<PAGE>
OPPENHEIMER MAIN STREET INCOME & GROWTH FUND
ANNUAL REPORT JUNE 30, 1994
[Logo] OPPENHEIMER FUNDS
"WE HAVE BIG PLANS--COLLEGE FOR THE KIDS, TRAVEL, A COMFORTABLE RETIREMENT.
I NEED AN INVESTMENT THAT GIVES ME THE POTENTIAL FOR GROWTH THAT STOCKS
OFFER WHILE PROVIDING INCOME, TOO.
I CHOSE THIS FUND BECAUSE IT INVESTS IN STOCKS AND BONDS. IT'S GIVEN ME THE
GROWTH AND INCOME THAT I NEED FOR HIGH TOTAL INVESTMENT RETURN.
<PAGE>
FUND FACTS
IN THIS REPORT:
ANSWERS TO THREE TIMELY QUESTIONS YOU SHOULD ASK YOUR FUND'S MANAGER.
- - DID THE FEDERAL RESERVE'S MOVES TO RAISE SHORT-TERM INTEREST RATES AFFECT THE
FUND'S PERFORMANCE OR INVESTMENT STRATEGY?
- - IS THE FUND DOING ANYTHING TO CAPITALIZE ON GLOBAL OPPORTUNITIES?
- - IN THIS ECONOMIC AND MARKET ENVIRONMENT, WHERE ARE YOU FINDING THE MOST
ATTRACTIVE INVESTMENT OPPORTUNITIES?
FACTS EVERY SHAREHOLDER SHOULD KNOW ABOUT
OPPENHEIMER MAIN STREET INCOME & GROWTH FUND
1 The Fund seeks high total return through a combination of equity and debt
securities. Its portfolio includes small- to medium-capitalization common
stocks, bonds and money market instruments.
2 Total return at net asset value for Class A shares for the 12 months ended
June 30, 1994 was 14.34%. For Class C shares, total return at net asset
value since inception on December 1, 1993 was -0.97%.(1)
3 Average annual total returns for Class A shares for the 1- and 5-year
periods ended June 30, 1994 and since inception on February 3, 1988 were
7.76%, 21.56%, and 20.70%, respectively.(2) For Class C shares, total
return since inception on December 1, 1993 was -1.96%.
4 In recognition of the Fund's outstanding performance, the Fund's Class A
shares received STAR STAR STAR STAR STAR from Morningstar, Inc. on June 30,
1994. The Fund was ranked among 1,052 equity funds.(3)
5 The Fund's top five stock holdings on June 30, 1994 were:(4)
PHILIP MORRIS COS., INC.
BELL ATLANTIC CORP.
WILLIAMS COS., INC.
NIKE INC., CI.B.
ATLANTIC RICHFIELD CORP.
6 "With our emphasis on small and medium size growth company stocks, we
manage this Fund more aggressively than the typical growth-and-income fund.
While the Fund can have short-term fluctuations, when you look out over the
investors are way ahead."
PORTFOLIO MANAGER JOHN WALLACE, JUNE 30, 1994
(1) Based on the change in net asset value per share for the periods shown,
without deducting any sales charges.
(2) Average annual total returns are based on a hypothetical investment in Class
A shares, after deducting the current maximum initial sales charge of 5.75% on
6/30/93, 6/30/89, and 2/3/88, respectively, held until 6/30/94. The total return
for Class C shares was based on a hypothetical investment held for that period,
after deducting the 1% contingent deferred sales charge.
(3) Source: MORNINGSTAR MUTUAL FUNDS, 6/30/94. Morningstar, Inc., an
independent mutual fund monitoring service, produces proprietary monthly
rankings of mutual funds in broad investment categories (equity, taxable bond,
tax-exempt bond, or "hybrid") that reflect historical risk-adjusted performance
based on a fund's 3-, 5-, and 10-year average annual total returns in excess of
90-day Treasury bill returns, after considering expenses and sales charges. Risk
is calculated by a factor that reflects fund performance below 3-month U.S.
Treasury bill returns. Risk and returns are combined to produce star rankings,
reflecting risk adjusted performance relative to the average fund in a category.
The highest ranking is 5 stars, the lowest, 1 star. The Fund was ranked among
1,052 "equity" funds of which 10% receive 5 stars, and 22.5% receive 4 stars.
Rankings are subject to change. The Fund's Class A and Class C shares have the
same portfolio.
(4) The Fund's portfolio is subject to change.
All figures assume reinvestment of dividends and capital gains distributions.
Past performance is not indicative of future results. An investment in the Fund
will fluctuate so that an investor's shares, when redeemed, may be worth more
or less than the original cost.
2 Oppenheimer Main Street Income & Growth Fund
<PAGE>
OUTSTANDING TOTAL RETURN
TOTAL RETURN FOR THE ONE-YEAR PERIOD ENDED JUNE 30, 1994
OPPENHEIMER MAIN STREET INCOME & GROWTH FUND A(6) (AT NET ASSET VALUE) 14.34%
LIPPER GROWTH & INCOME FUNDS AVERAGE(7) 2.01%
REPORT TO SHAREHOLDERS
The year ended June 30, 1994, was one of the most challenging periods U.S.
investors have seen in recent years, and it is a pleasure to report that
Oppenheimer Main Street Income & Growth Fund met these challenges well. And the
Fund's Class A shares earned a STAR STAR STAR STAR STAR ranking from
Morningstar, Inc.(5)
Of course, the Federal Reserve's preemptive attack on inflation had an
impact on the Fund during the past six months. Four increases in short-term
interest rates, running from early February through mid-May took a toll on the
growth stocks your managers rely on for capital gains, as well as on the
telecommunications, utilities, and convertible issues that provide the Fund's
attractive current yield.
economy--inflation remains well under control, interest rates appear to have
stabilized, and the economy is growing at a modest, sustainable pace. In this
environment, we are confident that earnings will re-emerge and replace interest
rates as the driving force behind stock prices, and your Fund is well positioned
to benefit as the markets resume their advance.
With the rise in interest rates, convertible securities became extremely
attractive, and we added to positions in several promising shorter-term issues,
including Cyprus Semiconductor and Eagle Hardware. At current price levels,
convertibles like these offer strong yields, which help insulate the portfolio
from volatility, along with potential for significant near-term capital
appreciation.
We also continued to invest in companies positioned to increase market
share and profit in the improving U.S. economy, such as Nike, which has
significantly revamped its product line and is poised to benefit from the
pick-up in consumer confidence and spending. We purchased stocks of industrial
companies that should benefit from the improving global economy, such as
Dentsply International, a leading dental equipment manufacturer positioned to
capitalize on rapid growth in dental hygiene overseas.
The outlook for the Fund remains promising. While day-to-day market
fluctuations may be greater than we've seen in the past, the economy is
expanding at a sustainable pace, and well managed companies are posting
encouraging gains.
We appreciate your trust in Oppenheimer Main Street Income & Growth Fund,
and we look forward to helping you meet your investment goals in the future.
James C. Swain Jon S. Fossel
Chairman, Oppenheimer Main Street President, Oppenheimer Main Street
Income & Growth Fund Income & Growth Fund
July 22, 1994
(5) See footnote 3, page 2.
(6) See footnote 1, page 2.
(7) Source of data: Lipper Analytical Services, Inc., an independent mutual fund
monitoring service, 6/30/94. The Lipper total return average for the year ended
6/30/94 was for 305 growth and income funds. The average is shown for
comparative purposes only. Lipper performance rankings do not take sales charges
into consideration.
3 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Statement of Investments June 30, 1994
Face Market Value
Amount See Note 1
- ------
Repurchase Agreements--17.8%
- ------
Repurchase agreement with First Chicago Capital Markets, 4.22%, dated 6/30/94,
to be repurchased at $162,119,001 on 7/1/94, collateralized by U.S. Treasury
Nts., 3.875%--9.25%, 12/31/94--11/30/98, with a value of $117,837,239 and U.S.
Treasury Bills, 0%, 6/29/95, with a value of $47,565,732 (Cost $162,100,000)
$162,100,000 $162,100,000
- ------
Long-Term U.S. Government Obligations--2.2%
- ------
U.S. Treasury Nts., 7.25%, 5/15/04 10,000,000 9,943,750
U.S. Treasury STRIPS, 0%, Series S, 5/15/14 46,878,000 9,862,284
- ------
Total Long-Term U.S. Government Obligations (Cost $20,067,204) 19,806,034
- ------
Corporate Bonds and Notes--7.6%
- ------
Agnico Eagle, 3.50% Cv. Sr. Nts., 1/27/04 2,000,000 1,650,000
- ------
Arch Communications Group, 6.75% Cv. Sub. Debs., 12/1/03(2)
1,450,000 1,493,500
- ------
Chiron Corp., 1.90% Cv. Sub. Nts., 11/17/00(2) 6,000,000 4,080,000
- ------
Cypress Semiconductor Corp., 3.15% Cv. Sub. Nts., 3/15/01(2)
8,000,000 6,060,000
- ------
Delta Airlines, Inc., 3.23% Cv. Sub. Nts., 6/15/03 5,000,000 3,443,750
- ------
Eagle Hardware & Garden, Inc., 6.25% Cv. Sub. Debs., 3/15/01
4,500,000 3,420,000
- ------
Empresas Ica Sociedad, 5% Cv. Sub. Debs., 3/15/04 4,500,000 4,140,000
- ------
Genesis Health Ventures, Inc., 6% Cv. Sr. Sub. Debs., 11/30/03
750,000 915,000
- ------
Interpool, Inc., 5.25% Cv. Sub. Exch. Nts., 12/15/18 1,000,000 805,000
- ------
IVAX Corp., 6.50% Cv. Sub. Nts., 11/15/01(2) 2,000,000 1,637,500
- ------
L.A. Gear, Inc., 7.75% Cv. Sub. Debs., 11/30/02 3,000,000 2,400,000
- ------
McKesson Corp., 4.50% Cv. Sub. Debs., 3/1/04 4,000,000 3,950,000
- ------
Noble Affiliates, Inc., 4.25% Cv. Sub. Nts., 11/1/03 4,500,000 4,381,875
- ------
Novacare, Inc., 5.50% Cv. Sub. Debs., 1/15/00 3,000,000 2,801,250
- ------
Physicians Clinical Laboratory, Inc., 7.50% Cv. Sub. Debs., 8/15/00(2)
1,000,000 1,003,750
- ------
Rohr, Inc., 7.75% Cv. Sub. Nts., 5/15/04 2,800,000 3,290,000
- ------
Seagate Technology, 5% Cv. Sub. Debs., 11/1/03(2) 1,000,000 920,000
- ------
Seagate Technology, 6.75% Cv. Sub. Debs., 5/1/12 4,000,000 3,370,000
- ------
Shangri-La Asia Ltd., 2.875% Cv.Sub.Debs., 6/16/00(2)
1,500,000 1,237,500
- ------
Sierra On-Line, Inc., 6.50% Cv. Sub. Nts., 4/1/01(2) 3,500,000 2,887,500
- ------
Softe SA, 4.25% Cv. Debs., 7/30/98(2) 2,350,000,000(4) 1,657,045
- ------
Synoptics Communications, Inc., 5.25% Cv. Sub. Debs., 5/15/03(2) 3,000,000
2,118,750
- ------
Time Warner, Inc., 8.75% Cv. Sr. Nts., 1/10/15 11,000,000 11,041,250
- ------
Total Corporate Bonds and Notes (Cost $71,587,174) 68,703,670
4 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Market Value
Date/Price Units See Note 1
- ------
Indexed Instruments--0.2% Nikkei Index (Cost $2,895,000) Nov./$21,378
5,000 $1,740,000
- ------
Rights, Warrants and Certificates--0.1%
- ------
American Satellite Networks Wts., Exp. 6/99 18,750 0
- ------
Banco Santander Rts., Exp 7/1/94 100,000 547,109
- ------
Total Rights, Warrants and Certificates (Cost $0) 547,109
Shares
- ------
Preferred Stocks--4.3%
- ------
AMR Corp., $3.00 Cum. Cv. Depositary Shares, Series A(2)
225,000 9,956,250
- ------
- ------
Freeport-McMoRan Copper & Gold, Inc., $1.875 Cv. Exch. Depositary Shares
175,000 3,959,375
- ------
James River Corp., 9% Cv. Exch. Depositary Shares, Series P
400,000 7,050,000
- ------
Nacional Financiera (TMX), 11.25% Cv., Exch., Series, 5/15/98, Preferred
Redeemable Increased Dividend Equity Security 50,000 3,062,500
- ------
Noble Drilling Corp., $2.25 Cv. Exch., Series A 20,000 850,000
- ------
Salomon, Inc., 6.125% Cv., Exch. Series, Pfd. Equity Linked Security
100,000 3,475,000
- ------
Santa Fe Energy Resources, Inc., $.732 Cv. Exch. Series A
325,000 3,128,125
- ------
Standish Care Co., $4.50 Cv., Series A(3) 60,000 547,500
- ------
Unisys Corp., $3.75 Cv., Series A 100,000 3,437,500
- ------
Total Preferred Stocks (Cost $42,093,807) 39,391,250
- ------
Common Stocks--69.0%
- ------
Basic Materials--3.5%
- ------
Chemicals--2.6% Bush Boake Allen, Inc.(1) 390,000 6,825,000
- ------
Great Lakes Chemical Corp. 90,000 4,871,250
- ------
Imperial Chemical Industries PLC, ADS 150,000 7,125,000
- ------
Methanex Corp.(1) 400,000 4,700,000
- ------
23,521,250
5 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Statement of Investments (Continued)
Market Value
Shares See Note 1
- ------
Gold--0.1% MK Gold Co.(1) 150,000 $806,250
- ------
Metal: Miscellaneous--0.4% Birmingham Steel Corp. 125,000 3,375,000
- ------
Steel--0.4% AK Steel Holding Corp.(1) 150,000 3,825,000
- ------
Consumer Cyclicals--14.6%
- ------
Airlines--2.8% Atlantic Southeast Airlines, Inc. 360,000 8,730,000
- ------
Comair Holdings, Inc. 200,000 4,050,000
- ------
Continental Airlines, Inc., Cl. B(1) 300,000 3,862,500
- ------
SkyWest, Inc. 25,000 637,500
- ------
UAL Corp.(1) 65,000 8,206,250
- ------
25,486,250
- ------
Automobiles--1.9% Fiat SpA Di Risp. 815,900 1,948,201
- ------
Fiat SpA, Preference(1) 2,584,100 6,423,312
- ------
Volkswagon AG 18,000 5,361,155
- ------
Volvo AB, Series B Free 35,500 3,095,198
- ------
16,827,866
- ------
Broadcast Media--0.9% IDB Communications Group, Inc.(1)
450,000 4,162,500
- ------
International Cablecasting Technologies, Inc.(1) 240,000 840,000
- ------
Lin Broadcasting Corp.(1) 30,000 3,592,500
- ------
8,595,000
- ------
Entertainment--0.4% Imax Corp.(1) 200,000 1,825,000
- ------
Iwerks Entertainment, Inc.(1) 250,000 1,656,250
- ------
3,481,250
- ------
Household Furnishings and
Appliances--0.7%
Rival Manufacturing Co. 110,000 2,255,000
- ------
Shaw Industries, Inc. 250,000 4,125,000
- ------
6,380,000
- ------
Leisure Time--1.0% Bally Gaming International, Inc.(1)
125,000 1,531,250
- ------
Brunswick Corp. 150,000 3,300,000
- ------
Innovative Gaming Corp. of America(1) 175,000 1,268,750
- ------
- ------
9,100,000
6 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Market Value
Shares See Note 1
- ------
Manufactured Housing--0.1% Shelter Components Corp.
97,500 $1,255,313
- ------
Publishing--0.2% Meredith Corp. 50,000 2,125,000
- ------
Restaurants--0.5% Applebee's International, Inc. 400,000 4,900,000
- ------
Retail Stores: Ames Department Stores, Inc.(1) 300,000 975,000
Department Stores--0.1%
- ------
Retail: Specialty--3.7% Bed Bath & Beyond, Inc.(1) 100,000 2,862,500
- ------
Blockbuster Entertainment Corp. 200,000 5,175,000
- ------
Brookstone, Inc.(1) 200,000 3,050,000
- ------
CML Group, Inc. 250,000 2,937,500
- ------
Lowe's Cos., Inc. 260,000 8,905,000
- ------
Rite Aid Corp. 470,000 9,517,500
- ------
Spiegel, Inc., Cl. A 75,000 1,425,000
- ------
33,872,500
- ------
Retail: Specialty Apparel--0.5% Cato Corp. Cl. A 325,000 4,103,125
- ------
Shoes--1.2% Nike Incorporated Cl. B 175,000 10,456,250
- ------
Textiles: Apparel
Manufacturers--0.6%
Donnkenny, Inc.(1) 122,500 2,955,313
- ------
Norton McNaughton, Inc.(1) 100,000 2,025,000
- ------
4,980,313
- ------
Consumer Non-Cyclicals--8.6%
- ------
Drugs--0.5% Lilly (Eli) & Co. 50,000 2,843,750
- ------
Neurogen Corp.(1) 160,000 1,040,000
- ------
3,883,750
- ------
Food Processing--1.7% IBP, Inc. 175,000 4,659,375
- ------
McCormick & Co., Inc., Non-Vtg. 300,000 6,075,000
- ------
Pet, Inc. 225,000 4,190,625
- ------
Ralston-Continental Baking Group(1) 125,000 609,375
- ------
15,534,375
- ------
Food Wholesalers--0.3% Food Lion, Inc., Cl. A 450,000 2,700,000
- ------
Healthcare: Diversified--1.2% Bristol-Myers Squibb Co.
125,000 6,703,125
- ------
Theratx, Inc.(1) 370,000 4,162,500
- ------
10,865,625
7 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Statement of Investments (Continued)
Market Value
Shares See Note 1
- ------
Healthcare: Alpha Beta Technology, Inc.(1) 95,000 $1,021,250
Miscellaneous--2.5%
- ------
Athena Neurosciences, Inc.(1) 120,000 810,000
- ------
COR Therapeutics, Inc.(1) 200,000 2,350,000
- ------
Cyto Therapeutics, Inc.(1) 100,000 562,500
- ------
Dentsply International, Inc.(1) 150,000 5,250,000
- ------
Matrix Pharmaceutical, Inc.(1) 200,000 2,050,000
- ------
Noven Pharmaceuticals, Inc.(1) 175,000 2,362,500
- ------
Pioneer Hi-Bred International, Inc. 69,400 2,272,850
- ------
ProCyte Corporation(1) 150,000 1,687,500
- ------
United Healthcare Corp. 100,000 4,587,500
- ------
22,954,100
- ------
Hospital Management--0.1% Pediatric Services of America, Inc.(1)
150,000 1,087,500
- ------
Medical Products--1.0% St. Jude Medical, Inc. 67,500 2,193,750
- ------
- ------
Ventritex, Inc.(1) 250,000 4,656,250
- ------
9,400,000
- ------
Tobacco--1.3% Philip Morris Cos., Inc. 225,000 11,587,500
- ------
Energy--3.7%
- ------
Oil: Exploration and Apache Corp. 200,000 5,525,000
Production--0.6%
- ------
Oil: Integrated Domestic--1.1% Atlantic Richfield Co.
100,000 10,212,500
- ------
Oil: Integrated
International--0.6%
Elf Aquitaine, Sponsored ADR(1) 150,000 4,987,500
- ------
Oil and Gas Drilling--0.3% Basin Exploration, Inc.(1)
100,000 850,000
- ------
Energy Service Company, Inc.(1) 125,000 2,156,250
- ------
3,006,250
- ------
Oil Well Services and
Equipment--1.1%
McDermott International, Inc. 100,000 2,500,000
- ------
Oceaneering International, Inc.(1) 200,000 2,800,000
- ------
Pride Petroleum Services(1) 200,000 1,087,500
- ------
Weatherford International, Inc.(1) 290,000 3,915,000
- ------
10,302,500
- ------
Financial--8.9%
- ------
Financial Services:
Miscellaneous--1.9%
First Financial Caribbean Corp. 27,000 297,000
- ------
H & R Block Incorporated 200,000 7,850,000
- ------
Japan OTC Equity Fund, Inc.(1) 200,000 2,475,000
- ------
Korea Equity Fund, Inc.(1) 110,000 1,141,250
- ------
Resource Bancshares Mortgage Group, Inc.(1) 84,000 798,000
- ------
Taiwan Fund, Inc. 75,000 2,015,625
- ------
Vallicorp Holdings, Inc. 171,000 2,565,000
- ------
17,141,875
8 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Market Value
Shares See Note 1
- ------
Insurance: Life--0.2% Southwestern Life Corp.(1) 365,800 $1,920,450
- ------
Insurance: Multi-line--0.3% CCP Insurance, Inc. 150,000 3,056,250
- ------
Insurance: Property and St. Paul Cos., Inc. (The) 200,000 8,025,000
Casualty--0.9%
- ------
Major Banks: Other--1.2% Banco de Santander SA 100,000 3,598,003
- ------
BankAmerica Corp. 125,000 5,718,750
- ------
Svenska Handelsbanken, Inc. 108,100 1,448,933
- ------
10,765,686
- ------
Major Banks: Regional--2.5% CoreStates Financial Corp.
175,000 4,506,250
- ------
First Interstate Bancorp 75,000 5,775,000
- ------
Midlantic Corp. 100,000 2,925,000
- ------
Norwest Corp. 200,000 5,225,000
- ------
West One Bancorp 150,000 4,312,500
- ------
22,743,750
- ------
Money Center Banks--0.6% First Chicago Corp. 120,000 5,775,000
- ------
Savings and Loans/Holding Cos.--1.3%
Charter One Financial, Inc. 190,000 3,847,500
- ------
Commercial Federal Corp.(1) 200,000 4,700,000
- ------
GP Financial Corp. 150,000 3,337,500
- ------
11,885,000
- ------
Industrial--5.2%
- ------
Building Materials Group--1.2% Centex Construction Products, Inc.(1)
250,000 2,968,750
- ------
Martin Marietta Materials, Inc. 150,000 3,300,000
- ------
National Gypsum Co.(1) 100,000 3,075,000
- ------
- ------
11,293,750
- ------
Commercial Services--1.2% Manpower, Inc. 200,000 4,200,000
- ------
Safety-Kleen Corp. 200,000 3,400,000
- ------
Wallace Computer Services, Inc. 100,000 3,200,000
- ------
10,800,000
- ------
Electrical Equipment--0.3% Methode Electronics, Inc., Cl. A
150,000 2,550,000
- ------
Machine Tools--0.4% Acme-Cleveland Corp. 93,100 965,913
- ------
Greenfield Industries-GTD 125,000 2,437,500
- ------
3,403,413
9 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Statement of Investments (Continued)
Market Value
Shares See Note 1
- ------
Manufacturing: Diversified
Industrials--0.3%
Watts Industries, Inc., Cl. A 125,000 $2,906,250
- ------
Railroads--0.3% Santa Fe Pacific Corp.(1) 150,000 3,131,250
- ------
Transportation:
Miscellaneous--0.8%
Airborne Freight Corp. 150,000 5,212,500
- ------
Kirby Corp.(1) 125,000 2,046,875
- ------
7,259,375
- ------
Truckers--0.6% Roadway Services, Inc. 90,000 5,670,000
- ------
Pollution Control--0.1% Newpark Resources, Inc.(1) 75,000 1,200,000
- ------
Technology--14.1%
- ------
Aerospace/Defense--0.5% Martin Marietta Corp. 100,000 4,412,500
- ------
Communication:
Equipment/Manufacturers--0.2%
CMG Information SVS Inc.(1)(3) 234,000 2,106,000
- ------
Computer Software and
Services--6.7%
Adobe Systems, Inc. 100,000 2,725,000
- ------
Alias Research, Inc.(1) 215,000 2,821,875
- ------
BMC Software, Inc.(1) 70,000 3,062,500
- ------
Banyan Systems, Inc.(1) 31,000 399,125
- ------
Cadence Design Systems(1) 150,000 2,512,500
- ------
Ciber, Inc.(1) 135,000 1,181,250
- ------
Computer Associates International, Inc. 100,000 4,000,000
- ------
Cornerstone Imaging, Inc.(1) 95,000 1,377,500
- ------
Exabyte Corp.(1) 100,000 1,425,000
- ------
Intersolv, Inc.(1) 205,000 2,203,750
- ------
Legent Corp.(1) 125,000 3,375,000
- ------
Micrografx, Inc.(1) 255,000 1,657,500
- ------
Microsoft Corp.(1)(5) 100,000 5,150,000
- ------
NetManage, Inc.(1) 200,000 2,800,000
- ------
Oracle Systems Corp.(1)(5) 75,000 2,812,500
- ------
Platinum Technology, Inc.(1) 125,000 1,625,000
- ------
QuickResponse Services, Inc.(1) 100,000 1,000,000
- ------
Reynolds & Reynolds Co., Cl. A 275,000 6,359,375
- ------
SHL Systemhouse, Inc.(1) 350,000 2,231,250
- ------
Sap AG, Preference 2,750 5,520,916
- ------
Shared Medical Systems Corp. 100,000 2,400,000
- ------
Softkey International, Inc.(1) 200,000 2,500,000
- ------
Virtuality Group PLC(1) 300,000 842,751
- ------
Wavefront Technologies, Inc.(1) 150,000 975,000
- ------
60,957,792
10 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Market Value
Shares See Note 1
- ------
- ------
International Business Machines Corp. 60,000 3,525,000
- ------
Komag Incorporated(1) 100,000 1,850,000
- ------
Radius, Inc.(1) 170,000 828,750
- ------
6,703,750
- ------
Electronics--0.4% California Micro Devices Corp.(1)
150,000 $3,225,000
- ------
Electronics:
Instrumentation--0.3%
Recoton Corp.(1) 90,000 2,857,500
- ------
Electronics:
Semiconductors--1.0%
Intel Corp. 75,000 4,387,500
- ------
Micron Technology, Inc. 125,000 4,312,500
- ------
8,700,000
- ------
Office Equipment and
Supplies--0.5%
Moore Corp. Ltd. 250,000 4,218,750
- ------
Supermac Technology, Inc.(1) 50,000 293,750
- ------
4,512,500
- ------
Telecommunications--3.8% A+ Communications, Inc.(1)
230,000 2,472,500
- ------
Airtouch Communications, Inc.(1) 150,000 3,543,750
- ------
American Mobile Systems, Inc.(1) 102,000 1,326,000
- ------
Atlantic Tele-Network, Inc. 240,000 1,980,000
- ------
Ericsson Telefonaktiebolaget 111,900 5,591,736
- ------
Executive Telecard, Ltd.(1) 135,000 1,029,375
- ------
MCI Communications Corp. 200,000 4,425,000
- ------
MFS Communications Co., Inc.(1) 150,000 3,712,500
- ------
McCaw Cellular Communications, Inc.(1) 125,000 6,468,750
- ------
Millicom International Cellular SA(1) 210,200 4,361,650
- ------
34,911,261
- ------
Utilities--10.4%
- ------
Electric Cos.--6.6% Empresa Nacional De Electricidad--ADR
200,000 8,975,000
- ------
FPL Group, Inc. 250,000 7,468,750
- ------
Houston Industries, Inc. 275,000 8,971,875
- ------
Ohio Edison Co. 125,000 2,234,375
- ------
Pacific Gas & Electric Co. 250,000 5,937,500
- ------
Peco Energy Co. 225,000 5,934,375
- ------
Public Service Co. of Colorado 100,000 2,612,500
- ------
Public Service Enterprise Group, Inc. 300,000 7,800,000
- ------
Texas Utilities Co. 225,000 7,059,375
- ------
Union Electric Co. 100,000 3,175,000
- ------
60,168,750
11 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Statement of Investments (Continued)
Market Value
Shares See Note 1
- ------
Natural Gas--1.2% Williams Cos., Inc. (The) 375,000 $10,734,375
- ------
Telephone--2.6% Bell Atlantic Corp. 200,000 11,200,000
- ------
GTE Corp. 250,000 7,875,000
- ------
Telefonica de Espana, ADS 350,000 4,707,418
- ------
23,782,418
- ------
Total Common Stocks (Cost $651,024,233) 628,710,862
- ------
Total Investments, at Value (Cost $949,767,418) 101.2% 920,998,925
- ------
Liabilities in Excess of Other Assets (1.2) (11,130,573)
- ------ ------
Net Assets 100.0% $909,868,352
- ------ ------
- ------ ------
1. Non-income producing security.
2. Restricted security--See Note 5 of Notes to Financial Statements.
3. Affiliated company. Represents ownership of at least 5% of the voting
Investment Company Act of 1940, at or during the year ended June 30, 1994. The
aggregate fair value of all securities of affiliated companies as of June 30,
1994 amounted to $2,653,500. Transactions during the period in which the issuer
was an affiliate are as follows:
Balance Balance
June 30, 1993 Gross Additions Gross Reductions June 30, 1994
- ------ ------ ------ ------
Shares Cost Shares Cost Shares Cost Shares Cost
- ------
Standish Care Co., $4.50 Cv., Series A -- $-- 60,000 $ 649,995
-- $-- 60,000 $ 649,995
- ------
CMG Information SVS Inc. -- -- 234,000 1,967,000 -- --
234,000 1,967,000
- ------ ------
$2,616,995 $2,616,995
- ------ ------
- ------ ------
4. Face amount reported in foreign currency.
5. Securities with an aggregate market value of $5,387,500 are held in escrow to
cover outstanding call options, as follows:
Market
Shares Expiration Exercise Premium Value
Subject to Call Date Price Received See Note 1
- ------
Microsoft Corp. 50,000 7/94 $52.50 $ 92,247 $ 43,750
Oracle Systems 75,000 7/94 35.00 147,745 215,625
- ------ ------ ------
125,000 239,992 259,375
See accompanying Notes to Financial Statements.
12 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Statement of Assets and Liabilities June 30, 1994
- ------
Assets Investments, at value (cost $949,767,418)--see accompanying
statements $920,998,925
- ------
Cash 914,813
- ------
Receivables:
Shares of capital stock sold 20,385,032
Investments sold 17,852,790
Dividends and interest 2,838,873
- ------
Other 106,676
- ------
Total assets 963,097,109
- ------
Liabilities Options written, at value (premiums received $239,992)--see
accompanying statement--Note 6 259,375
Payables and other liabilities:
Investments purchased 47,827,181
Shares of capital stock redeemed 4,054,615
Distribution and service plan fees--Note 4 443,112
Other 644,474
- ------
Total liabilities 53,228,757
- ------
Net Assets $909,868,352
- ------
- ------
- ------
Composition of Net Assets
Par value of shares of capital stock 446,277
- ------
Additional paid-in capital 953,159,883
- ------
Undistributed net investment income 706,011
- ------
Accumulated net realized loss from investment and written option transactions
(15,645,364)
- ------
Net unrealized depreciation on investments and translation of assets and
liabilities denominated in foreign currencies (28,798,455)
- ------
Net assets $909,868,352
- ------
- ------
- ------
Net Asset Value
Per Share
Class A Shares:
$739,552,177 and 36,250,537 shares of capital stock outstanding) $20.40
Maximum offering price per share (net asset value plus sales charge of 5.75% of
offering price) $21.64
- ------
Class C Shares:
Net asset value, redemption price and offering price per share (based on net
assets of $170,316,175 and 8,377,158 shares of capital stock outstanding)
$20.33
See accompanying Notes to Financial Statements.
13 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Statement of Operations For the Year Ended June 30, 1994
- ------
Investment Income Dividends $8,519,789
- ------
Interest 3,264,314
- ------
Total income 11,784,103
- ------
Expenses Management fees--Note 4 1,817,623
- ------
Transfer and shareholder servicing agent fees--Note 4 850,630
- ------
Distribution and service plan fees:
Class A--Note 4 643,787
Class C--Note 4 413,111
- ------
Registration and filing fees:
Class A 304,239
Class C 62,520
- ------
Shareholder reports 160,322
- ------
Custodian fees and expenses 29,902
- ------
Legal and auditing fees 21,002
- ------
Directors' fees and expenses 2,648
- ------
Other 42,633
- ------
Total expenses 4,348,417
- ------
Net Investment Income 7,435,686
- ------
Realized and Unrealized
Loss on Investments
Net realized loss on investments (12,425,245)
- ------
Net change in unrealized depreciation on investments (36,662,021)
- ------
Net realized and unrealized loss on investments (49,087,266)
- ------
Net Decrease in Net Assets Resulting From Operations $(41,651,580)
- ------
- ------
See accompanying Notes to Financial Statements.
14 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Statements of Changes in Net Assets
Year Ended Year Ended
June 30, 1994 June 30, 1993
- ------
Operations Net investment income $7,435,686 $398,115
- ------
Net realized gain (loss) on investments and options written
(12,425,245) 6,992,957
- ------
Net change in unrealized depreciation or appreciation on investments
(36,662,021) 6,820,214
- ------ ------
Net increase (decrease) in net assets resulting from operations
(41,651,580) 14,211,286
- ------
Dividends and Distributions to Shareholders
Dividends from net investment income:
Class A ($.356 and $.192 per share, respectively) (5,859,657) (434,312)
Class C ($.136 per share) (815,401) --
- ------
Distributions from net realized gain on investments and options written:
Class A ($2.202 per share) -- (4,252,038)
- ------
Distributions in excess of gains:
Class A ($1.989 per share) (9,339,980) --
- ------
Capital Stock
Transactions
Net increase in net assets resulting from Class A
capital stock transactions--Note 2 727,055,604 21,779,236
- ------
Net increase in net assets resulting from Class C
capital stock transactions--Note 2 182,249,457 --
- ------
- ------
Beginning of year 58,229,909 26,925,737
- ------ ------
End of year (including undistributed net investment income of $706,011
and $31,753, respectively) $909,868,352 $58,229,909
- ------ ------
- ------ ------
See accompanying Notes to Financial Statements.
15 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Financial Highlights
Class A Class C
- ------ ------
Year Ended Period Ended
June 30, 1994 1993 1992 1991 1990 1989 1988(2) June 30, 1994(1)
- ------
Per Share Operating Data:
Net asset value, beginning
of period $19.88 $15.46 $13.22 $12.38 $11.67 $10.13
$9.60 $20.76
- ------
Income from investment operations:
Net investment income .37 .16 .25 .38 .17 .24 (3)
.05 .13
Net realized and unrealized gain
on investments and options written 2.50 6.65 4.72 .87 .88
1.62 .52 (.42)
- ------ ------ ------ ------ ------ ------ ------
- ------
Total income from investment
operations 2.87 6.81 4.97 1.25 1.05 1.86 .57
(.29)
- ------
Dividends and distributions to shareholders:
Dividends from net investment income (.36) (.19) (.22) (.41)
(.19) (.19) (.04) (.14)
Distributions from net realized gain
on investments and options written -- (2.20) (2.51) -- (.15)
(.13) -- --
Distributions in excess of gains (1.99) -- -- -- -- --
-- --
- ------ ------ ------ ------ ------ ------ ------
- ------
Total dividends and distributions
to shareholders (2.35) (2.39) (2.73) (.41) (.34) (.32)
(.04) (.14)
- ------
Net asset value, end of period $20.40 $19.88 $15.46 $13.22
$12.38 $11.67 $10.13 $20.33
- ------ ------ ------ ------ ------ ------ ------
- ------
- ------ ------ ------ ------ ------ ------ ------
- ------
- ------
Total Return, at Net Asset Value(4) 14.34% 46.38% 39.48% 10.60%
9.07% 18.77% 5.94% (.97)%
- ------
Ratios/Supplemental Data:
Net assets, end of period
(in thousands) $739,552 $58,230 $26,926 $15,968 $13,851
$1,256 $345 $170,316
- ------
Average net assets
(in thousands) $270,417 $38,974 $23,018 $14,563 $ 7,520
$ 788 $118 $71,924
- ------
Number of shares outstanding
at end of period (in thousands) 36,251 2,929 1,742 1,208
1,119 108 34 8,377
- ------
Ratios to average net assets:
Net investment income 2.46% 1.02% 1.63% 3.15% 2.33%
2.67% 2.86% 1.86%
Expenses, before reimbursement
2.21% 2.46% 10.54% 2.11%
Expenses, net of reimbursement
from or assumption by the Manager N/A N/A N/A N/A N/A
2.12%(3) N/A N/A
- ------
Portfolio turnover rate(5) 199.4% 283.0% 290.1% 208.9%
214.3% 136.8% 18.8% 199.4%
1. For the period from December 1, 1993 (inception of offering) to June 30,
1994.
2. For the period from February 3, 1988 (commencement of operations) to June 30,
1988.
3. Net investment income would have been $.20 per share absent the voluntary
expense reimbursement, resulting in an expense ratio of 2.46%.
4. Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period, with all dividends and distributions reinvested
in additional shares on the reinvestment date, and redemption at the net asset
value calculated on the last business day of the fiscal period. Sales charges
are not reflected in the total returns.
5. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities owned
during the period. Securities with a maturity or expiration date at the time of
acquisition of one year or less are excluded from the calculation. Purchases and
sales of investment securities (excluding short-term securities) for the year
ended June 30, 1994 were $1,510,599,271 and $494,572,017, respectively.
See accompanying Notes to Financial Statements.
16 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Notes to Financial Statements
- ------
1. Significant Accounting Policies
Oppenheimer Main Street Income & Growth Fund (the Fund), formerly named Main
Street Funds, Inc.-Income & Growth Fund, is a separate series of Oppenheimer
Main Street Funds, Inc., an open-end management investment company registered
under the Investment Company Act of 1940, as amended. The Fund's investment
advisor is Oppenheimer Management Corporation (the Manager). The Fund offers
both Class A and Class C shares. Class A shares are sold with a front-end sales
charge. Class C shares may be subject to a contingent deferred sales charge.
Both classes of shares have identical rights to earnings, assets and voting
privileges, except that each class has its own distribution plan, expenses
directly attributable to a particular class and exclusive voting rights with
respect to matters affecting a single class. The following is a summary of
significant accounting policies consistently followed by the Fund.
- ------
Investment Valuation. Portfolio securities are valued at 4:00 p.m. (New York
time) on each trading day. Listed and unlisted securities for which such
information is regularly reported are valued at the last sale price of the day
or, in the absence of sales, at values based on the closing bid or asked price
or the last sale price on the prior trading day. Long-term debt securities are
Long-term debt securities which cannot be valued by the approved portfolio
pricing service are valued by averaging the mean between the bid and asked
prices obtained from two active market makers in such securities. Short-term
debt securities having a remaining maturity of 60 days or less are valued at
cost (or last determined market value) adjusted for amortization to maturity of
any premium or discount. Securities for which market quotes are not readily
available are valued under procedures established by the Board of Directors to
determine fair value in good faith. A call option is valued based upon the last
sales price on the principal exchange on which the option is traded or, in the
absence of any transactions that day, the value is based upon the last sale on
the prior trading date if it is within the spread between the closing bid and
asked prices. If the last sale price is outside the spread, the closing bid or
asked price closest to the last reported sale price is used.
- ------
Repurchase Agreement. The Fund requires the custodian to take possession, to
have legally segregated in the Federal Reserve Book Entry System or to have
segregated within the custodian's vault, all securities held as collateral for
repurchase agreements. If the seller of the agreement defaults and the value of
the collateral declines, or if the seller enters an insolvency proceeding,
realization of the value of the collateral by the Fund may be delayed or
limited.
- ------
Allocation of Income, Expenses and Gains and Losses. Income, expenses (other
than those attributable to a specific class) and gains and losses are allocated
daily to each class of shares based upon the relative proportion of net assets
represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.
- ------
Federal Income Taxes. The Fund intends to continue to comply with provisions of
the Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income, including any net realized gain on
investments not offset by loss carryovers, to shareholders. Therefore, no
federal income tax provision is required.
- ------
Distributions to Shareholders. Dividends and distributions to shareholders are
recorded on the ex-dividend date.
- ------
Change in Accounting for Distributions to Shareholders. Effective July 1, 1993,
the Fund adopted Statement of Position 93-2: Determination, Disclosure, and
Financial Statement Presentation of Income, Capital Gain, and Return of Capital
Distributions by Investment Companies. As a result, the Fund changed the
classification of distributions to shareholders to better disclose the
differences between financial statement amounts and distributions determined in
accordance with income tax regulations. Accordingly, subsequent to June 30,
of $23,375, an increase in undistributed net investment income of $15,399, and a
decrease in undistributed capital gain on investments of $38,774. During the
year ended June 30, 1994, in accordance with Statement of Position 93-2,
undistributed capital gain on investments was increased by $103,573,
undistributed net investment income was decreased by $101,769, and paid-in
capital was decreased by $1,804.
- ------
Other. Investment transactions are accounted for on the date the investments are
purchased or sold (trade date) and dividend income is recorded on the
ex-dividend date. Discount on securities purchased is amortized over the life of
the respective securities, in accordance with federal income tax requirements.
Realized gains and losses on investments and unrealized appreciation and
depreciation are determined on an identified cost basis, which is the same basis
used for federal income tax purposes.
17 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Notes to Financial Statements (Continued)
- ------
2. Capital Stock The Fund has authorized 102,500,000 shares of $.01 par
value capital stock (76,250,000 for Class A and 26,250,000 for Class C).
Transactions in shares of capital stock were as follows:
Year Ended June 30, 1994(1) Year Ended June 30, 1993
- ------ ------
Shares Amount Shares Amount
- ------
Class A:
Sold 34,877,614 $761,137,297 1,080,758 $20,104,977
Dividends and distributions reinvested 704,717 14,641,214 264,954
4,627,593
Issued in connection with the acquisition of Main Street Asset
Allocation Fund--Note 7 72,926 1,179,937
Redeemed (2,260,838) (48,722,907) (231,352) (4,133,271)
- ------ ------ ------ ------
Net increase 33,321,493 $727,055,604 1,187,286 $21,779,236
- ------ ------ ------ ------
- ------ ------ ------ ------
- ------
Class C:
Sold 8,563,107 $186,240,396 -- $--
Dividends and distributions reinvested 35,985 747,590 -- --
Redeemed (221,934) (4,738,529) --
- ------ ------ ------ ------
Net increase 8,377,158 $182,249,457 -- $--
- ------ ------ ------ ------
- ------ ------ ------ ------
1. For the year ended June 30, 1994 for Class A shares and for the period from
December 1, 1993 (inception of offering) to June 30, 1994 for Class C shares.
- ------
3. Unrealized Gains and Losses on Investments
At June 30, 1994, net unrealized depreciation on investments of $28,787,847 was
composed of gross appreciation of $23,383,823, and gross depreciation of
$52,171,670.
- ------
4. Management Fees And Other Transactions With Affiliates
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Fund which provides for an annual fee of .65% on the
thereafter to $500 million and .45% on net assets in excess of $500 million. The
Manager has agreed to reimburse the Fund if aggregate expenses (with specified
exceptions) exceed the most stringent applicable regulatory limit on Fund
expenses.
For the year ended June 30, 1994, commissions (sales charges paid by
investors) on sales of Class A shares totaled $23,502,310, of which $6,373,770
was retained by Oppenheimer Funds Distributor, Inc. (OFDI), a subsidiary of the
Manager as general distributor, and by an affiliated broker/dealer.
Oppenheimer Shareholder Services (OSS), a division of the Manager, is the
transfer and shareholder servicing agent for the Fund, and for other registered
investment companies. OSS's total costs of providing such services are allocated
ratably to these companies.
Under separate approved plans, each class may expend up to .25% of its net
assets annually to reimburse OFDI for costs incurred in connection with the
personal service and maintenance of accounts that hold shares of the Fund,
including amounts paid to brokers, dealers, banks and other institutions. In
addition, Class C shares are subject to an asset-based sales charge of .75% of
net assets annually, to reimburse OFDI for sales commissions paid from its own
resources at the time of sale and associated financing costs. In the event of
termination or discontinuance of the Class C plan, the Board of Trustees may
allow the Fund to continue payment of the asset-based sales charge to OFDI for
distribution expenses incurred on Class C shares sold prior to termination or
discontinuance of the plan. During the year ended June 30, 1994, OFDI paid
$20,221 to an affiliated broker/dealer as reimbursement for Class A personal
service and maintenance expenses and retained $386,830 as reimbursement for
Class C sales commissions and service fee advances, as well as financing costs.
18 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
- ------
5. Restricted Securities
The Fund owns securities purchased in private placement transactions, without
registration under the Securities Act of 1993 (the Act). The securities are
valued under methods approved by the Board of Directors as reflecting fair
value. The Fund intends to invest no more than 10% of its net assets (determined
at the time of purchase) in restricted and illiquid securities, excluding
securities eligible for resale pursuant to Rule 144A of the Act that are
determined to be liquid by the Board of Directors or by the Manager under
Board-approved guidelines.
Valuation Per Unit
Security Acquisition Date Cost Per Unit as of June 30, 1994
- ------
AMR Corp. $3.00 Cum. Cv.
Depositary Shares, Series A(1) 3/18/94 $44.84 $44.25
- ------
Arch Communications Group, 6.75%
Cv. Sub. Debs., 12/1/03(1) 6/21/94 $102.50 $103.00
- ------
- ------
Cypress Semiconductor Corp.,
3.15% Cv. Sub. Nts., 3/15/01(1) 3/25/94 $80.30 $75.75
- ------
IVAX Corp., 6.50% Cv. Sub. Nts., 11/15/01(1) 9/22/92 $85.25 $81.87
- ------
Physicians Clinical Laboratory, Inc.,
7.50% Cv. Sub. Debs., 8/15/00(1) 1/13/94 $104.00 $100.37
- ------
Seagate Technology, 5% Cv. Sub. Debs., 11/1/03(1) 6/30/94 $92.00
$92.00
- ------
Shangri-La Asia Ltd., 2.875% Cv. Sub. Debs., 6/16/00(1) 12/13/93 $87.30
$82.50
- ------
Sierra On-Line, Inc., 6.50% Cv. Sub. Nts., 4/1/01(1) 4/13/94 $98.71
$82.50
- ------
Softe SA, 4.25% Cv. Debs., 7/30/98(1) 6/2/94 $117.75 $111.62
- ------
Synoptics Communications, Inc.,
5.25% Cv. Sub. Debs., 5/15/03(1) 5/5/94--5/20/94 $78.14 $70.62
1. Transferable under Rule 144A of the Act.
- ------
6. Call Option Activity Call option activity for the year ended June 30,
1994 was as follows:
Number of Amount of
Call Option Activity Options Premiums
- ------
Options outstanding at June 30, 1993 -- $--
- ------
Options written 1,250 239,992
- ------
Options expired prior to exercise -- --
- ------
Options exercised -- --
- ------ ------
Options outstanding at June 30, 1994 1,250 $239,992
- ------ ------
- ------ ------
- ------
7. Acquisition On October 16, 1992, the Fund acquired all of the net assets
of Main Street Asset Allocation Fund (AAF), pursuant to an Agreement and Plan of
Reorganization approved by the AAF shareholders on October 9, 1992. The Fund
issued 72,926 shares of beneficial interest, valued at $1,179,937, in exchange
for the net assets, resulting in combined net assets of $30,151,286 on October
16, 1992. The net assets acquired included net unrealized appreciation of
$145,867 and capital loss carryovers for federal income tax purposes of $25,921.
The exchange was tax-free.
19 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Independent Auditors' Report
- ------
The Board of Trustees and Shareholders of Oppenheimer Main Street Income and
Growth Fund:
We have audited the accompanying statement of assets and liabilities, including
the statement of investments, of Oppenheimer Main Street Income and Growth Fund
as of June 30, 1994, the related statement of operations for the year then
ended, the statements of changes in net assets for the years ended June 30, 1994
and 1993, and the financial highlights for the period February 3, 1988
(commencement of operations) to June 30, 1994. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
highlights are free of material misstatement. An audit also includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements. Our procedures included confirmation of securities owned
at June 30, 1994 by correspondence with the custodian and brokers; where replies
were not received from brokers, we performed other auditing procedures. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of Oppenheimer Main
Street Income and Growth Fund at June 30, 1994, the results of its operations,
the changes in its net assets, and the financial highlights for the respective
stated periods, in conformity with generally accepted accounting principles.
DELOITTE & TOUCHE
Denver, Colorado
July 22, 1994
20 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Federal Income Tax Information
- ------
In early 1995, shareholders will receive information regarding all dividends and
distributions paid to them by the Fund during calendar year 1994. Regulations of
the U.S. Treasury Department require the Fund to report this information to the
Internal Revenue Service.
A distribution of $2.085 per share was paid on November 29, 1993, of which
$1.989 was designated as a "capital gain distribution" for federal income tax
purposes. Whether received in stock or cash, the capital gain distribution
should be treated by shareholders as a gain from the sale of capital assets held
for more than one year (long-term capital gains).
Dividends paid by the Fund during the fiscal year ended June 30, 1994 which
are not designated as capital gain distributions should be multiplied by 54.0%
to arrive at the net amount eligible for the corporate dividend-received
deduction.
The foregoing information is presented to assist shareholders in reporting
distributions received from the Fund to the Internal Revenue Service. Because of
the complexity of the federal regulations which may affect your individual tax
return and the many variations in state and local tax regulations, we recommend
that you consult your tax advisor for specific guidance.
21 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
Oppenheimer Main Street Income & Growth Fund
A Series of Oppenheimer Main Street Funds, Inc.
- ------
Officers and Directors
James C. Swain, Chairman and Chief Executive Officer
Robert G. Avis, Director
William A. Baker, Director
Charles Conrad, Jr., Director
Jon S. Fossel, President
Raymond J. Kalinowski, Director
C. Howard Kast, Director
Robert M. Kirchner, Director
Ned M. Steel, Director
Andrew J. Donohue, Vice President
George C. Bowen, Vice President, Secretary and Treasurer
Robert J. Bishop, Assistant Treasurer
Scott Farrar, Assistant Treasurer
Robert G. Zack, Assistant Secretary
- ------
Investment Advisor Oppenheimer Management Corporation
- ------
Distributor Oppenheimer Funds Distributor, Inc.
- ------
Transfer and Shareholder
Servicing Agent
Oppenheimer Shareholder Services
- ------
Custodian of
Portfolio Securities
The Bank of New York
- ------
Independent Auditors Deloitte & Touche
- ------
Legal Counsel Myer, Swanson & Adams, P.C.
This is a copy of a report to shareholders of Oppenheimer Main Street Income &
Growth Fund. This report must be preceded or accompanied by a Prospectus of
Oppenheimer Main Street Income & Growth Fund. For material information
concerning the Fund, see the Prospectus.
22 Oppenheimer Main Street Income & Growth Fund
<PAGE>
- ------
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- ------
OppenheimerFunds offers over 30 funds designed to fit virtually every investment
goal. Whether you're investing for retirement, your children's education, or
tax-free income, we have the funds to help you seek your objective.
When you invest with OppenheimerFunds, you can feel comfortable knowing that
you are investing with a respected financial institution with over 30 years of
experience in helping people just like you reach their financial goals. And
you're investing with a leader in global, growth stock, and flexible fixed
income investments--with over 1.8 million shareholder accounts and more than
$26 billion under Oppenheimer's management and that of our affiliates.
As an OppenheimerFunds shareholder, you can easily exchange shares of
eligible funds of the same class by mail or by telephone for a small
administrative fee.1 For more information on OppenheimerFunds, please contact
your financial advisor or call us at 1-800-525-7048 for a prospectus. You may
also write us at the address shown on the back cover. As always, please read
the prospectus carefully before you invest.
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Specialty Stock Fund Gold & Special Minerals Fund
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Stock Funds Discovery Fund Global Fund
Time Fund Oppenheimer Fund
Target Fund Value Stock Fund
Special Fund
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Stock and Bond Funds
Main Street Income & Growth Fund
Total Return Fund
Global Growth & Income Fund
Equity Income Fund
Asset Allocation Fund
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Bond Funds
High Yield Fund
Champion High Yield Fund
Strategic Income & Growth Fund
Strategic Income Fund
Strategic Diversified Income Fund
Strategic Investment Grade Bond Fund
Strategic Short-Term Income Fund
Investment Grade Bond Fund
Mortgage Income Fund
U.S. Government Trust
Limited-Term Government2
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Tax-Exempt Funds
New York Tax-Exempt Fund3
California Tax-Exempt Fund3
Pennsylvania Tax-Exempt Fund3
Florida Tax-Exempt Fund3
New Jersey Tax-Exempt Fund3
Tax-Free Bond Fund
Insured Tax-Exempt Bond Fund
Intermediate Tax-Exempt Bond Fund
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1. The fee is waived for PhoneLink exchanges between existing accounts. Exchange
privileges are subject to change or termination.
2. Formerly Government Securities Fund.
3. Available only to residents of those states.
OppenheimerFunds are distributed by Oppenheimer Funds Distributor, Inc., Two
World Trade Center, New York, NY 10048-0203.
(C) Copyright 1994 Oppenheimer Management Corporation. All rights reserved.
23 Oppenheimer Main Street Income & Growth Fund
<PAGE>
"HOW MAY I HELP YOU?"
GENERAL INFORMATION
1-800-525-7048
Talk to a Customer Service Representative.
Monday through Friday from
8:30 a.m. to 8:00 p.m., and Saturday from 10:00 a.m.
to 2:00 p.m. ET.
TELEPHONE TRANSACTIONS
1-800-852-8457
Make account transactions with a Customer Service Representative.
Monday through Friday from
8:30 a.m. to 8:00 p.m. ET.
PHONELINK
1-800-533-3310
Get automated information or make automated transactions.
24 hours a day, 7 days a week.
TELECOMMUNICATION
DEVICE FOR THE DEAF
1-800-843-4461
Service for the hearing impaired.
Monday through Friday from
8:30 a.m. to 8:00 p.m. ET.
OPPENHEIMERFUNDS
INFORMATION HOTLINE
1-800-835-3104
Hear timely and insightful messages on the economy and issues that affect your
finances. 24 hours a day, 7 days a week.
"Just as OppenheimerFunds offers over 30 different mutual funds designed to
help meet virtually every investment need, Oppenheimer Shareholder Services
offers a variety of services to satisfy your individual needs. Whenever you
require help, we're only a toll-free phone call away.
"For personalized assistance and account information, call our General
Information number to speak with our knowledgeable Customer Service
Representatives and get the help you need.
"When you want to make account transactions, it's easy for you to redeem
shares, exchange shares, or conduct AccountLink transactions, simply by calling
our Telephone Transactions number.
"And for added convenience, OppenheimerFunds' PhoneLink, an automated voice
response system is available 24 hours a day, 7 days a week. PhoneLink gives you
access to a variety of fund, account, and market information. You can even make
purchases, exchanges and redemptions using your touch-tone phone. Of course,
PhoneLink will always give you the option to speak with a Customer Service
Representative during the hours shown to the left.
"When you invest in OppenheimerFunds, you know you'll receive a high level
of customer service. The International Customer Service Association knows it,
too, as it awarded Oppenheimer Shareholder Services a 1993 Award of Excellence
for consistently demonstrating superior customer service.
"Whatever your needs, we're ready to assist you."
[Logo]
1993
AWARD OF EXCELLENCE
ICSA
International Customer Service Association
[Photo]
BARBARA HENNIGAR
CHIEF EXECUTIVE OFFICER
OPPENHEIMER SHAREHOLDER SERVICES
[Logo] OPPENHEIMER FUNDS
P.O. Box 5270
Denver, CO 80217-5270
Bulk Rate
U.S. Postage
PAID
Permit No. 469
Denver, CO
