------------------------
Kvaerner AS 685,600 29,852,451
- ---------------------------------------------------------------------------------------------------------------
Lisnave-Estaleiros Navais de Lisbona SA(3) 827,500 4,052,942
- ---------------------------------------------------------------------------------------------------------------
Malaysian International Shipping Corp. 1,499,999 4,323,825
- ---------------------------------------------------------------------------------------------------------------
Singmarine Industries Ltd. 2,500,000 6,233,558
- ---------------------------------------------------------------------------------------------------------------
Unitor Ships Service AS 600,000 8,512,722
--------------
66,419,002
- ---------------------------------------------------------------------------------------------------------------
TECHNOLOGY--14.8%
- ---------------------------------------------------------------------------------------------------------------
COMPUTER HARDWARE--3.0%
Canon USA, Inc. 500,000 8,275,458
- ---------------------------------------------------------------------------------------------------------------
Digital Equipment Corp. 600,000 22,725,000
- ---------------------------------------------------------------------------------------------------------------
International Business Machines Corp. 399,700 32,725,438
--------------
63,725,896
- ---------------------------------------------------------------------------------------------------------------
COMPUTER SOFTWARE--1.1%
Microsoft Corp.(3) 275,000 19,559,375
- ---------------------------------------------------------------------------------------------------------------
Oracle Systems Corp.(3) 142,500 4,453,1252
--------------
4,012,500
- ---------------------------------------------------------------------------------------------------------------
ELECTRONICS--3.7%
Advanced Micro Devices, Inc.(3) 758,300 25,687,413
- ---------------------------------------------------------------------------------------------------------------
General Motors Corp., Cl. H 400,000 16,500,000
- ---------------------------------------------------------------------------------------------------------------
Hewlett-Packard Co. 100,000 12,037,500
- ---------------------------------------------------------------------------------------------------------------
Intel Corp. 120,000 10,185,000
- ---------------------------------------------------------------------------------------------------------------
Motorola, Inc. 300,000 16,387,500
--------------
80,797,413
- ---------------------------------------------------------------------------------------------------------------
TELECOMMUNICATIONS-TECHNOLOGY--7.0%
Airtouch Communications, Inc.(3) 600,000 16,350,000
- ---------------------------------------------------------------------------------------------------------------
AT&T Corp. 600,000 31,050,000
- ---------------------------------------------------------------------------------------------------------------
Cisco Systems, Inc.(3) 400,000 15,250,000
- ---------------------------------------------------------------------------------------------------------------
Kinnevik Investments AB Free, Series B(7) 400,000 12,211,624
- ---------------------------------------------------------------------------------------------------------------
Korea Mobile Telecommunications Corp. 17,019 12,807,132
- ---------------------------------------------------------------------------------------------------------------
Korea Mobile Telecommunications GDR(2) 120,000 3,217,500
- ---------------------------------------------------------------------------------------------------------------
Millicom International Cellular SA 1,001,256 26,533,284
- ---------------------------------------------------------------------------------------------------------------
Millicom, Inc. 207,000 --
- ---------------------------------------------------------------------------------------------------------------
Pakistan Telecommunications, GDR(2)(3) 38,300 3,523,600
- ---------------------------------------------------------------------------------------------------------------
Petersburg Long Distance, Inc.(7) 1,259,000 7,554,000
- ---------------------------------------------------------------------------------------------------------------
Shinawatra Computer & Communication PLC 50,000 1,070,995
- ---------------------------------------------------------------------------------------------------------------
Technology Resources Industries Berhad 814,000 2,330,326
- ---------------------------------------------------------------------------------------------------------------
Vodafone Group 6,242,655 20,183,550
--------------
152,082,011
- ---------------------------------------------------------------------------------------------------------------
UTILITIES--4.1%
- ---------------------------------------------------------------------------------------------------------------
ELECTRIC UTILITIES--1.9%
Korea Electric Power Co. 500,000 17,420,022
- ---------------------------------------------------------------------------------------------------------------
Sithe Energies, Inc. 240,600 2,225,550
- ---------------------------------------------------------------------------------------------------------------
Veba AG(7) 60,000 21,878,096
--------------
41,523,668
</TABLE>
10 Oppenheimer Global Fund
<PAGE> 11
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
GAS UTILITIES--0.5%
Hong Kong & China Gas 6,000,000 $ 10,708,473
- ---------------------------------------------------------------------------------------------------------------
TELEPHONE UTILITIES--1.7%
Compania Peruana de Telefonos SA 1,866,700 2,289,432
- ---------------------------------------------------------------------------------------------------------------
Telecom Italia SpA(7) 8,000,000 18,714,276
- ---------------------------------------------------------------------------------------------------------------
Telecommunication de Argentina, Cl. B 1,500,000 6,526,606
- ---------------------------------------------------------------------------------------------------------------
Telefonica de Argentina SA, Sponsored ADR(7) 360,000 8,685,000
--------------
36,215,314
--------------
Total Common Stocks (Cost $1,624,593,221) 1,812,281,697
==========================================================
=====================================================
PREFERRED STOCKS--3.7%
- ---------------------------------------------------------------------------------------------------------------
Fiat SpA(3) 10,014,500 24,370,917
- ---------------------------------------------------------------------------------------------------------------
Rhoen Klinikum AG 31,014 21,756,386
- ---------------------------------------------------------------------------------------------------------------
Spar Handels AG, Non-Vtg. 80,580 20,078,875
- ---------------------------------------------------------------------------------------------------------------
Telecomunicacoes Brasileiras SA 504,600,000 13,612,889
--------------
Total Preferred Stocks (Cost $63,589,221) 79,819,067
</TABLE>
<TABLE>
<CAPTION>
UNITS
==========================================================
=====================================================
<S> <C> <C>
RIGHTS, WARRANTS AND CERTIFICATES--0.0%
- ---------------------------------------------------------------------------------------------------------------
American Satellite Networks Wts., Exp. 6/99 51,750 --
- ---------------------------------------------------------------------------------------------------------------
Plant Genetics, Inc. Wts., Exp. 6/99(6) 187,500 390,973
--------------
Total Rights, Warrants and Certificates (Cost $0) 390,973
</TABLE>
<TABLE>
<CAPTION>
FACE
AMOUNT
==========================================================
=====================================================
<S> <C> <C>
REPURCHASE AGREEMENTS--10.6%
- ---------------------------------------------------------------------------------------------------------------
Repurchase agreement with First Chicago Capital Markets, 6.25%,
dated 3/31/95, to be repurchased at $229,519,479 on 4/3/95, collateralized
by U.S. Treasury Nts., 4.75%--8.875%, 5/15/96--10/31/99, with a value of
$200,169,539 and U.S. Treasury Bonds, 8.125%--12.50%, 8/15/14--8/15/19,
with a value of $34,067,765 (Cost $229,400,000) $229,400,000 229,400,000
- ---------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE (COST $1,968,660,883) 100.2% 2,171,950,487
- ---------------------------------------------------------------------------------------------------------------
LIABILITIES IN EXCESS OF OTHER ASSETS (0.2) (4,468,550)
------------ --------------
NET ASSETS 100.0% $2,167,481,937
============ ==============
</TABLE>
Distribution of investments by country of issue, as a percentage of total
investments at value, is as follows:
<TABLE>
<CAPTION>
COUNTRY MARKET VALUE PERCENT
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
United States $ 885,227,783 40.7%
- ---------------------------------------------------------------------------------------------------------------
Germany 115,398,935 5.3
- ---------------------------------------------------------------------------------------------------------------
Sweden 105,950,949 4.9
- ---------------------------------------------------------------------------------------------------------------
Argentina 104,662,515 4.8
- ---------------------------------------------------------------------------------------------------------------
Great Britain 103,361,220 4.8
- ---------------------------------------------------------------------------------------------------------------
Japan 100,232,999 4.6
- ---------------------------------------------------------------------------------------------------------------
Netherlands 96,677,212 4.4
- ---------------------------------------------------------------------------------------------------------------
Korea, Republic of (South) 82,584,878 3.8
- ---------------------------------------------------------------------------------------------------------------
France 76,240,856 3.5
- ---------------------------------------------------------------------------------------------------------------
Switzerland 61,992,604 2.9
- ---------------------------------------------------------------------------------------------------------------
Norway 54,068,657 2.5
- ---------------------------------------------------------------------------------------------------------------
Portugal 46,162,245 2.1
- ---------------------------------------------------------------------------------------------------------------
Italy 45,868,388 2.1
</TABLE>
11 Oppenheimer Global Fund
<PAGE> 12
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS (Unaudited) (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COUNTRY MARKET VALUE PERCENT
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Australia $ 40,220,417 1.9%
- ---------------------------------------------------------------------------------------------------------------
Singapore 26,985,557 1.2
- ---------------------------------------------------------------------------------------------------------------
Austria 26,963,956 1.2
- ---------------------------------------------------------------------------------------------------------------
Denmark 21,820,786 1.0
- ---------------------------------------------------------------------------------------------------------------
Indonesia 21,000,377 1.0
- ---------------------------------------------------------------------------------------------------------------
Brazil 20,202,282 0.9
- ---------------------------------------------------------------------------------------------------------------
Hong Kong 17,538,390 0.8
- ---------------------------------------------------------------------------------------------------------------
Malaysia 15,657,191 0.7
- ---------------------------------------------------------------------------------------------------------------
Turkey 15,568,199 0.7
- ---------------------------------------------------------------------------------------------------------------
Finland 14,154,108 0.7
- ---------------------------------------------------------------------------------------------------------------
Russia 12,174,000 0.6
- ---------------------------------------------------------------------------------------------------------------
Thailand 10,563,898 0.5
- ---------------------------------------------------------------------------------------------------------------
Spain 9,259,916 0.4
- ---------------------------------------------------------------------------------------------------------------
Canada 8,344,538 0.4
- ---------------------------------------------------------------------------------------------------------------
Chile 6,933,554 0.3
- ---------------------------------------------------------------------------------------------------------------
Taiwan 6,450,000 0.3
- ---------------------------------------------------------------------------------------------------------------
Panama 6,375,000 0.3
- ---------------------------------------------------------------------------------------------------------------
Belgium 3,934,095 0.2
- ---------------------------------------------------------------------------------------------------------------
Pakistan 3,523,600 0.2
- ---------------------------------------------------------------------------------------------------------------
Peru 2,289,432 0.1
- ---------------------------------------------------------------------------------------------------------------
Philippines 1,900,000 0.1
- ---------------------------------------------------------------------------------------------------------------
Mexico 1,661,950 0.1
-------------- -----
Total $2,171,950,487 100.0%
============== =====
</TABLE>
1. Represents the current interest rate for an increasing rate security.
2. Represents a security sold under Rule 144A, which is exempt from registration
under the Securities Act of 1933, as amended. This security has been determined
to be liquid under guidelines established by the Board of Trustees. These
securities amount to $48,555,982 or 2.24% of the Fund's net assets, at March 31,
1995.
3. Non-income producing security.
4. Affiliated company. Represents ownership of at least 5% of the voting
securities of the issuer and is or was an affiliate, as defined in the
Investment Company Act of 1940, at or during the period ended March 31, 1995.
The aggregate fair value of all securities of affiliated companies as of March
31, 1995 amounted to $21,006,130. Transactions during the period in which the
issuer was an affiliate are as follows:
<TABLE>
<CAPTION>
BALANCE SEPTEMBER 30, 1994 GROSS ADDITIONS GROSS REDUCTIONS
BALANCE MARCH 31, 1995
-------------------------- --------------- --------------------- ----------------------
SHARES COST SHARES COST SHARES COST SHARES
COST
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
<C>
Grontmij NV 205,612 $ 5,659,302 -- $-- -- $ -- 205,612 $ 5,659,302
- -----------------------------------------------------------------------------------------------------------------------------------
International de Ceramica--UB 770,000 4,229,354 -- -- -- -- 770,000 4,229,354
- -----------------------------------------------------------------------------------------------------------------------------------
K-V Pharmaceutical Co., Cl. A 376,800 2,120,350 -- -- -- -- 376,800 2,120,350
- -----------------------------------------------------------------------------------------------------------------------------------
K-V Pharmaceutical Co., Cl. B 264,900 928,721 -- -- -- -- 264,900 928,721
- -----------------------------------------------------------------------------------------------------------------------------------
Kvaerner Industrier AS(5) 849,230 31,138,037 -- -- 849,230 31,138,037 -- --
- -----------------------------------------------------------------------------------------------------------------------------------
LEM Holdings SA 27,300 5,580,815 -- -- -- -- 27,300 5,580,815
- -----------------------------------------------------------------------------------------------------------------------------------
Neozyme II Corp., Units(5) 146,000 2,205,987 -- -- 146,000 2,205,987 -- --
----------- ---- ----------- -----------
$51,862,566 $-- $33,344,024 $18,518,542
=========== ==== ===========
===========
</TABLE>
5. Not an affiliate as of March 31, 1995.
6. Identifies issues considered to be illiquid--See Note 6 of Notes to Financial
Statements.
7. Loaned Security--See Note 5 of Notes to Financial Statements.
8. First NIS Regional Fund, a closed end fund listed on the Luxembourg Stock
Exchange, is offered in installments. The Fund entered into the first
installment (40% of the total commitment) on November 29, 1994. The second and
third installments (30% each of the total commitment) are provisional and may
be postponed indefinitely at the discretion of the Board of NIS Fund.
See accompanying Notes to Financial Statements.
12 Oppenheimer Global Fund
<PAGE> 13
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES March 31, 1995 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
==========================================================
=======================================================
<S> <C>
ASSETS
Investments, at value (including repurchase agreements of $229,400,000)
(cost $1,968,660,883)--see accompanying statement $2,171,950,487
- -----------------------------------------------------------------------------------------------------------------
Receivables:
Investments sold 21,364,766
Shares of beneficial interest sold 9,668,162
Interest and dividends 6,235,901
- -----------------------------------------------------------------------------------------------------------------
Other 169,669
--------------
Total assets 2,209,388,985
==========================================================
=======================================================
LIABILITIES
Bank overdraft 4,866,011
- -----------------------------------------------------------------------------------------------------------------
Unrealized depreciation on forward foreign currency exchange contracts--Note 7 214,130
- -----------------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased 20,139,745
Shares of beneficial interest redeemed 15,154,455
Distribution and service plan fees--Note 4 959,887
Trustees' fees 16,212
Dividends 1,175
Other 555,433
--------------
Total liabilities 41,907,048
==========================================================
=======================================================
NET ASSETS $2,167,481,937
==============
==========================================================
=======================================================
COMPOSITION OF NET ASSETS
Paid-in capital $1,933,146,455
- -----------------------------------------------------------------------------------------------------------------
Overdistributed net investment income (56,207)
- -----------------------------------------------------------------------------------------------------------------
Accumulated net realized gain from investment and foreign currency transactions 31,152,320
- -----------------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments and translation of assets and liabilities
denominated in foreign currencies 203,239,369
--------------
Net assets $2,167,481,937
==============
==========================================================
=======================================================
NET ASSET VALUE PER SHARE
Class A Shares:
Net asset value and redemption price per share (based on net assets of $1,920,933,893 and
59,006,053 shares of beneficial interest outstanding) $32.55
Maximum offering price per share (net asset value plus sales charge of 5.75% of offering price) $34.54
- -----------------------------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price and offering price per share (based on net assets
of $246,548,044 and 7,681,855 shares of beneficial interest outstanding) $32.09
</TABLE>
See accompanying Notes to Financial Statements.
13 Oppenheimer Global Fund
<PAGE> 14
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS For the Six Months Ended March 31, 1995 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
==========================================================
=====================================================
<S> <C>
INVESTMENT INCOME
Interest $ 7,479,089
- ---------------------------------------------------------------------------------------------------------------
Dividends (net of foreign withholding taxes of $577,041) 9,843,884
- ---------------------------------------------------------------------------------------------------------------
Securities lending fees--Note 5 250,000
-------------
Total income 17,572,973
==========================================================
=====================================================
EXPENSES
Management fees--Note 4 7,553,106
- ---------------------------------------------------------------------------------------------------------------
Distribution and service plan fees:
Class A--Note 4 1,652,696
Class B--Note 4 1,070,047
- ---------------------------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 4 1,457,073
- ---------------------------------------------------------------------------------------------------------------
Custodian fees and expenses 736,554
- ---------------------------------------------------------------------------------------------------------------
Shareholder reports 341,166
- ---------------------------------------------------------------------------------------------------------------
Registration and filing fees:
Class A 25,644
Class B 24,681
- ---------------------------------------------------------------------------------------------------------------
Trustees' fees and expenses 42,668
- ---------------------------------------------------------------------------------------------------------------
Legal and auditing fees 22,800
- ---------------------------------------------------------------------------------------------------------------
Other 164,911
-------------
Total expenses 13,091,346
==========================================================
=====================================================
NET INVESTMENT INCOME 4,481,627
==========================================================
=====================================================
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
Net realized gain (loss) from:
Investments:
Unaffiliated companies (3,852,949)
Affiliated companies 10,900,205
Foreign currency transactions 24,506,177
-------------
Net realized gain 31,553,433
- ---------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on:
Investments (153,996,850)
Translation of assets and liabilities denominated in foreign currencies 43,193,133
-------------
Net change (110,803,717)
-------------
Net realized and unrealized loss on investments and foreign currency transactions (79,250,284)
==========================================================
=======================================================
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS $
(74,768,657)
=============
</TABLE>
See accompanying Notes to Financial Statements.
14 Oppenheimer Global Fund
<PAGE> 15
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
MARCH 31, 1995 SEPTEMBER 30,
(UNAUDITED) 1994
==========================================================
==========================================================
==
<S> <C> <C>
OPERATIONS
Net investment income $ 4,481,627 $ 6,228,615
- ----------------------------------------------------------------------------------------------------------------------
Net realized gain on investments and foreign currency transactions 31,553,433 222,933,956
- ----------------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on investments
and translation of assets and liabilities denominated in foreign currencies (110,803,717) 44,664,808
-------------- --------------
Net increase (decrease) in net assets resulting from operations (74,768,657) 273,827,379
==========================================================
==========================================================
==
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income:
Class A ($.251 per share) -- (10,150,479)
Class B ($.178 per share) -- (81,844)
- ----------------------------------------------------------------------------------------------------------------------
Distributions from net realized gain on investments and foreign
currency transactions:
Class A ($3.749 and $3.365 per share, respectively) (194,602,256) (135,248,957)
Class B ($3.749 and $3.365 per share, respectively) (22,710,993) (1,541,613)
==========================================================
==========================================================
==
BENEFICIAL INTEREST
TRANSACTIONS
Net increase in net assets resulting from Class A beneficial
interest transactions--Note 2 262,234,750 407,788,581
- ----------------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from Class B beneficial
interest transactions--Note 2 90,218,066 177,716,315
==========================================================
==========================================================
==
NET ASSETS
Total increase 60,370,910 712,309,382
- ----------------------------------------------------------------------------------------------------------------------
Beginning of period 2,107,111,027 1,394,801,645
-------------- --------------
End of period (including overdistributed net investment income
of $56,207 and $4,537,834, respectively) $2,167,481,937 $2,107,111,027
==============
==============
</TABLE>
See accompanying Notes to Financial Statements.
15 Oppenheimer Global Fund
<PAGE> 16
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CLASS A
-----------------------------------------------------------------------
SIX MONTHS
ENDED
MARCH 31, 1995 YEAR ENDED SEPTEMBER 30,
(UNAUDITED) 1994 1993 1992 1991 1990
==========================================================
==========================================================
=
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning of period $37.69 $35.04 $30.03 $32.05 $27.63 $30.43
- ---------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) .08 .17 .26 .17 .05 .02
Net realized and unrealized gain
(loss) on investments and foreign
currency transactions (1.47) 6.10 4.99 (1.50) 6.14 .29
------ ------ ------ ------ ------ ------
Total income (loss) from
investment operations (1.39) 6.27 5.25 (1.33) 6.19 .31
- ---------------------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income -- (.25) (.12) (.11) (.08) (.11)
Distributions from net realized
gain on investments and foreign
currency transactions (3.75) (3.37) (.12) (.58) (1.69) (3.00)
------ ------ ------ ------ ------ ------
Total dividends and distributions
to shareholders (3.75) (3.62) (.24) (.69) (1.77) (3.11)
- ---------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $32.55 $37.69 $35.04 $30.03 $32.05 $27.63
====== ====== ====== ====== ======
======
==========================================================
==========================================================
=
TOTAL RETURN, AT NET ASSET VALUE(2) (3.46)% 19.19% 17.67% (4.23)% 23.71%
.79%
==========================================================
==========================================================
=
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in millions) $1,921 $1,921 $1,389 $1,215 $1,076 $720
- ---------------------------------------------------------------------------------------------------------------------
Average net assets (in millions) $1,868 $1,711 $1,213 $1,194 $899 $672
- ---------------------------------------------------------------------------------------------------------------------
Number of shares outstanding at
end of period (in thousands) 59,006 50,955 39,632 40,441 33,585 26,056
- ---------------------------------------------------------------------------------------------------------------------
Amount of debt outstanding at
end of period (in thousands) N/A N/A $-- $60,000 $60,000 $60,000
- ---------------------------------------------------------------------------------------------------------------------
Average amount of debt
outstanding throughout each
period (in thousands) N/A N/A $18,247 $60,000 $60,000 $42,877
- ---------------------------------------------------------------------------------------------------------------------
Average number of shares
outstanding throughout
each period (in thousands) N/A N/A 39,853 37,435 30,607 21,982
- ---------------------------------------------------------------------------------------------------------------------
Amount of debt per share
outstanding throughout each period N/A N/A $.46 $1.60 $1.96 $1.95
- ---------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss) .51%(3) .38% .84% .55% .22% .16%
Expenses 1.17%(3) 1.15% 1.18% 1.36% 1.65% 1.68%
- ---------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(4) 43.4% 78.3% 86.9% 18.0% 19.9% 27.2%
</TABLE>
<TABLE>
<CAPTION>
CLASS B
------------------------------------
SIX MONTHS
ENDED
MARCH 31, 1995 YEAR ENDED SEPT. 30,
(UNAUDITED) 1994 1993(1)
==========================================================
========================
<S> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning of period $37.36 $34.99 $33.33
- ----------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) (.02) .08 .03
Net realized and unrealized gain
(loss) on investments and foreign
currency transactions (1.50) 5.83 1.63
------ ------ ------
Total income (loss) from
investment operations (1.52) 5.91 1.66
- ----------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income -- (.18) --
Distributions from net realized
gain on investments and foreign
currency transactions (3.75) (3.36) --
------ ------ ------
Total dividends and distributions
to shareholders (3.75) (3.54) --
- ----------------------------------------------------------------------------------
Net asset value, end of period $32.09 $37.36 $34.99
====== ====== ======
==========================================================
========================
TOTAL RETURN, AT NET ASSET VALUE(2) (3.86)% 18.10% 3.64%
==========================================================
========================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in millions) $247 $187 $6
- ----------------------------------------------------------------------------------
Average net assets (in millions) $217 $88 $3
- ----------------------------------------------------------------------------------
Number of shares outstanding at
end of period (in thousands) 7,682 4,993 172
- ----------------------------------------------------------------------------------
Amount of debt outstanding at
end of period (in thousands) N/A N/A N/A
- ----------------------------------------------------------------------------------
Average amount of debt
outstanding throughout each
period (in thousands) N/A N/A N/A
- ----------------------------------------------------------------------------------
Average number of shares
outstanding throughout
each period (in thousands) N/A N/A N/A
- ----------------------------------------------------------------------------------
Amount of debt per share
outstanding throughout each period N/A N/A N/A
- ----------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss) (.29)%(3) (.3)% 1.52%(3)
Expenses 2.01%(3) 2.08% 2.40%(3)
- ----------------------------------------------------------------------------------
Portfolio turnover rate(4) 43.4% 78.3% 86.9%
</TABLE>
1. For the period from August 17, 1993 (inception of offering) to September 30,
1993.
2. Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period, with all dividends and distributions reinvested
in additional shares on the reinvestment date, and redemption at the net asset
value calculated on the last business day of the fiscal period. Sales charges
are not reflected in the total returns. Total returns are not annualized for
periods of less than one full year.
3. Annualized.
4. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities owned
during the period. Securities with a maturity or expiration date at the time of
acquisition of one year or less are excluded from the calculation. Purchases
and sales of investment securities (excluding short-term securities) for the six
months ended March 31, 1995 were $946,610,899 and $816,913,633, respectively.
See accompanying Notes to Financial Statements.
16 Oppenheimer Global Fund
<PAGE> 17
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Unaudited)
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
Oppenheimer Global Fund (the Fund) is registered under the Investment Company
Act of 1940, as amended, as a diversified, open-end management investment
company. The Fund's investment advisor is Oppenheimer Management Corporation
(the Manager). The Fund offers both Class A and Class B shares. Class A shares
are sold with a front-end sales charge. Class B shares may be subject to a
contingent deferred sales charge. Both classes of shares have identical rights
to earnings, assets and voting privileges, except that each class has its own
distribution and/or service plan, expenses directly attributable to a
particular class and exclusive voting rights with respect to matters affecting a
single class. Class B shares will automatically convert to Class A shares six
years after the date of purchase. The following is a summary of significant
accounting policies consistently followed by the Fund.
- --------------------------------------------------------------------------------
INVESTMENT VALUATION. Portfolio securities are valued at the close of the New
York Stock Exchange on each trading day. Listed and unlisted securities for
which such information is regularly reported are valued at the last sale price
of the day or, in the absence of sales, at values based on the closing bid or
asked price or the last sale price on the prior trading day. Long-term and
short-term "non-money market" debt securities are valued by a portfolio pricing
service approved by the Board of Trustees. Such securities which cannot be
valued by the approved portfolio pricing service are valued using
dealer-supplied valuations provided the Manager is satisfied that the firm
rendering the quotes is reliable and that the quotes reflect current market
value, or under consistently applied procedures established by the Board of
Trustees to determine fair value in good faith. Short-term "money market type"
debt securities having a remaining maturity of 60 days or less are valued at
cost (or last determined market value) adjusted for amortization to maturity of
any premium or discount. Forward contracts are valued based on the closing
prices of the forward currency contract rates in the London foreign exchange
markets on a daily basis as provided by a reliable bank or dealer. Options are
valued based upon the last sale price on the principal exchange on which the
option is traded or, in the absence of any transactions that day, the value is
based upon the last sale price on the prior trading date if it is within the
spread between the closing bid and asked prices. If the last sale price is
outside the spread, the closing bid or asked price closest to the last reported
sale price is used.
- --------------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The accounting records of the Fund are maintained
in U.S. dollars. Prices of securities denominated in foreign currencies are
translated into U.S. dollars at the closing rates of exchange. Amounts related
to the purchase and sale of securities and investment income are translated at
the rates of exchange prevailing on the respective dates of such transactions.
The effect of changes in foreign currency exchange rates on
investments is separately identified from the fluctuations arising from changes
in market values of securities held and reported with all other foreign currency
gains and losses in the Fund's results of operations.
- --------------------------------------------------------------------------------
REPURCHASE AGREEMENTS. The Fund requires the custodian to take possession, to
have legally segregated in the Federal Reserve Book Entry System or to have
segregated within the custodian's vault, all securities held as collateral for
repurchase agreements. The market value of the underlying securities is
required to be at least 102% of the resale price at the time of purchase. If the
seller of the agreement defaults and the value of the collateral declines, or if
the seller enters an insolvency proceeding, realization of the value of the
collateral by the Fund may be delayed or limited.
- --------------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES AND GAINS AND LOSSES. Income, expenses (other
than those attributable to a specific class) and gains and losses are allocated
daily to each class of shares based upon the relative proportion of net assets
represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.
- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to continue to comply with provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income, including any net realized gain on
investments not offset by loss carryovers, to shareholders. Therefore, no
federal income or excise tax provision is required.
- --------------------------------------------------------------------------------
TRUSTEES' FEES AND EXPENSES. The Fund has adopted a nonfunded retirement plan
for the Fund's independent trustees. Benefits are based on years of service and
fees paid to each trustee during the years of service. During the six months
ended March 31, 1995, a payment of $3,122 was made to a retired trustee,
resulting in an accumulated liability of $165,747 at March 31, 1995.
17 Oppenheimer Global Fund
<PAGE> 18
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to shareholders are
recorded on the ex-dividend date.
- --------------------------------------------------------------------------------
CLASSIFICATION OF DISTRIBUTIONS TO SHAREHOLDERS. Net investment income (loss)
and net realized gain (loss) may differ for financial statement and tax purposes
primarily because of the recognition of certain foreign currency gains (losses)
as ordinary income (loss) for tax purposes. The character of the distributions
made during the year from net investment income or net realized gains may differ
from their ultimate characterization for federal income tax purposes. Also, due
to timing of dividend distributions, the fiscal year in which amounts are
distributed may differ from the year that the income or realized gain (loss) was
recorded by the Fund. Effective October 1, 1993, the Fund adopted Statement of
Position 93-2: Determination, Disclosure, and Financial Statement Presentation
of Income, Capital Gain, and Return of Capital Distributions by Investment
Companies. As a result, the Fund changed the classification of distributions to
shareholders to better disclose the differences between financial statement
amounts and distributions determined in accordance with income tax regulations.
- --------------------------------------------------------------------------------
OTHER. Investment transactions are accounted for on the date the investments are
purchased or sold (trade date) and dividend income is recorded on the
ex-dividend date. Discount on securities purchased is amortized over the life of
the respective securities, in accordance with federal income tax requirements.
Realized gains and losses on investments and unrealized appreciation and
depreciation are determined on an identified cost basis, which is the same basis
used for federal income tax purposes.
==========================================================
======================
2. SHARES OF BENEFICIAL INTEREST
The Fund has authorized an unlimited number of no par value shares of beneficial
interest of each class. Transactions in shares of beneficial interest were as
follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED MARCH 31, 1995 YEAR ENDED SEPTEMBER 30,
1994
------------------------------- -------------------------------
SHARES AMOUNT SHARES AMOUNT
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A:
Sold 8,515,729 $ 289,097,678 17,855,832 $ 660,092,556
Dividends and distributions reinvested 5,837,685 185,638,391 4,104,346 137,249,235
Redeemed (6,302,241) (212,501,319) (10,636,826) (389,553,210)
---------- ------------- ----------- -------------
Net increase 8,051,173 $ 262,234,750 11,323,352 $ 407,788,581
========== ============= ===========
=============
- -------------------------------------------------------------------------------------------------------------------
Class B:
Sold 3,003,212 $ 101,705,620 5,282,343 $ 194,604,861
Dividends and distributions reinvested 687,781 21,610,069 46,691 1,559,020
Redeemed (1,002,421) (33,097,623) (508,033) (18,447,566)
---------- ------------- ----------- -------------
Net increase 2,688,572 $ 90,218,066 4,821,001 $ 177,716,315
========== ============= ===========
=============
</TABLE>
==========================================================
======================
3. UNREALIZED GAINS AND LOSSES ON INVESTMENTS
At March 31, 1995, net unrealized appreciation on investments of $203,075,476
was composed of gross appreciation of $254,562,783, and gross depreciation of
$51,487,307.
==========================================================
======================
4. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Fund which provides for an annual fee of .80% on the
first $250 million of average annual net assets, .77% on the next $250 million,
.75% on the next $500 million, .69% on the next $1 billion, .67 % on the next
$1.5 billion and .65% on net assets in excess of $3.5 billion. The Manager has
voluntarily undertaken that the total expenses of the Fund (with specified
exceptions) shall not exceed the most stringent state regulatory limit on Fund
expenses.
For the six months ended March 31, 1995, commissions (sales charges
paid by investors) on sales of Class A shares totaled $3,707,993, of which
$1,135,323 was retained by Oppenheimer Funds Distributor, Inc. (OFDI), a
subsidiary of the Manager, as general distributor, and by an affiliated
broker/dealer. Sales charges advanced to broker/dealers by OFDI on sales of the
Fund's Class B shares totaled $3,210,979, of which $377,175 was paid to an
affiliated broker/dealer. During the six months ended March 31, 1995, OFDI
received contingent deferred sales charges of $197,066 upon redemption of Class
B shares, as reimbursement for sales commissions advanced by OFDI at the time of
sale of such shares.
Oppenheimer Shareholder Services (OSS), a division of the Manager,
is the transfer and shareholder servicing agent for the Fund, and for other
registered investment companies. OSS's total costs of providing such services
are allocated ratably to these companies.
18 Oppenheimer Global Fund
<PAGE> 19
==========================================================
======================
4. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES (CONTINUED)
Under separate approved plans, each class may expend up to .25% of its net
assets annually to reimburse OFDI for costs incurred in connection with the
personal service and maintenance of accounts that hold shares of the Fund,
including amounts paid to brokers, dealers, banks and other institutions. In
addition, Class B shares are subject to an asset-based sales charge of .75% of
net assets annually, to reimburse OFDI for sales commissions paid from its own
resources at the time of sale and associated financing costs. In the event of
termination or discontinuance of the Class B plan, the Boar d of Trustees may
allow the Fund to continue payment of the asset-based sales charge to OFDI for
distribution expenses incurred on Class B shares sold prior to termination or
discontinuance of the plan. During the six months ended March 31, 1995, OFDI
paid $92,402 and $3,697, respectively, to an affiliated broker/dealer as
reimbursement for Class A and Class B personal service and maintenance expenses
and retained $1,032,788 as reimbursement for Class B sales commissions and
service fee advances, as well as financing costs.
==========================================================
======================
5. SECURITIES LOANED
The Fund has entered into a securities lending arrangement with the custodian.
Under the terms of the agreement, the Fund receives an annual fee of $500,000,
plus 25% of the annual net income from lending transactions in excess of
$1,500,000. In exchange for such fees, the custodian is authorized to loan
securities on behalf of the Fund, against receipt of cash collateral at least
equal in value to the value of the securities loaned. The collateral is invested
by the custodian in money market instruments approved by the Manager. As of
March 31, 1995, the Fund had on loan securities valued at $180,050,757. Cash of
$178,268,000 was received as collateral for the loans, and has been invested in
the approved instruments identified below. U.S. Treasury Notes valued at
$1,798,000 were also received as collateral. The Fund bears the risk of any
deficiency in the amount of collateral available for return to a borrower due
to a loss in an approved investment.
<TABLE>
<CAPTION>
VALUATION AS OF
SECURITY MARCH 31, 1995
- -------------------------------------------------------------------------------------------------------------------------
<S> <C>
Repurchase agreement with Goldman, Sachs, & Co., 6.40%, dated 3/31/95 and maturing 4/3/95,
collateralized by Federal Home Loan Mortgage Corp., 6%, 12/15/23, with a value of $21,219,559,
and by Federal National Mortgage Assn., 6%--7%, 11/1/07--11/1/23, with a value of $55,048,441 $76,268,000
- -------------------------------------------------------------------------------------------------------------------------
Repurchase agreement with Merrill Lynch, Pierce, Fenner & Smith, Inc., 6.25%, dated 3/31/95 and maturing
4/3/95, collateralized by Federal National Mortgage Assn., 8%, 11/15/23, with a value of $2,000,000 2,000,000
- -------------------------------------------------------------------------------------------------------------------------
Repurchase agreement with Morgan Stanley & Co., 6.03%, dated 3/24/95 and maturing 4/7/95, collateralized
by Federal National Mortgage Assn., 5.85%--6.66%, 3/1/24--4/1/34, with a value of $100,000,000 100,000,000
- -------------------------------------------------------------------------------------------------------------------------
U.S. Treasury Bonds, 8.875%, 8/15/17 1,798,000
============
$180,066,000
============
</TABLE>
==========================================================
======================
6. ILLIQUID SECURITIES
At March 31, 1995, investments in securities included issues that are illiquid
or restricted. The securities are often purchased in private placement
transactions, are not registered under the Securities Act of 1933, may have
contractual restrictions on resale, and are valued under methods approved by the
Board of Trustees as reflecting fair value. The Fund intends to invest no more
than 10% of its net assets (determined at the time of purchase) in illiquid or
restricted securities. The aggregate value of these securities subject to this
limitation at March 31, 1995 wa s $25,954,156, which represents 1.2% of the
Fund's net assets. Information concerning these securities is as follows:
<TABLE>
<CAPTION>
VALUATION PER UNIT AS
SECURITY ACQUISITION DATE COST PER UNIT OF MARCH 31, 1995
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Clinica y Maternidad Suizo Argentino 5/16/94 $3,883 $4,464
- ------------------------------------------------------------------------------------------------------------------
Plant Genetics Systems International NV 5/27/92 $11.18 $ 6.17
- ------------------------------------------------------------------------------------------------------------------
Plant Genetics Systems International NV 3/7/95 $14.07 $12.82
- ------------------------------------------------------------------------------------------------------------------
Plant Genetics, Inc. Wts., Exp. 6/99 3/7/95 $ -- $ 2.09
- ------------------------------------------------------------------------------------------------------------------
Quintiles Transnational Corp. 8/2/93 $17.27 $32.63
</TABLE>
Pursuant to guidelines adopted by the Board of Trustees, certain unregistered
securities are determined to be liquid and are not included within the 10%
limitation specified above.
19 Oppenheimer Global Fund
<PAGE> 20
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
==========================================================
======================
7. FORWARD CONTRACTS
A forward foreign currency exchange contract (forward contract) is a commitment
to purchase or sell a foreign currency at a future date, at a negotiated rate.
The Fund uses forward contracts to seek to manage foreign currency
risks. They may also be used to tactically shift portfolio currency risk. The
Fund generally enters into forward contracts as a hedge upon the purchase or
sale of a security denominated in a foreign currency. In addition, the Fund may
enter into such contracts as a hedge against changes in foreign currency
exchange rates on portfolio positions.
Forward contracts are valued based on the closing prices of the
forward currency contract rates in the London foreign exchange markets on a
daily basis as provided by a reliable bank or dealer. The Fund will realize a
gain or loss upon the closing or settlement of the forward transaction.
In this report, securities held in segregated accounts to cover net
exposure on outstanding forward contracts are noted in the Statement of
Investments where applicable. Gains and losses on outstanding contracts
(unrealized appreciation or depreciation on forward contracts) are reported in
the Statement of Assets and Liabilities. Realized gains and losses are reported
with all other foreign currency gains and losses in the Fund's Statement of
Operations.
Risks include the potential inability of the counterparty to meet
the terms of the contract and unanticipated movements in the value of a foreign
currency relative to the U.S. dollar.
At March 31, 1995, the Fund had outstanding forward contracts to purchase and
sell foreign currencies as follows:
<TABLE>
<CAPTION>
CONTRACT UNREALIZED
AMOUNT VALUATION AS OF APPRECIATION
CONTRACTS TO PURCHASE EXPIRATION DATE (000'S) MARCH 31, 1995 (DEPRECIATION)
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
German Deutsche Mark 4/4/95--4/28/95 1,509 $ 1,516,955 $ 7,817
- ------------------------------------------------------------------------------------------------
French Franc 4/28/95 9,692 9,706,659 14,177
- ------------------------------------------------------------------------------------------------
Hong Kong Dollar 4/3/95--4/4/95 861 861,220 (68)
- ------------------------------------------------------------------------------------------------
Japanese Yen 4/5/95 5,917 5,918,080 1,366
- ------------------------------------------------------------------------------------------------
Netherlands Guilder 4/6/95--4/7/95 2,118 2,136,831 19,247
----------- ---------
$20,139,745 $ 42,539
=========== =========
</TABLE>
<TABLE>
<CAPTION>
CONTRACT UNREALIZED
AMOUNT VALUATION AS OF APPRECIATION
CONTRACTS TO SELL EXPIRATION DATE (000'S) MARCH 31, 1995 (DEPRECIATION)
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Argentine Austral 4/3/95--4/4/95 370 $ 370,336 $ (462)
- ------------------------------------------------------------------------------------------------
Austrian Schilling 4/3/95--4/10/95 8,804 9,047,558 (244,007)
- ------------------------------------------------------------------------------------------------
Indonesian Rupiah 4/3/95--4/5/95 3,067 3,070,091 (2,724)
- ------------------------------------------------------------------------------------------------
Swedish Krone 4/3/95--4/5/95 4,931 4,940,081 (9,476)
----------- ---------
$17,428,066 (256,669)
----------- ---------
$(214,130)
=========
</TABLE>
Appendix
Industry Classifications
Aerospace/Defense
Air Transportation
Auto Parts Distribution
Automotive
Bank Holding Companies
Banks
Beverages
Broadcasting
Broker-Dealers
Building Materials
Cable Television
Chemicals
Commercial Finance
Computer Hardware
Computer Software
Conglomerates
Consumer Finance
Containers
Convenience Stores
Department Stores
Diversified Financial
Diversified Media
Drug Stores
Drug Wholesalers
Durable Household Goods
Education
Electric Utilities
Electrical Equipment
Electronics
Energy Services & Producers
Entertainment/Film
Environmental
Food
Gas Transmission*
Gas Utilities*
Gold
Health Care/Drugs
Health Care/Supplies & Services
Homebuilders/Real Estate
Hotel/Gaming
Industrial Services
Insurance
Leasing & Factoring
Leisure
Manufacturing
Metals/Mining
Nondurable Household Goods
Oil - Integrated
Paper
Publishing/Printing
Railroads
Restaurants
Savings & Loans
Shipping
Special Purpose Financial
Specialty Retailing
Steel
Supermarkets
Telecommunications - Technology
Telephone - Utility
Textile/Apparel
Tobacco
Toys
Trucking
____________________________
* For purposes of the Fund's policy not to concentrate in securities of
issuers in the same industry, gas utilities and gas transmission
utilities will each be considered a separate industry.
<PAGE>
Investment Adviser
Oppenheimer Management Corporation
Two World Trade Center
New York, New York 10048-0203
Distributor
Oppenheimer Funds Distributor, Inc.
Two World Trade Center
New York, New York 10048-0203
Transfer and Shareholder Servicing Agent
Oppenheimer Shareholder Services
P.O. Box 5270
Denver, Colorado 80217
1-800-525-7048
Custodian of Portfolio Securities
The Bank of New York
One Wall Street
New York, New York 10015
Independent Auditors
KPMG Peat Marwick LLP
707 Seventeenth Street
Denver, Colorado 80202
Legal Counsel
Gordon Altman Butowsky
Weitzen Shalov & Wein
114 West 47th Street
New York, New York 10036
