<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant To Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-11(c) or
Section240.14a-12
/ / Confidential for Use of the Commission Only (as permitted by Rule
14a-6(c)(2))
QUEST FOR VALUE FAMILY OF FUNDS
--------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
DEBORAH KABACK, ESQ.
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(Name of Person(s) Filing Proxy Statement)
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14-a6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:1
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4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
1Set forth the amount on which the filing fee is calculated and state
how it was determined.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
------------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
3) Filing Party:
------------------------------------------------------------------------
4) Date Filed:
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<PAGE>
QUEST FOR VALUE
FAMILY OF FUNDS September 19, 1995
Dear Quest for Value Growth and Income Fund, Opportunity Fund and
Small Capitalization Fund Shareholder:
Last month we advised you that Quest for Value Advisors, the adviser
of your Fund, had entered into an agreement with Oppenheimer Management
Corporation ("OMC") for the sale to OMC of mutual fund assets of Quest
for Value Advisors. The agreement contemplates that, subject to
shareholder approval, OMC will enter into an Investment Advisory
Agreement with the Fund and that OMC and Quest for Value Advisors will
enter into a Subadvisory Agreement so that the Fund's portfolio would
continue to be managed by Quest for Value Advisors. Distribution services
would be provided by Oppenheimer Funds Distributor, Inc., a subsidiary of
OMC.
A SHAREHOLDER MEETING HAS BEEN SCHEDULED FOR NOVEMBER 3 AND ALL
SHAREHOLDERS OF RECORD ON SEPTEMBER 7 ARE BEING ASKED TO VOTE EITHER IN
PERSON OR BY PROXY. ENCLOSED YOU WILL FIND SEVERAL ITEMS, INCLUDING A
NOTICE OF THE MEETING, A PROXY STATEMENT DETAILING THE PROPOSALS, A
BALLOT CARD AND A POSTAGE-PAID RETURN ENVELOPE FOR YOUR CONVENIENCE.
WHAT IS BEING PROPOSED?
In June, your Board of Trustees, which represents your interests in
the day-to-day management of the Fund, approved the proposed transaction
with OMC and the new contracts with the Fund and recommended that Fund
shareholders approve the new Investment Advisory Agreement, Subadvisory
Agreement and Distribution and Service Plans and Agreements.
WHY DOES THE BOARD AND QUEST FOR VALUE ADVISORS RECOMMEND THIS CHANGE?
The Board of Trustees believes that the proposed changes are in the
best interest of shareholders. The Fund would benefit from OMC's
outstanding distribution and shareholder servicing capabilities while
maintaining continuity of portfolio management through Quest for Value
Advisors' role as Subadvisor.
The proposed transaction will allow Quest for Value Advisors to
concentrate on what it does best -- portfolio management.
YOUR VOTE IS VERY IMPORTANT BECAUSE THESE DECISIONS WILL AFFECT YOUR
INVESTMENT. SO WE URGE YOU TO CONSIDER THESE ISSUES CAREFULLY, AND TO
MAKE YOUR VOTE COUNT.
HOW DO YOU VOTE?
No matter how large or small your investment, your vote is important,
so please review the proxy statement carefully. To cast your vote, simply
mark, sign and date the enclosed proxy ballot and return it in the
postage-paid envelope today.
Please contact your financial adviser or call us at 1-800-232-FUND if
you have any questions.
As always, we appreciate your confidence in the Quest for Value
Funds.
Sincerely
[LOGO]
Joseph M. La Motta
Chairman of the
Board and President
Quest for Value Family of Funds
<PAGE>
137 53
170 171
190 191
51
168
188
<PAGE>
QUEST FOR VALUE FAMILY OF FUNDS
GROWTH AND INCOME FUND
OPPORTUNITY FUND
SMALL CAPITALIZATION FUND
ONE WORLD FINANCIAL CENTER, NEW YORK, N.Y. 10281
------------------------
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD NOVEMBER 3, 1995
------------------------
TO THE SHAREHOLDERS:
Notice is hereby given that a special meeting of shareholders of the Growth
and Income Fund, Opportunity Fund and Small Capitalization Fund (each a "Fund"
and collectively the "Funds"), series of Quest for Value Family of Funds (the
"Trust"), will be held at One World Financial Center, New York, New York 10281
on the 40th floor on November 3, 1995, at 10:00 a.m., Eastern Time, for the
following purposes:
1. To approve a new Investment Advisory Agreement with Oppenheimer
Management Corporation;
2. To approve new Subadvisory Agreements between Oppenheimer Management
Corporation and Quest for Value Advisors, the current advisor to the
Funds;
3. To approve new Distribution and Service Plans and Agreements with
Oppenheimer Funds Distributor, Inc.;
4. To elect Trustees; and
5. To act upon such other matters as may properly come before the meeting
or any adjournment or adjournments thereof.
The close of business on September 7, 1995 has been fixed as the record date
for the determination of shareholders entitled to notice of and to vote at the
meeting. A list of shareholders entitled to vote at the meeting will be
available for inspection by shareholders at the Trust office for ten days prior
to the meeting date.
BY ORDER OF THE BOARD OF TRUSTEES,
DEBORAH KABACK
SECRETARY
September 19, 1995
IMPORTANT
THE BOARD OF TRUSTEES URGES YOU TO MARK, SIGN AND RETURN THE ENCLOSED PROXY AS
SOON AS POSSIBLE WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING IN PERSON. THE
ENCLOSED ADDRESSED ENVELOPE REQUIRES NO POSTAGE AND IS PROVIDED FOR YOUR
CONVENIENCE. YOUR PROMPT RESPONSE WILL ELIMINATE THE NEED FOR ADDITIONAL AND
UNNECESSARY MAILINGS. QUEST FOR VALUE ADVISORS HAS RETAINED D. F. KING & CO.,
INC. TO ASSIST IN THE SOLICITATION OF PROXIES. SHAREHOLDERS WHO HAVE NOT VOTED
THEIR PROXIES IN A TIMELY MANNER MAY RECEIVE A TELEPHONE CALL FROM D.F. KING &
CO., INC. IN AN EFFORT TO URGE THEM TO VOTE.
<PAGE>
QUEST FOR VALUE FAMILY OF FUNDS
GROWTH AND INCOME FUND
OPPORTUNITY FUND
SMALL CAPITALIZATION FUND
ONE WORLD FINANCIAL CENTER, NEW YORK, N.Y. 10281
PROXY STATEMENT
------------------------
SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD NOVEMBER 3, 1995
------------------------
This statement is furnished to the shareholders of the Growth and Income
Fund, Opportunity Fund and Small Capitalization Fund (each individually the
"Fund" and collectively the "Funds"), series of the Quest for Value Family of
Funds (the "Trust"), in connection with the solicitation by management of
proxies to be used at a special meeting (the "meeting") of shareholders of the
Funds to be held on November 3, 1995, or any adjournment or adjournments
thereof. This statement will first be mailed to shareholders on or about
September 19, 1995.
Each of the Funds is a separate series of capital stock of the Trust with
three classes of beneficial interest : A, B and C. Shareholders of each Fund
will vote separately with respect to approval of Proposals one and two and
shareholders of each class of each Fund will vote separately with respect to
Proposal three. Shareholders of the Funds will vote together for the election of
Trustees. As of September 7, 1995, the record date, there were outstanding
3,376,485 Class A shares, 635,939 Class B shares and 130,583 Class C shares of
the Growth and Income Fund, 14,007,448 Class A shares, 7,797,686 Class B shares
and 1,728,071 Class C shares of the Opportunity Fund, and 7,044,944 Class A
shares, 1,359,747 Class B shares and 483,187 Class C shares of the Small
Capitalization Fund. Each shareholder will be entitled to one vote for each
share held on the record date.
If the enclosed form of proxy is properly executed and returned, the shares
represented thereby will be voted at the meeting as indicated thereon with
respect to the Proposals stated therein. In the absence of choices, the shares
represented by the proxy will be voted in favor of the Proposals.
In order that your shares may be represented at the meeting or any
adjournment or adjournments thereof, you are requested to: indicate your voting
instructions on the proxy card; date and sign the proxy card; mail the proxy
card promptly in the enclosed postage-paid envelope; and allow sufficient time
for the proxy to be received on or before 10:00 a.m. on November 3, 1995.
The proxy confers discretionary authority upon the persons named therein to
vote on other business, not currently contemplated, which may come before the
meeting. In the event that a quorum (the presence in person or by proxy of the
holders of a majority of the Trust's shares entitled to vote) cannot be
obtained, an adjournment or adjournments of the meeting may be sought by the
Board of Trustees. In the event that a quorum is present at the meeting but
sufficient votes to approve a particular Proposal are not received, the persons
named as proxies may propose one or more adjournments of the meeting to permit
further solicitation of proxies. Any such adjournment would require the
affirmative vote of the holders of a majority
1
<PAGE>
of the shares of the Trust present at the meeting or any adjournment thereof, in
person or by proxy. The persons named as proxies will vote those proxies which
they are entitled to vote FOR any matter in favor of such an adjournment and
will vote those proxies required to be voted AGAINST any matter that comes
before the meeting against any such adjournment.
The proxy may be revoked at any time prior to the voting thereof by: (i)
written instructions addressed to the Secretary of the Trust at One World
Financial Center, New York, New York 10281; (ii) attendance at the meeting and
voting in person; or (iii) signing and returning a new proxy (if returned and
received in time to be voted).
It is anticipated that proxy solicitation will be made principally by mail,
although employees of Quest for Value Advisors may, without special
compensation, contact shareholders by telephone or wire. Arrangements have been
made with brokers and custodians, nominees and fiduciaries to send proxy
material to beneficial owners. In addition, Quest for Value Advisors has
retained D. F. King & Co., Inc. to assist in the solicitation of proxies
primarily by contacting shareholders by telephone and telegram. D.F. King & Co.,
Inc. may call shareholders to ask if they would be willing to have their votes
recorded by telephone. The telephone voting procedure is designed to
authenticate shareholders' identities, to allow shareholders to authorize the
voting of their shares in accordance with their instructions and to confirm that
their instructions have been recorded properly. The Trust has been advised by
counsel that these procedures are consistent with the requirements of applicable
law. Shareholders voting by telephone will be asked for their social security
number or other identifying information and will be given an opportunity to
authorize proxies to vote their shares in accordance with their instructions. To
ensure that the shareholders' instructions have been recorded correctly they
will receive a confirmation of their instructions in the mail. A special
toll-free number will be available in case the information contained in the
confirmation is incorrect. Although a shareholder's vote may be taken by
telephone, each shareholder will receive a copy of this Proxy Statement and may
vote by mail using the enclosed proxy card. The expenses of the solicitation and
meeting will be shared by Quest for Value Advisors and Oppenheimer Management
Corporation.
To the knowledge of the Funds, the following shareholders held as beneficial
or record owners 5% or more of each specified class of shares of the Funds as of
the record date:
<TABLE>
<CAPTION>
NUMBER AND CLASS OF SHARES
BENEFICIALLY OWNED OR PERCENTAGE
OWNED OF RECORD NAME AND ADDRESS OF CLASS
-------------------------------------------------- -------------------------------------------------- -----------
<S> <C> <C>
1,434,790 Class A shares of the Growth and Income Unified Management Corp Omnibus Account for the 42.49 %
Fund held of record but not beneficially Benefit of Clients
429 N Pennsylvania Street
Indianapolis, IN 426204
429,983 Class A shares of the Growth and Income Unified Management Corp. Omnibus Account for the 12.73 %
Fund held of record but not beneficially Benefit of Clients
429 N. Pennsylvania Street
Indianapolis, IN 42604
12,640 Class C shares of the Growth and Income State Street Bank and Trust as Custodian for the 9.68 %
Fund IRA of Robert B. Delano
Route 3 Box 1955
Warsaw, VA 22572
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
NUMBER AND CLASS OF SHARES
BENEFICIALLY OWNED OR PERCENTAGE
OWNED OF RECORD NAME AND ADDRESS OF CLASS
-------------------------------------------------- -------------------------------------------------- -----------
<S> <C> <C>
10,167 Class C shares of the Growth and Income Jeff McClusky Associates 7.79 %
Fund 401(K) Plan
719 W. Willow
Chicago, IL 60614
1,040,582 Class A shares of the Opportunity Fund CSR America 7.43 %
401(K) Plan
P.O. Box 24635
West Palm Beach, FL 33416
427,660 Class A shares of the Small Capitalization Oppenheimer Group Profit Sharing Plan Indiv A/C 6.07 %
Fund held of record but not beneficially 401K
Oppenheimer Tower
World Financial Center
New York, NY 10281
393,063 Class A shares of the Small Capitalization Comtrades 5.58 %
Fund c/o Commerce Bank & Trust
3035 SW Topeka Blvd
Topeka, KS 66611-2155
</TABLE>
The officers and Trustees of the Trust, as a group, owned beneficially less
than 1% of the shares of any class of the Growth and Income Fund, the
Opportunity Fund and the Small Capitalization Fund as of the record date.
SUMMARY OF THE PROPOSED TRANSACTION
Oppenheimer Capital formed its subsidiary Quest for Value Advisors to offer
its institutional investment advisory services to the retail market. Its
flagship fund, the Quest for Value Fund, Inc., was established in 1980. Since
that time, Quest for Value Advisors has steadily added to its product line
through the development of new funds and by acquisitions. Quest for Value
Distributors has marketed these products through an expanding network of third
party broker dealers and with an emphasis on the retirement market. Although
Oppenheimer Capital is proud of the performance of its mutual fund products and
the benefits they have brought to shareholders, in the course of a review of its
business, it recently concluded that it should concentrate on its core
investment management business and not continue in the retail distribution of
mutual funds. The retail mutual fund market requires significant assets per fund
and in the aggregate for a mutual fund family to cover normal costs, significant
capital investment in new products and services, financing for Class B and Class
C shares and sales support. Consequently, it has become increasingly difficult
for a relatively small mutual fund operation, with assets under $10 billion, to
compete.
After this determination had been made, representatives of Oppenheimer
Management Corporation ("OMC") approached Oppenheimer Capital about acquiring
certain of its mutual fund assets. Representatives of OMC, Oppenheimer Capital,
Quest for Value Distributors and Quest for Value Advisors held meetings
beginning in April 1995 and the parties negotiated the terms of an Acquisition
Agreement (the "Acquisition Agreement") and related agreements. The Acquisition
Agreement was executed by OMC, Oppenheimer Capital, Quest for Value Distributors
and Quest for Value Advisors on August 17, 1995. It is
3
<PAGE>
proposed that, subject to approval by the shareholders of the Funds and the
satisfaction of certain other conditions, OMC become the investment adviser to
the Funds and that a subsidiary of OMC, Oppenheimer Funds Distributor, Inc.,
become the Funds' general distributor and enter into distribution agreements
with the Funds pursuant to Rule 12b-1 under the Investment Company Act of 1940
(the "1940 Act"), and that OMC and Quest for Value Advisors enter into
Subadvisory Agreements with respect to the Funds, pursuant to which Quest for
Value Advisors will continue to provide investment advisory services to the
Funds. Accordingly, the portfolios of the Funds will continue to be managed by
Quest for Value Advisors, although overall management and distribution and
shareholder services will be provided by OMC and its subsidiaries. In this way,
although the Funds will become part of the OppenheimerFunds, a much larger
mutual fund group, there will be continuity of portfolio management. Oppenheimer
Capital and Quest for Value Advisors believe that the proposed transaction with
OMC described in this Proxy Statement has the potential for continued benefits
for shareholders.
OMC and its subsidiaries are engaged principally in the business of
managing, distributing and servicing registered investment companies. OMC owns
all of the outstanding stock of Oppenheimer Funds Distributor, Inc., Shareholder
Services, Inc. and Shareholder Financial Services, Inc. OMC is a wholly-owned
subsidiary of Oppenheimer Acquisition Corp. ("OAC"), which is controlled by
Massachusetts Mutual Life Insurance Company ("MassMutual"), a mutual life
insurance company located at 1295 State Street, Springfield, MA 01111, that also
advises pension plans and investment companies. OAC acquired OMC on October 22,
1990. OMC is not related to Oppenheimer Capital nor its affiliate, the brokerage
firm Oppenheimer & Co., Inc. As indicated below, the common stock of OAC is
owned by (i) certain officers and/ or directors of OMC, (ii) MassMutual and
(iii) another investor. No institution or person holds 5% or more of OAC's
outstanding common stock except MassMutual. MassMutual has engaged in the life
insurance business since 1851. It is the nation's twelfth largest life insurance
company by assets and has an A.M. Best Co. rating of "A++".
The common stock of OAC is divided into three classes. At June 30, 1995,
MassMutual held (i) all of the 2,160,000 shares of Class A voting stock, (ii)
470,021 shares of Class B voting stock, and (iii) 940,067 shares of Class C
non-voting stock. This collectively represented 81.3% of the voting power of OAC
as of that date. Certain officers and/or directors of OMC held (i) 654,788
shares of the Class B voting stock, representing 14.9% of the outstanding common
stock and 10.2% of the voting power, and (ii) options acquired without cash
payment which, when they become exercisable, allow the holders to purchase up to
810,771 shares of Class C non-voting stock. That group includes persons who will
serve as officers of the Trust if the proposed transaction described in this
Proxy Statement is consummated (Ms. Bridget A. Macaskill, Messrs. George C.
Bowen, Andrew J. Donohue and Robert C. Doll, Jr) and one of whom (Ms. Bridget A.
Macaskill) is a nominee to the Board of Trustees of the Trust. Holders of OAC
Class B and Class C common stock may put (sell) their shares and vested options
to OAC or MassMutual at a formula price (based on earnings of OMC). MassMutual
may exercise call (purchase) options on all outstanding shares of both such
classes of common stock and vested options at the same formula price, according
to a schedule that will commence on September 30, 1995. During the period
commencing November 1, 1994 to date, Ms. Macaskill surrendered to OAC 20,000
stock appreciation rights issued in tandem with the Class B OAC options, for
cash payments aggregating $1,375,800 (subject to adjustment of the formula
price) by OAC or MassMutual to be made as follows: one-third of the amount due
(i) within 30 days of the transaction, (ii) by the first anniversary following
the transaction (with interest), and (iii) by the second anniversary following
the transaction (with interest).
4
<PAGE>
The principal executive officers and directors of OMC are as follows: Jon S.
Fossel, Chairman of the Board and Director; Bridget A. Macaskill, President,
Chief Executive Officer (effective September 30, 1995) and Director; Donald W.
Spiro, Chairman Emeritus and Director; Robert G. Galli, Vice Chairman; James C.
Swain, Vice Chairman of the Board and Director; Robert C. Doll, O. Leonard
Darling and James Ruff, Executive Vice Presidents; Tilghman G. Pitts III,
Executive Vice President and Director; Andrew J. Donohue, Executive Vice
President and General Counsel; Kenneth C. Eich, Executive Vice President and
Chief Financial Officer; George C. Bowen, Senior Vice President and Treasurer;
Victor Babin, Robert A. Densen, Loretta McCarthy, Robert Patterson, Nancy
Sperte, Arthur Steinmetz, Ralph Stellmacher, William L. Wilby and Robert G.
Zack, Senior Vice Presidents. The business location of all such persons is Two
World Trade Center, New York, NY except for Mr. Swain and Mr. Bowen, who are
located at OMC's office at 3410 S. Galena Street, Denver, Colorado 80231.
Shareholders of each Fund are being asked to approve the new Investment
Advisory Agreement with OMC and the new Subadvisory Agreement between OMC and
Quest for Value Advisors. A favorable shareholder vote on Proposal 1 also will
constitute a vote to approve the termination of each Fund's existing Investment
Advisory Agreement with Quest for Value Advisors.
THE TERMS OF THE ACQUISITION AGREEMENT
The Acquisition Agreement contemplates the acquisition by OMC of all of the
investment adivsory and other contracts and business relationships and certain
assets and liabilities (the "Purchased Assets") of Quest for Value Advisors,
Quest for Value Distributors and Oppenheimer Capital (collectively, the
"Companies") relating to twelve Quest for Value mutual funds (the "Acquired
Funds") and the assumption by OMC of certain liabilities of the Companies with
respect to the Acquired Funds (the "Assumed Liabilities") (the foregoing is
referred to as the "Acquisition"). OMC is not affiliated with the Companies. The
Acquisition Agreement contemplates that six of the Acquired Funds will be
reorganized into certain mutual funds currently advised by OMC (the "Reorganized
Funds") and the remaining six Acquired Funds (including each Fund) will enter
into investment advisory agreements with OMC (or its designee) and OMC (or its
designee) will thereupon enter into subadvisory agreements with Quest for Value
Advisors for the benefit of each such fund (the "Continuing Funds").
The purchase price for the Purchased Assets will be calculated pursuant to
the formula set forth on Exhibit A hereto. If the Acquisition had been
consummated on July 31, 1995, Quest for Value Advisors estimates that the
purchase price (which includes the initial purchase payment payable at closing,
the amount of certain commissions and a deferred cash payment) would have been
approximately $50 million. The actual purchase price may be lower depending upon
changes in the net asset value of the Acquired Funds.
A condition to the obligation of OMC to close under the Acquisition
Agreement (the "Closing") is the approval of the reorganizations of the
Reorganized Funds and the approval of the investment advisory agreements and
subadvisory agreements with the Continuing Funds by shareholders of the Acquired
Funds that have in the aggregate at least 75% of the closing net assets of all
Acquired Funds. A condition to the obligation of the Companies to close under
the Acquisition Agreement is that the directors or trustees of the Continuing
Funds and the Reorganized Funds have adopted a resolution that for a period of
three years after the Closing, at least 75% of the members of the board of each
such fund will not be interested persons
5
<PAGE>
of the investment adviser or subadviser for such fund or interested persons of
Quest for Value Advisors, the predecessor investment adviser, as to the
Continuing Funds. The Acquisition Agreement sets forth certain other closing
conditions.
The Companies have each agreed pursuant to an Agreement Not To Compete (the
"Non Compete Agreement") not to sponsor, manage or distribute any open-end or
closed-end management investment company registered under the 1940 Act or any
similar law in Canada (except for certain identified investment companies or
types of investment companies) and not to sell, underwrite or assist in the
distribution of shares of any such funds for a period to end on the earlier of
(i) the third anniversary of the date on which there is no effective subadvisory
agreement between OMC and Quest for Value Advisors or (ii) the eighth
anniversary of the Closing. OMC and the Companies have agreed to indemnify the
other party for certain liabilities.
PROPOSALS NO. 1 AND 2
CONSIDERATION OF NEW INVESTMENT ADVISORY AGREEMENT
WITH OPPENHEIMER MANAGEMENT CORPORATION
AND NEW SUBADVISORY AGREEMENTS
BETWEEN OPPENHEIMER MANAGEMENT CORPORATION
AND QUEST FOR VALUE ADVISORS
THE PROPOSED NEW INVESTMENT ADVISORY AND SUBADVISORY AGREEMENTS
If approved by the shareholders of the Funds, the new Investment Advisory
Agreements (the "New Investment Advisory Agreements") and the New Subadvisory
Agreements (the "New Subadvisory Agreements") will become effective at the
Closing, which is anticipated to be held promptly after the shareholders'
meeting. The following summary of the New Investment Advisory and New
Subadvisory Agreements is qualified in its entirety by reference to the form of
such agreements which are attached to this proxy statement as Exhibits B and C,
respectively.
SERVICES TO BE PERFORMED
Under the New Investment Advisory Agreement, OMC will act as the investment
adviser for the Funds and will supervise the investment program of each Fund.
The New Investment Advisory Agreement provides that OMC will provide
administrative services for the Funds including the completion and maintenance
of records, preparation and filing of reports required by the Securities and
Exchange Commission, reports to shareholders and composition of proxy statements
and registration statements required by Federal and state securities laws. OMC
will furnish the Funds with office space, facilities and equipment and arrange
for its employees to serve as officers of the Trust. The administrative services
to be provided by OMC under the New Investment Advisory Agreement will be at its
own expense except that the Funds will pay OMC for calculating each Fund's daily
net asset value for the same fees as are currently paid by the Funds to State
Street Bank and Trust Company for such calculations. For the fiscal year ended
October 31, 1994, each class of shares of the Funds paid the following fees to
State Street Bank and Trust Company for the calculation of daily net asset
value: Class A -- $25,000; Class B -- $18,000; and Class C -- $12,000.
Expenses not assumed by OMC under the New Investment Advisory Agreement or
paid by Oppenheimer Funds Distributor, Inc. will be paid by the Funds including
interest, taxes, brokerage commissions, insurance premiums, compensation,
expenses and fees of non-interested Trustees, legal and audit expenses, transfer
agent and custodian fees and expenses, registration fees, expenses of printing
and mailing
6
<PAGE>
reports and proxy statements to shareholders, expenses of shareholders meetings
and non-recurring expenses including litigation. The New Investment Advisory
Agreement contains no expense limitation. However, independently of the New
Investment Advisory Agreement, OMC has undertaken to reimburse the Funds to the
extent that the total expenses of any Fund in any fiscal year (including the
investment advisory fee but exclusive of taxes, interest, brokerage commissions,
distribution plan payments and any extraordinary non-recurring expenses,
including litigation) exceeds the most stringent state regulatory limitation
application to each Fund. At present, that limitation is imposed by California
and limits expenses (with specified exclusions) to 2.5% of the first $30 million
of average annual net assets, 2% of the next $70 million and 1.5% of average
annual net assets in excess of $100 million. The current Investment Advisory
Agreement contains a similar expense limitation.
The New Investment Advisory Agreement provides that OMC may enter into sub
advisory agreements with other affiliated or unaffiliated registered investment
advisers in order to obtain specialized services for the Funds provided that the
Funds are not required to pay any additional fees for such services. Each New
Subadvisory Agreement provides that Quest for Value Advisors shall regularly
provide investment advice with respect to the respective Fund and invest and
reinvest cash, securities and the property comprising the assets of the Funds.
Under the New Subadvisory Agreements, Quest for Value Advisors agrees not to
change the Portfolio Manager of any Fund without the written approval of OMC and
to provide assistance in the distribution and marketing of the Funds.
ADVISORY AND SUBADVISORY FEES
For the services and facilities to be provided by OMC under the New
Investment Advisory Agreement each Fund will pay a monthly fee computed as a
percentage of the Fund's average daily net assets. The fee applicable to the
Growth and Income Fund will be an annual fee, payable monthly, at the rate of
.85% of daily total net assets, which is the same rate currently in effect
pursuant to the Fund's existing advisory contract. With respect to the Small
Capitalization and Opportunity Funds, the fees will be 1.00% of the first $400
million of net assets, .90% of the next $400 million of net assets and .85% of
net assets over $800 million. The existing advisory fees for the Small
Capitalization and Opportunity Funds are 1.00% of net assets with no
breakpoints. Under each New Subadvisory Agreement, OMC will pay Quest for Value
Advisors an annual fee payable monthly, based on the average daily net assets of
each Fund, equal to 40% of the investment advisory fee collected by OMC from
each Fund based on the total net assets of each Fund as of the effective date of
the New Subadvisory Agreement (the "base amount") plus 30% of the investment
advisory fee collected by OMC based on the total net assets of each Fund that
exceed the base amount. On the record date, the net assets of the Growth and
Income Fund, Opportunity Fund and Small Capitalization Fund were $47,259,586,
$586,337,096, and $159,176,086, respectively.
LIMITATION OF LIABILITY
The New Investment Advisory Agreement provides that in the absence of
willful misfeasance, bad faith or gross negligence in the performance of its
duties or reckless disregard for its obligations and duties under the New
Investment Advisory Agreement, OMC will not be liable for any loss sustained by
reason of good faith errors or omissions in connection with any matters to which
the New Investment Advisory Agreement relates. The existing Investment Advisory
Agreement contains a similar provision. Each New Subadvisory Agreement provides
that in the absence of willful misfeasance, bad faith, negligence or reckless
disregard of its duties or obligations, Quest for Value Advisors shall not be
liable to OMC for any act or omission in the course of or connected with
rendering services under the New Subadvisory Agreement or for any losses that
may be sustained in the purchase, holding or sale of any security.
7
<PAGE>
TERMINATION
The New Investment Advisory Agreement may be terminated by OMC or by a Fund
at any time without penalty upon 60 days written notice to the other party.
Termination by a Fund must be approved by the vote of a majority of the Trustees
or by vote of a majority of the outstanding shares of a Fund. The New Investment
Advisory Agreement will terminate in the event of an "assignment," as required
by the 1940 Act. The existing Investment Advisory Agreement contains a similar
provision except that Quest for Value Advisors may terminate the agreement on 90
days' notice. Each New Subadvisory Agreement contains similar provisions to the
New Investment Advisory Agreement with respect to termination in the event of an
"assignment" and termination by the Funds.
In addition, the New Subadvisory Agreement provides that if the agreement is
terminated by OMC prior to the tenth anniversary thereof, OMC will be obligated
to pay Quest for Value Advisors an amount equal to the subadvisory fee until the
tenth anniversary unless the New Investment Advisory Agreement has been
terminated or the New Subadvisory Agreement has been terminated upon the
occurrence of any of the following events:
(1) A Fund's performance ranks in the bottom quartile for two
consecutive calendar years and earns a Morningstar, Inc. three year rating
of less than three stars;
(2) Quest for Value Advisors is disqualified from serving as an
investment adviser to the Funds under Section 9(a) of the 1940 Act;
(3) Quest for Value Advisors, Quest for Value Distributors, Oppenheimer
Capital or persons under their control cause a material violation of the Non
Compete Agreement; or
(4) Quest for Value Advisors breaches a material provision of the New
Subadvisory Agreement.
PORTFOLIO TRANSACTIONS AND BROKERAGE
The New Investment Advisory Agreement contains provisions relating to the
selection of broker-dealers ("brokers") for the Funds' portfolio transactions.
OMC and any Subadvisor may use such brokers as may, in their best judgment based
on all relevant factors, implement the policy of the Funds to achieve best
execution of portfolio transactions. While OMC need not seek advance competitive
bidding or base its selection on posted rates, it is expected to be aware of the
current rates of most eligible brokers and to minimize the commissions paid to
the extent consistent with the interests and policies of the Funds as
established by their Board and the provisions of the New Investment Advisory
Agreement. The existing Investment Advisory Agreement contains similar
provisions.
The New Investment Advisory Agreement also provides that, consistent with
obtaining the best execution of the Funds' portfolio transactions, OMC and any
Subadvisor, in the interest of the Funds, may select brokers other than
affiliated brokers, because they provide brokerage and/or research services to
the Funds and/or other accounts of OMC or any Subadvisor. The commissions paid
to such brokers may be higher than another qualified broker would have charged
if a good faith determination is made by OMC or any Subadvisor that the
commissions are reasonable in relation to the services provided, viewed either
in terms of that transaction or OMC's or any Subadvisor's overall
responsibilities to all its accounts. No specific dollar value need be put on
the services, some of which may or may not be used by OMC or any Subadvisor for
the benefit of the Funds or other of its advisory clients. To show that the
determinations were made in good faith, OMC or any Subadvisor must be prepared
to show that the amount of such commissions paid over a representative period
selected by the Board was reasonable in relation to the
8
<PAGE>
benefits to the Funds. The New Investment Advisory Agreement recognizes that an
affiliated broker-dealer may act as one of the regular brokers for the Funds
provided that any commissions paid to such broker are calculated in accordance
with procedures adopted by the Trust's Board under applicable SEC rules. The
existing Investment Advisory Agreement contains similar provisions.
The New Subadvisory Agreements permit Quest for Value Advisors to enter into
"soft dollar" arrangements through the agency of third parties to obtain
services for the Funds. Pursuant to these arrangements, Quest for Value Advisors
will undertake to place brokerage business with broker-dealers who pay third
parties that provide services. Any such "soft dollar" arrangements will be made
in accordance with policies adopted by the Board of the Trust and in compliance
with applicable law.
THE EXISTING INVESTMENT ADVISORY AGREEMENT WITH QUEST FOR VALUE ADVISORS
Quest for Value Advisors provides investment advisory and management
services to each Fund pursuant to an Investment Advisory Agreement dated April
29, 1988, as amended. The existing Investment Advisory Agreement with respect to
each Fund was renewed most recently by the Board of Trustees of the Trust,
including a majority of the non-interested Trustees, for a period of one year on
October 25, 1994. The shareholders of the Opportunity and Small Capitalization
Funds approved the existing Investment Advisory Agreement at a meeting held on
July 23, 1990 and the shareholders of the Growth and Income Fund approved the
Investment Advisory Agreement on July 27, 1992.
The advisory fees accrued or paid to Quest for Value Advisors with respect
to the Funds for the fiscal year ended October 31, 1994 were as follows:
$1,555,477 for the Opportunity Fund; $1,260,578 for the Small Capitalization
Fund; and $263,469 for the Growth and Income Fund, of which $142,772 was waived
voluntarily by Quest for Value Advisors. The existing Investment Advisory
Agreement provides for reimbursement to Quest for Value Advisors for a portion
of bookkeeping and accounting services performed for each Fund. For the fiscal
year ended October 31, 1994 such fees were as follows: $53,245 for the
Opportunity Fund; $67,578 for the Small Capitalization Fund; and $68,117 for the
Growth and Income Fund.
For the fiscal year ended October 31, 1994, Oppenheimer & Co, Inc., an
affiliated broker dealer of the Funds, was paid a total of $55,911 in brokerage
commissions by the Growth and Income Fund, $94,589 in brokerage commissions by
the Opportunity Fund and $143,991 in brokerage commissions by the Small
Capitalization Fund, which amounts were 75.2%, 49.8% and 48.0%, respectively, of
those Funds' total brokerage commissions during the period.
The following tables compare current and pro forma fees based on assets and
expenses for the six months ended April 30, 1995 and for the fiscal year ended
October 31, 1994. The pro forma fees are those estimated to be incurred under
the New Investment Advisory Agreement, 12b-1 plans and other agreements if the
proposed transaction is consummated.
9
<PAGE>
CURRENT
PERIOD: SIX MONTHS ENDED APRIL 30, 1995
SUMMARY OF FUND EXPENSES
<TABLE>
<CAPTION>
OPPORTUNITY SMALL CAPITALIZATION GROWTH AND INCOME
---------------------- ---------------------- ---------------------------------
CLASS OF SHARES: A B C A B C A B C
------ ------ ------ ------ ------ ------ --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Initial Sales Load Imposed on
Purchase (as a % of offering price)......... 5.50% none none 5.50% none none 4.75% none none
Maximum Deferred Sales Load (1).............. none 5.00% 1.00% none 5.00% 1.00% none 5.00% 1.00%
Maximum Sales Load Imposed On Reinvested
Dividends................................... none none none none none none none none none
Redemption Fee............................... none none none none none none none none none
Exchange Fee................................. $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00
ANNUAL FUND OPERATING EXPENSES
(AS % OF AVERAGE NET ASSETS)
Management Fee (2)........................... 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% .85% .85% .85%
12b-1 Fee (including service fees of .25%)... .50% 1.00% 1.00% .50% 1.00% 1.00% .40% 1.00% 1.00%
Other Expenses............................... .21% .24% .26% .30% .37% .35% .92% .88% 1.15%
------ ------ ------ ------ ------ ------ --------- --------- ---------
TOTAL FUND OPERATING EXPENSES................ 1.71% 2.24% 2.26% 1.80% 2.37% 2.35% 2.17%(3) 2.73%(3) 3.00%(3)
------ ------ ------ ------ ------ ------ --------- --------- ---------
------ ------ ------ ------ ------ ------ --------- --------- ---------
<FN>
------------------------------
(1) Purchases of Class A shares of $1 million or more are not subject to
front-end sales charges but a contingent deferred sales charge of 1% is
imposed if the shares are redeemed within the first 12 months after the end
of the calendar month of their purchase.
(2) The management fee is higher than that paid by most other investment
companies.
(3) During the period presented above, Quest for Value Advisors waived a
portion of its fee with respect to the Growth and Income Fund. The expenses
set forth above have been restated to reflect what expenses would have been
if Quest for Value Advisors had not waived a portion of its advisory fee.
After such waivers, the ratios of net operating expenses to average net
assets for Class A, B and C shares were 1.92%, 2.49% and 2.77%,
respectively.
</TABLE>
PRO FORMA
SUMMARY OF FUND EXPENSES
<TABLE>
<CAPTION>
OPPORTUNITY SMALL CAPITALIZATION GROWTH AND INCOME
---------------------- ---------------------- ---------------------------------
CLASS OF SHARES: A B C A B C A B C
------ ------ ------ ------ ------ ------ --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Initial Sales Load Imposed on
Purchase (as a % of offering price)......... 5.75% none none 5.75% none none 5.75% none none
Maximum Deferred Sales Load (1).............. none 5.00% 1.00% none 5.00% 1.00% none 5.00% 1.00%
Maximum Sales Load Imposed On Reinvested
Dividends................................... none none none none none none none none none
Redemption Fee............................... none none none none none none none none none
Exchange Fee................................. none none none none none none none none none
ANNUAL FUND OPERATING EXPENSES
(AS % OF AVERAGE NET ASSETS)
Management Fee (2)........................... 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% .85% .85% .85%
12b-1 Fee (including service fees of .25%)... .50% 1.00% 1.00% .50% 1.00% 1.00% .40% 1.00% 1.00%
Other Expenses............................... .21% .24% .26% .30% .37% .35% .92% .88% 1.15%
------ ------ ------ ------ ------ ------ --------- --------- ---------
TOTAL FUND OPERATING EXPENSES................ 1.71% 2.24% 2.26% 1.80% 2.37% 2.35% 2.17% 2.73% 3.00%
------ ------ ------ ------ ------ ------ --------- --------- ---------
------ ------ ------ ------ ------ ------ --------- --------- ---------
<FN>
------------------------------
(1) Purchases of Class A shares of $1 million or more will not be subject to
front-end sales charges but a contingent deferred sales charge of 1% will
be imposed if the shares are redeemed within the first 18 months after the
end of the calendar month of their purchase.
(2) The management fee is higher than that paid by most other investment
companies.
</TABLE>
10
<PAGE>
CURRENT
EXAMPLE 1: YOU WOULD PAY THE FOLLOWING EXPENSES OVER THE INDICATED PERIODS
IN EACH OF THE FUNDS ON A $1,000 INVESTMENT ASSUMING (A) PAYMENT OF THE MAXIMUM
SALES CHARGE, (B) A 5% ANNUAL RETURN, AND (C) RETENTION OF SHARES AT THE END OF
THE TIME PERIOD. 10-YEAR FIGURES FOR CLASS B SHARES ASSUME CONVERSION TO CLASS A
SHARES AFTER EIGHT YEARS.
<TABLE>
<CAPTION>
SMALL GROWTH AND INCOME
OPPORTUNITY CAPITALIZATION
------------------- ------------------- -------------------
A B C A B C A B C
----- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 Year....................... $ 71 $ 23 $ 23 $ 72 $ 24 $ 24 $ 68 $ 28 $ 30
3 Years...................... 106 70 71 109 74 73 112 85 93
5 Years...................... 143 120 121 147 127 126 158 144 158
10 Years...................... 246 244 260 255 256 269 286 293 332
</TABLE>
EXAMPLE 2: YOU WOULD PAY THE FOLLOWING EXPENSES OVER THE INDICATED PERIODS
IN EACH OF THE FUNDS ON A $1,000 INVESTMENT ASSUMING (A) PAYMENT OF THE MAXIMUM
SALES CHARGE, (B) A 5% ANNUAL RETURN, AND (C) REDEMPTION AT THE END OF THE TIME
PERIOD. 10-YEAR FIGURES FOR CLASS B SHARES ASSUME CONVERSION TO CLASS A SHARES
AFTER EIGHT YEARS.
<TABLE>
<CAPTION>
A B C A B C A B C
----- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 Year....................... $ 71 $ 73 $ 33 $ 72 $ 74 $ 34 $ 68 $ 78 $ 40
3 Years...................... 106 100 71 109 104 73 112 115 93
5 Years...................... 143 140 121 147 147 126 158 164 158
10 Years...................... 246 244 260 255 256 269 286 293 332
</TABLE>
PRO FORMA
EXAMPLE 1: YOU WOULD PAY THE FOLLOWING EXPENSES OVER THE INDICATED PERIODS
IN EACH OF THE FUNDS ON A $1,000 INVESTMENT ASSUMING (A) PAYMENT OF THE MAXIMUM
SALES CHARGE, (B) A 5% ANNUAL RETURN, AND (C) RETENTION OF SHARES AT THE END OF
THE TIME PERIOD. 10-YEAR FIGURES FOR CLASS B SHARES ASSUME CONVERSION TO CLASS A
SHARES AFTER SIX YEARS.
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 Year....................... $ 74 $ 23 $ 23 $ 75 $ 24 $ 24 $ 78 $ 28 $ 30
3 Years...................... 108 70 71 111 74 73 122 85 93
5 Years...................... 145 120 121 149 127 126 167 144 158
10 Years...................... 248 232 260 257 244 269 293 280 332
</TABLE>
EXAMPLE 2: YOU WOULD PAY THE FOLLOWING EXPENSES OVER THE INDICATED PERIODS
IN EACH OF THE FUNDS ON A $1,000 INVESTMENT ASSUMING (A) PAYMENT OF THE MAXIMUM
SALES CHARGE, (B) A 5% ANNUAL RETURN, AND (C) REDEMPTION AT THE END OF THE TIME
PERIOD. 10-YEAR FIGURES FOR CLASS B SHARES ASSUME CONVERSION TO CLASS A SHARES
AFTER SIX YEARS.
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 Year....................... $ 74 $ 73 $ 33 $ 75 $ 74 $ 34 $ 78 $ 78 $ 40
3 Years...................... 108 100 71 111 104 73 122 115 93
5 Years...................... 145 140 121 149 147 126 167 164 158
10 Years...................... 248 232 260 257 244 269 293 280 332
</TABLE>
THE EXAMPLES SHOULD NOT BE CONSIDERED INDICATIONS OF PAST OR FUTURE EXPENSES
OR PERFORMANCE AND ACTUAL EXPENSES OR PERFORMANCE MAY VARY FROM THOSE SHOWN.
INVESTORS SHOULD BE AWARE THAT OVER TIME, CLASS B AND C SHAREHOLDERS MAY PAY
MORE THAN THE EQUIVALENT OF THE MAXIMUM FRONT-END SALES CHARGES PERMITTED BY THE
NATIONAL ASSOCIATION OF SECURITIES DEALERS RULES OF FAIR PRACTICE.
11
<PAGE>
CURRENT
PERIOD: FISCAL YEAR ENDED OCTOBER 31, 1994
SUMMARY OF FUND EXPENSES
<TABLE>
<CAPTION>
OPPORTUNITY SMALL CAPITALIZATION GROWTH AND INCOME
---------------------- ---------------------- ---------------------------------
CLASS OF SHARES: A B C A B C A B C
------ ------ ------ ------ ------ ------ --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Initial Sales Load Imposed on
Purchase (as a % of offering price)......... 5.50% none none 5.50% none none 4.75% none none
Maximum Deferred Sales Load (1).............. none 5.00% 1.00% none 5.00% 1.00% none 5.00% 1.00%
Maximum Sales Load Imposed On Reinvested
Dividends................................... none none none none none none none none none
Redemption Fee............................... none none none none none none none none none
Exchange Fee................................. $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00
ANNUAL FUND OPERATING EXPENSES
(AS % OF AVERAGE NET ASSETS)
Management Fee (2)........................... 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% .85% .85% .85%
12b-1 Fee (including service fees of .25%)... .50% 1.00% 1.00% .50% 1.00% 1.00% .40% 1.00% 1.00%
Other Expenses............................... .28% .34% .35% .38% .48% .59% 1.07% 1.08% 1.25%
------ ------ ------ ------ ------ ------ --------- --------- ---------
TOTAL FUND OPERATING EXPENSES................ 1.78% 2.34% 2.35% 1.88% 2.48% 2.59% 2.32%(3) 2.93%(3) 3.10%(3)
------ ------ ------ ------ ------ ------ --------- --------- ---------
------ ------ ------ ------ ------ ------ --------- --------- ---------
<FN>
------------------------------
(1) Purchases of Class A shares of $1 million or more are not subject to
front-end sales charges but a contingent deferred sales charge of 1% is
imposed if the shares are redeemed within the first 12 months after the end
of the calendar month of their purchase.
(2) The management fee is higher than that paid by most other investment
companies.
(3) During the period presented above, Quest for Value Advisors voluntarily
waived a portion of its fee with respect to the Growth and Income Fund. The
expenses set forth above have been restated to reflect what expenses would
have been if Quest for Value Advisors had not waived a portion of its
advisory fee. After such waivers, the ratio of net operating expenses to
average net assets for Class A, B and C shares were 1.86%, 2.47% and 2.62%,
respectively.
</TABLE>
PRO FORMA
SUMMARY OF FUND EXPENSES
<TABLE>
<CAPTION>
OPPORTUNITY SMALL CAPITALIZATION GROWTH AND INCOME
---------------------- ---------------------- ---------------------------------
CLASS OF SHARES: A B C A B C A B C
------ ------ ------ ------ ------ ------ --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Initial Sales Load Imposed on
Purchase (as a % of offering price)......... 5.75% none none 5.75% none none 5.75% none none
Maximum Deferred Sales Load (1).............. none 5.00% 1.00% none 5.00% 1.00% none 5.00% 1.00%
Maximum Sales Load Imposed On Reinvested
Dividends................................... none none none none none none none none none
Redemption Fee............................... none none none none none none none none none
Exchange Fee................................. none none none none none none none none none
ANNUAL FUND OPERATING EXPENSES
(AS % OF AVERAGE NET ASSETS)
Management Fee (2)........................... 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% .85% .85% .85%
12b-1 Fee (including service fees of .25%)... .50% 1.00% 1.00% .50% 1.00% 1.00% .40% 1.00% 1.00%
Other Expenses............................... .28% .34% .35% .38% .48% .59% 1.07% 1.08% 1.25%
------ ------ ------ ------ ------ ------ --------- --------- ---------
TOTAL FUND OPERATING EXPENSES................ 1.78% 2.34% 2.35% 1.88% 2.48% 2.59% 2.32% 2.93% 3.10%
------ ------ ------ ------ ------ ------ --------- --------- ---------
------ ------ ------ ------ ------ ------ --------- --------- ---------
<FN>
------------------------------
(1) Purchases of Class A shares of $1 million or more will not be subject to
front-end sales charges but a contingent deferred sales charge of 1% will
be imposed if the shares are redeemed within the first 18 months after the
end of the calendar month of their purchase.
(2) The management fee is higher than that paid by most other investment
companies.
</TABLE>
12
<PAGE>
CURRENT
EXAMPLE 1: YOU WOULD PAY THE FOLLOWING EXPENSES OVER THE INDICATED PERIODS
IN EACH OF THE FUNDS ON A $1,000 INVESTMENT ASSUMING (A) PAYMENT OF THE MAXIMUM
SALES CHARGE, (B) A 5% ANNUAL RETURN, AND (C) RETENTION OF SHARES AT THE END OF
THE TIME PERIOD. 10-YEAR FIGURES FOR CLASS B SHARES ASSUME CONVERSION TO CLASS A
SHARES AFTER EIGHT YEARS.
<TABLE>
<CAPTION>
A B C A B C A B C
----- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 Year....................... $ 72 $ 24 $ 24 $ 73 $ 25 $ 26 $ 70 $ 30 $ 31
3 Years...................... 108 73 73 111 77 81 116 91 96
5 Years...................... 146 125 126 151 132 138 166 154 163
10 Years...................... 253 254 269 263 267 292 300 311 341
</TABLE>
EXAMPLE 2: YOU WOULD PAY THE FOLLOWING EXPENSES OVER THE INDICATED PERIODS
IN EACH OF THE FUNDS ON A $1,000 INVESTMENT ASSUMING (A) PAYMENT OF THE MAXIMUM
SALES CHARGE, (B) A 5% ANNUAL RETURN, AND (C) REDEMPTION AT THE END OF THE TIME
PERIOD. 10-YEAR FIGURES FOR CLASS B SHARES ASSUME CONVERSION TO CLASS A SHARES
AFTER EIGHT YEARS.
<TABLE>
<CAPTION>
A B C A B C A B C
----- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 Year....................... $ 72 $ 74 $ 34 $ 73 $ 75 $ 36 $ 70 $ 80 $ 41
3 Years...................... 108 103 73 111 107 81 116 121 96
5 Years...................... 146 145 126 151 152 138 166 174 163
10 Years...................... 253 254 269 263 267 292 300 311 341
</TABLE>
PRO FORMA
EXAMPLE 1: YOU WOULD PAY THE FOLLOWING EXPENSES OVER THE INDICATED PERIODS
IN EACH OF THE FUNDS ON A $1,000 INVESTMENT ASSUMING (A) PAYMENT OF THE MAXIMUM
SALES CHARGE, (B) A 5% ANNUAL RETURN, AND (C) RETENTION OF SHARES AT THE END OF
THE TIME PERIOD. 10-YEAR FIGURES FOR CLASS B SHARES ASSUME CONVERSION TO CLASS A
SHARES AFTER SIX YEARS.
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 Year....................... $ 75 $ 24 $ 24 $ 76 $ 25 $ 26 $ 80 $ 30 $ 31
3 Years...................... 110 73 73 113 77 81 126 91 96
5 Years...................... 148 125 126 153 132 138 174 154 163
10 Years...................... 255 241 269 265 253 292 308 298 341
</TABLE>
EXAMPLE 2: YOU WOULD PAY THE FOLLOWING EXPENSES OVER THE INDICATED PERIODS
IN EACH OF THE FUNDS ON A $1,000 INVESTMENT ASSUMING (A) PAYMENT OF THE MAXIMUM
SALES CHARGE, (B) A 5% ANNUAL RETURN, AND (C) REDEMPTION AT THE END OF THE TIME
PERIOD. 10-YEAR FIGURES FOR CLASS B SHARES ASSUME CONVERSION TO CLASS A SHARES
AFTER SIX YEARS.
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 Year....................... $ 75 $ 74 $ 34 $ 76 $ 75 $ 36 $ 80 $ 80 $ 41
3 Years...................... 110 103 73 113 107 81 126 121 96
5 Years...................... 148 145 126 153 152 138 174 174 163
10 Years...................... 255 241 269 265 253 292 308 298 341
</TABLE>
13
<PAGE>
OTHER MATTERS IN CONNECTION WITH OR SUBSEQUENT TO THE CLOSING
It is a condition to the Closing that the Funds enter into a transfer agency
agreement with Shareholder Services, Inc. ("SSI"), a wholly owned subsidiary of
OMC. The fees to be paid to SSI for transfer agency and dividend disbursing
services are set at the same schedule as is currently in effect pursuant to the
Transfer Agent Agreement between the Funds and State Street Bank and Trust
Company. The Board of Trustees of the Funds approved the terms of the proposed
transfer agency agreement with SSI at a meeting held on June 22, 1995. It is
expected that on or about the time of the Closing, the Funds will elect new
officers and will appoint The Bank of New York as custodian. The Funds' current
custodian is State Street Bank and Trust Company. The Transfer Agent Agreement
and the Custodian Contract are not required to be approved by shareholders of
the Funds.
EVALUATION BY THE BOARD OF TRUSTEES
The Board of Trustees has determined that continuity and efficiency of
management services after the Acquisition can best be assured by approving the
New Investment Advisory and Subadvisory Agreements on behalf of each Fund. The
Board believes that the new Investment Advisory and Subadvisory Agreements will
enable each Fund to obtain services of high quality at costs which they deem
appropriate and reasonable and that approval of the Agreements is in the best
interests of each Fund and its shareholders.
In evaluating the New Investment Advisory and Subadvisory Agreements, the
Board of Trustees requested and reviewed, with the assistance of independent
legal counsel, materials furnished by OMC and Quest for Value Advisors. These
materials included financial statements as well as other written information
regarding OMC and its personnel, operations, and financial condition. The Board
also reviewed the same type of information about Quest for Value Advisors. The
Board also retained Management Practice, Inc., an independent consultant, to
provide data on comparable advisory fee structures. Consideration was given to
comparative information concerning other mutual funds with similar investment
objectives including information prepared by Lipper Analytical Services, Inc.
Attached to this Proxy Statement as Exhibit D is a list of other funds managed
by OMC that have similar investment objectives to those of the Funds, their net
assets and the rate of the advisory fees paid to OMC. The Board of Trustees also
reviewed and discussed the terms and provisions of the New Investment Advisory
and Subadvisory Agreements and compared them to the existing management
arrangements as well as the management arrangements of other mutual funds,
particularly with respect to the allocation of various types of expenses, levels
of fees and resulting expense ratios. The Board evaluated the nature and extent
of services provided by other investment advisers to their respective funds and
also considered the benefits OMC would obtain from its relationship with the
Funds and the economies of scale in costs and expenses to OMC associated with
its providing such services.
The Board of Trustees also considered the terms of the Acquisition Agreement
and the possible effects of the Acquisition upon OMC and its ability to provide
services to the Funds. In this regard, in May and July 1995, the non-interested
Trustees visited OMC's offices in New York to meet with OMC's senior executives
and Board members of the OppenheimerFunds and in August 1995 the non-interested
Trustees visited Shareholder Services, Inc.'s offices in Denver, Colorado, to
assess in person OMC's and its subsidiaries' capabilities and facilities. All
the interested Trustees participated in such visits. The Board evaluated such
factors as OMC's experience in providing various financial services to
investment companies, its experience in the investment company business, its
distribution and shareholder servicing capabilities and its reputation,
integrity, financial responsibility and stability. The Board also considered the
following factors in determining to approve the New Investment Advisory
Agreement: shareholders of the Funds
14
<PAGE>
would be able to exchange their shares after the Closing for a wider variety of
portfolios within the OppenheimerFunds family than are currently available to
shareholders of the Funds within the Quest family; the annual operating expenses
of the Funds on a pro forma basis are no higher than the Funds' expenses for the
most recent fiscal year ended October 31, 1994 and six month period ended April
30, 1995 (in the case of the Growth and Income Fund, the pro forma expenses are
no higher than what the expenses would have been if Quest for Value Advisors had
not voluntarily waived a portion of its advisory fee); Class B shareholders
would benefit from the earlier conversion (after six years rather than after
eight years) to Class A shares that have a lower asset based sales charge; and
breakpoints were established at the request of the Board in the advisory fee to
be paid to OMC with respect to the Opportunity and the Small Capitalization
Funds so that if assets exceed certain levels, the effective advisory fees will
be reduced. The Board of Trustees determined that OMC's assumption of the
investment management function for the Funds would in all likelihood offer the
Funds continued effective advisory services and capabilities.
The Board of Trustees was advised by OMC that currently it was not
recommending changes in any Fund's investment objectives and policies. The Board
also noted the assurances it received from OMC that it is adequately capitalized
to enable it to provide high quality investment management services.
Based upon its review, the Board of Trustees concluded that the terms of the
New Investment Advisory and Subadvisory Agreements are reasonable, fair and in
the best interests of each relevant Fund and its shareholders, and that the fees
provided therein are fair and reasonable in light of the usual and customary
charges made by others for services of the same nature and quality. Accordingly,
the Board concluded that retaining OMC to serve as investment adviser and Quest
for Value Advisors as Subadvisor to the Funds after the Acquisition is desirable
and in the best interests of each Fund and its shareholders.
VOTE REQUIRED
As provided under the 1940 Act, approval of the New Investment Advisory and
Subadvisory Agreements will require the vote of a majority of the outstanding
shares of each Fund voting separately with respect to the New Investment
Advisory Agreement and its respective New Subadvisory Agreement. Under the 1940
Act, the vote of a "majority of the outstanding voting securities" of an
investment company (or a series thereof) means the vote, at a duly-called annual
or special meeting of shareholders, of 67% or more of the shares present at such
meeting, if the holders of more than 50% of the outstanding shares of such
company or series are present or represented by proxy, or of more than 50% of
the total outstanding shares of such company or series, whichever is less.
THE TRUSTEES, INCLUDING THE TRUSTEES WHO ARE NOT INTERESTED PERSONS OF THE
TRUST, QUEST FOR VALUE ADVISORS OR OPPENHEIMER MANAGEMENT CORPORATION OR THEIR
AFFILIATES, UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS OF EACH FUND VOTE TO
APPROVE THE NEW INVESTMENT ADVISORY AGREEMENT WITH OPPENHEIMER MANAGEMENT
CORPORATION AND THAT THE SHAREHOLDERS OF EACH FUND VOTE TO APPROVE THE
RESPECTIVE NEW SUBADVISORY AGREEMENT BETWEEN OPPENHEIMER MANAGEMENT CORPORATION
AND QUEST FOR VALUE ADVISORS.
15
<PAGE>
PROPOSAL NO. 3
APPROVAL OF NEW DISTRIBUTION PLANS FOR CLASS A,
CLASS B AND CLASS C SHARES
It is proposed that the Funds enter into an Amended and Restated
Distribution and Service Plan and Agreement (a "Plan") with Oppenheimer Funds
Distributor, Inc. with respect to each Class of shares (the "New Plans"). The
Plan for Class A shares is attached as Exhibit E; the Plan for Class B shares is
attached as Exhibit F; and the Plan for Class C shares is attached as Exhibit G
to this Proxy Statement. The New Plans were approved on June 22, 1995 by the
Trustees, including the non-interested Trustees, subject to the approval by the
shareholders. Shareholders of each Class of shares will vote separately on the
approval of the Plan with respect to that class. The following is a summary of
the terms of the New Plans.
If the New Plans are approved by shareholders, the Plans will become
effective at the Closing and the corresponding current distribution plans
("Current Plans") with Quest for Value Distributors will terminate. The Closing
is conditioned upon, among other things, approval of the New Plans by
shareholders of the Funds together with approval of similar Plans by
shareholders of the other Continuing Funds that have in the aggregate at least
75% of the closing net assets of such Funds.
The fees payable by each class of shares of the Funds under the New Plans
will be at the same rate as is provided in the Current Plans. The fees under
each New Plan will consist of a service fee at the annual rate of .25% of the
average net assets of the shares and a distribution fee which will be at the
annual rate of .25% of the average net assets of Class A shares of the
Opportunity and Small Capitalization Funds and at the annual rate of .15% of the
average net assets of Class A shares of the Growth and Income Fund and at the
annual rate of .75% of the average net assets of Class B and Class C shares of
each of the Funds.
Oppenheimer Funds Distributor, Inc. will be authorized under the New Plans
to pay broker dealers, banks or other entities (the "Recipients") that render
assistance in the distribution of shares or provide administrative support with
respect to shares held by customers. The service fee payments made under the
Plans will compensate Oppenheimer Funds Distributor, Inc. and the Recipients for
providing administrative support with respect to shareholder accounts. The
distribution fee payments made under the Plans will compensate Oppenheimer Funds
Distributor, Inc. and the Recipients for providing distribution assistance in
connection with the sale of Fund shares.
The New Plans provide that payments may be made by OMC or by Oppenheimer
Funds Distributor, Inc. to the Recipients from its own resources or from
borrowings. Like the Current Plans, the New Plans may not be amended to increase
materially the amount of payments to be made without the approval of the
relevant class of shareholders of each Fund.
If the New Plans are approved by a separate vote of Class A, Class B and
Class C shareholders, each Plan will remain in effect only if its continuance is
specifically approved at least annually by the vote of both a majority of the
Trustees and a majority of the non-interested Trustees who have no direct or
indirect individual financial interest in the operation of the New Plans or any
agreements related thereto (the "Qualified Trustees"). The New Plans may be
terminated at any time by vote of a majority of the Qualified Trustees or by a
vote of a majority of the relevant class of Shares of a Fund. In the event of
such termination, the Board including the Qualified Trustees shall determine
whether Oppenheimer Funds Distributor, Inc. is entitled to payment by a Fund of
all or a portion of the service fee and/or the distribution fee with respect to
shares sold prior to the effective date of such termination.
16
<PAGE>
The service fee and the distribution fee payable under the New Plans, like
the fees payable under the Current Plans, are subject to reduction or
elimination under the limits imposed by the Rules of Fair Practice of the
National Association of Securities Dealers, Inc. ("NASD Rules"). The Plans are
intended to comply with NASD Rules and Rule 12b-1 adopted under the 1940 Act.
Rule 12b-1 requires that the selection and nomination of Trustees who are not
"interested persons" of the Trust be committed to the discretion of the
Qualified Trustees and that the Trustees receive quarterly reports on the
payments made under the Plans and the purposes for those payments.
THE CURRENT PLANS
Each Current Plan was reviewed most recently by the Board of Trustees on
October 25, 1994. At that meeting the Trustees evaluated all information deemed
reasonably necessary to make an informed determination that, in the exercise of
their reasonable business judgment and in view of their fiduciary duties, there
was a reasonable likelihood that continuation of each Current Plan would benefit
the applicable class of shares of the Funds and their shareholders.
For the fiscal year ended October 31, 1994, each class of shares accrued or
paid the following fees under the Current Plans both in the aggregate and as a
percentage of average net assets:
<TABLE>
<CAPTION>
FUND CLASS A CLASS B CLASS C
-------------------------------------------- ------------------------ ------------------------ ----------------------
<S> <C> <C> <C> <C> <C> <C>
Growth and Income........................... $ 116,449 .40% $ 15,858 1.00% $ 2,983 1.00%
Opportunity................................. $ 683,116 .50% $ 162,157 1.00% $ 27,089 1.00%
Small Capitalization........................ $ 576,382 .50% $ 94,008 1.00% $ 13,806 1.00%
</TABLE>
For the fiscal year ended October 31, 1994, Quest for Value Distributors
paid the following amounts in distribution and service fees to Oppenheimer &
Co., Inc., an affiliated broker-dealer, with respect to the Funds:
<TABLE>
<CAPTION>
DISTRIBUTION AND SERVICE FEES
PAID TO OPPENHEIMER & CO,
FUND INC.
------------------------------------------------------------------------------- -----------------------------
<S> <C>
Growth and Income.............................................................. $ 10,684
Opportunity.................................................................... $ 180,536
Small Capitalization........................................................... $ 186,468
</TABLE>
CURRENT AND PROPOSED SALES ARRANGEMENTS
Class A shares of the Funds are sold with an initial sales load except that
purchases of Class A shares in the amount of $1 million or more are sold without
an initial sales load but are subject to a contingent deferred sales charge
("CDSC") of 1% if the shares are redeemed within the first twelve months after
the end of the calendar month of their purchase. Class B shares of the Funds are
sold without an initial sales load but are subject to a maximum CDSC of 5.00% if
redeemed within one year after the end of the calendar month of the purchase.
The CDSC declines to 0 after the shares have been held for 6 years. Class C
shares are sold without an initial sales load but are subject to a CDSC of 1% if
the shares are redeemed within one year after the end of the calendar month in
which they were purchased. Class B shares automatically convert to Class A
shares of the same Fund eight years after the end of the calendar month in which
the shares were purchased. Class A shares of the Funds may be exchanged for
Class A shares of any other Quest Fund, Class B shares of the Funds may be
exchanged for Class B shares of any other Quest Fund and Class C shares may be
exchanged for Class C shares of any other Quest Fund.
17
<PAGE>
After the Closing, the CDSC applicable to Class B and Class C shares of the
Funds will remain the same. The maximum initial sales load applicable to
purchases of less than $25,000 of Class A shares will be 5.75% (rather than
5.50% for the Opportunity and Small Capitalization Funds and 4.75% for the
Growth and Income Fund) and purchases of Class A shares in the amount of $1
million or more will not be charged an initial sales load but will be subject to
a contingent deferred sales charge of 1% if the shares are redeemed within 18
months (rather than 12 months) after the month of their purchase.
In addition, Class B shares will convert to Class A shares automatically
after 6 years. After the Closing, Class A shares of the Funds may be exchanged
for Class A shares of any Oppenheimer Fund, Class B shares of the Funds may be
exchanged for Class B shares of any Oppenheimer Fund and Class C shares of the
Funds may be exchanged for Class C shares of any Oppenheimer Fund. Any
shareholders of the Funds who are entitled to purchase Class A shares at net
asset value in accordance with the provisions of each Fund's prospectus will
have the right, after the Closing, to purchase any Class A shares of the
Continuing Funds at net asset value and will have the right to purchase any
Class A shares of other OppenheimerFunds at net asset value as soon as the
prospectus for each OppenheimerFund is updated to include such purchase
provisions.
EVALUATION BY THE BOARD OF TRUSTEES
The Trustees, including the Qualified Trustees, believe the adoption of a
distribution plan under Rule 12b-1 is essential to and a part of the purpose of
each class of Shares of each Fund in selling its Shares to those persons who
wish to avail themselves of the services of a broker-dealer. In addition, the
Trustees believe past experience with the Current Plans has shown that
maintaining a plan under Rule 12b-1 has been in the best interests of each Fund
and its shareholders. In their deliberations, the Trustees considered many
pertinent factors such as the levels of fees prescribed by the Current Plans and
the New Plans. The Board also considered the potential benefit to each Fund of
the proposed method of distribution through Oppenheimer Funds Distributor, Inc.;
the potential conflicts of interest inherent in the use of Fund assets to pay
for distribution expenses; the relationship of the fees under the New Plans to
the overall cost structure of each Fund; and the potential benefits to existing
shareholders of continued asset growth, including the potential to benefit from
economies of scale.
VOTE REQUIRED
Approval of each New Plan for each class of Shares of any Fund will require
the vote of a "majority of the outstanding voting securities" of that class of
Shares of the Fund, as defined in the next to last paragraph of Proposal 1 and 2
of this Proxy Statement.
THE TRUSTEES, INCLUDING THE QUALIFIED TRUSTEES, UNANIMOUSLY RECOMMEND THAT
THE NEW CLASS A PLAN, THE NEW CLASS B PLAN AND THE NEW CLASS C PLAN BE APPROVED
BY SHAREHOLDERS OF EACH RESPECTIVE CLASS OF EACH FUND.
18
<PAGE>
PROPOSAL NO. 4
ELECTION OF TRUSTEES
If Proposals 1,2 and 3 are approved, proxies not indicating a contrary
intention will be voted in favor of the election of the five persons named below
as Trustees, to hold office for an indefinite period and until their successors
are elected and qualified.
OMC, Quest for Value Advisors, Quest for Value Distributors and Oppenheimer
Capital have agreed to comply and use all reasonable efforts to cause compliance
with the provisions of Section 15(f) of the 1940 Act. Section 15(f) provides, in
pertinent part, that an investment adviser and its affiliates may receive any
amount or benefit in connection with a sale of such investment adviser which
results in an assignment of an investment advisory contract if (1) for a period
of three years after the time of such event, 75% of the members of the board of
trustees or directors of the investment company which it advises are not
"interested persons" (as defined in the 1940 Act) of the new or old investment
adviser, and (2) during the two-year period after the date on which the
transactions occurs, there is no "unfair burden" imposed on the investment
company as a result of the transaction. For this purpose, "unfair burden" is
defined to include any arrangement during the two-year period after the
transactions whereby the investment adviser or predecessor or successor
investment advisers, or any interested person of any such adviser, receives or
is entitled to receive any compensation directly or indirectly (i) from any
person in connection with the purchase or sale of securities or other property
to, from, or on behalf of the investment company other than bona fide ordinary
compensation as principal underwriter for such company, or (ii) from the
investment company or its security holders for other than bona fide investment
advisory or other services. No compensation arrangements of the types described
above are contemplated in the proposed transaction. The composition of the Board
of Trustees of the Trust is presently in compliance with the 75% requirement and
will continue to be so if all the nominees named in Proposal 4 are elected.
The Board is recommending the election of four Trustees who are currently
Trustees of the Trust and are not "interested persons" of OMC, Quest for Value
Advisors, Quest for Value Distributors or Oppenheimer Capital and one Trustee,
Bridget A. Macaskill, who is an "interested person" of OMC but not of Quest for
Value Advisors. Joseph M. La Motta, who is currently the Chairman of the Board
of the Trust, is not standing for re-election and, upon the Closing, will
resign.
Each nominee has consented to being named as a nominee in this Proxy
Statement. Should any nominee become unable or unwilling to serve, the persons
appointed as proxies shall vote for the election of such other person or persons
as the Board of Trustees of the Trust shall recommend. The Board of Trustees has
no reason to believe that any person nominated will be unable or unwilling to
serve if elected to office.
The following table shows the nominees who are standing for election and
their principal occupation which, unless specific dates are shown, are of more
than five years duration, although the titles held may
19
<PAGE>
not have been the same throughout. The table also shows how long the nominee has
served on the Board of Trustees of the Trust; if no date is shown, the nominee
is standing for election for the first time at this Meeting.
<TABLE>
<CAPTION>
TRUSTEE
NAME, AGE AND ADDRESS SINCE PRINCIPAL OCCUPATION DURING PAST 5 YEARS
-------------------------------------- ----------- -----------------------------------------------------------------------
<S> <C> <C>
Paul Y. Clinton ...................... 1987 Director, External Affairs, Kravco Corporation, a national real estate
Age: 64 owner and property management corporation; formerly President of Essex
946 Morris Avenue Management Corporation, a management consulting company; Trustee of
Bryn Mawr, PA 19010 Capital Cash Management Trust, Prime Cash Fund and Short Term Asset
Reserves, each of which is a money-market fund; Director of Quest for
Value Fund, Inc., Quest for Value Global Equity Fund, Inc., Quest for
Value Global Funds, Inc. and Quest Cash Reserves, Inc., Trustee of
Quest for Value Accumulation Trust, all of which are open-end
investment companies. Formerly a general partner of Capital Growth
Fund, a venture capital partnership; formerly a general partner of
Essex Limited Partnership, an investment partnership; formerly
President of Geneve Corp., a venture capital fund; formerly Chairman
of Woodland Capital Corp., a small business investment company;
formerly Vice President of W.R. Grace & Co.
Thomas W. Courtney, C.F.A. ........... 1987 Principal of Courtney Associates, Inc., a venture capital firm; former
Age: 61 General Partner of Trivest Venture Fund, a private venture capital
P.O. Box 580 fund; former President of Investment Counseling Federated Investors,
Sewickley, PA 15143 Inc.; Trustee of Cash Assets Trust, a money market fund; Director of
Quest Cash Reserves, Inc., Quest for Value Fund, Inc., Quest for Value
Global Equity Fund, Inc. and Quest for Value Global Funds, Inc.,
Trustee of Quest for Value Accumulation Trust, all of which are
open-end investment companies; former President of Boston Company
Institutional Investors; Trustee of Hawaiian Tax-Free Trust and Tax
Free Trust of Arizona, tax-exempt bond funds; Director of several
privately owned corporations; former Director of Financial Analysts
Federation.
</TABLE>
20
<PAGE>
<TABLE>
<CAPTION>
TRUSTEE
NAME, AGE AND ADDRESS SINCE PRINCIPAL OCCUPATION DURING PAST 5 YEARS
-------------------------------------- ----------- -----------------------------------------------------------------------
<S> <C> <C>
Lacy B. Herrmann ..................... 1987 President and Chairman of the Board of Aquila Management Corporation
Age: 66 (since 1984) and of Incap Management Corporation (since 1982), the
380 Madison Avenue sponsoring organizations and Administrator and/or Sub-Advisor to the
Suite 2300 following open-end investment companies, and Chairman of the Board of
New York, NY 10017 Trustees and President of each: Churchill Cash Reserves Trust (since
1985), Short Term Asset Reserves (since 1984), Cash Assets Trust
(since 1984), U.S. Treasuries Cash Assets Trust (since 1988), Tax-Free
Cash Assets Trust (since 1988), Prime Cash Fund (since 1982), Oxford
Cash Management Fund (1982-1988) and Trinity Liquid Assets Trust
(1982-1985), each of which is a money market fund, and of Churchill
Tax-Free Fund of Kentucky (since 1986), Tax-Free Fund of Colorado
(since 1986), Tax-Free Trust of Oregon (since 1985), Tax-Free Fund of
Arizona (since 1985), and Hawaiian Tax-Free Trust (since 1984), each
of which is a tax-free municipal bond fund; Vice President, Director,
Secretary, and formerly Treasurer of Aquila Distributors, Inc. (since
1981), distributor of most of the above funds; President and Chairman
of the Board of Trustees of Capital Cash Management Trust ("CCMT") a
money market fund (since 1981) and an Officer and Trustee/Director of
its predecessors (since 1974); President and Director of STCM
Management Company, Inc., sponsor and Sub-Advisor to CCMT; General
Partner of Tamarack Associates (1966-1984), a private investment
partnership and Chairman of the Board and President of various of its
subsidiaries through 1986. Director of Quest Cash Reserves, Inc.,
Quest for Value Fund, Inc., Quest for Value Global Equity Fund, Inc.
and Quest for Value Global Funds, Inc., Trustee of Quest for Value
Accumulation Trust and The Saratoga Advantage Trust, each of which is
an open-end investment company.
George Loft .......................... 1987 Private Investor; Director of Quest Cash Reserves, Inc., Quest for
Age: 80 Value Fund, Inc., Quest for Value Global Equity Fund, Inc. and Quest
51 Herrick Road for Value Global Funds, Inc., Trustee of Quest for Value Accumulation
Sharon, CT 06069 Trust and The Saratoga Advantage Trust, all of which are open-end
investment companies, and Director of Quest for Value Dual Purpose
Fund, Inc., a closed-end investment company.
</TABLE>
21
<PAGE>
<TABLE>
<CAPTION>
TRUSTEE
NAME, AGE AND ADDRESS SINCE PRINCIPAL OCCUPATION DURING PAST 5 YEARS
-------------------------------------- ----------- -----------------------------------------------------------------------
<S> <C> <C>
Bridget A. Macaskill ................. Chief Executive Officer of Oppenheimer Management Corporation effective
Age: 47 September 30, 1995 and President and Chief Operating Officer of
Two World Trade Center Oppenheimer Management Corporation since 1991; prior thereto, Chief
New York, NY 10048 Operating Officer of OMC from 1989 to 1991 and Executive Vice
President of OMC from 1987-1989. Vice President, Director of
Oppenheimer Acquisition Corp., Director of Oppenheimer Partnership
Holdings, Inc., Chairman and a Director of Shareholder Services, Inc.,
Director of Main Street Advisers, Inc., Director of Harbourview Asset
Management Corporation, all of which are subsidiaries of OMC.
</TABLE>
If all five nominees are elected, four of the five Trustees (over 75%) will
not be "interested persons" of OMC, Quest for Value Advisors, Quest for Value
Distributors or Oppenheimer Capital or any of their affiliates.
As of August 15, 1995, each nominee for Trustee and the current officers and
Trustees of the Trust as a group held shares of each specified class of the
Funds as set forth below:
<TABLE>
<CAPTION>
NUMBER OF SHARES AS TO
NUMBER OF SHARES AS NUMBER OF SHARES AS NUMBER OF SHARES AS WHICH OWNERS HAVE
TO WHICH OWNERS HAVE TO WHICH OWNERS HAVE TO WHICH OWNERS HAVE SHARED INVESTMENT
NAME SOLE VOTING POWER SHARED VOTING POWER SOLE INVESTMENT POWER POWER
-------------------------------- --------------------- --------------------- --------------------- ----------------------
<S> <C> <C> <C> <C>
Paul Y. Clinton................. 0 634 Opportunity 0 634 Opportunity
Class A Class A
801 Small Cap 801 Small Cap
Class A Class A
Thomas W. Courtney.............. 0 0 0 0
Lacy B. Herrmann................ 1,765 Opportunity 0 1,765 Opportunity 0
Class A Class A
George Loft..................... 0 287 Growth & Income 0 287 Growth & Income
Class A Class A
1,503 Opportunity 1,503 Opportunity
Class A Class A
1,048 Small Cap 1,048 Small Cap
Class A Class A
Bridget A. Macaskill............ 0 0 0 0
All current officers and
trustees as a group............ 3,382 Opportunity 287 Growth & Income 15,082 Growth & 287 Growth & Income
Class A Class A Income Class A
2,213 Small Cap 1,849 Small Cap Class A 2,137 Opportunity
Class A Class A 28,010 Opportunity Class A
12,798 Growth & 2,137 Opportunity Class A 1,849 Small Cap
Income Class A 28,425 Small Cap Class A
Class A Class A
</TABLE>
During the last fiscal year of the Funds the Board of Trustees held four
regular quarterly meetings and one special meeting. The Board of Trustees' audit
committee, which consists of all Trustees who are not
22
<PAGE>
"interested persons," held two meetings during the Trust's last fiscal year.
That committee reviews audits, audit procedures, financial statements and other
financial and operational matters of the Funds. The Board has neither a standing
nominating committee nor a standing compensation committee. Each Trustee
attended at least 75% of the meetings of the Board of Trustees and the meetings
held by the committee of the Board on which such Trustee served during the last
fiscal year.
REMUNERATION OF TRUSTEES
Mr. La Motta and the officers of the Trust receive no salary from the Funds.
The following table sets forth the aggregate compensation received from the
Funds and Quest for Value Advisors' Fund Complex by the Trust's non-interested
trustees during the fiscal year ended October 31, 1994.
<TABLE>
<CAPTION>
AGGREGATE PENSION OR
AGGREGATE AGGREGATE COMPENSATION RETIREMENT ESTIMATED TOTAL
COMPENSATION COMPENSATION FROM THE BENEFITS ANNUAL COMPENSATION
FROM THE FROM THE SMALL ACCRUED AS PART BENEFITS FROM FUNDS
GROWTH AND OPPORTUNITY CAPITALIZATION OF FUND UPON AND FUND
NAME OF PERSON INCOME FUND FUND FUND EXPENSES RETIREMENT COMPLEX
---------------------------------------- ------------- ------------- ------------- --------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Paul Y. Clinton......................... $ 2,100 $ 4,200 $ 4,200 None None $ 68,100
Thomas W. Courtney...................... 2,100 4.200 4,200 None None 66,600
Lacy B. Herrmann........................ 2,100 4,200 4,200 None None 67,350
George Loft............................. 2,100 4,200 4,200 None None 74,800
</TABLE>
Messrs. Clinton, Courtney and Herrmann earned directors fees with respect to
18 investment companies in Quest for Value Advisors' Fund Complex and the fees
earned by Mr. Loft were with respect to 19 investment companies in the Complex.
During such periods the non-interested Trustees received fees from three
investment companies for which they no longer serve as directors and which are
no longer part of the Complex but for which Quest for Value Advisors currently
serves as subadviser. In addition, during such periods, Mr. Clinton and Mr.
Courtney each served as director with respect to three investment companies in
the Complex for which they received no fees and Mr. Loft and Mr. Herrmann each
served as director with respect to 10 investment companies in the Complex for
which they received no fees. For the purpose of this paragraph, a portfolio of
an investment company organized in series form is considered to be an investment
company. Under the fee schedule in effect for the Complex, until a portfolio has
net assets of $25 million, no Trustees fees are paid by that portfolio. When a
portfolio has net assets of at least $25 million but not more than $50 million,
the Trustees, other than Mr. La Motta, are paid an annual fee of $1,750 plus
$250 for each Trustees meeting attended and $100 for each committee meeting
attended. When a portfolio has net assets in excess of $50 million, the
Trustees, other than Mr. La Motta, are paid an annual fee of $3,500 plus $500
for each Trustees meeting attended and $100 for each committee meeting attended.
These fees are reduced when more than five funds managed by Quest for Value
Advisors have net assets in excess of $50 million.
The following table sets forth information about the current officers of the
Trust who are not Trustees.
<TABLE>
<CAPTION>
NAME AND AGE PRINCIPAL OCCUPATION DURING PAST FIVE YEARS TITLE WITH THE TRUST
---------------------------- --------------------------------------------------- ------------------------------------
<S> <C> <C>
Bernard H. Garil ........... President since 1994 and Chief Operating Officer Vice President since 1991
Age: 55 since 1990 of Quest for Value Advisors; Executive
Vice President of Quest for Value Advisors from
1990-1994.
</TABLE>
23
<PAGE>
<TABLE>
<CAPTION>
NAME AND AGE PRINCIPAL OCCUPATION DURING PAST FIVE YEARS TITLE WITH THE TRUST
---------------------------- --------------------------------------------------- ------------------------------------
<S> <C> <C>
Robert J. Bluestone ........ Managing Director since 1992 and Senior Vice Vice President since 1987
Age: 49 President from 1986 to 1992 of Oppenheimer
Capital.
Richard Glasebrook ......... Managing Director since 1994 and Senior Vice Vice President and Portfolio Manager
Age: 47 President from 1991 to 1994 of Oppenheimer since 1991
Capital; prior thereto, Partner and Portfolio
Manager of Delafield Asset Management.
Colin Glinsman ............. Senior Vice President since 1995, Vice President Vice President and Portfolio Manager
Age: 37 from 1991 to 1995 and Assistant Vice President since 1993
from 1989 to 1991 of Oppenheimer Capital.
Louis Goldstein ............ Vice President of Oppenheimer Capital since 1991; Vice President and Portfolio Manager
Age: 35 prior thereto, security analyst with David J. since January 1995
Greene & Co.
Matthew Greenwald .......... Vice President since 1992 and Assistant Vice Vice President and Portfolio Manager
Age: 41 President from 1989 to 1992 of Oppenheimer since 1993
Capital.
Vikki Hanges ............... Vice President since 1991 and Assistant Vice Vice President and Portfolio Manager
Age: 35 President and fixed income Portfolio Manager of since 1993
Oppenheimer Capital from 1987 to 1991.
Jenny B. Jones ............. Senior Vice President since 1994, Vice President Vice President and Portfolio Manager
Age: 37 from 1991 to 1994 and Assistant Vice President since 1990
from 1990 to 1991 of Oppenheimer Capital.
George B. Tilghman ......... Vice President since 1991 and Assistant Vice Vice President and Portfolio Manager
Age: 36 President from 1989 to 1991 of Oppenheimer since 1993
Capital.
Jeffrey Whittington ........ Senior Vice President of Oppenheimer Capital since Vice President and Portfolio Manager
Age: 38 1994 and from 1987 to 1991. From 1991 to 1994 he since 1994
was a portfolio manager with Oppenheimer & Co. and
then with Neuberger Berman
Sheldon M. Siegel .......... Managing Director of Oppenheimer Capital Treasurer since 1987
Age: 53
Deborah Kaback ............. Senior Vice President since 1993 and Vice President Secretary since 1992
Age: 44 from 1989 to 1993 of Oppenheimer Capital
</TABLE>
24
<PAGE>
<TABLE>
<CAPTION>
NAME AND AGE PRINCIPAL OCCUPATION DURING PAST FIVE YEARS TITLE WITH THE TRUST
---------------------------- --------------------------------------------------- ------------------------------------
<S> <C> <C>
Leslie Klein ............... Vice President of Oppenheimer Capital Assistant Treasurer since 1987
Age: 43
Thomas E. Duggan ........... Managing Director and General Counsel of Assistant Secretary since 1992
Age: 51 Oppenheimer Capital
Maria Camacho .............. Assistant Vice President since 1994 and blue sky Assistant Secretary since 1995
Age: 40 administrator of Oppenheimer Capital
</TABLE>
Upon the Closing, it is anticipated that the foregoing officers of the Trust
will resign and that OMC will propose to the Trustees that Bridget A. Macaskill
be elected Chairman of the Board and President, that George Bowen be elected
Treasurer, that Robert Doll be elected Vice President and that Andrew J. Donohue
be elected Secretary. Information about Ms. Macaskill, who is a nominee for
Trustee, is provided in the table on nominees. The address of all such proposed
officers is Oppenheimer Management Corporation, 2 World Trade Center, NY, NY
except for Mr. Bowen, whose address is Oppenheimer Management Corporation, 3410
S. Galena Street, Denver, Colorado 80231. The following table provides
information about the other proposed officers:
<TABLE>
<CAPTION>
NAME AND AGE PRINCIPAL OCCUPATION DURING PAST FIVE YEARS
------------------------------------------------ ---------------------------------------------------------------------
<S> <C>
George C. Bowen ................................ Senior Vice President and Treasurer of OMC; Vice President and
Age: 59 Treasurer of Oppenheimer Funds Distributor, Inc., and Harbour View
Asset Management Corporation; President, Treasurer and Director of
Centennial Capital Corporation; Senior Vice President, Treasurer and
Secretary of Shareholder Services, Inc.; Vice President, Treasurer
and Secretary of Shareholder Financial Services, Inc. and an officer
of various Oppenheimer Funds.
Robert T. Doll ................................. Executive Vice President and Director of Equity Investments of OMC;
Age: 41 officer of various Oppenheimer Funds.
Andrew J. Donohue .............................. Executive Vice President and General Counsel of OMC and Oppenheimer
Age: 45 Funds Distributor, Inc.; officer of various Oppenheimer Funds.
</TABLE>
VOTE REQUIRED
A plurality of all the votes cast at the meeting, if a quorum is present at
the meeting, is sufficient to elect the nominees. If Proposals 1, 2 and 3 are
not approved by the shareholders, no election of Trustees will be held and the
slate of officers first named above will continue in office.
THE BOARD OF TRUSTEES UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE TO ELECT
EACH OF THE NOMINEES
25
<PAGE>
OTHER INFORMATION
THE CURRENT ADVISOR
Quest for Value Advisors and Oppenheimer Capital are located at One World
Financial Center, New York, New York, and all executive officers of the Advisor
have business addresses at that location.
The Advisor is a general partnership of which Oppenheimer Capital, an
investment management firm, holds a 99% interest and Oppenheimer Financial Corp.
holds a 1% interest. Oppenheimer Capital is a general partnership of which
Oppenheimer Financial Corp., a holding company, holds a 33.0% interest and
Oppenheimer Capital, L.P., a limited partnership of which Oppenheimer Financial
Corp. is the sole general partner, holds a 67.0% interest. Oppenheimer Capital
L.P. acquired a 32.3% interest in Oppenheimer Capital on July 9, 1987 for
$99,032,000 in connection with a public offering of units of limited partnership
interest in Oppenheimer Capital. L.P. (see Registration Statement No. 33-14364
and Amendments). Additional interests were acquired subsequently as a result of
the issuance of units pursuant to the Restricted Unit and Restricted Option
Plans. An additional interest of 33.6% in Oppenheimer Capital was acquired by
Oppenheimer Capital, L.P. on April 23 and May 1, 1991 in connection with a
public offering of 6.6 million units of limited partnership interest in
Oppenheimer Capital, L.P. (see Registration Statement No. 33-39345 and
Amendments). All such units were sold by Oppenheimer Financial Corp., which is
owned by Oppenheimer Group, Inc. Oppenheimer & Co., L.P., an investment limited
partnership, controls Oppenheimer Group, Inc. and is the ultimate parent of
Oppenheimer & Co., Inc. Mr. La Motta is Chairman of the Advisor and President of
Oppenheimer Capital, Executive Vice President of Oppenheimer & Co., Inc., and
Director and Executive Vice President of Oppenheimer Financial Corp.,
Oppenheimer Group, Inc., and Oppenheimer Holdings, Inc.
Mr. La Motta and Mr. Siegel both hold general partnership and limited
partnership interests in Oppenheimer & Co., L.P.; Mr. Bluestone, Mr. Duggan and
Mr. Garil hold limited partnership interests in Oppenheimer & Co., L.P.
RECEIPT OF SHAREHOLDER PROPOSALS, QUORUM AND VOTING
Under the proxy rules of the SEC, shareholder proposals meeting tests
contained in those rules may, under certain conditions, be included in the
Trust's proxy statement and proxy for a particular annual meeting. Those rules
require that at the time the shareholder submits the proposal the shareholder be
a record or beneficial owner of at least 1% or $1,000 in market value of
securities entitled to be voted on the proposal and have held such securities
for at least one year prior thereto, and continue to hold such shares through
the date on which such meeting is held. Another of these conditions relates to
the timely receipt by the Funds of any such proposal. Under these rules,
proposals submitted for inclusion in the Trust's proxy material for the next
annual meeting after the meeting to which this proxy statement relates must be
received by the Trust not less than 120 days before the first anniversary of the
date stated on the first page of this Proxy Statement relating to the first
mailing of this Proxy Statement. The date for such submission could change,
depending on the scheduled date for the next annual meeting.
The fact that the Trust receives a shareholder proposal in a timely manner
does not insure its inclusion in its proxy material, since there are other
requirements in the proxy rules relating to such inclusion.
Shareholders should be aware that under the law of the state in which the
Trust is established, Massachusetts, business trusts need hold no annual
meetings of shareholders as long as there is no
26
<PAGE>
particular requirement under the Investment Company Act of 1940 which must be
met by convening such a shareholders' meeting. As it is the intention of the
Board of Trustees not to hold annual shareholder meetings in the future unless
required to do so under that Act, there can be no assurance that shareholder
proposals validly submitted to the Trust will be acted upon at a regularly
scheduled annual shareholders' meeting.
Shares represented in person or by proxy (including shares which abstain or
do not vote with respect to one or more of the proposals presented for
shareholder approval including "broker non-votes") will be counted for purposes
of determining whether a quorum is present at the Meeting. Abstentions will be
treated as shares that are present and entitled to vote for purposes of
determining the number of shares that are present and entitled to vote with
respect to any particular proposal, but will not be counted as a vote in favor
of such proposal. Accordingly, an abstention from voting on a proposal has the
same legal effect as a vote against the proposal. "Broker non votes" have the
same legal effect as a vote against the proposal. "Broker non-votes" exist where
a proxy received from a broker indicates that the broker does not have
discretionary authority to vote the shares on that matter.
INDEPENDENT AUDITORS
Price Waterhouse LLP are the independent auditors of the Funds. A
representative of the firm is expected to be present at the meeting with the
opportunity to make a statement and to respond to appropriate questions.
MAILING OF ANNUAL REPORT
The Funds will furnish, without charge, a copy of their Annual Report for
the year ended October 31, 1994 and their Semi-Annual Report for the six month
period ended April 30, 1995 to a shareholder upon request. Such request should
be made to Bernard H. Garil, Quest for Value Advisors, One World Financial
Center, New York, NY 10281, or by calling 1-800-232-3863. The report will be
sent by first class mail within three business days of the request.
OTHER BUSINESS
The management knows of no business other than the matters specified above
which will be presented at the meeting. Inasmuch as matters not known at the
time of the solicitation may come before the meeting, the proxy as solicited
confers discretionary authority with respect to such matters as may properly
come before the meeting and it is the intention of the persons named in the
proxy to vote the proxy in accordance with their judgment on such matters.
By Order of the Board of Trustees
DEBORAH KABACK
SECRETARY
27
<PAGE>
EXHIBIT A
The aggregate purchase price for the Purchased Assets will be an amount
equal to the sum of (i) the Initial Purchase Payment (as hereinafter defined)
payable in cash at the Closing, (ii) the aggregate amount of all unamortized
prepaid commissions as of the business day immediately preceding the Acquisition
Closing which relate to the Acquired Funds (excluding those with respect to
Citibank, N.A.) payable in cash at the Closing, (iii) the amount payable by OMC
in respect of the right, title and interest of Citibank, N.A. to certain
commissions and (iv) the Deferred Purchase Payment (as hereinafter defined).
The "Initial Purchase Payment" shall be an amount equal to the sum of (x)
225% of the Annualized Fee Amount (as hereinafter defined) of each Reorganized
Fund and (y) 270% of the Annualized Fee Amount of each Continuing Fund
(excluding the Quest for Value Officers Fund). The "Annualized Fee Amount" of an
Acquired Fund shall equal the product of (i) such Acquired Fund's Closing Net
Assets (as hereinafter defined) and (ii) the annual advisory fee payable to
Quest for Value Advisors by such Acquired Fund at the rate indicated in the most
recent prospectus for such Acquired Fund at the Closing (plus any applicable
annual administrative fee). "Closing Net Assets" for an Acquired Fund shall mean
the aggregate net asset value of such Acquired Fund as of the close of business
on the last business date preceding the Closing.
The "Deferred Purchase Payment" shall be an amount equal to the aggregate
amounts determined for all Reorganized Funds pursuant to the following formula:
the Closing Payment (as hereinafter defined) times the Applicable Percentage (as
hereinafter defined). The "Closing Payment" shall be the aggregate amount
calculated for all Reorganized Funds pursuant to clause (x) of the Initial
Purchase Payment formula. The "Applicable Percentage" shall be 100% if the
Continuing Net Asset Percentage (as hereinafter defined) is 75% or more, 0% if
the Continuing Net Asset Percentage is 50% or less and the percentage determined
in accordance with the following formula if the Continuing Net Asset Percentage
is between 75% and 50%: 100% - (4) (75% - Continuing Net Asset Percentage). The
"Continuing Net Asset Percentage" shall equal the percentage obtained by
dividing the Anniversary Net Assets (as hereinafter defined) by the Closing Net
Assets. The "Anniversary Net Assets" shall mean the most recently determined
aggregate net asset values of all Reorganized Funds as of 8:00 p.m. on the first
anniversary of the Closing of each account of the Reorganized Funds which are
eligible to be included in Anniversary Net Assets in accordance with the
principles set forth in the Acquisition Agreement.
A-1
<PAGE>
EXHIBIT B
INVESTMENT ADVISORY AGREEMENT
AGREEMENT, made the day of October, 1995, by and between
OPPENHEIMER/QUEST FOR VALUE FAMILY OF FUNDS, a Massachusetts business trust
(hereinafter referred to as the "Company"), and OPPENHEIMER MANAGEMENT
CORPORATION (hereinafter referred to as "OMC").
WHEREAS, the Company is an open-end, diversified management investment
company registered as such with the Securities and Exchange Commission (the
"Commission") pursuant to the Investment Company Act of 1940 (the "Investment
Company Act"), and OMC is an investment adviser registered as such with the
Commission under the Investment Advisors Act of 1940;
WHEREAS, each of Growth and Income Fund, Small Capitalization Fund,
Opportunity Fund and Officers Fund is a separately capitalized Series (the
"Series") of the Shares of beneficial interest to be issued by the Company
("Shares") pursuant to the Company's registration statement;
WHEREAS, the Company desires that OMC shall act as its investment adviser
with respect to each Series pursuant to this Agreement;
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, it is agreed by and between the parties, as follows:
1. GENERAL PROVISIONS:
The Company hereby employs OMC and OMC hereby undertakes to act as the
investment adviser of the Company in connection with and for the benefit of each
Series, including any Series hereafter created and to perform for the Company
such other duties and functions in connection with each Series for the period
and on such terms as set forth in this Agreement. OMC shall, in all matters,
give to the Company and its Board of Trustees (the "Trustees") the benefit of
its best judgement, effort, advice and recommendations and shall, at all times
conform to, and use its best efforts to enable the Company to conform to (i) the
provisions of the Investment Company Act and any rules or regulations
thereunder; (ii) any other applicable provisions of state or Federal law; (iii)
the provisions of the Declaration of Trust and By-Laws of the Company as amended
from time to time; (iv) policies and determinations of the Trustees; (v) the
fundamental policies and investment restrictions of each Series as reflected in
the registration statement of the Company under the Investment Company Act or as
such policies may, from time to time, be amended and (vi) the Prospectus and
Statement of Additional Information of each Series in effect from time to time.
The appropriate officers and employees of OMC shall be available upon reasonable
notice for consultation with any of the Trustees and officers of the Company
with respect to any matters dealing with the business and affairs of the Company
including the valuation of portfolio securities of the Company which are either
not registered for public sale or not traded on any securities market.
2. INVESTMENT MANAGEMENT:
(a) OMC shall, subject to the direction and control by the Trustees, (i)
regularly provide investment advice and recommendations to the Company with
respect to the investments, investment policies and the purchase and sale of
securities for each Series; (ii) supervise continuously the investment program
of each Series of the Company and the composition of its portfolio and determine
what securities shall be purchased
B-1
<PAGE>
or sold by; and (iii) arrange, subject to the provisions of paragraph 7 hereof,
for the purchase of securities and other investments for each Series of the
Company and the sale of securities and other investments held in the portfolio
of each Series.
(b) Provided that the Company shall not be required to pay any compensation
for services under this Agreement other than as provided by the terms of the
Agreement and subject to the provisions of paragraph 7 hereof, OMC may obtain
investment information, research or assistance from any other person, firm or
corporation to supplement, update or otherwise improve its investment management
services including entering into sub-advisory agreements with other affiliated
or unaffiliated registered investment advisors to obtain specialized services.
(c) Provided that nothing herein shall be deemed to protect OMC from willful
misfeasance, bad faith or gross negligence in the performance of its duties, or
reckless disregard of its obligations and duties under this Agreement, OMC shall
not be liable for any loss sustained by reason of good faith errors or omissions
in connection with any matters to which this Agreement relates.
(d) Nothing in this Agreement shall prevent OMC or any entity controlling,
controlled by or under common control with OMC or any officer thereof from
acting as investment adviser for any other person, firm or corporation or in any
way limit or restrict OMC or any of its directors, officers, stockholders or
employees from buying, selling or trading any securities for its or their own
account or for the account of others for whom it or they may be acting, provided
that such activities will not adversely affect or otherwise impair the
performance by OMC of its duties and obligations under this Agreement.
3. OTHER DUTIES OF OMC:
OMC shall, at its own expense, provide and supervise the activities of all
administrative and clerical personnel as shall be required to provide effective
corporate administration for the Company, including the compilation and
maintenance of such records with respect to its operations as may reasonably be
required; the preparation and filing of such reports with respect thereto as
shall be required by the Commission; composition of periodic reports with
respect to operations of each Series of the Company for its shareholders;
composition of proxy materials for meetings of the Company's shareholders; and
the composition of such registration statements as may be required by Federal
and state securities laws for continuous public sale of Shares of each Series
and the Company. OMC shall, at its own cost and expense, also provide the
Company with adequate office space, facilities and equipment. OMC shall, at its
own expenses, provide such officers for the Company as the Board of Trustees may
request.
4. ALLOCATION OF EXPENSES:
All other costs and expenses of the Fund not expressly assumed by OMC under
this Agreement, or to be paid by the Distributor of the Shares of the Fund,
shall be paid by the Fund, including, but not limited to: (i) interest, taxes
and governmental fees; (ii) brokerage commissions and other expenses incurred in
acquiring or disposing of the portfolio securities and other investments of each
Series; (iii) insurance premiums for fidelity and other coverage requisite to
its operations; (iv) compensation and expenses of its Trustees other than those
affiliated with OMC; (v) legal and audit expenses; (vi) custodian and transfer
agent fees and expenses; (vii) expenses incident to the redemption of its
Shares; (viii) expenses incident to the issuance of its Shares against payment
therefor by or on behalf of the subscribers thereto; (ix) fees and expenses,
other than as hereinabove provided, incident to the registration under Federal
and state securities laws of Shares of the Company and Series for public sale;
(x) expenses of printing and mailing reports,
B-2
<PAGE>
notices and proxy materials to shareholders of the Company and each Series; (xi)
except as noted above, all other expenses incidental to holding meetings of the
Company's shareholders; and (xii) such extraordinary non-recurring expenses as
may arise, including litigation, affecting the Company or any Series thereof and
any legal obligation which the Company, or any Series of the Company may have to
indemnify its officers and Trustees with respect thereto. Any officers or
employees of OMC or any entity controlling, controlled by, or under common
control with, OMC who also serve as officers, Trustees or employees of the
Company shall not receive any compensation from the Company or any Series
thereof for their services.
5. COMPENSATION OF OMC:
The Company agrees to pay OMC and OMC agrees to accept as full compensation
for the performance of all functions and duties on its part to be performed
pursuant to the provisions hereof, a fee computed on the total net asset value
of each Series of the Company as of the close of each business day and payable
monthly at the annual rate for each Series set forth on Schedule A hereto.
6. USE OF NAME "OPPENHEIMER" OR "QUEST FOR VALUE":
OMC hereby grants to the Company a royalty-free, non-exclusive license to
use the name "Oppenheimer" or "Quest For Value" in the name of the Company for
the duration of this Agreement and any extensions or renewals thereof. To the
extent necessary to protect OMC's rights to the name "Oppenheimer" or "Quest For
Value" under applicable law, such license shall allow OMC to inspect and,
subject to control by the Company's Board, control the nature and quality of
services offered by the Company under such name and may, upon termination of
this Agreement, be terminated by OMC, in which event the Company shall promptly
take whatever action may be necessary to change its name and discontinue any
further use of the name "Oppenheimer" or "Quest For Value" in the name of the
Company or otherwise. The name "Oppenheimer" and "Quest For Value" may be used
or licensed by OMC in connection with any of its activities, or licensed by OMC
to any other party.
7. PORTFOLIO TRANSACTIONS AND BROKERAGE:
(a) OMC (and any Sub Advisor) is authorized, in arranging the purchase and
sale of the portfolio securities of each Series of the Company to employ or deal
with such members of securities or commodities exchanges, brokers or dealers
(hereinafter "broker-dealers"), including "affiliated" broker-dealers (as that
term is defined in the Investment Company Act), as may, in its best judgment,
implement the policy of the Fund to obtain, at reasonable expense, the "best
execution" (prompt and reliable execution at the most favorable security price
obtainable) of the portfolio transactions of each Series of the Company as well
as to obtain, consistent with the provisions of subparagraph (c) of this
paragraph 7, the benefit of such investment information or research as will be
of significant assistance to the performance by OMC of its investment management
functions.
(b) OMC (and any Sub Advisor) shall select broker-dealers to effect the
portfolio transactions of each Series of the Company on the basis of its
estimate of their ability to obtain best execution of particular and related
portfolio transactions. The abilities of a broker-dealer to obtain best
execution of particular portfolio transaction(s) will be judged by OMC (or any
Sub Advisor) on the basis of all relevant factors and considerations including,
insofar as feasible, the execution capabilities required by the transaction or
transactions; the ability and willingness of the broker-dealer to facilitate the
portfolio transactions of each Series of the Company by participating therein
for its own account; the importance to the Company of
B-3
<PAGE>
speed, efficiency or confidentiality; the broker-dealer's apparent familiarity
with sources from or to whom particular securities might be purchased or sold;
as well as any other matters relevant to the selection of a broker-dealer for
particular and related transactions of each Series of the Company.
(c) OMC (and any Sub Advisor) shall have discretion, in the interest of the
Company and each Series, to allocate brokerage on the portfolio transactions of
each Series of the Company to broker-dealers, other than affiliated
broker-dealers, qualified to obtain best execution of such transactions who
provide brokerage and/or research services (as such services are defined in
Section 28(e)(3) of the Securities Exchange Act of 1934) for the Fund and/or
other accounts for which OMC or its affiliates (or any Sub Advisor) exercise
"investment discretion" (as that term is defined in Section 3(a)(35) of the
Securities Exchange Act of 1934) and to cause the Company or a Series to pay
such broker-dealers a commission for effecting a portfolio transaction for the
Company or a Series that is in excess of the amount of commission another
broker-dealer adequately qualified to effect such transaction would have charged
for effecting that transaction, if OMC (or any Sub Advisor) determines, in good
faith, that such commission is reasonable in relation to the value of the
brokerage and/or research services provided by such broker-dealer viewed in
terms of either that particular transaction or the overall responsibilities of
OMC or its affiliates (or any Sub Advisor) with respect to accounts as to which
they exercise investment discretion. In reaching such determination, OMC (or any
Sub Advisor) will not be required to place or attempt to place a specific dollar
value on the brokerage and/or research services provided or being provided by
such broker-dealer. In demonstrating that such determinations were made in good
faith, OMC (and any Sub Advisor) shall be prepared to show that all commissions
were allocated for purposes contemplated by this Agreement and that the total
commissions paid by the Company and each Series over a representative period
selected by the Company's Trustees were reasonable in relation to the benefits
to the Company and each Series.
(d) OMC (or any Sub Advisor) shall have no duty or obligation to seek
advance competitive bidding for the most favorable commission rate applicable to
any particular portfolio transactions or to select any broker-dealer on the
basis of its purported or "posted" commission rate but will, to the best of its
ability, endeavor to be aware of the current level of the charges of eligible
broker-dealers and to minimize the expense incurred by the Company and each
Series for effecting its portfolio transactions to the extent consistent with
the interests and policies of the Company and each Series as established by the
determinations of the Board of Trustees of the Company and the provisions of
this paragraph 7.
(e) The Company recognizes that an affiliated broker-dealer: (i) may act as
one of the Company's regular brokers for the Company or a Series thereof so long
as it is lawful for it so to act; (ii) may be a major recipient of brokerage
commissions paid by the Company or a Series; and (iii) may effect portfolio
transactions for the Company or a Series thereof only if the commissions, fees
or other renumeration received or to be received by it are determined in
accordance with procedures contemplated by any rule, regulation or order adopted
under the Investment Company Act for determining the permissible level of such
commissions.
(f) Subject to the foregoing provisions of this paragraph 7, OMC (and any
Sub Advisor) may also consider sales of Shares of the Company, each Series
thereof and the other funds advised by OMC and its affiliates as a factor in the
selection of broker-dealers for its portfolio transactions.
8. DURATION:
This Agreement will take effect on the date first set forth above. Unless
earlier terminated pursuant to paragraph 10 hereof, this Agreement shall remain
in effect from year to year, so long as such continuance
B-4
<PAGE>
shall be approved at least annually by the Company's Board of Trustees,
including the vote of the majority of the Trustees of the Company who are not
parties to this Agreement or "interested persons" (as defined in the Investment
Company Act) of any such party, cast in person at a meeting called for the
purpose of voting on such approval, or by the holders of a "majority" (as
defined in the Investment Company Act) of the outstanding voting securities of
the Company, or each Series thereof, and by such a vote of the Company's Board
of Trustees.
9. DISCLAIMER OF SHAREHOLDER OR TRUSTEE LIABILITY:
OMC understands and agrees that the obligations of the Company under this
Agreement are not binding upon any shareholder or Trustee of the Company
personally, but bind only the Company and the Company's property; OMC represents
that it has notice of the provisions of the Declaration of Trust of the Company
disclaiming shareholder or Trustee liability for acts or obligations of the
Company.
10. TERMINATION.
This Agreement may be terminated (i) by OMC at any time without penalty upon
sixty days' written notice to the Company (which notice may be waived by the
Company); or (ii) by the Company at any time without penalty upon sixty days'
written notice to OMC (which notice may be waived by OMC) provided that such
termination by the Company shall be directed or approved by the vote of a
majority of all of the Trustees of the Company then in office or by the vote of
the holders of a "majority" of the outstanding voting securities of the Company
(as defined in the Investment Company Act).
11. ASSIGNMENT OR AMENDMENT:
This Agreement may not be amended or the rights of OMC hereunder sold,
transferred, pledged or otherwise in any manner encumbered without the
affirmative vote or written consent of the holders of the "majority" of the
outstanding voting securities of the Company. This Agreement shall automatically
and immediately terminate in the event of its "assignment," as defined in the
Investment Company Act.
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<PAGE>
12. DEFINITIONS:
The terms and provisions of the Agreement shall be interpreted and defined
in a manner consistent with the provisions and definitions contained in the
Investment Company Act.
<TABLE>
<S> <C>
OPPENHEIMER/QUEST FOR VALUE
FAMILY OF FUNDS
Attest: --------------------------------------- By: ------------------------------------------
Title: ----------------------------------------
OPPENHEIMER MANAGEMENT
CORPORATION
Attest: --------------------------------------- By: ------------------------------------------
Katherine P. Feld Andrew J. Donohue
SECRETARY EXECUTIVE VICE PRESIDENT
</TABLE>
B-6
<PAGE>
SCHEDULE A
TO
INVESTMENT ADVISORY AGREEMENT
BETWEEN
OPPENHEIMER/QUEST FOR VALUE FAMILY OF FUNDS
AND
OPPENHEIMER MANAGEMENT CORPORATION
<TABLE>
<CAPTION>
ANNUAL FEE AS A PERCENTAGE OF DAILY TOTAL
NAME OF SERIES NET ASSETS
----------------------------------- ------------------------------------------------
<S> <C>
Growth and Income Fund............. 0.85% of all net assets
Officers Fund...................... 1.00% of all net assets
Small Capitalization Fund.......... 1.00% of first $400 million of net assets 0.90%
of next $400 million of net assets 0.85% of net
assets over $800 million
Opportunity Fund................... 1.00% of first $400 million of net assets 0.90%
of next $400 million of net assets 0.85% of net
assets over $800 million
</TABLE>
B-7
<PAGE>
EXHIBIT C
FORM OF
SUBADVISORY AGREEMENT
THIS AGREEMENT is made by and between Oppenheimer Management Corporation, a
Colorado corporation (the "Adviser"), and Advisors, a Delaware general
partnership (the "Subadviser"), as of the date set forth below.
RECITAL
WHEREAS, Oppenheimer/Quest For Value Family of Funds (the "Company") is
registered under the Investment Company Act of 1940, as amended (the "1940
Act"), as an open-end, management investment company;
WHEREAS, the Adviser is registered under the Investment Advisers Act of
1940, as amended (the "Advisers Act"), as an investment adviser and engages in
the business of acting as an investment adviser;
WHEREAS, the Subadviser is registered under the Advisers Act as an
investment adviser and engages in the business of acting as an investment
adviser;
WHEREAS, the Company's Declaration of Trust authorizes the Board of Trustees
of the Company to classify or reclassify authorized but unissued shares of the
Company into series of shares representing interests in various investment
portfolios;
WHEREAS, pursuant to such authority, the Company has established the
Opportunity Fund (the "Fund");
WHEREAS, the Adviser has entered into an Investment Advisory Agreement as of
the date hereof with the Company (the "Investment Advisory Agreement"), pursuant
to which the Adviser shall act as investment adviser with respect to the Fund;
and
WHEREAS, pursuant to Paragraph of the Investment Advisory Agreement, the
Adviser wishes to retain the Subadviser for purposes of rendering investment
advisory services to the Adviser in connection with the Fund upon the terms and
conditions hereinafter set forth;
NOW THEREFORE, in consideration of the mutual covenants herein contained and
other good and valuable consideration, the receipt of which are hereby
acknowledged, the parties hereto agree as follows:
I. APPOINTMENT AND OBLIGATIONS OF THE ADVISER.
The Adviser hereby appoints the Subadviser to render, to the Adviser with
respect to the Fund, investment research and advisory services as set forth
below in Section II, under the supervision of the Adviser and subject to the
approval and direction of the Company's Board of Trustees (the "Board"), and the
Subadviser hereby accepts such appointment, all subject to the terms and
conditions contained herein. The Subadviser shall, for all purposes herein, be
deemed an independent contractor and shall not have, unless otherwise expressly
provided or authorized, any authority to act for or represent the Company or the
Fund in any way or otherwise to serve as or be deemed an agent of the Company or
the Fund.
------------------------
*AGREEMENT IS IDENTICAL FOR GROWTH AND INCOME FUND AND SMALL CAPITALIZATION FUND
EXCEPT FOR THE NAME OF THE FUND.
C-1
<PAGE>
II. DUTIES OF THE SUBADVISER AND THE ADVISER.
A. DUTIES OF THE SUBADVISER.
The Subadviser shall regularly provide investment advice with respect to the
Fund and shall, subject to the terms of this Agreement, continuously supervise
the investment and reinvestment of cash, securities and instruments or other
property comprising the assets of the Fund, and in furtherance thereof, the
Subadviser's duties shall include:
1. Obtaining and evaluating pertinent information about significant
developments and economic, statistical and financial data, domestic, foreign
or otherwise, whether affecting the economy generally or the Fund, and
whether concerning the individual issuers whose securities are included in
the Fund or the activities in which such issuers engage, or with respect to
securities which the Subadviser considers desirable for inclusion in the
Fund's investment portfolio;
2. Determining which securities shall be purchased, sold or exchanged
by the Fund or otherwise represented in the Fund's investment portfolio and
regularly reporting thereon to the Adviser and, at the request of the
Adviser, to the Board;
3. Formulating and implementing continuing programs for the purchases
and sales of the securities of such issuers and regularly reporting thereon
to the Adviser and, at the request of the Adviser, to the Board; and
4. Taking, on behalf of the Fund, all actions that appear to the
Subadviser necessary to carry into effect such investment program, including
the placing of purchase and sale orders, and making appropriate reports
thereon to the Adviser and the Board.
B. DUTIES OF THE ADVISER.
The Adviser shall retain responsibility for, among other things, providing
the following advice and services with respect to the Fund:
1. Without limiting the obligation of the Subadviser to so comply, the
Adviser shall monitor the investment program maintained by the Subadviser
for the Fund to ensure that the Fund's assets are invested in compliance
with this Agreement and the Fund's Registration Statement, as currently in
effect from time to time; and
2. The Adviser shall oversee matters relating to Fund promotion,
including, but not limited to, marketing materials and the Subadviser's
reports to the Board.
III. REPRESENTATIONS, WARRANTIES AND COVENANTS.
A. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SUBADVISER.
1. ORGANIZATION. The Subadviser is now, and will continue to be, a general
partnership duly formed and validly existing under the laws of its jurisdiction
of formation, fully authorized to enter into this Agreement and carry out its
duties and obligations hereunder.
2. REGISTRATION. The Subadviser is registered as an investment adviser
with the Securities and Exchange Commission (the "SEC") under the Advisers Act,
and is registered or licensed as an investment adviser under the laws of all
jurisdictions in which its activities require it to be so registered or
licensed,
C-2
<PAGE>
except where the failure to be so licensed would not have a material adverse
effect on the Subadviser. The Subadviser shall maintain such registration or
license in effect at all times during the term of this Agreement.
3. BEST EFFORTS. The Subadviser at all times shall provide its best
judgment and effort to the Adviser and the Fund in carrying out its obligations
hereunder.
4. OTHER COVENANTS. The Subadviser further agrees that:
a. it will use the same skill and care in providing such services as it
uses in providing services to other accounts for which it has investment
management responsibilities;
b. it will not make loans to any person to purchase or carry units of
beneficial interest in the Fund or make loans to the Fund;
c. it will report regularly to the Fund and to the Adviser and will
make appropriate persons available for the purpose of reviewing with
representatives of the Adviser on a regular basis the management of the
Fund, including, without limitation, review of the general investment
strategy of the Fund, economic considerations and general conditions
affecting the marketplace;
d. as required by applicable laws and regulations, it will maintain
books and records with respect to the Fund's securities transactions and it
will furnish to the Adviser and to the Board such periodic and special
reports as the Adviser or the Board may reasonably request;
e. it will treat confidentially and as proprietary information of the
Fund all records and other information relative to the Fund, and will not
use records and information for any purpose other than performance of its
responsibilities and duties hereunder, except after prior notification to
and approval in writing by the Fund or when so requested by the Fund or
required by law or regulation;
f. it will, on a continuing basis and at its own expense, (1) provide
the distributor of the Fund (the "Distributor") with assistance in the
distribution and marketing of the Fund in such amount and form as the
Adviser may reasonably request from time to time, and (2) use its best
efforts to cause the portfolio manager or other person who manages or is
responsible for overseeing the management of the Fund's portfolio (the
"Portfolio Manager") to provide marketing and distribution assistance to the
Distributor, including, without limitation, conference calls, meetings and
road trips, provided that each Portfolio Manager shall not be required to
devote more than 10% of his or her time to such marketing and distribution
activities;
g. it will use its reasonable best efforts (i) to retain the services
of the Portfolio Manager who manages the portfolio of the Fund, from time to
time and (ii) to promptly obtain the services of a Portfolio Manager
acceptable to the Adviser if the services of the Portfolio Manager are no
longer available to the Subadviser;
h. it will, from time to time, assure that each Portfolio Manager is
acceptable to the Adviser;
i. it will obtain the written approval of the Adviser prior to
designating a new Portfolio Manager; provided, however, that, if the
services of a Portfolio Manager are no longer available to the Subadviser
due to circumstances beyond the reasonable control of the Subadviser (e.g.,
voluntary resignation,
C-3
<PAGE>
death or disability), the Subadviser may designate an interim Portfolio
Manager who (a) shall be reasonably acceptable to the Adviser and (b) shall
function for a reasonable period of time until the Subadviser designates an
acceptable permanent replacement; and
j. it will promptly notify the Adviser of any impending change in
Portfolio Manager, portfolio management or any other material matter that
may require disclosure to the Board, shareholders of the Fund or dealers.
B. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE ADVISER.
1. ORGANIZATION. The Adviser is now, and will continue to be, duly
organized and in good standing under the laws of its state of incorporation,
fully authorized to enter into this Agreement and carry out its duties and
obligations hereunder.
2. REGISTRATION. The Adviser is registered as an investment adviser with
the SEC under the Advisers Act, and is registered or licensed as an investment
adviser under the laws of all jurisdictions in which its activities require it
to be so registered or licensed. The Adviser shall maintain such registration or
license in effect at all times during the term of this Agreement.
3. BEST EFFORTS. The Adviser at all times shall provide its best judgment
and effort to the Fund in carrying out its obligations hereunder. For a period
of five years from the date hereof, and subject to the Adviser's fiduciary
obligations to the Fund and its shareholders, the Adviser will not recommend to
the Board that the Fund be reorganized into another Fund unless the total net
assets of the Fund are less than $100 million at the time of such
reorganization.
IV. COMPLIANCE WITH APPLICABLE REQUIREMENTS.
In carrying out its obligations under this Agreement, the Subadviser shall
at all times conform to:
A. all applicable provisions of the 1940 Act and any rules and
regulations adopted thereunder;
B. the provisions of the registration statement of the Company, as the
same may be amended from time to time, under the Securities Act of 1933, as
amended, and the 1940 Act;
C. the provisions of the Company's Declaration of Trust or other
governing document, as amended from time to time;
D. the provisions of the By-laws of the Company, as amended from time
to time;
E. any other applicable provisions of state or federal law; and
F. guidelines, investment restrictions, policies, procedures or
instructions adopted or issued by the Company, the Fund or the Adviser from
time to time.
The Adviser shall promptly notify the Subadviser of any changes or
amendments to the provisions of B., C., D. and F. above when such changes or
amendments relate to the obligations of the Subadviser.
V. CONTROL BY THE BOARD.
Any investment program undertaken by the Subadviser pursuant to this
Agreement, as well as any other activities undertaken by the Subadviser with
respect to the Fund, shall at all times be subject to any directives of the
Adviser and the Board.
C-4
<PAGE>
VI. BOOKS AND RECORDS.
The Subadviser agrees that all records which it maintains for the Fund on
behalf of the Adviser are the property of the Fund and further agrees to
surrender promptly to the Fund or to the Adviser any of such records upon
request. The Subadviser further agrees to preserve for the periods prescribed by
applicable laws, rules and regulations all records required to be maintained by
the Subadviser on behalf of the Adviser under such applicable laws, rules and
regulations, or such longer period as the Adviser may reasonably request from
time to time.
VII. BROKER-DEALER RELATIONSHIPS.
A. PORTFOLIO TRADES.
The Subadviser, at its own expense, and to the extent appropriate, in
consultation with the Adviser, shall place all orders for the purchase and sale
of portfolio securities for the Fund with brokers or dealers selected by the
Subadviser, which may include, to the extent permitted by the Adviser and the
Fund, brokers or dealers affiliated with the Subadviser. The Subadviser shall
use its best efforts to seek to execute portfolio transactions at prices that
are advantageous to the Fund and at commission rates that are reasonable in
relation to the benefits received.
B. SELECTION OF BROKER-DEALERS.
With respect to the execution of particular transactions, the Subadviser
may, to the extent permitted by the Adviser and the Fund, select brokers or
dealers who also provide brokerage and research services (as those terms are
defined in Section 28(e) of the Securities Exchange Act of 1934, as amended) to
the Fund and/or the other accounts over which the Subadviser or its affiliates
exercise investment discretion. The Subadviser is authorized to pay a broker or
dealer who provides such brokerage and research services a commission for
executing a portfolio transaction for the Fund that is in excess of the amount
of commission another broker or dealer would have charged for effecting that
transaction if the Subadviser determines in good faith that such amount of
commission is reasonable in relation to the value of the brokerage and research
services provided by such broker or dealer. This determination may be viewed in
terms of either that particular transaction or the overall responsibilities that
the Subadviser and its affiliates have with respect to accounts over which they
exercise investment discretion. The Adviser, Subadviser and the Board shall
periodically review the commissions paid by the Fund to determine, among other
things, if the commissions paid over representative periods of time were
reasonable in relation to the benefits received.
C. SOFT DOLLAR ARRANGEMENTS.
The Subadviser may enter into "soft dollar" arrangements through the agency
of third parties on behalf of the Adviser. Soft dollar arrangements for services
may be entered into in order to facilitate an improvement in performance in
respect of the Subadviser's service to the Adviser with respect to the Fund. The
Subadviser makes no direct payments but instead undertakes to place business
with broker-dealers who in turn pay third parties who provide these services.
Soft dollar transactions will be conducted on an arm's-length basis, and the
Subadviser will secure best execution for the Adviser. Any arrangements
involving soft dollars and/or brokerage services shall be effected in compliance
with Section 28(e) of the Securities Exchange Act of 1934, as amended, and the
policies that the Adviser and the Board may adopt from time to time. The
Subadviser agrees to provide reports to the Adviser as necessary for purposes of
providing information on these arrangements to the Board.
C-5
<PAGE>
VIII. COMPENSATION.
A. AMOUNT OF COMPENSATION.
The Adviser shall pay the Subadviser, as compensation for services rendered
hereunder, from its own assets, an annual fee, payable monthly, equal to 40% of
the investment advisory fee collected by the Adviser from the Fund, based on the
total net assets of the Fund existing as of the date hereof (the "base amount"),
plus 30% of the advisory fee collected by the Adviser, based on the total net
assets of the Fund that exceed the base amount (the "marginal amount"), in each
case calculated after any waivers, voluntary or otherwise.
B. CALCULATION OF COMPENSATION.
Except as hereinafter set forth, compensation under this Agreement shall be
calculated and accrued on the same basis as the advisory fee paid to the Adviser
by the Fund. If this Agreement becomes effective subsequent to the first day of
a month or shall terminate before the last day of a month, compensation for that
part of the month this Agreement is in effect shall be prorated in a manner
consistent with the calculation of the fees set forth above.
C. PAYMENT OF COMPENSATION.
Subject to the provisions of this paragraph, payment of the Subadviser's
compensation for the preceding month shall be made within 15 days after the end
of the preceding month.
D. REORGANIZATION OF THE FUND.
If the Fund is reorganized with another investment company for which the
Subadviser does not serve as an investment adviser or subadviser, and the Fund
is the surviving entity, the subadvisory fee payable under this section shall be
adjusted in an appropriate manner as the parties may agree.
IX. ALLOCATION OF EXPENSES.
The Subadviser shall pay the expenses incurred in providing services in
connection with this Agreement, including, but not limited to, the salaries,
employment benefits and other related costs of those of its personnel engaged in
providing investment advice to the Fund hereunder, including, without
limitation, office space, office equipment, telephone and postage costs and
other expenses. In the event of an "assignment" of this Agreement, other than an
assignment resulting solely by action of the Adviser or an affiliate thereof,
the Subadviser shall be responsible for payment of all costs and expenses
incurred by the Adviser and the Fund relating thereto, including, but not
limited to, reasonable legal, accounting, printing and mailing costs related to
obtaining approval of Fund shareholders.
X. NON-EXCLUSIVITY.
The services of the Subadviser with respect to the Company and the Fund are
not to be deemed to be exclusive, and the Subadviser shall be free to render
investment advisory and administrative or other services to others (including
other investment companies) and to engage in other activities, subject to the
provisions of a certain Agreement Not to Compete dated as of , 1995
among the Adviser, Oppenheimer Capital, the Subadviser and Quest For Value
Distributors (the "Agreement Not to Compete"). It is understood and agreed that
officers or directors of the Subadviser may serve as officers or directors of
the Adviser or of the Fund; that officers or directors of the Adviser or of the
Company may serve as officers or directors of the Subadviser to the extent
permitted by law; and that the officers and directors of the Subadviser are not
prohibited from engaging in any other business activity or from rendering
services to
C-6
<PAGE>
any other person, or from serving as partners, officers, directors or trustees
of any other firm or trust, including other investment advisory companies
(subject to the provisions of the Agreement Not to Compete) provided it is
permitted by applicable law and does not adversely affect the Company or the
Fund.
XI. TERM.
This Agreement shall become effective at the close of business on the date
hereof and shall remain in force and effect, subject to Paragraphs XII.A and
XII.B hereof and approval by the Fund's shareholders, for a period of two years
from the date hereof.
XII. RENEWAL.
Following the expiration of its initial two-year term, the Agreement shall
continue in full force and effect from year to year for a period of eight years,
provided that such continuance is specifically approved:
A. at least annually (1) by the Board or by the vote of a majority of
the Fund's outstanding voting securities (as defined in Section 2(a)(42) of
the 1940 Act), and (2) by the affirmative vote of a majority of the Trustees
who are not parties to this Agreement or interested persons of a party to
this Agreement (other than as a Trustee of the Fund), by votes cast in
person at a meeting specifically called for such purpose; or
B. by such method required by applicable law, rule or regulation then
in effect.
XIII. TERMINATION.
A. TERMINATION BY THE COMPANY.
This Agreement may be terminated at any time, without the payment of any
penalty, by vote of the Board or by vote of a majority of the Fund's outstanding
voting securities, on sixty (60) days' written notice. The notice provided for
herein may be waived by the party required to be notified.
B. ASSIGNMENT.
This Agreement shall automatically terminate in the event of its
"assignment," as defined in Section 2(a)(4) of the 1940 Act. In the event of an
assignment that occurs solely due to the change in control of the Subadviser
(provided that no condition exists that permits, or, upon the consummation of
the assignment, will permit, the termination of this Agreement by the Adviser
pursuant to Section XIII.D. hereof), the Adviser and the Subadviser, at the sole
expense of the Subadviser, shall use their reasonable best efforts to obtain
shareholder approval of a successor Subadvisory Agreement on substantially the
same terms as contained in this Agreement.
C. PAYMENT OF FEES AFTER TERMINATION.
Notwithstanding the termination of this Agreement prior to the tenth
anniversary of the date hereof, the Adviser shall continue to pay to the
Subadviser the subadvisory fee for the term of this Agreement and any renewals
thereof through such tenth anniversary, if: (1) the Adviser or the Company
terminates this Agreement for a reason other than the reasons set forth in
Section XIII.D. hereof, provided the Investment Advisory Agreement remains in
effect; (2) the Fund reorganizes with another investment company advised by the
Adviser (or an affiliate of the Adviser) and for which the Subadviser does not
serve as an investment adviser or subadviser and such other investment company
is the surviving entity; or (3) the Investment Advisory Agreement terminates (i)
by reason of an "assignment;" (ii) because the Adviser is disqualified from
serving as an investment adviser; or (iii) by reason of a voluntary termination
by the Adviser; provided that the Subadviser does not serve as the investment
adviser or subadviser of the Fund after such
C-7
<PAGE>
termination of the Investment Advisory Agreement. The amount of the subadvisory
fee paid pursuant to this section shall be calculated on the basis of the Fund's
net assets measured at the time of such termination or such reorganization.
Notwithstanding anything to the contrary, if the Subadviser terminates this
Agreement or if this Agreement is terminated by operation of law, due solely to
an act or omission by the Subadviser, Oppenheimer Capital ("OpCap") or their
respective partners, subsidiaries, directors, officers, employees or agents
(other than by reason of an "assignment" of this Agreement), then the Adviser
shall not be liable for any further payments under this Agreement, provided,
however, that if at any time prior to the end of the term of the Agreement Not
to Compete any event that would have permitted the termination of this Agreement
by the Adviser pursuant to Section XIII.D.(3) hereof occurs, the Adviser shall
be under no further obligation to pay any subadvisory fees.
D. TERMINATION BY THE ADVISER.
The Adviser may terminate this Agreement without penalty and without the
payment of any fee or penalty, immediately after giving written notice, upon the
occurrence of any of the following events:
1. The Fund's investment performance of the Fund's Class A shares
compared to the appropriate universe of Class A shares (or their
equivalent), as set forth on Schedule D-1, as amended from time to time,
ranks in the bottom quartile for two consecutive calendar years (beginning
with the calendar year 1995) and earns a Morningstar three-year rating of
less than three (3) stars at the time of such termination; or
2. Any of the Subadviser, OpCap, their respective partners,
subsidiaries, affiliates, directors, officers, employees or agents engages
in an action or omits to take an action that would cause the Subadviser or
OpCap to be disqualified in any manner under Section 9(a) of the 1940 Act,
if the SEC were not to grant an exemptive order under Section 9(c) thereof
or that would constitute grounds for the SEC to deny, revoke or suspend the
registration of the Subadviser as an investment adviser with the SEC;
3. Any of OpCap, the Subadviser, their respective partners,
subsidiaries, affiliates, directors, officers, employees or agents causes a
material violation of the Agreement Not to Compete which is not cured in
accordance with the provisions of that agreement; or
4. The Subadviser breaches the representations contained in Paragraph
III.A.4.i. of this Agreement or any other material provision of this
Agreement, and any such breach is not cured within a reasonable period of
time after notice thereof from the Adviser to the Subadviser. However,
consistent with its fiduciary obligations, for a period of seven months the
Adviser will not terminate this Agreement solely because the Subadviser has
failed to designate an acceptable permanent replacement to a Portfolio
Manager whose services are no longer available to the Subadviser due to
circumstances beyond the reasonable control of the Subadviser, provided that
the Subadviser uses its reasonable best efforts to promptly obtain the
services of a Portfolio Manager acceptable to the Adviser and further
provided that the Adviser has not unreasonably withheld approval of such
replacement Portfolio Manager.
E. TRANSACTIONS IN PROGRESS UPON TERMINATION.
The Adviser and Subadviser will cooperate with each other to ensure that
portfolio or other transactions in progress at the date of termination of this
Agreement shall be completed by the Adviser in accordance with the terms of such
transactions, and to this end the Subadviser shall provide the Adviser with all
necessary information and documentation to secure the implementation thereof.
C-8
<PAGE>
XIV. NON-SOLICITATION.
During the term of this Agreement, the Adviser (and its affiliates under its
control) shall not solicit or knowingly assist in the solicitation of any
Portfolio Manager of the Fund or any portfolio assistant of the Fund then
employed by the Subadviser or OpCap, provided, however, that the Adviser (or its
affiliates) may solicit or hire any such individual who (A) the Subadviser or
OpCap (or its affiliates) has terminated or (B) has voluntarily terminated his
or her employment with the Subadviser, OpCap (or its affiliates) without
inducement of the Adviser (or its affiliates under its control) prior to the
time of such solicitation. Advertising in general circulation newspapers or
industry newsletters by the Adviser shall not constitute "inducement" by the
Adviser (or its affiliates under its control).
XV. LIABILITY OF THE SUBADVISER.
In the absence of willful misfeasance, bad faith, negligence or reckless
disregard of obligations or duties hereunder on the part of the Subadviser or
any of its officers, directors or employees, the Subadviser shall not be subject
to liability to the Adviser for any act or omission in the course of, or
connected with, rendering services hereunder or for any losses that may be
sustained in the purchase, holding or sale of any security; PROVIDED, HOWEVER,
that the foregoing shall not be construed to relieve the Subadviser of any
liability it may have arising under the Agreement Not to Compete or the
Acquisition Agreement dated August 15, 1995, among the Subadviser, the Adviser
and certain affiliates of the Subadviser.
XVI. NOTICES.
Any notice or other communication required or that may be given hereunder
shall be in writing and shall be delivered personally, telecopied, sent by
certified, registered or express mail, postage prepaid or sent by national
next-day delivery service and shall be deemed given when so delivered personally
or telecopied, or if mailed, two days after the date of mailing, or if by
next-day delivery service, on the business day following delivery thereto, as
follows or to such other location as any party notifies any other party:
A. if to the Adviser, to:
Oppenheimer Management Corporation
Two World Trade Center
New York, New York 10048-0203
Attention: Andrew J. Donohue
Executive Vice President and General Counsel
Telecopier: 212-321-1159
B. if to the Subadviser, to:
Quest For Value Advisors
c/o Oppenheimer Capital
225 Liberty Street
New York, New York 10281
Attention: Thomas E. Duggan
Secretary and General Counsel
Telecopier: 212-349-4759
XVII. QUESTIONS OF INTERPRETATION.
This Agreement shall be governed by the laws of the State of New York
applicable to agreements made and to be performed entirely within the State of
New York (without regard to any conflicts of law principles
C-9
<PAGE>
thereof). Any question of interpretation of any term or provision of this
Agreement having a counterpart in or otherwise derived from a term or provision
of the 1940 Act shall be resolved by reference to such term or provision of the
1940 Act and to interpretations thereof, if any, by the United States Courts or,
in the absence of any controlling decision of any such court, by rules,
regulations or orders of the SEC issued pursuant to the 1940 Act. In addition,
where the effect of a requirement of the 1940 Act reflected in any provision of
this Agreement is revised by rule, regulation or order of the SEC, such
provision shall be deemed to incorporate the effect of such rule, regulation or
order.
XVIII. FORM ADV -- DELIVERY.
The Adviser hereby acknowledges that it has received from the Subadviser a
copy of the Subadviser's Form ADV, Part II as currently filed, at least 48 hours
prior to entering into this Agreement and that it has read and understood the
disclosures set forth in the Subadviser's Form ADV, Part II.
XIX. MISCELLANEOUS.
The captions in this Agreement are included for convenience of reference
only and in no way define or delimit any of the provisions hereof or otherwise
affect their construction or effect. If any provision of this Agreement shall be
held or made invalid by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby. This Agreement shall
be binding upon and shall inure to the benefit of the parties hereto and their
respective successors.
XX. COUNTERPARTS.
This Agreement may be executed in counterparts, each of which shall
constitute an original and both of which, collectively, shall constitute one
agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate by their respective officers as of the day of October,
1995.
<TABLE>
<S> <C>
OPPENHEIMER MANAGEMENT CORPORATION
By:
--------------------------------------
Name: Andrew J. Donohue
Title: EXECUTIVE VICE PRESIDENT
ADVISORS
By: OPPENHEIMER FINANCIAL CORP.,
a general partner
By:
--------------------------------------
Name:
Title:
</TABLE>
C-10
<PAGE>
EXHIBIT D
INFORMATION ON COMPARABLE FUNDS
MANAGED BY OPPENHEIMER
MANAGEMENT CORPORATION
<TABLE>
<CAPTION>
APPROXIMATE
NAME OF NET ASSETS AS
COMPARABLE OF 6/30/95 ADVISORY FEE RATE AS A % OF
NAME OF QUEST FUND OPPENHEIMER FUND (IN MILLIONS) AVERAGE ANNUAL NET ASSETS
--------------------------- --------------------- ------------- ----------------------------------------
<S> <C> <C> <C>
Small Capitalization Fund Oppenheimer Discovery 734.7 .75% of the first $200 million of
Fund aggregate net assets; .72% of the next
$200 million; .69% of the next $200
million; .66% of the next $200 million;
and .60% of aggregate net assets in
excess of $800 million.
Oppenheimer Global 137.3 1.00% of the first $50 million of
Emerging Growth Fund average annual net assets; .75% of the
next $150 million; .72% of the next
$200 million; .69% of the next $200
million; .66% of the next $200 million
and .60% of net assets in excess of
$800 million.
Oppenheimer Variable 237.9 .75% of the first $200 million of
Account Funds/ average annual net assets; .72% of the
Oppenheimer Capital next $200 million; .69% of the next
Appreciation Fund $200 million; .66% of the next $200
million; and .60% of average annual net
assets in excess of $800 million.
Growth and Income Fund Oppenheimer Main 3,010.6 .65% of the first $200 million of net
Street Funds, Inc./ assets; .60% of the next $150 million;
Oppenheimer Income & .55% of the next $150 million and .45%
Growth Fund of net assets in excess of $500
million.
Oppenheimer Total 1,908 .75% of the first $100 million of net
Return Fund, Inc. assets; .70% of the next $100 million;
.65% of the next $100 million; .60% of
the next $100 million; .55% of the next
$100 million; and .50% of net assets in
excess of $500 million.
Oppenheimer Equity 2,052.7 .75% of the first $100 million of net
Income Fund assets; .70% of the next $100 million;
.65% of the next $100 million; .60% of
the next $100 million; .55% of the next
$100 million; and .50% of net assets in
excess of $500 million.
Oppenheimer Asset 269.9 .75% of the first $200 million of
Allocation Fund aggregate net assets; .72% of the next
$200 million; .69% of the next $200
million; .66% of the next $200 million;
and .60% of aggregate net assets over
$800 million.
Oppenheimer Variable 342.5 .75% of the first $200 million of
Account Funds/ average annual net assets; .72% of the
Oppenheimer Multiple next $200 million; .69% of the next
Strategies Fund $200 million; .66% of the next $200
million; and .60% of average annual net
assets in excess of $800 million.
</TABLE>
D-1
<PAGE>
<TABLE>
<CAPTION>
APPROXIMATE
NAME OF NET ASSETS AS
COMPARABLE OF 6/30/95 ADVISORY FEE RATE AS A % OF
NAME OF QUEST FUND OPPENHEIMER FUND (IN MILLIONS) AVERAGE ANNUAL NET ASSETS
--------------------------- --------------------- ------------- ----------------------------------------
<S> <C> <C> <C>
Growth and Income Fund
(continued) Oppenheimer Variable 0 .75% of the first $200 million of
Account Funds/ average annual net assets; .72% of the
Oppenheimer Growth & next $200 million; .69% of the next
Income Fund $200 million; .66% of the next $200
million; and .60% of average annual net
assets in excess of $800 million.
Opportunity Fund Oppenheimer Global $ 137.3 1% of the first $50 million of average
Emerging Growth Fund annual net assets; .75% of the next
$150 million; .72% of the next $200
million; .69% of the next $200 million;
.66% of the next $200 million and .60%
of net assets in excess of $800
million.
Oppenheimer Discovery 734.7 .75% of the first $200 million of
Fund aggregate net assets; .72% of the next
$200 million; .69% of the next $200
million; .66% of the next $200 million;
and .60% of aggregate net assets over
$800 million.
Oppenheimer Fund 272.5 .75% of the first $200 million of
aggregate net assets; .72% of the next
$200 million; .69% of the next $200
million; .66% of the next $200 million;
and .60% of aggregate net assets over
$800 million.
Oppenheimer Target 684.0 .75% of the first $200 million of
Fund aggregate net assets; .72% of next $200
million; .69% of next $200 million;
.66% of next $200 million; and .60% of
aggregate net assets over $800 million.
Oppenheimer Growth 905.8 .75% of first $200 million of aggregate
Fund net assets; .72% of the next $200
million; .69% of the next $200 million;
.66% of the next $200 million; and .60%
of aggregate net assets over $800
million.
Oppenheimer Value 134.6 .75% of the first $100 million of
Stock Fund average annual net assets; .72% of the
next $200 million; .69% of the next
$200 million; and .66% of average
annual net assets in excess of $500
million.
Oppenheimer Variable 237.9 .75% of the first $200 million of
Account Funds/ average annual net assets; .72% of the
Oppenheimer Capital next $200 million; .69% of the next
Appreciation Fund $200 million; .66% of the next $200
million; and .60% of average annual net
assets in excess of $800 million.
Oppenheimer Variable 89.8 .75% of the first $200 million of
Account Funds/ average annual net assets; .72% of the
Oppenheimer Growth next $200 million; .69% of the next
Fund $200 million; .66% of the next $200
million; and .60% of average annual net
assets in excess of $800 million.
</TABLE>
D-2
<PAGE>
EXHIBIT E
AMENDED AND RESTATED
DISTRIBUTION AND SERVICE PLAN AND AGREEMENT
BETWEEN
OPPENHEIMER FUNDS DISTRIBUTOR, INC.
AND
OPPENHEIMER/QUEST FOR VALUE FAMILY OF FUNDS
FOR CLASS A SHARES OF
OPPORTUNITY FUND*
AMENDED AND RESTATED DISTRIBUTION AND SERVICE PLAN AND AGREEMENT (the
"Plan") dated the day of 95, by and between OPPENHEIMER/QUEST FOR VALUE
FAMILY OF FUNDS (the "Trust") for the account of its OPPORTUNITY FUND (the
"Fund") and OPPENHEIMER FUNDS DISTRIBUTOR, INC. (the "Distributor").
1. THE PLAN. This Plan is the Fund's written distribution plan for Class A
shares of the Fund (the "Shares"), contemplated by Rule 12b-1 (the "Rule") under
the Investment Company Act of 1940 (the "1940 Act"), pursuant to which the Fund
will compensate the Distributor for its services incurred in connection with the
distribution of Shares, and the personal service and maintenance of shareholder
accounts that hold Shares ("Accounts"). The Fund may act as distributor of
securities of which it is the issuer, pursuant to the Rule, according to the
terms of this Plan. The Distributor is authorized under the Plan to pay
"Recipients," as hereinafter defined, for rendering (1) distribution assistance
in connection with the sale of Shares and/or (2) administrative support services
with respect to Accounts. Such Recipients are intended to have certain rights as
third-party beneficiaries under this Plan. The terms and provisions of this Plan
shall be interpreted and defined in a manner consistent with the provisions and
definitions contained in (i) the 1940 Act, (ii) the Rule, (iii) Article III,
Section 26, of the Rules of Fair Practice of the National Association of
Securities Dealers, Inc., or its successor (the "NASD Rules of Fair Practice")
and (iv) any conditions pertaining either to distribution-related expenses or to
a plan of distribution, to which the Fund is subject under any order on which
the Fund relies, issued at any time by the Securities and Exchange Commission.
2. DEFINITIONS. As used in this Plan, the following terms shall have the
following meanings:
(a) "Recipient" shall mean any broker, dealer, bank or other person or
entity which: (i) has rendered assistance (whether direct, administrative or
both) in the distribution of Shares or has provided administrative support
services with respect to Shares held by Customers (defined below) of the
Recipient; (ii) shall furnish the Distributor (on behalf of the Fund) with such
information as the Distributor shall reasonably request to answer such questions
as may arise concerning the sale of Shares; and (iii) has been selected by the
Distributor to receive payments under the Plan. Notwithstanding the foregoing, a
majority of the Trust's Board of Trustees (the "Board") who are not "interested
persons" (as defined in the 1940 Act) and who have no direct or indirect
financial interest in the operation of this Plan or in any agreements relating
to this Plan (the "Independent Trustees") may remove any broker, dealer, bank or
other person or entity as a Recipient, whereupon such person's or entity's
rights as a third-party beneficiary hereof shall terminate.
------------------------
*THE AGREEMENT IS IDENTICAL FOR THE GROWTH AND INCOME FUND AND THE SMALL
CAPITALIZATION FUND EXCEPT FOR THE NAME OF THE FUND AND THE ASSET-BASED SALES
CHARGE WHICH IS .15% ON AN ANNUAL BASIS FOR THE GROWTH AND INCOME FUND.
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(b) "Qualified Holdings" shall mean, as to any Recipient, all Shares owned
beneficially or of record by: (i) such Recipient, or (ii) such customers,
clients and/or accounts as to which such Recipient is a fiduciary or custodian
or co-fiduciary or co-custodian (collectively, the "Customers"), but in no event
shall any such Shares be deemed owned by more than one Recipient for purposes of
this Plan. In the event that more than one person or entity would otherwise
qualify as Recipients as to the same Shares, the Recipient which is the dealer
of record on the Fund's books as determined by the Distributor shall be deemed
the Recipient as to such Shares for purposes of this Plan.
3. PAYMENTS FOR DISTRIBUTION ASSISTANCE AND ADMINISTRATIVE SUPPORT
SERVICES.
(a) The Fund will make payments to the Distributor (i) within forty-five
(45) days of the end of each calendar quarter, in the aggregate amount of
0.0625% (0.25% on an annual basis) of the average during the calendar quarter of
the aggregate net asset value of the Shares computed as of the close of each
business day (the "Service Fee"), plus (ii) within ten (10) days of the end of
each month, in the aggregate 0.020833% (0.25%* on an annual basis) of the
average during the calendar quarter of the aggregate net asset value of the
Shares computed as of the close of each business day (the "Asset-Based Sales
Charge"). Such Service Fee payments received from the Fund will compensate the
Distributor and Recipients for providing administrative support services with
respect to Accounts. Such Asset-Based Sales Charge payments received from the
Fund will compensate the Distributor and Recipients for providing distribution
assistance in connection with the sale of Shares.
The administrative support services in connection with the Accounts to be
rendered by Recipients may include, but shall not be limited to, the following:
answering routine inquiries concerning the Fund, assisting in establishing and
maintaining accounts or sub-accounts in the Fund and processing Share redemption
transactions, making the Fund's investment plans and dividend payment options
available, and providing such other information and services in connection with
the rendering of personal services and/or the maintenance of Accounts, as the
Distributor or the Fund may reasonably request.
The distribution assistance in connection with the sale of Shares to be
rendered by the Distributor and by Recipients may include, but shall not be
limited to, the following: distributing sales literature and prospectuses other
than those furnished to current holders of the Fund's Shares ("Shareholders"),
and providing such other information and services in connection with the
distribution of Shares as the Distributor or the Fund may reasonably request.
It may be presumed that a Recipient has provided distribution assistance or
administrative support services qualifying for payment under the Plan if it has
Qualified Holdings of Shares to entitle it to payments under the Plan. In the
event that either the Distributor or the Board should have reason to believe
that, notwithstanding the level of Qualified Holdings, a Recipient may not be
rendering appropriate distribution assistance in connection with the sale of
Shares or administrative support services for the Accounts, then the
Distributor, at the request of the Board, shall require the Recipient to provide
a written report or other information to verify that said Recipient is providing
appropriate distribution assistance and/or services in this regard. If the
Distributor or the Board of Trustees still is not satisfied, either may take
appropriate steps to terminate the Recipient's status as such under the Plan,
whereupon such Recipient's rights as a third-party beneficiary hereunder shall
terminate.
(b) The Distributor shall make service fee payments to any Recipient
quarterly, within forty-five (45) days of the end of each calendar quarter, at a
rate not to exceed 0.0625% (0.25% on an annual basis) of the
------------------------
*0.01250% (0.15% ON AN ANNUAL BASIS) WITH RESPECT TO THE GROWTH AND INCOME FUND.
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average during the calendar quarter of the aggregate net asset value of Shares,
computed as of the close of each business day, constituting Qualified Holdings
owned beneficially or of record by the Recipient or by its Customers for a
period of more than the minimum period (the "Minimum Holding Period"), if any,
to be set from time to time by a majority of the Independent Trustees.
Alternatively, the Distributor may, at its sole option, make service fee
payments ("Advance Service Fee Payments") to any Recipient quarterly, within
forty-five (45) days of the end of each calendar quarter, at a rate not to
exceed (i) 0.25% of the average during the calendar quarter of the aggregate net
asset value of Shares, computed as of the close of business on the day such
Shares are sold, constituting Qualified Holdings sold by the Recipient during
that quarter and owned beneficially or of record by the Recipient or by its
Customers, plus (ii) 0.0625% (0.25% on an annual basis) of the average during
the calendar quarter of the aggregate net asset value of Shares computed as of
the close of each business day, constituting Qualified Holdings owned
beneficially or of record by the Recipient or by its Customers for a period of
more than one (1) year, subject to reduction or chargeback so that the Advance
Service Fee Payments do not exceed the limits on payments to Recipients that
are, or may be, imposed by Article III, Section 26, of the NASD Rules of Fair
Practice. In the event Shares are redeemed less than one year after the date
such Shares were sold, the Recipient is obligated and will repay to the
Distributor on demand a pro rata portion of such Advance Service Fee Payments,
based on the ratio of the time such shares were held to one (1) year.
The Advance Service Fee Payments described in part (i) of the preceding
sentence may, at the Distributor's sole option, be made more often than
quarterly, and sooner than the end of the calendar quarter. In addition, the
Distributor may make asset-based sales charge payments to any Recipient
quarterly, within forty-five (45) days of the end of each calendar quarter, at a
rate not to exceed 0.0625% (0.25%* on an annual basis) of the average during the
calendar quarter of the aggregate net asset value of Shares computed as of the
close of each business day, constituting Qualified Holdings owned beneficially
or of record by the Recipient or its Customers. However, no such service fee or
asset-based sales charge payments (collectively, the "Recipient Payments") shall
be made to any Recipient for any such quarter in which its Qualified Holdings do
not equal or exceed, at the end of such quarter, the minimum amount ("Minimum
Qualified Holdings"), if any, to be set from time to time by a majority of the
Independent Trustees.
A majority of the Independent Trustees may at any time or from time to time
decrease and thereafter adjust the rate of fees to be paid to the Distributor or
to any Recipient, but not to exceed the rates set forth above, and/or direct the
Distributor to increase or decrease the Minimum Holding Period or the Minimum
Qualified Holdings. The Distributor shall notify all Recipients of the Minimum
Qualified Holdings or Minimum Holding Period, if any, and the rates of Recipient
Payments hereunder applicable to Recipients, and shall provide each Recipient
with written notice within thirty (30) days after any change in these
provisions. Inclusion of such provisions or a change in such provisions in a
revised current prospectus shall constitute sufficient notice. The Distributor
may make Plan payments to any "affiliated person" (as defined in the 1940 Act)
of the Distributor if such affiliated person qualifies as a Recipient.
(c) The Service Fee and the Asset-Based Sales Charge on Shares are subject
to reduction or elimination of such amounts under the limits to which the
Distributor is, or may become, subject under Article III, Section 26, of the
NASD Rules of Fair Practice. The distribution assistance and administrative
support services to be rendered by the Distributor in connection with the Shares
may include, but shall not be limited to, the following: (i) paying sales
commissions to any broker, dealer, bank or other person or entity
------------------------
*0.0375% (0.15% ON AN ANNUAL BASIS) WITH RESPECT TO THE GROWTH AND INCOME FUND.
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<PAGE>
that sells Shares, and\or paying such persons Advance Service Fee Payments in
advance of, and\or greater than, the amount provided for in Section 3(b) of this
Agreement; (ii) paying compensation to and expenses of personnel of the
Distributor who support distribution of Shares by Recipients; (iii) obtaining
financing or providing such financing from its own resources, or from an
affiliate, for interest and other borrowing costs of the Distributor's
unreimbursed expenses incurred in rendering distribution assistance and
administrative support services to the Fund; (iv) paying other direct
distribution costs, including without limitation the costs of sales literature,
advertising and prospectuses (other than those furnished to current
Shareholders) and state "blue sky" registration expenses; and (v) providing any
service rendered by the Distributor that a Recipient may render pursuant to part
(a) of this Section 3. Such services include distribution assistance and
administrative support services rendered in connection with Shares acquired (i)
by purchase, (ii) in exchange for shares of another investment company for which
the Distributor serves as distributor or sub-distributor, or (iii) pursuant to a
plan of reorganization to which the Fund is a party. In the event that the Board
should have reason to believe that the Distributor may not be rendering
appropriate distribution assistance or administrative support services in
connection with the sale of Shares, then the Distributor, at the request of the
Board, shall provide the Board with a written report or other information to
verify that the Distributor is providing appropriate services in this regard.
(d) Under the Plan, payments may be made to Recipients: (i) by Oppenheimer
Management Corporation ("OMC") from its own resources (which may include profits
derived from the advisory fee it receives from the Fund), or (ii) by the
Distributor (a subsidiary of OMC), from its own resources, from Asset-Based
Sales Charge payments or from its borrowings.
(e) Notwithstanding any other provision of this Plan, this Plan does not
obligate or in any way make the Fund liable to make any payment whatsoever to
any person or entity other than directly to the Distributor. In no event shall
the amounts to be paid to the Distributor exceed the rate of fees to be paid by
the Fund to the Distributor set forth in paragraph (a) of this Section 3.
4. SELECTION AND NOMINATION OF TRUSTEES. While this Plan is in effect, the
selection and nomination of those persons to be Trustees of the Trust who are
not "interested persons" of the Fund or the Trust ("Disinterested Trustees")
shall be committed to the discretion of such Disinterested Trustees. Nothing
herein shall prevent the Disinterested Trustees from soliciting the views or the
involvement of others in such selection or nomination if the final decision on
any such selection and nomination is approved by a majority of the incumbent
Disinterested Trustees.
5. REPORTS. While this Plan is in effect, the Treasurer of the Trust shall
provide at least quarterly a written reports to the Trust's Board for its
review, detailing services rendered in connection with the distribution of the
Shares, the amount of all payments made and the purpose for which the payments
were made. The reports shall be provided quarterly and shall state whether all
provisions of Section 3 of this Plan have been complied with.
6. RELATED AGREEMENTS. Any agreement related to this Plan shall be in
writing and shall provide that: (i) such agreement may be terminated at any
time, without payment of any penalty, by a vote of a majority of the Independent
Trustees or by a vote of the holders of a "majority" (as defined in the 1940
Act) of the Fund's outstanding voting securities of the Class, on not more than
sixty days written notice to any other party to the agreement; (ii) such
agreement shall automatically terminate in the event of its assignment (as
defined in the 1940 Act); (iii) it shall go into effect when approved by a vote
of the Board and its Independent Trustees cast in person at a meeting called for
the purpose of voting on such agreement; and
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<PAGE>
(iv) it shall, unless terminated as herein provided, continue in effect from
year to year only so long as such continuance is specifically approved at least
annually by a vote of the Board and its Independent Trustees cast in person at a
meeting called for the purpose of voting on such continuance.
7. EFFECTIVENESS, CONTINUATION, TERMINATION AND AMENDMENT. This Amended
and Restated Plan has been approved by a vote of the Board and its Independent
Trustees cast in person at a meeting called on June 22, 1995 for the purpose of
voting on this Plan, and shall take effect after approval by Class A
shareholders of the Fund, at which time it shall replace the Fund's Plan and
Agreement of Distribution for the Shares made as of April 28, 1988 as amended as
of December 30, 1988, August 14, 1990, October 18, 1990, August 23, 1991 and
September 1, 1993. Unless terminated as hereinafter provided, it shall continue
in effect from year to year from the date first set forth above or as the Board
may otherwise determine only so long as such continuance is specifically
approved at least annually by a vote of the Board and its Independent Trustees
cast in person at a meeting called for the purpose of voting on such
continuance. This Plan may not be amended to increase materially the amount of
payments to be made without approval of the Class A Shareholders, in the manner
described above, and all material amendments must be approved by a vote of the
Board and of the Independent Trustees. This Plan may be terminated at any time
by vote of a majority of the Independent Trustees or by the vote of the holders
of a "majority" (as defined in the 1940 Act) of the Fund's outstanding voting
securities of the Class. In the event of such termination, the Board and its
Independent Trustees shall determine whether the Distributor is entitled to
payment from the Fund of all or a portion of the Service Fee and/or the
Asset-Based Sales Charge in respect of Shares sold prior to the effective date
of such termination.
8. DISCLAIMER OF SHAREHOLDER AND TRUSTEE LIABILITY. The Distributor
understands that the obligations of the Trust and the Fund under this Plan are
not binding upon any Trustee or shareholder of the Fund personally, but bind
only the Fund and the Fund's property. The Distributor represents that it has
notice of the provisions of the Declaration of Trust of the Fund disclaiming
shareholder and Trustee liability for acts or obligations of the Trust and the
Fund.
OPPENHEIMER/QUEST FOR VALUE
FAMILY OF FUNDS
On Behalf of OPPORTUNITY FUND
By: __________________________________
OPPENHEIMER FUNDS DISTRIBUTOR, INC.
By: __________________________________
Andrew J. Donohue
EXECUTIVE VICE PRESIDENT
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<PAGE>
EXHIBIT F
AMENDED AND RESTATED
DISTRIBUTION AND SERVICE PLAN AND AGREEMENT
BETWEEN
OPPENHEIMER FUNDS DISTRIBUTOR, INC.
AND
OPPENHEIMER/QUEST FOR VALUE FAMILY OF FUNDS
FOR CLASS B SHARES OF
OPPORTUNITY FUND*
AMENDED AND RESTATED DISTRIBUTION AND SERVICE PLAN AND AGREEMENT (the
"Plan") dated the day of , 1995, by and between OPPENHEIMER/QUEST
FOR VALUE FAMILY OF FUNDS (the "Trust") for the account of its OPPORTUNITY FUND
(the "Fund") and OPPENHEIMER FUNDS DISTRIBUTOR, INC. (the "Distributor").
1. THE PLAN. This Plan is the Fund's written distribution and service plan
for Class B shares of the Fund (the "Shares"), contemplated by Rule 12b-1 (the
"Rule") under the Investment Company Act of 1940 (the "1940 Act"), pursuant to
which the Fund will compensate the Distributor for its services in connection
with the distribution of Shares, and the personal service and maintenance of
shareholder accounts that hold Shares ("Accounts"). The Fund may act as
distributor of securities of which it is the issuer, pursuant to the Rule,
according to the terms of this Plan. The Distributor is authorized under the
Plan to pay "Recipients," as hereinafter defined, for rendering (1) distribution
assistance in connection with the sale of Shares and/or (2) administrative
support services with respect to Accounts. Such Recipients are intended to have
certain rights as third-party beneficiaries under this Plan. The terms and
provisions of this Plan shall be interpreted and defined in a manner consistent
with the provisions and definitions contained in (i) the 1940 Act, (ii) the
Rule, (iii) Article III, Section 26, of the Rules of Fair Practice of the
National Association of Securities Dealers, Inc., or its successor (the "NASD
Rules of Fair Practice") and (iv) any conditions pertaining either to
distribution-related expenses or to a plan of distribution, to which the Fund is
subject under any order on which the Fund relies, issued at any time by the
Securities and Exchange Commission.
2. DEFINITIONS. As used in this Plan, the following terms shall have the
following meanings:
(a) "Recipient" shall mean any broker, dealer, bank or other person or
entity which: (i) has rendered assistance (whether direct, administrative or
both) in the distribution of Shares or has provided administrative support
services with respect to Shares held by Customers (defined below) of the
Recipient; (ii) shall furnish the Distributor (on behalf of the Fund) with such
information as the Distributor shall reasonably request to answer such questions
as may arise concerning the sale of Shares; and (iii) has been selected by the
Distributor to receive payments under the Plan. Notwithstanding the foregoing, a
majority of the Trust's Board of Trustees (the "Board") who are not "interested
persons" (as defined in the 1940 Act) and who have no direct or indirect
financial interest in the operation of this Plan or in any agreements relating
to this Plan (the "Independent Trustees") may remove any broker, dealer, bank or
other person or entity as a Recipient, whereupon such person's or entity's
rights as a third-party beneficiary hereof shall terminate.
------------------------
*THE AGREEMENT IS IDENTICAL FOR THE GROWTH AND INCOME FUND AND THE SMALL
CAPITALIZATION FUND EXCEPT FOR THE NAME OF THE FUND.
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<PAGE>
(b) "Qualified Holdings" shall mean, as to any Recipient, all Shares owned
beneficially or of record by: (i) such Recipient, or (ii) such customers,
clients and/or accounts as to which such Recipient is a fiduciary or custodian
or co-fiduciary or co-custodian (collectively, the "Customers"), but in no event
shall any such Shares be deemed owned by more than one Recipient for purposes of
this Plan. In the event that more than one person or entity would otherwise
qualify as Recipients as to the same Shares, the Recipient which is the dealer
of record on the Fund's books as determined by the Distributor shall be deemed
the Recipient as to such Shares for purposes of this Plan.
3. PAYMENTS FOR DISTRIBUTION ASSISTANCE AND ADMINISTRATIVE SUPPORT
SERVICES.
(a) The Fund will make payments to the Distributor, (i) within forty-five
(45) days of the end of each calendar quarter, in the aggregate amount of
0.0625% (0.25% on an annual basis) of the average during the calendar quarter of
the aggregate net asset value of the Shares computed as of the close of each
business day (the "Service Fee"), plus (ii) within ten (10) days of the end of
each month, in the aggregate amount of 0.0625% (0.75% on an annual basis) of the
average during the month of the aggregate net asset value of Shares computed as
of the close of each business day (the "Asset-Based Sales Charge") outstanding
for six years or less (the "Maximum Holding Period"). Such Service Fee payments
received from the Fund will compensate the Distributor and Recipients for
providing administrative support services with respect to Accounts. Such
Asset-Based Sales Charge payments received from the Fund will compensate the
Distributor and Recipients for providing distribution assistance in connection
with the sales of Shares.
The administrative support services in connection with the Accounts to be
rendered by Recipients may include, but shall not be limited to, the following:
answering routine inquiries concerning the Fund, assisting in the establishment
and maintenance of accounts or sub-accounts in the Fund and processing Share
redemption transactions, making the Fund's investment plans and dividend payment
options available, and providing such other information and services in
connection with the rendering of personal services and/or the maintenance of
Accounts, as the Distributor or the Fund may reasonably request.
The distribution assistance in connection with the sale of Shares to be
rendered by the Distributor and Recipients may include, but shall not be limited
to, the following: distributing sales literature and prospectuses other than
those furnished to current holders of the Fund's Shares ("Shareholders"), and
providing such other information and services in connection with the
distribution of Shares as the Distributor or the Fund may reasonably request.
It may be presumed that a Recipient has provided distribution assistance or
administrative support services qualifying for payment under the Plan if it has
Qualified Holdings of Shares to entitle it to payments under the Plan. In the
event that either the Distributor or the Board should have reason to believe
that, notwithstanding the level of Qualified Holdings, a Recipient may not be
rendering appropriate distribution assistance in connection with the sale of
Shares or administrative support services for Accounts, then the Distributor, at
the request of the Board, shall require the Recipient to provide a written
report or other information to verify that said Recipient is providing
appropriate distribution assistance and/or services in this regard. If the
Distributor or the Board of Trustees still is not satisfied, either may take
appropriate steps to terminate the Recipient's status as such under the Plan,
whereupon such Recipient's rights as a third-party beneficiary hereunder shall
terminate.
(b) The Distributor shall make service fee payments to any Recipient
quarterly, within forty-five (45) days of the end of each calendar quarter, at a
rate not to exceed 0.0625% (0.25% on an annual basis) of the average during the
calendar quarter of the aggregate net asset value of Shares computed as of the
close of
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<PAGE>
each business day, constituting Qualified Holdings owned beneficially or of
record by the Recipient or by its Customers for a period of more than the
minimum period (the "Minimum Holding Period"), if any, to be set from time to
time by a majority of the Independent Trustees.
Alternatively, the Distributor may, at its sole option, make service fee
payments ("Advance Service Fee Payments") to any Recipient quarterly, within
forty-five (45) days of the end of each calendar quarter, at a rate not to
exceed (i) 0.25% of the average during the calendar quarter of the aggregate net
asset value of Shares, computed as of the close of business on the day such
Shares are sold, constituting Qualified Holdings sold by the Recipient during
that quarter and owned beneficially or of record by the Recipient or by its
Customers, plus (ii) 0.0625% (0.25% on an annual basis) of the average during
the calendar quarter of the aggregate net asset value of Shares computed as of
the close of each business day, constituting Qualified Holdings owned
beneficially or of record by the Recipient or by its Customers for a period of
more than one (1) year, subject to reduction or chargeback so that the Advance
Service Fee Payments do not exceed the limits on payments to Recipients that
are, or may be, imposed by Article III, Section 26, of the NASD Rules of Fair
Practice. In the event Shares are redeemed less than one year after the date
such Shares were sold, the Recipient is obligated and will repay to the
Distributor on demand a pro rata portion of such Advance Service Fee Payments,
based on the ratio of the time such shares were held to one (1) year.
The Advance Service Fee Payments described in part (i) of this paragraph (b)
may, at the Distributor's sole option, be made more often than quarterly, and
sooner than the end of the calendar quarter. However, no such payments shall be
made to any Recipient for any such quarter in which its Qualified Holdings do
not equal or exceed, at the end of such quarter, the minimum amount ("Minimum
Qualified Holdings"), if any, to be set from time to time by a majority of the
Independent Trustees.
A majority of the Independent Trustees may at any time or from time to time
decrease and thereafter adjust the rate of fees to be paid to the Distributor or
to any Recipient, but not to exceed the rate set forth above, and/or direct the
Distributor to increase or decrease the Maximum Holding Period, the Minimum
Holding Period or the Minimum Qualified Holdings. The Distributor shall notify
all Recipients of the Minimum Qualified Holdings, Maximum Holding Period and
Minimum Holding Period, if any, and the rate of payments hereunder applicable to
Recipients, and shall provide each Recipient with written notice within thirty
(30) days after any change in these provisions. Inclusion of such provisions or
a change in such provisions in a revised current prospectus shall constitute
sufficient notice. The Distributor may make Plan payments to any "affiliated
person" (as defined in the 1940 Act) of the Distributor if such affiliated
person qualifies as a Recipient.
(c) The Service Fee and the Asset-Based Sales Charge on Shares are subject
to reduction or elimination of such amounts under the limits to which the
Distributor is, or may become, subject under Article III, Section 26, of the
NASD Rules of Fair Practice. The distribution assistance and administrative
support services to be rendered by the Distributor in connection with the Shares
may include, but shall not be limited to, the following: (i) paying sales
commissions to any broker, dealer, bank or other person or entity that sells
Shares, and\or paying such persons Advance Service Fee Payments in advance of,
and\or greater than, the amount provided for in Section 3(b) of this Agreement;
(ii) paying compensation to and expenses of personnel of the Distributor who
support distribution of Shares by Recipients; (iii) obtaining financing or
providing such financing from its own resources, or from an affiliate, for
interest and other borrowing costs on the Distributor's unreimbursed expenses
incurred in rendering distribution assistance and administrative support
services to the Fund; (iv) paying other direct distribution costs, including
without limitation
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the costs of sales literature, advertising and prospectuses (other than those
furnished to current Shareholders) and state "blue sky" registration expenses;
and (v) providing any service rendered by the Distributor that a Recipient may
render pursuant to part (a) of this Section 3. Such services include
distribution assistance and administrative support services rendered in
connection with Shares acquired (i) by purchase, (ii) in exchange for shares of
another investment company for which the Distributor serves as distributor or
sub-distributor, or (iii) pursuant to a plan of reorganization to which the Fund
is a party. In the event that the Board should have reason to believe that the
Distributor may not be rendering appropriate distribution assistance or
administrative support services in connection with the sale of Shares, then the
Distributor, at the request of the Board, shall provide the Board with a written
report or other information to verify that the Distributor is providing
appropriate services in this regard.
(d) Under the Plan, payments may be made to Recipients: (i) by Oppenheimer
Management Corporation ("OMC") from its own resources (which may include profits
derived from the advisory fee it receives from the Fund), or (ii) by the
Distributor (a subsidiary of OMC), from its own resources, from Asset-Based
Sales Charge payments or from its borrowings.
(e) Notwithstanding any other provision of this Plan, this Plan does not
obligate or in any way make the Fund liable to make any payment whatsoever to
any person or entity other than directly to the Distributor. In no event shall
the amounts to be paid to the Distributor exceed the rate of fees to be paid by
the Fund to the Distributor set forth in paragraph (a) of this Section 3.
4. SELECTION AND NOMINATION OF TRUSTEES. While this Plan is in effect, the
selection and nomination of those persons to be Trustees of the Trust who are
not "interested persons" of the Fund or the Trust ("Disinterested Trustees")
shall be committed to the discretion of such Disinterested Trustees. Nothing
herein shall prevent the Disinterested Trustees from soliciting the views or the
involvement of others in such selection or nomination if the final decision on
any such selection and nomination is approved by a majority of the incumbent
Disinterested Trustees.
5. REPORTS. While this Plan is in effect, the Treasurer of the Trust shall
provide written reports to the Trust's Board for its review, detailing services
rendered in connection with the distribution of the Shares, the amount of all
payments made and the purpose for which the payments were made. The reports
shall be provided quarterly, and shall state whether all provisions of Section 3
of this Plan have been complied with.
6. RELATED AGREEMENTS. Any agreement related to this Plan shall be in
writing and shall provide that: (i) such agreement may be terminated at any
time, without payment of any penalty, by a vote of a majority of the Independent
Trustees or by a vote of the holders of a "majority" (as defined in the 1940
Act) of the Fund's outstanding voting securities of the Class, on not more than
sixty days written notice to any other party to the agreement; (ii) such
agreement shall automatically terminate in the event of its assignment (as
defined in the 1940 Act); (iii) it shall go into effect when approved by a vote
of the Board and its Independent Trustees cast in person at a meeting called for
the purpose of voting on such agreement; and (iv) it shall, unless terminated as
herein provided, continue in effect from year to year only so long as such
continuance is specifically approved at least annually by a vote of the Board
and its Independent Trustees cast in person at a meeting called for the purpose
of voting on such continuance.
7. EFFECTIVENESS, CONTINUATION, TERMINATION AND AMENDMENT. This Amended
and Restated Plan has been approved by a vote of the Board and its Independent
Trustees cast in person at a meeting called on June 22, 1995, for the purpose of
voting on this Plan, and shall take effect after approval by Class B
F-4
<PAGE>
shareholders of the Fund, at which time it shall replace the Fund's Amended and
Restated Distribution Plan adopted as of December 23, 1994 and the Amended and
Restated Distribution Agreement for the Shares dated December 23, 1994. Unless
terminated as hereinafter provided, it shall continue in effect from year to
year thereafter or as the Board may otherwise determine only so long as such
continuance is specifically approved at least annually by a vote of the Board
and its Independent Trustees cast in person at a meeting called for the purpose
of voting on such continuance. This Plan may not be amended to increase
materially the amount of payments to be made without approval of the Class B
Shareholders, in the manner described above, and all material amendments must be
approved by a vote of the Board and of the Independent Trustees. This Plan may
be terminated at any time by vote of a majority of the Independent Trustees or
by the vote of the holders of a "majority" (as defined in the 1940 Act) of the
Fund's outstanding voting securities of the Class. In the event of such
termination, the Board and its Independent Trustees shall determine whether the
Distributor shall be entitled to payment from the Fund of all or a portion of
the Service Fee and/or the Asset-Based Sales Charge in respect of Shares sold
prior to the effective date of such termination.
8. DISCLAIMER OF SHAREHOLDER LIABILITY. The Distributor understands that
the obligations of the Trust and the Fund under this Plan are not binding upon
any Trustee or shareholder of the Fund personally, but bind only the Fund and
the Fund's property. The Distributor represents that it has notice of the
provisions of the Declaration of Trust of the Trust disclaiming shareholder and
Trustee liability for acts or obligations of the Trust and the Fund.
OPPENHEIMER/QUEST FOR
VALUE FAMILY OF FUNDS
ON BEHALF OF OPPORTUNITY FUND
By: __________________________________
OPPENHEIMER FUNDS DISTRIBUTOR, INC.
By: __________________________________
Andrew J. Donohue
EXECUTIVE VICE PRESIDENT
F-5
<PAGE>
EXHIBIT G
AMENDED AND RESTATED
DISTRIBUTION AND SERVICE PLAN AND AGREEMENT
BETWEEN
OPPENHEIMER FUNDS DISTRIBUTOR, INC.
AND
OPPENHEIMER/QUEST FOR VALUE FAMILY OF FUNDS
FOR CLASS C SHARES OF
OPPORTUNITY FUND*
AMENDED AND RESTATED DISTRIBUTION AND SERVICE PLAN AND AGREEMENT (the
"Plan") dated the day of , 1995, by and between OPPENHEIMER/QUEST FOR
VALUE FAMILY OF FUNDS (the "Trust") for the account of its OPPORTUNITY FUND (the
"Fund") and OPPENHEIMER FUNDS DISTRIBUTOR, INC. (the "Distributor").
1. THE PLAN. This Plan is the Fund's written distribution plan for Class C
shares of the Fund (the "Shares"), contemplated by Rule 12b-1 (the "Rule") under
the Investment Company Act of 1940 (the "1940 Act"), pursuant to which the Fund
will compensate the Distributor for its services incurred in connection with the
distribution of Shares, and the personal service and maintenance of shareholder
accounts that hold Shares ("Accounts"). The Fund may act as distributor of
securities of which it is the issuer, pursuant to the Rule, according to the
terms of this Plan. The Distributor is authorized under the Plan to pay
"Recipients," as hereinafter defined, for rendering (1) distribution assistance
in connection with the sale of Shares and/or (2) administrative support services
with respect to Accounts. Such Recipients are intended to have certain rights as
third-party beneficiaries under this Plan. The terms and provisions of this Plan
shall be interpreted and defined in a manner consistent with the provisions and
definitions contained in (i) the 1940 Act, (ii) the Rule, (iii) Article III,
Section 26, of the Rules of Fair Practice of the National Association of
Securities Dealers, Inc., or its successor (the "NASD Rules of Fair Practice")
and (iv) any conditions pertaining either to distribution-related expenses or to
a plan of distribution, to which the Fund is subject under any order on which
the Fund relies, issued at any time by the Securities and Exchange Commission.
2. DEFINITIONS. As used in this Plan, the following terms shall have the
following meanings:
(a) "Recipient" shall mean any broker, dealer, bank or other person or
entity which: (i) has rendered assistance (whether direct, administrative or
both) in the distribution of Shares or has provided administrative support
services with respect to Shares held by Customers (defined below) of the
Recipient; (ii) shall furnish the Distributor (on behalf of the Fund) with such
information as the Distributor shall reasonably request to answer such questions
as may arise concerning the sale of Shares; and (iii) has been selected by the
Distributor to receive payments under the Plan. Notwithstanding the foregoing, a
majority of the Trust's Board of Trustees (the "Board") who are not "interested
persons" (as defined in the 1940 Act) and who have no direct or indirect
financial interest in the operation of this Plan or in any agreements relating
to this Plan (the "Independent Trustees") may remove any broker, dealer, bank or
other person or entity as a Recipient, whereupon such person's or entity's
rights as a third-party beneficiary hereof shall terminate.
------------------------
*THE AGREEMENT IS IDENTICAL FOR THE GROWTH AND INCOME FUND AND THE SMALL
CAPITALIZATION FUND EXCEPT FOR THE NAME OF THE FUND.
G-1
<PAGE>
(b) "Qualified Holdings" shall mean, as to any Recipient, all Shares owned
beneficially or of record by: (i) such Recipient, or (ii) such customers,
clients and/or accounts as to which such Recipient is a fiduciary or custodian
or co-fiduciary or co-custodian (collectively, the "Customers"), but in no event
shall any such Shares be deemed owned by more than one Recipient for purposes of
this Plan. In the event that more than one person or entity would otherwise
qualify as Recipients as to the same Shares, the Recipient which is the dealer
of record on the Fund's books as determined by the Distributor shall be deemed
the Recipient as to such Shares for purposes of this Plan.
3. PAYMENTS FOR DISTRIBUTION ASSISTANCE AND ADMINISTRATIVE SUPPORT
SERVICES.
(a) The Fund will make payments to the Distributor, within forty-five (45)
days of the end of each calendar quarter, in the aggregate amount (i) of 0.0625%
(0.25% on an annual basis) of the average during the calendar quarter of the
aggregate net asset value of the Shares computed as of the close of each
business day (the "Service Fee"), plus (ii) 0.1875% (0.75% on an annual basis)
of the average during the calendar quarter of the aggregate net asset value of
the Shares computed as of the close of each business day (the "Asset-Based Sales
Charge"). Such Service Fee payments received from the Fund will compensate the
Distributor and Recipients for providing administrative support services with
respect to Accounts. Such Asset-Based Sales Charge payments received from the
Fund will compensate the Distributor and Recipients for providing distribution
assistance in connection with the sale of Shares.
The administrative support services in connection with the Accounts to be
rendered by Recipients may include, but shall not be limited to, the following:
answering routine inquiries concerning the Fund, assisting in establishing and
maintaining accounts or sub-accounts in the Fund and processing Share redemption
transactions, making the Fund's investment plans and dividend payment options
available, and providing such other information and services in connection with
the rendering of personal services and/or the maintenance of Accounts, as the
Distributor or the Fund may reasonably request.
The distribution assistance in connection with the sale of Shares to be
rendered by the Distributor and by Recipients may include, but shall not be
limited to, the following: distributing sales literature and prospectuses other
than those furnished to current holders of the Fund's Shares ("Shareholders"),
and providing such other information and services in connection with the
distribution of Shares as the Distributor or the Fund may reasonably request.
It may be presumed that a Recipient has provided distribution assistance or
administrative support services qualifying for payment under the Plan if it has
Qualified Holdings of Shares to entitle it to payments under the Plan. In the
event that either the Distributor or the Board should have reason to believe
that, notwithstanding the level of Qualified Holdings, a Recipient may not be
rendering appropriate distribution assistance in connection with the sale of
Shares or administrative support services for the Accounts, then the
Distributor, at the request of the Board, shall require the Recipient to provide
a written report or other information to verify that said Recipient is providing
appropriate distribution assistance and/or services in this regard. If the
Distributor or the Board of Trustees still is not satisfied, either may take
appropriate steps to terminate the Recipient's status as such under the Plan,
whereupon such Recipient's rights as a third-party beneficiary hereunder shall
terminate.
(b) The Distributor shall make service fee payments to any Recipient
quarterly, within forty-five (45) days of the end of each calendar quarter, at a
rate not to exceed 0.0625% (0.25% on an annual basis) of the average during the
calendar quarter of the aggregate net asset value of Shares, computed as of the
close of
G-2
<PAGE>
each business day, constituting Qualified Holdings owned beneficially or of
record by the Recipient or by its Customers for a period of more than the
minimum period (the "Minimum Holding Period"), if any, to be set from time to
time by a majority of the Independent Trustees.
Alternatively, the Distributor may, at its sole option, make service fee
payments ("Advance Service Fee Payments") to any Recipient quarterly, within
forty-five (45) days of the end of each calendar quarter, at a rate not to
exceed (i) 0.25% of the average during the calendar quarter of the aggregate net
asset value of Shares, computed as of the close of business on the day such
Shares are sold, constituting Qualified Holdings sold by the Recipient during
that quarter and owned beneficially or of record by the Recipient or by its
Customers, plus (ii) 0.0625% (0.25% on an annual basis) of the average during
the calendar quarter of the aggregate net asset value of Shares computed as of
the close of each business day, constituting Qualified Holdings owned
beneficially or of record by the Recipient or by its Customers for a period of
more than one (1) year, subject to reduction or chargeback so that the Advance
Service Fee Payments do not exceed the limits on payments to Recipients that
are, or may be, imposed by Article III, Section 26, of the NASD Rules of Fair
Practice. In the event Shares are redeemed less than one year after the date
such Shares were sold, the Recipient is obligated and will repay to the
Distributor on demand a pro rata portion of such Advance Service Fee Payments,
based on the ratio of the time such shares were held to one (1) year.
The Advance Service Fee Payments described in part (i) of the preceding
sentence may, at the Distributor's sole option, be made more often than
quarterly, and sooner than the end of the calendar quarter. In addition, the
Distributor shall make asset-based sales charge payments to any Recipient
quarterly, within forty-five (45) days of the end of each calendar quarter, at a
rate not to exceed 0.1875% (0.75% on an annual basis) of the average during the
calendar quarter of the aggregate net asset value of Shares computed as of the
close of each business day, constituting Qualified Holdings owned beneficially
or of record by the Recipient or its Customers for a period of more than one (1)
year. However, no such service fee or asset-based sales charge payments
(collectively, the "Recipient Payments") shall be made to any Recipient for any
such quarter in which its Qualified Holdings do not equal or exceed, at the end
of such quarter, the minimum amount ("Minimum Qualified Holdings"), if any, to
be set from time to time by a majority of the Independent Trustees.
A majority of the Independent Trustees may at any time or from time to time
decrease and thereafter adjust the rate of fees to be paid to the Distributor or
to any Recipient, but not to exceed the rates set forth above, and/or direct the
Distributor to increase or decrease the Minimum Holding Period or the Minimum
Qualified Holdings. The Distributor shall notify all Recipients of the Minimum
Qualified Holdings or Minimum Holding Period, if any, and the rates of Recipient
Payments hereunder applicable to Recipients, and shall provide each Recipient
with written notice within thirty (30) days after any change in these
provisions. Inclusion of such provisions or a change in such provisions in a
revised current prospectus shall constitute sufficient notice. The Distributor
may make Plan payments to any "affiliated person" (as defined in the 1940 Act)
of the Distributor if such affiliated person qualifies as a Recipient.
(c) The Service Fee and the Asset-Based Sales Charge on Shares are subject
to reduction or elimination of such amounts under the limits to which the
Distributor is, or may become, subject under Article III, Section 26, of the
NASD Rules of Fair Practice. The distribution assistance and administrative
support services to be rendered by the Distributor in connection with the Shares
may include, but shall not be limited to, the following: (i) paying sales
commissions to any broker, dealer, bank or other person or entity that sells
Shares, and\or paying such persons Advance Service Fee Payments in advance of,
and\or greater than, the amount provided for in Section 3(b) of this Agreement;
(ii) paying compensation to and expenses
G-3
<PAGE>
of personnel of the Distributor who support distribution of Shares by
Recipients; (iii) obtaining financing or providing such financing from its own
resources, or from an affiliate, for interest and other borrowing costs of the
Distributor's unreimbursed expenses incurred in rendering distribution
assistance and administrative support services to the Fund; (iv) paying other
direct distribution costs, including without limitation the costs of sales
literature, advertising and prospectuses (other than those furnished to current
Shareholders) and state "blue sky" registration expenses; and (v) providing any
service rendered by the Distributor that a Recipient may render pursuant to part
(a) of this Section 3. Such services include distribution assistance and
administrative support services rendered in connection with Shares acquired (i)
by purchase, (ii) in exchange for shares of another investment company for which
the Distributor serves as distributor or sub-distributor, or (iii) pursuant to a
plan of reorganization to which the Fund is a party. In the event that the Board
should have reason to believe that the Distributor may not be rendering
appropriate distribution assistance or administrative support services in
connection with the sale of Shares, then the Distributor, at the request of the
Board, shall provide the Board with a written report or other information to
verify that the Distributor is providing appropriate services in this regard.
(d) Under the Plan, payments may be made to Recipients: (i) by Oppenheimer
Management Corporation ("OMC") from its own resources (which may include profits
derived from the advisory fee it receives from the Fund), or (ii) by the
Distributor (a subsidiary of OMC), from its own resources, from Asset-Based
Sales Charge payments or from its borrowings.
(e) Notwithstanding any other provision of this Plan, this Plan does not
obligate or in any way make the Fund liable to make any payment whatsoever to
any person or entity other than directly to the Distributor. In no event shall
the amounts to be paid to the Distributor exceed the rate of fees to be paid by
the Fund to the Distributor set forth in paragraph (a) of this Section 3.
4. SELECTION AND NOMINATION OF TRUSTEES. While this Plan is in effect, the
selection and nomination of those persons to be Trustees of the Trust who are
not "interested persons" of the Fund or the Trust ("Disinterested Trustees")
shall be committed to the discretion of such Disinterested Trustees. Nothing
herein shall prevent the Disinterested Trustees from soliciting the views or the
involvement of others in such selection or nomination if the final decision on
any such selection and nomination is approved by a majority of the incumbent
Disinterested Trustees.
5. REPORTS. While this Plan is in effect, the Treasurer of the Trust shall
provide at least quarterly written reports to the Trust's Board for its review,
detailing services rendered in connection with the distribution of the Shares,
the amount of all payments made and the purpose for which the payments were
made. The reports shall be provided quarterly and shall state whether all
provisions of Section 3 of this Plan have been complied with.
6. RELATED AGREEMENTS. Any agreement related to this Plan shall be in
writing and shall provide that: (i) such agreement may be terminated at any
time, without payment of any penalty, by a vote of a majority of the Independent
Trustees or by a vote of the holders of a "majority" (as defined in the 1940
Act) of the Fund's outstanding voting securities of the Class, on not more than
sixty days written notice to any other party to the agreement; (ii) such
agreement shall automatically terminate in the event of its assignment (as
defined in the 1940 Act); (iii) it shall go into effect when approved by a vote
of the Board and its Independent Trustees cast in person at a meeting called for
the purpose of voting on such agreement; and
G-4
<PAGE>
(iv) it shall, unless terminated as herein provided, continue in effect from
year to year only so long as such continuance is specifically approved at least
annually by a vote of the Board and its Independent Trustees cast in person at a
meeting called for the purpose of voting on such continuance.
7. EFFECTIVENESS, CONTINUATION, TERMINATION AND AMENDMENT. This Amended
and Restated Plan has been approved by a vote of the Board and its Independent
Trustees cast in person at a meeting called on June 22, 1995 for the purpose of
voting on this Plan, and shall take effect after approval by Class C
shareholders of the Fund, at which time it shall replace the Fund's Plan and
Agreement of Distribution for the Shares made as of September 1, 1993, as
amended February 1, 1995. Unless terminated as hereinafter provided, it shall
continue in effect from year to year from the date first set forth above or as
the Board may otherwise determine only so long as such continuance is
specifically approved at least annually by a vote of the Board and its
Independent Trustees cast in person at a meeting called for the purpose of
voting on such continuance. This Plan may not be amended to increase materially
the amount of payments to be made without approval of the Class C Shareholders,
in the manner described above, and all material amendments must be approved by a
vote of the Board and of the Independent Trustees. This Plan may be terminated
at any time by vote of a majority of the Independent Trustees or by the vote of
the holders of a "majority" (as defined in the 1940 Act) of the Fund's
outstanding voting securities of the Class. In the event of such termination,
the Board and its Independent Trustees shall determine whether the Distributor
is entitled to payment from the Fund of all or a portion of the Service Fee
and/or the Asset-Based Sales Charge in respect of Shares sold prior to the
effective date of such termination.
8. DISCLAIMER OF SHAREHOLDER AND TRUSTEE LIABILITY. The Distributor
understands that the obligations of the Trust and the Fund under this Plan are
not binding upon any Trustee or shareholder of the Fund personally, but bind
only the Fund and the Fund's property. The Distributor represents that it has
notice of the provisions of the Declaration of Trust of the Fund disclaiming
shareholder and Trustee liability for acts or obligations of the Trust and the
Fund.
OPPENHEIMER/QUEST FOR
VALUE FAMILY OF FUNDS
On Behalf of OPPORTUNITY FUND
By: __________________________________
OPPENHEIMER FUNDS DISTRIBUTOR, INC.
By: __________________________________
Andrew J. Donohue
EXECUTIVE VICE PRESIDENT
G-5
<PAGE>
QUEST FOR VALUE OPPORTUNITY FUND - CLASS A
PROXY FOR SHAREHOLDERS MEETING NOVEMBER 3, 1995
PROXY SOLICITED ON BEHALF OF MANAGEMENT
MANAGEMENT RECOMMENDS A VOTE FOR THE ELECTION OF DIRECTORS AND
FOR THE PROPOSALS ON THE REVERSE. THE SHARES REPRESENTED HEREBY WILL BE
VOTED AS INDICATED OR FOR IF NO CHOICE IS INDICATED.
The undersigned shareholder of QUEST FOR VALUE OPPORTUNITY FUND does hereby
appoint Thomas E. Duggan and Maria Camacho and each of them, as the attorneys
and proxies of the undersigned, with full power of substitution, to attend the
Special Meeting of Shareholders of Quest for Value Family of Funds to be held on
November 3, 1995 at the offices of Oppenheimer & Co., Inc., 40th Floor, One
World Financial Center at 10:00 a.m. New York time and all adjournments thereof,
to vote the number of shares of stock in the name of the undersigned on the
record date for said meeting on the matters specified in the proxy statement.
As to any other matters or if any of said nominees are not available for
election, said attorneys shall vote in accordance with their best judgment.
PLEASE VOTE AND SIGN ON OTHER SIDE AND RETURN PROMPTLY IN ENCLOSED ENVELOPE.
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME(s) APPEARS HEREON. When signing as
custodian, attorney, executor, administrator, trustee, guardian, etc., please
give your full title as such. Joint owners should each sign this Proxy.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
----------------------------------- ----------------------------------------
----------------------------------- ----------------------------------------
<PAGE>
/X/ PLEASE MARK VOTES AS IN THIS EXAMPLE
1. Approval of the New Investment Advisory Agreement with Oppenheimer
Management Corporation
FOR AGAINST ABSTAIN
/ / / / / /
2. Approval of the New Subadvisory Agreement with Quest for Value Advisors
FOR AGAINST ABSTAIN
/ / / / / /
3. Approval of the New Distribution and Service Plan and Agreement with
Oppenheimer Funds Distributor, Inc.
FOR AGAINST ABSTAIN
/ / / / / /
4. Election of Trustees:
FOR WITHHOLD FOR ALL EXCEPT
/ / / / / /
P. CLINTON, T. COURTNEY, L. HERRMANN, G. LOFT AND B. MACASKILL
If you do not wish your shares voted "FOR" a particular nominee, mark the "For
All Except" box and strike a line through the nominee(s) name. Your shares will
be voted for the remaining nominee(s).
5. To act upon such other matters as may come before the meeting or any
adjournment or adjournments thereof.
FOR AGAINST ABSTAIN
/ / / / / /
Please be sure to sign and date this Proxy. Date
---------------
--------------------------------------------------------------------------------
Stockholder sign here Co-owner sign here
Mark box at right if comments or address change have been
noted on the reverse side of this card. / /
RECORD DATE SHARES:
DETACH CARD
<PAGE>
QUEST FOR VALUE OPPORTUNITY FUND - CLASS B
PROXY FOR SHAREHOLDERS MEETING NOVEMBER 3, 1995
PROXY SOLICITED ON BEHALF OF MANAGEMENT
MANAGEMENT RECOMMENDS A VOTE FOR THE ELECTION OF DIRECTORS AND
FOR THE PROPOSALS ON THE REVERSE. THE SHARES REPRESENTED HEREBY WILL BE
VOTED AS INDICATED OR FOR IF NO CHOICE IS INDICATED.
The undersigned shareholder of QUEST FOR VALUE OPPORTUNITY FUND does hereby
appoint Thomas E. Duggan and Maria Camacho and each of them, as the attorneys
and proxies of the undersigned, with full power of substitution, to attend the
Special Meeting of Shareholders of Quest for Value Family of Funds to be held on
November 3, 1995 at the offices of Oppenheimer & Co., Inc., 40th Floor, One
World Financial Center at 10:00 a.m. New York time and all adjournments thereof,
to vote the number of shares of stock in the name of the undersigned on the
record date for said meeting on the matters specified in the proxy statement.
As to any other matters or if any of said nominees are not available for
election, said attorneys shall vote in accordance with their best judgment.
PLEASE VOTE AND SIGN ON OTHER SIDE AND RETURN PROMPTLY IN ENCLOSED ENVELOPE.
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME(s) APPEARS HEREON. When signing as
custodian, attorney, executor, administrator, trustee, guardian, etc., please
give your full title as such. Joint owners should each sign this Proxy.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
----------------------------------- ----------------------------------------
----------------------------------- ----------------------------------------
<PAGE>
/X/ PLEASE MARK VOTES AS IN THIS EXAMPLE
1. Approval of the New Investment Advisory Agreement with Oppenheimer
Management Corporation
FOR AGAINST ABSTAIN
/ / / / / /
2. Approval of the New Subadvisory Agreement with Quest for Value Advisors
FOR AGAINST ABSTAIN
/ / / / / /
3. Approval of the New Distribution and Service Plan and Agreement with
Oppenheimer Funds Distributor, Inc.
FOR AGAINST ABSTAIN
/ / / / / /
4. Election of Trustees:
FOR WITHHOLD FOR ALL EXCEPT
/ / / / / /
P. CLINTON, T. COURTNEY, L. HERRMANN, G. LOFT AND B. MACASKILL
If you do not wish your shares voted "FOR" a particular nominee, mark the "For
All Except" box and strike a line through the nominee(s) name. Your shares will
be voted for the remaining nominee(s).
5. To act upon such other matters as may come before the meeting or any
adjournment or adjournments thereof.
FOR AGAINST ABSTAIN
/ / / / / /
Please be sure to sign and date this Proxy. Date
---------------
--------------------------------------------------------------------------------
Stockholder sign here Co-owner sign here
Mark box at right if comments or address change have been
noted on the reverse side of this card. / /
RECORD DATE SHARES:
DETACH CARD
<PAGE>
QUEST FOR VALUE OPPORTUNITY FUND - CLASS C
PROXY FOR SHAREHOLDERS MEETING NOVEMBER 3, 1995
PROXY SOLICITED ON BEHALF OF MANAGEMENT
MANAGEMENT RECOMMENDS A VOTE FOR THE ELECTION OF DIRECTORS AND
FOR THE PROPOSALS ON THE REVERSE. THE SHARES REPRESENTED HEREBY WILL BE
VOTED AS INDICATED OR FOR IF NO CHOICE IS INDICATED.
The undersigned shareholder of QUEST FOR VALUE OPPORTUNITY FUND does hereby
appoint Thomas E. Duggan and Maria Camacho and each of them, as the attorneys
and proxies of the undersigned, with full power of substitution, to attend the
Special Meeting of Shareholders of Quest for Value Family of Funds to be held on
November 3, 1995 at the offices of Oppenheimer & Co., Inc., 40th Floor, One
World Financial Center at 10:00 a.m. New York time and all adjournments thereof,
to vote the number of shares of stock in the name of the undersigned on the
record date for said meeting on the matters specified in the proxy statement.
As to any other matters or if any of said nominees are not available for
election, said attorneys shall vote in accordance with their best judgment.
PLEASE VOTE AND SIGN ON OTHER SIDE AND RETURN PROMPTLY IN ENCLOSED ENVELOPE.
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME(s) APPEARS HEREON. When signing as
custodian, attorney, executor, administrator, trustee, guardian, etc., please
give your full title as such. Joint owners should each sign this Proxy.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
----------------------------------- ----------------------------------------
----------------------------------- ----------------------------------------
<PAGE>
/X/ PLEASE MARK VOTES AS IN THIS EXAMPLE
1. Approval of the New Investment Advisory Agreement with Oppenheimer
Management Corporation
FOR AGAINST ABSTAIN
/ / / / / /
2. Approval of the New Subadvisory Agreement with Quest for Value Advisors
FOR AGAINST ABSTAIN
/ / / / / /
3. Approval of the New Distribution and Service Plan and Agreement with
Oppenheimer Funds Distributor, Inc.
FOR AGAINST ABSTAIN
/ / / / / /
4. Election of Trustees:
FOR WITHHOLD FOR ALL EXCEPT
/ / / / / /
P. CLINTON, T. COURTNEY, L. HERRMANN, G. LOFT AND B. MACASKILL
If you do not wish your shares voted "FOR" a particular nominee, mark the "For
All Except" box and strike a line through the nominee(s) name. Your shares will
be voted for the remaining nominee(s).
5. To act upon such other matters as may come before the meeting or any
adjournment or adjournments thereof.
FOR AGAINST ABSTAIN
/ / / / / /
Please be sure to sign and date this Proxy. Date
---------------
--------------------------------------------------------------------------------
Stockholder sign here Co-owner sign here
Mark box at right if comments or address change have been
noted on the reverse side of this card. / /
RECORD DATE SHARES:
DETACH CARD
<PAGE>
QUEST FOR VALUE GROWTH AND INCOME FUND - CLASS A
PROXY FOR SHAREHOLDERS MEETING NOVEMBER 3, 1995
PROXY SOLICITED ON BEHALF OF MANAGEMENT
MANAGEMENT RECOMMENDS A VOTE FOR THE ELECTION OF DIRECTORS AND
FOR THE PROPOSALS ON THE REVERSE. THE SHARES REPRESENTED HEREBY WILL BE
VOTED AS INDICATED OR FOR IF NO CHOICE IS INDICATED.
The undersigned shareholder of QUEST FOR VALUE GROWTH AND INCOME FUND does
hereby appoint Thomas E. Duggan and Maria Camacho and each of them, as the
attorneys and proxies of the undersigned, with full power of substitution, to
attend the Special Meeting of Shareholders of Quest for Value Family of Funds to
be held on November 3, 1995 at the offices of Oppenheimer & Co., Inc., 40th
Floor, One World Financial Center at 10:00 a.m. New York time and all
adjournments thereof, to vote the number of shares of stock in the name of the
undersigned on the record date for said meeting on the matters specified in the
proxy statement. As to any other matters or if any of said nominees are not
available for election, said attorneys shall vote in accordance with their best
judgment.
PLEASE VOTE AND SIGN ON OTHER SIDE AND RETURN PROMPTLY IN ENCLOSED ENVELOPE.
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME(s) APPEARS HEREON. When signing as
custodian, attorney, executor, administrator, trustee, guardian, etc., please
give your full title as such. Joint owners should each sign this Proxy.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
----------------------------------- ----------------------------------------
----------------------------------- ----------------------------------------
<PAGE>
/X/ PLEASE MARK VOTES AS IN THIS EXAMPLE
1. Approval of the New Investment Advisory Agreement with Oppenheimer
Management Corporation
FOR AGAINST ABSTAIN
/ / / / / /
2. Approval of the New Subadvisory Agreement with Quest for Value Advisors
FOR AGAINST ABSTAIN
/ / / / / /
3. Approval of the New Distribution and Service Plan and Agreement with
Oppenheimer Funds Distributor, Inc.
FOR AGAINST ABSTAIN
/ / / / / /
4. Election of Trustees:
FOR WITHHOLD FOR ALL EXCEPT
/ / / / / /
P. CLINTON, T. COURTNEY, L. HERRMANN, G. LOFT AND B. MACASKILL
If you do not wish your shares voted "FOR" a particular nominee, mark the "For
All Except" box and strike a line through the nominee(s) name. Your shares will
be voted for the remaining nominee(s).
5. To act upon such other matters as may come before the meeting or any
adjournment or adjournments thereof.
FOR AGAINST ABSTAIN
/ / / / / /
Please be sure to sign and date this Proxy. Date
---------------
--------------------------------------------------------------------------------
Stockholder sign here Co-owner sign here
Mark box at right if comments or address change have been
noted on the reverse side of this card. / /
RECORD DATE SHARES:
DETACH CARD
<PAGE>
QUEST FOR VALUE GROWTH AND INCOME FUND - CLASS B
PROXY FOR SHAREHOLDERS MEETING NOVEMBER 3, 1995
PROXY SOLICITED ON BEHALF OF MANAGEMENT
MANAGEMENT RECOMMENDS A VOTE FOR THE ELECTION OF DIRECTORS AND
FOR THE PROPOSALS ON THE REVERSE. THE SHARES REPRESENTED HEREBY WILL BE
VOTED AS INDICATED OR FOR IF NO CHOICE IS INDICATED.
The undersigned shareholder of QUEST FOR VALUE GROWTH AND INCOME FUND does
hereby appoint Thomas E. Duggan and Maria Camacho and each of them, as the
attorneys and proxies of the undersigned, with full power of substitution, to
attend the Special Meeting of Shareholders of Quest for Value Family of Funds to
be held on November 3, 1995 at the offices of Oppenheimer & Co., Inc., 40th
Floor, One World Financial Center at 10:00 a.m. New York time and all
adjournments thereof, to vote the number of shares of stock in the name of the
undersigned on the record date for said meeting on the matters specified in the
proxy statement. As to any other matters or if any of said nominees are not
available for election, said attorneys shall vote in accordance with their best
judgment.
PLEASE VOTE AND SIGN ON OTHER SIDE AND RETURN PROMPTLY IN ENCLOSED ENVELOPE.
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME(s) APPEARS HEREON. When signing as
custodian, attorney, executor, administrator, trustee, guardian, etc., please
give your full title as such. Joint owners should each sign this Proxy.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
----------------------------------- ----------------------------------------
----------------------------------- ----------------------------------------
<PAGE>
/X/ PLEASE MARK VOTES AS IN THIS EXAMPLE
1. Approval of the New Investment Advisory Agreement with Oppenheimer
Management Corporation
FOR AGAINST ABSTAIN
/ / / / / /
2. Approval of the New Subadvisory Agreement with Quest for Value Advisors
FOR AGAINST ABSTAIN
/ / / / / /
3. Approval of the New Distribution and Service Plan and Agreement with
Oppenheimer Funds Distributor, Inc.
FOR AGAINST ABSTAIN
/ / / / / /
4. Election of Trustees:
FOR WITHHOLD FOR ALL EXCEPT
/ / / / / /
P. CLINTON, T. COURTNEY, L. HERRMANN, G. LOFT AND B. MACASKILL
If you do not wish your shares voted "FOR" a particular nominee, mark the "For
All Except" box and strike a line through the nominee(s) name. Your shares will
be voted for the remaining nominee(s).
5. To act upon such other matters as may come before the meeting or any
adjournment or adjournments thereof.
FOR AGAINST ABSTAIN
/ / / / / /
Please be sure to sign and date this Proxy. Date
---------------
--------------------------------------------------------------------------------
Stockholder sign here Co-owner sign here
Mark box at right if comments or address change have been
noted on the reverse side of this card. / /
RECORD DATE SHARES:
DETACH CARD
<PAGE>
QUEST FOR VALUE GROWTH AND INCOME FUND - CLASS C
PROXY FOR SHAREHOLDERS MEETING NOVEMBER 3, 1995
PROXY SOLICITED ON BEHALF OF MANAGEMENT
MANAGEMENT RECOMMENDS A VOTE FOR THE ELECTION OF DIRECTORS AND
FOR THE PROPOSALS ON THE REVERSE. THE SHARES REPRESENTED HEREBY WILL BE
VOTED AS INDICATED OR FOR IF NO CHOICE IS INDICATED.
The undersigned shareholder of QUEST FOR VALUE GROWTH AND INCOME FUND does
hereby appoint Thomas E. Duggan and Maria Camacho and each of them, as the
attorneys and proxies of the undersigned, with full power of substitution, to
attend the Special Meeting of Shareholders of Quest for Value Family of Funds to
be held on November 3, 1995 at the offices of Oppenheimer & Co., Inc., 40th
Floor, One World Financial Center at 10:00 a.m. New York time and all
adjournments thereof, to vote the number of shares of stock in the name of the
undersigned on the record date for said meeting on the matters specified in the
proxy statement. As to any other matters or if any of said nominees are not
available for election, said attorneys shall vote in accordance with their best
judgment.
PLEASE VOTE AND SIGN ON OTHER SIDE AND RETURN PROMPTLY IN ENCLOSED ENVELOPE.
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME(s) APPEARS HEREON. When signing as
custodian, attorney, executor, administrator, trustee, guardian, etc., please
give your full title as such. Joint owners should each sign this Proxy.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
----------------------------------- ----------------------------------------
----------------------------------- ----------------------------------------
<PAGE>
/X/ PLEASE MARK VOTES AS IN THIS EXAMPLE
1. Approval of the New Investment Advisory Agreement with Oppenheimer
Management Corporation
FOR AGAINST ABSTAIN
/ / / / / /
2. Approval of the New Subadvisory Agreement with Quest for Value Advisors
FOR AGAINST ABSTAIN
/ / / / / /
3. Approval of the New Distribution and Service Plan and Agreement with
Oppenheimer Funds Distributor, Inc.
FOR AGAINST ABSTAIN
/ / / / / /
4. Election of Trustees:
FOR WITHHOLD FOR ALL EXCEPT
/ / / / / /
P. CLINTON, T. COURTNEY, L. HERRMANN, G. LOFT AND B. MACASKILL
If you do not wish your shares voted "FOR" a particular nominee, mark the "For
All Except" box and strike a line through the nominee(s) name. Your shares will
be voted for the remaining nominee(s).
5. To act upon such other matters as may come before the meeting or any
adjournment or adjournments thereof.
FOR AGAINST ABSTAIN
/ / / / / /
Please be sure to sign and date this Proxy. Date
---------------
--------------------------------------------------------------------------------
Stockholder sign here Co-owner sign here
Mark box at right if comments or address change have been
noted on the reverse side of this card. / /
RECORD DATE SHARES:
DETACH CARD
<PAGE>
QUEST FOR VALUE SMALL CAPITALIZATION FUND - CLASS A
PROXY FOR SHAREHOLDERS MEETING NOVEMBER 3, 1995
PROXY SOLICITED ON BEHALF OF MANAGEMENT
MANAGEMENT RECOMMENDS A VOTE FOR THE ELECTION OF DIRECTORS AND
FOR THE PROPOSALS ON THE REVERSE. THE SHARES REPRESENTED HEREBY WILL BE
VOTED AS INDICATED OR FOR IF NO CHOICE IS INDICATED.
The undersigned shareholder of QUEST FOR VALUE SMALL CAPITALIZATION FUND does
hereby appoint Thomas E. Duggan and Maria Camacho and each of them, as the
attorneys and proxies of the undersigned, with full power of substitution, to
attend the Special Meeting of Shareholders of Quest for Value Family of Funds to
be held on November 3, 1995 at the offices of Oppenheimer & Co., Inc., 40th
Floor, One World Financial Center at 10:00 a.m. New York time and all
adjournments thereof, to vote the number of shares of stock in the name of the
undersigned on the record date for said meeting on the matters specified in the
proxy statement. As to any other matters or if any of said nominees are not
available for election, said attorneys shall vote in accordance with their best
judgment.
PLEASE VOTE AND SIGN ON OTHER SIDE AND RETURN PROMPTLY IN ENCLOSED ENVELOPE.
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME(s) APPEARS HEREON. When signing as
custodian, attorney, executor, administrator, trustee, guardian, etc., please
give your full title as such. Joint owners should each sign this Proxy.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
----------------------------------- ----------------------------------------
----------------------------------- ----------------------------------------
<PAGE>
/X/ PLEASE MARK VOTES AS IN THIS EXAMPLE
1. Approval of the New Investment Advisory Agreement with Oppenheimer
Management Corporation
FOR AGAINST ABSTAIN
/ / / / / /
2. Approval of the New Subadvisory Agreement with Quest for Value Advisors
FOR AGAINST ABSTAIN
/ / / / / /
3. Approval of the New Distribution and Service Plan and Agreement with
Oppenheimer Funds Distributor, Inc.
FOR AGAINST ABSTAIN
/ / / / / /
4. Election of Trustees:
FOR WITHHOLD FOR ALL EXCEPT
/ / / / / /
P. CLINTON, T. COURTNEY, L. HERRMANN, G. LOFT AND B. MACASKILL
If you do not wish your shares voted "FOR" a particular nominee, mark the "For
All Except" box and strike a line through the nominee(s) name. Your shares will
be voted for the remaining nominee(s).
5. To act upon such other matters as may come before the meeting or any
adjournment or adjournments thereof.
FOR AGAINST ABSTAIN
/ / / / / /
Please be sure to sign and date this Proxy. Date
---------------
--------------------------------------------------------------------------------
Stockholder sign here Co-owner sign here
Mark box at right if comments or address change have been
noted on the reverse side of this card. / /
RECORD DATE SHARES:
DETACH CARD
<PAGE>
QUEST FOR VALUE SMALL CAPITALIZATION FUND - CLASS B
PROXY FOR SHAREHOLDERS MEETING NOVEMBER 3, 1995
PROXY SOLICITED ON BEHALF OF MANAGEMENT
MANAGEMENT RECOMMENDS A VOTE FOR THE ELECTION OF DIRECTORS AND
FOR THE PROPOSALS ON THE REVERSE. THE SHARES REPRESENTED HEREBY WILL BE
VOTED AS INDICATED OR FOR IF NO CHOICE IS INDICATED.
The undersigned shareholder of QUEST FOR VALUE SMALL CAPITALIZATION FUND does
hereby appoint Thomas E. Duggan and Maria Camacho and each of them, as the
attorneys and proxies of the undersigned, with full power of substitution, to
attend the Special Meeting of Shareholders of Quest for Value Family of Funds to
be held on November 3, 1995 at the offices of Oppenheimer & Co., Inc., 40th
Floor, One World Financial Center at 10:00 a.m. New York time and all
adjournments thereof, to vote the number of shares of stock in the name of the
undersigned on the record date for said meeting on the matters specified in the
proxy statement. As to any other matters or if any of said nominees are not
available for election, said attorneys shall vote in accordance with their best
judgment.
PLEASE VOTE AND SIGN ON OTHER SIDE AND RETURN PROMPTLY IN ENCLOSED ENVELOPE.
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME(s) APPEARS HEREON. When signing as
custodian, attorney, executor, administrator, trustee, guardian, etc., please
give your full title as such. Joint owners should each sign this Proxy.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
----------------------------------- ----------------------------------------
----------------------------------- ----------------------------------------
<PAGE>
/X/ PLEASE MARK VOTES AS IN THIS EXAMPLE
1. Approval of the New Investment Advisory Agreement with Oppenheimer
Management Corporation
FOR AGAINST ABSTAIN
/ / / / / /
2. Approval of the New Subadvisory Agreement with Quest for Value Advisors
FOR AGAINST ABSTAIN
/ / / / / /
3. Approval of the New Distribution and Service Plan and Agreement with
Oppenheimer Funds Distributor, Inc.
FOR AGAINST ABSTAIN
/ / / / / /
4. Election of Trustees:
FOR WITHHOLD FOR ALL EXCEPT
/ / / / / /
P. CLINTON, T. COURTNEY, L. HERRMANN, G. LOFT AND B. MACASKILL
If you do not wish your shares voted "FOR" a particular nominee, mark the "For
All Except" box and strike a line through the nominee(s) name. Your shares will
be voted for the remaining nominee(s).
5. To act upon such other matters as may come before the meeting or any
adjournment or adjournments thereof.
FOR AGAINST ABSTAIN
/ / / / / /
Please be sure to sign and date this Proxy. Date
---------------
--------------------------------------------------------------------------------
Stockholder sign here Co-owner sign here
Mark box at right if comments or address change have been
noted on the reverse side of this card. / /
RECORD DATE SHARES:
DETACH CARD
<PAGE>
QUEST FOR VALUE SMALL CAPITALIZATION FUND - CLASS C
PROXY FOR SHAREHOLDERS MEETING NOVEMBER 3, 1995
PROXY SOLICITED ON BEHALF OF MANAGEMENT
MANAGEMENT RECOMMENDS A VOTE FOR THE ELECTION OF DIRECTORS AND
FOR THE PROPOSALS ON THE REVERSE. THE SHARES REPRESENTED HEREBY WILL BE
VOTED AS INDICATED OR FOR IF NO CHOICE IS INDICATED.
The undersigned shareholder of QUEST FOR VALUE SMALL CAPITALIZATION FUND does
hereby appoint Thomas E. Duggan and Maria Camacho and each of them, as the
attorneys and proxies of the undersigned, with full power of substitution, to
attend the Special Meeting of Shareholders of Quest for Value Family of Funds to
be held on November 3, 1995 at the offices of Oppenheimer & Co., Inc., 40th
Floor, One World Financial Center at 10:00 a.m. New York time and all
adjournments thereof, to vote the number of shares of stock in the name of the
undersigned on the record date for said meeting on the matters specified in the
proxy statement. As to any other matters or if any of said nominees are not
available for election, said attorneys shall vote in accordance with their best
judgment.
PLEASE VOTE AND SIGN ON OTHER SIDE AND RETURN PROMPTLY IN ENCLOSED ENVELOPE.
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME(s) APPEARS HEREON. When signing as
custodian, attorney, executor, administrator, trustee, guardian, etc., please
give your full title as such. Joint owners should each sign this Proxy.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
----------------------------------- ----------------------------------------
----------------------------------- ----------------------------------------
<PAGE>
/X/ PLEASE MARK VOTES AS IN THIS EXAMPLE
1. Approval of the New Investment Advisory Agreement with Oppenheimer
Management Corporation
FOR AGAINST ABSTAIN
/ / / / / /
2. Approval of the New Subadvisory Agreement with Quest for Value Advisors
FOR AGAINST ABSTAIN
/ / / / / /
3. Approval of the New Distribution and Service Plan and Agreement with
Oppenheimer Funds Distributor, Inc.
FOR AGAINST ABSTAIN
/ / / / / /
4. Election of Trustees:
FOR WITHHOLD FOR ALL EXCEPT
/ / / / / /
P. CLINTON, T. COURTNEY, L. HERRMANN, G. LOFT AND B. MACASKILL
If you do not wish your shares voted "FOR" a particular nominee, mark the "For
All Except" box and strike a line through the nominee(s) name. Your shares will
be voted for the remaining nominee(s).
5. To act upon such other matters as may come before the meeting or any
adjournment or adjournments thereof.
FOR AGAINST ABSTAIN
/ / / / / /
Please be sure to sign and date this Proxy. Date
---------------
--------------------------------------------------------------------------------
Stockholder sign here Co-owner sign here
Mark box at right if comments or address change have been
noted on the reverse side of this card. / /
RECORD DATE SHARES:
DETACH CARD
