Oppenheimer
Global Emerging Growth Fund
Prospectus dated January 24,1995, Revised August 4, 1995
Oppenheimer Global Emerging Growth Fund (the "Fund") is a mutual fund that
aggressively seeks capital appreciation as its investment objective.
Current income is not an objective of the Fund.
In seeking its objective, the Fund emphasizes investments in emerging
growth companies in the U.S. and foreign countries that offer the
potential for growth of earnings or revenue. In an uncertain investment
environment, the Fund may stress defensive investment methods. The Fund
may also use "hedging" instruments. As a "global" fund, the Fund normally
invests in the U.S. and at least three foreign countries and may have a
substantial portion of its assets invested in foreign securities.
Some investment techniques the Fund uses may be considered to be
speculative investment methods that may increase the costs of investing
in the Fund and may also increase the Fund's operating costs. You should
carefully review the risks associated with an investment in the Fund. The
Fund is designed for investors who are willing to accept greater risks of
loss in the hopes of greater gains. Please refer to "Investment Policies
and Strategies" for more information about the types of securities the
Fund invests in, its investment methods and the risks of investing in the
Fund.
This Prospectus explains concisely what you should know before
investing in the Fund. Please read this Prospectus carefully and keep it
for future reference. You can find more detailed information about the
Fund in the January 24, 1995, Statement of Additional Information. For a
free copy, call Oppenheimer Shareholder Services, the Fund's Transfer
Agent, at 1-800-525-7048, or write to the Transfer Agent at the address
on the back cover. The Statement of Additional Information has been filed
with the Securities and Exchange Commission and is incorporated into this
Prospectus by reference (which means that it is legally part of this
Prospectus).
Shares of the Fund are not deposits or obligations of any bank, are not
guaranteed by any bank, are not insured by the F.D.I.C. or any other
agency, and involve investment risks, including the possible loss of the
principal amount invested.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<PAGE>
Contents
A B O U T T H E F U N D
Expenses
A Brief Overview of the Fund
Financial Highlights
Investment Objective and Policies
How the Fund is Managed
Performance of the Fund
A B O U T Y O U R A C C O U N T
How to Buy Shares
Special Investor Services
AccountLink
Automatic Withdrawal and Exchange Plans
Reinvestment Privilege
Retirement Plans
How to Sell Shares
By Mail
By Telephone
How to Exchange Shares
Shareholder Account Rules and Policies
Dividends, Capital Gains and Taxes
Appendix - Industry Classifications
<PAGE>
A B O U T T H E F U N D
Expenses
The Fund pays a variety of expenses directly for management of its
assets, administration, distribution of its shares and other services, and
those expenses are subtracted from the Fund's assets to calculate the
Fund's net asset value per share. All shareholders therefore pay those
expenses indirectly. Shareholders pay other expenses directly, such as
sales charges and account transaction charges. The following tables are
provided to help you understand your direct expenses of investing in the
Fund and your share of the Fund's operating expenses that you will bear
indirectly. The numbers below are based on the Fund's expenses during its
last fiscal year ended September 30, 1994.
-- Shareholder Transaction Expenses are charges you pay when you buy
or sell shares of the Fund. Please refer to "About Your Account," from
pages ___ through ___ for an explanation of how and when these charges
apply.
Maximum Sales Charge 5.75%
on Purchases (as a %
of offering price)
-----------------------------------------------------
Sales Charge on None
Reinvested Dividends
-----------------------------------------------------
Deferred Sales Charge None(1)
(as a % of the lower of
the original purchase
price or redemption
proceeds)
-----------------------------------------------------
Exchange Fee None
-----------------------------------------------------
(1) If you invest $1 million or more ($500,000 or more for purchases by
OppenheimerFunds 401(k) plans) in shares of the Fund, you may have to pay
a sales charge of up to 1.0% if you sell your shares within 18 calendar
months from the end of the calendar month during which you purchased those
shares. See "How to Buy Shares," below.
-- Annual Fund Operating Expenses are paid out of the Fund's assets
and represent the Fund's expenses in operating its business. For example,
the Fund pays management fees to its investment adviser, Oppenheimer
Management Corporation (which is referred to in this Prospectus as the
"Manager"). The rates of the Manager's fees are set forth in "How the
Fund is Managed," below. The Fund has other regular expenses for
services, such as transfer agent fees, custodial fees paid to the bank
that holds its portfolio securities, audit fees and legal expenses. These
expenses are detailed in the Fund's Financial Statements in the Statement
of Additional Information.
The numbers in the table below are projections of the Fund's business
expenses based on the Fund's expenses in its last fiscal year. These
amounts are shown as a percentage of the average net assets of the Fund
for that year. The "12b-1 Service Plan Fees" can be up to a maximum of
0.25% of average annual net assets. The actual expenses of the Fund in
future years may be more or less than the numbers in the table, depending
on a number of factors, including the actual value of the Fund's assets
on which some of these fees are based.
Management Fees 0.81%
-----------------------------------------
12b-1 Service Plan Fees 0.24%
-----------------------------------------
Other Expenses 0.72%
-----------------------------------------
Total Fund Operating Expenses 1.77%
-----------------------------------------
-- Example. To try to show the effect of these expenses on an
investment over time, we have created the hypothetical example shown
below. Assume that you make a $1,000 investment in the Fund, and that the
Fund's annual return is 5%, and that its operating expenses are the ones
shown in the chart above. If you were to redeem your shares at the end
of each period shown below, your investment would incur the following
expenses by the end of 1, 3, 5 and 10 years:
1 year 3 years 5 years 10 years
------ ------- ------- --------
$ 74 $110 $148 $254
This example shows the effect of expenses on an investment, but is
not meant to state or predict actual or expected costs or investment
returns of the Fund, all of which will vary.
<PAGE>
A Brief Overview of the Fund
Some of the important facts about the Fund are summarized below, with
references to the section of this Prospectus where more complete
information can be found. You should carefully read the entire Prospectus
before making a decision about investing in the Fund. Keep the Prospectus
for reference after you invest, particularly for information about your
account, such as how to sell or exchange shares.
-- What Is The Fund's Investment Objective? The Fund's investment
objective is to aggressively seek capital appreciation (that is, growth
in the value of its shares). It does not invest to earn current income
to pay to shareholders.
-- What Does the Fund Invest In? The Fund emphasizes investment in
common stocks or other equity securities, including convertible
securities, of emerging growth companies located in the United States and
foreign countries. The Fund may have a substantial amount of its
investments in foreign securities. The Fund may hold warrants and rights.
The Fund may also use hedging instruments and some derivative investments
to try to manage investment risks. These investments are more fully
explained in "Investment Objective and Policies," starting on page ___.
-- Who Manages the Fund? The Fund's investment adviser is
Oppenheimer Management Corporation. The Manager (including a subsidiary)
manages investment company portfolios having over $35 billion in assets
at June 30, 1995. The Manager is paid an advisory fee by the Fund, based
on its net assets. The Fund has a portfolio manager, Mr. James C. Ayer,
who is employed by the Manager. He is primarily responsible for the
selection of the Fund's securities. The Fund's Board of Trustees, elected
by shareholders, oversees the investment adviser and the portfolio
manager. Please refer to "How the Fund is Managed," starting on page ___
for more information about the Manager and its fees.
-- How Risky is the Fund? All investments carry risks to some
degree. It is important to remember that the Fund is an aggressive growth
fund designed for long-term investing and is not designed for investors
seeking income or conservation of capital. The Fund's investments in
stocks are subject to changes in their value from a number of factors such
as changes in general bond and stock market movements, or the change in
value of particular stocks because of an event affecting the issuer.
Because the Fund's investments may be concentrated in one industry or
group of industries, its share price will be affected by changes affecting
those industries and may be more volatile than other funds that do not
concentrate their investments. The Fund's investments in foreign
securities are subject to additional risks associated with investing
abroad, such as the effect of currency rate changes on stock values.
These changes affect the value of the Fund's investments and its price per
share.
In the OppenheimerFunds spectrum, the Fund is generally expected to
be more volatile than the other stock funds, the income and growth funds,
and the more conservative income funds. While the Manager tries to reduce
risks by diversifying investments, by carefully researching securities
before they are purchased for the portfolio, and in some cases by using
hedging techniques, there is no guarantee of success in achieving the
Fund's objective and your shares may be worth more or less than their
original cost when you redeem them. Please refer to "Investment Objective
and Policies" starting on page ___ for a more complete discussion of the
Fund's investment risks.
-- How Can I Buy Shares? You can buy shares through your dealer or
financial institution, or you can purchase shares directly through the
Distributor by completing an Application or by using an Automatic
Investment Plan under AccountLink. Please refer to "How to Buy Shares"
on page ___ for more details.
-- Will I Pay a Sales Charge to Buy Shares? The Fund's shares are
offered with a front-end sales charge, starting at 5.75%, and reduced for
larger purchases. Please review "How to Buy Shares" starting on page ___
for more details.
-- How Can I Sell My Shares? Shares can be redeemed by mail or by
telephone call to the Transfer Agent on any business day, or through your
dealer. Please refer to "How to Sell Shares" on page ___. The Fund also
offers exchange privileges to other Oppenheimer funds, described in "How
to Exchange Shares" on page _____.
-- How Has the Fund Performed? The Fund measures its performance
by quoting its average annual total returns and cumulative total returns,
which measure historical performance. Those returns can be compared to
the returns (over similar periods) of other funds. Of course, other funds
may have different objectives, investments, and levels of risk. The
Fund's performance can also be compared to broad market indices, which we
have done on page ___. Please remember that past performance does not
guarantee future results.
<PAGE>
Financial Highlights
The table on the following pages presents selected financial
information about the Fund, including per share data, expense ratios and
other data based on the Fund's average net assets. This information has
been audited by KPMG Peat Marwick LLP, the Fund's independent auditors,
whose report on the Fund's Financial Statements for the fiscal year ended
September 30, 1994, is included in the Statement of Additional
Information.
<TABLE>
<CAPTION>
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FINANCIAL HIGHLIGHTS
YEAR ENDED SEPTEMBER 30,
1994 1993 1992 1991(2) 1990 1989 1988(1)
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
<C>
PER SHARE OPERATING DATA:
Net asset value, beginning
of period $21.64 $20.25 $26.90 $11.81 $12.09 $10.63 $10.00
-------------------------------------------------------------------------------------------
Income (loss) from
investment operations:
Net investment income (loss) (.01) (.10) (.17) (.03) (.02) (.10) .14
Net realized and unrealized
gain (loss) on investments,
options written and foreign
currency transactions (2.11) 1.69 (6.47) 15.12 (.26) 1.69 .49
------ ------ ------ ------ ------ ------ ------
Total income (loss) from
investment operations (2.12) 1.59 (6.64) 15.09 (.28) 1.59 .63
-------------------------------------------------------------------------------------------
Dividends and distributions
to shareholders:
Dividends from net
investment income -- -- (.01) -- -- (.10) --
Distributions in excess
of net realized gain
on investments,
options written and foreign
currency transactions (.17) (.20) -- -- -- (.03) --
------ ------ ------ ------ ------ ------ ------
Total dividends and
distributions to shareholders (.17) (.20) (.01) -- -- (.13) --
------ ------ ------ ------ ------ ------ ------
Net asset value, end of period $19.35 $21.64 $20.25 $26.90 $11.81 $12.09 $10.63
------ ------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------ ------
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET
VALUE(3) (9.91)% 7.79% (24.70)% 127.78% (2.32)% 15.21% 6.30%
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in thousands) $163,295 $199,697 $129,634 $103,352 $16,217 $3,872 $1,921
-------------------------------------------------------------------------------------------
Average net assets
(in thousands) $190,984 $194,184 $166,144 $50,989 $8,716 $2,343 $1,394
-------------------------------------------------------------------------------------------
Number of shares
outstanding at end of
period (in thousands) 8,437 9,226 6,400 3,841 1,373 320 181
-------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss) (1.05)% (.80)% (.71)% (.18)% (.37)% (.70)% 1.41%(4)
Expenses 1.77% 1.59% 1.39% 1.50% 1.78% 2.40% 2.06%(4)
-------------------------------------------------------------------------------------------
Portfolio turnover rate(5) 54.7% 41.0% 2.6% 11.2% 16.6% 17.1% 1.7%
</TABLE>
1. For the period from December 30, 1987 (commencement of operations) to
September 30, 1988. Per share amounts calculated based on the weighted
average number of shares outstanding during the period.
2. Per share amounts calculated based on the weighted average number of
shares outstanding during the period.
3. 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.
4. Annualized.
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 September 30, 1994 were
$92,464,689 and $140,116,746, respectively.
<PAGE>
Investment Objective and Policies
Objective. The Fund invests its assets to aggressively seek capital
appreciation.
Investment Policies and Strategies. The Fund seeks its investment
objective by emphasizing investment in common stocks or other equity
securities, including securities that are convertible into common stock.
The Fund may hold warrants and rights. These securities may be traded on
securities exchanges or in over-the-counter markets.
Under normal market conditions, the Fund invests at least 65% of its
total assets in securities of emerging growth companies located in the
United States and at least three foreign countries. The Fund may invest
a substantial amount of its assets in foreign securities, discussed below.
There is also an explanation of "emerging growth" companies below.
The Fund's portfolio manager currently uses an investment strategy
in selecting foreign and domestic securities that examines the effects of
worldwide trends on the growth of various business sectors. These trends,
or "global themes," currently include telecommunications expansion,
emerging consumer markets, infrastructure development, natural resource
use and development, corporate restructuring, capital market development
in foreign countries, healthcare expansion and global integration. These
trends, which may affect the growth of companies having businesses in
these sectors or affected by their development, may suggest opportunities
for investing the Fund's assets. The Manager does not invest a fixed
amount of the Fund's assets in any one sector, and these themes and this
approach may change over time.
When investing the Fund's assets, the Manager considers many factors,
including general economic conditions abroad relative to those in the U.S.
and the trends in foreign and domestic stock markets. The Fund may try
to hedge against losses in the value of its portfolio of securities by
using hedging strategies or derivative investments, described below.
The Fund may also seek to take advantage of changes in the business
cycle by investing in companies that are sensitive to those changes, if
the Manager believes they present opportunities for growth. For example,
when the economy of a country is expanding, companies in the financial
services and consumer products industries may be in a position to benefit
from changes in the business cycle and may present long-term growth
opportunities.
When market conditions are unstable, the Fund may invest substantial
amounts of its assets in debt securities, such as money market instruments
or government securities, for temporary defensive purposes, as described
below. The Fund's portfolio manager may employ special investment
techniques in selecting securities for the Fund. These are also described
below. Additional information may be found about them under the same
headings in the Statement of Additional Information.
Because of the types of companies the Fund invests in and the
investment techniques the Fund uses, some of which may be speculative, the
Fund is designed for investors who are investing for the long-term and who
are willing to accept greater risks of loss of their capital in the hope
of achieving greater capital appreciation. Investing for capital
appreciation entails the risk of loss of all or part of your principal.
-- Prior Investment Policy. The Fund previously emphasized
investments in biotechnology companies, and was named "Oppenheimer Global
Bio-Tech Fund". At a meeting held September 19, 1994, the Fund's
shareholders approved a proposal to expand the Fund's investment policies
to emphasize investments in emerging growth companies worldwide, and to
eliminate the policy that the Fund would generally invest at least 65% of
its total assets in biotechnology companies. The Fund's Board of Trustees
simultaneously changed the Fund's name to "Oppenheimer Global Emerging
Growth Fund" to reflect its revised investment policies.
-- Interim Concentration Policy. Because of the Fund's prior
emphasis on biotechnology investments, it retains a substantial amount of
its assets in those investments, although over time the Fund expects to
reduce those holdings. The Fund reserves the freedom to concentrate its
investments (that is, to invest 25% or more of its total assets) in
securities of biotechnology companies. This policy is expected to be in
effect for an interim transition period to permit an orderly reduction in
its biotechnology investments. Market conditions affecting the Fund's
biotechnology holdings or unanticipated redemptions of Fund shares might
make it impracticable for the Fund to quickly reduce its biotechnology
holdings in an orderly manner to less than 25% of its total assets.
Therefore, the duration of this interim period cannot be specifically
stated.
The Fund defines "biotechnology" companies as those with a
significant business or investment in biotechnology. In defining
industries or groups of industries for its concentration policy, the Fund
has adopted the industry classifications set forth in the Appendix to this
Prospectus. For purposes of its interim biotechnology concentration
policy, the Fund reserves the right to invest more than 25% of its assets
in either or both of the "health care/drugs" and "health care/supplies &
service" industry categories.
On November 18, 1994, the Fund acquired substantially all of the
assets of Oppenheimer Global Environment Fund. The Fund anticipates that
it will maintain, for at least an interim period, a substantial portion
of the environmental securities it acquired in that merger. Most of those
issuers qualify as emerging growth companies.
-- What Are "Emerging Growth" Companies? The Fund emphasizes
investments in companies that offer the potential for accelerated earnings
or revenues growth. These are "emerging growth companies," which tend to
be newer, smaller companies that are developing new products or services
or that are expanding into new markets for their products. However,
emerging growth companies can be any size and can be in any industry, and
may include established companies entering a new growth cycle. They
normally retain a large part of their earnings for research, development
and investment in capital assets. Therefore, they tend not to emphasize
the payment of dividends.
-- Can the Fund's Investment Objective and Policies Change? The Fund
has an investment objective, which is described above, as well as
investment policies it follows to try to achieve its objective.
Additionally, the Fund uses certain investment techniques and strategies
in carrying out those investment policies. The Fund's investment policies
and techniques are not "fundamental" unless the Prospectus or Statement
of Additional Information says that a particular policy is "fundamental."
The Fund's investment objective is a fundamental policy.
Fundamental policies are those that cannot be changed without the
approval of a "majority" of the Fund's outstanding voting shares. The
term "majority" is defined in the Investment Company Act to be a
particular percentage of outstanding voting shares (and this term is
explained in the Statement of Additional Information). The Fund's Board
of Trustees may change non-fundamental policies without shareholder
approval, although significant changes will be described in amendments to
this Prospectus.
-- Stock Investment Risks. Because the Fund invests a substantial
portion of its assets in stocks, the value of the Fund's portfolio will
be affected by changes in the stock markets. At times, the stock markets
can be volatile, and stock prices can change substantially. This market
risk will affect the Fund's net asset value per share, which will
fluctuate as the values of the Fund's portfolio securities change. Not
all stock prices change uniformly or at the same time, not all stock
markets move in the same direction at the same time, and other factors can
affect a particular stock's prices (for example, poor earnings reports by
an issuer, loss of major customers, major litigation against an issuer,
or changes in government regulations affecting an industry). Not all of
these factors can be predicted.
The Fund attempts to limit market risks by diversifying its
investments, that is, by not holding a substantial amount of the stock of
any one company and by not investing too great a percentage of the Fund's
assets in any one company. Expanding the Fund's investment policies to
emphasize investments in emerging growth companies worldwide serves to
diversify the Fund's investments across a number of sectors, in addition
to the biotechnology sector. Because changes in market prices can occur
at any time, there is no assurance that the Fund will achieve its
investment objective, and when you redeem your shares, they may be worth
more or less than what you paid for them.
-- Foreign Securities. The Fund may invest a substantial amount of
its assets in foreign securities. The Fund may purchase securities issued
or guaranteed by foreign companies or foreign governments including
foreign government agencies. The Fund may buy securities of companies in
any country, developed or underdeveloped. Other than the requirement that
the Fund will normally invest at least 65% of its assets in the U.S. and
at least three foreign countries, there is no limit on the amount of the
Fund's assets that may be invested in foreign securities. The Fund will
hold foreign currency only in connection with the purchase or sale of
foreign securities. If the Fund's securities are held abroad, the
countries in which they are held and the sub-custodians holding them must
be approved by the Fund's Board of Trustees.
-- Foreign securities have special risks. There are special risks
in investing in foreign securities. Because the Fund may buy securities
denominated in foreign currencies or traded primarily in foreign markets,
a change in the value of a foreign currency against the U.S. dollar will
result in a change in the U.S. dollar value of securities denominated in
that foreign currency. Investments in securities of issuers in non-
industrialized countries generally involve more risk and may be considered
to be highly speculative. Foreign issuers are not subject to the same
accounting and disclosure requirements that U.S. companies are subject to.
The value of foreign investments may be affected by other factors,
including exchange control regulations, expropriation or nationalization
of a company's assets, foreign taxes, delays in settlement of
transactions, changes in governmental economic or monetary policy in the
U.S. or abroad, or other political and economic factors.
In addition, it is generally more difficult to obtain court judgments
outside the U.S. if the Fund were to sue a foreign issuer or broker.
Additional costs may be incurred because foreign brokerage commissions may
be higher than U.S. rates, and there are additional custodial costs
associated with holding securities abroad.
-- Warrants and Rights. Warrants basically are options to purchase
stock at set prices that are valid for a limited period of time. Rights
are options to purchase securities, normally granted to stockholders by
the issuer. The Fund may invest up to 5% of its total assets in warrants
or rights. That 5% does not apply to warrants or rights the Fund has
acquired as part of units that include other securities or that were
attached to other securities. No more than 2% of the Fund's assets may
be invested in warrants that are not listed on the New York or American
Stock Exchanges. These percentage limitations are fundamental policies.
-- Portfolio Turnover. A change in the securities held by the Fund
is known as "portfolio turnover." The Fund may engage in short-term
trading to try to achieve its objective. The "Financial Highlights,"
above, show the Fund's portfolio turnover rate during past fiscal years.
High turnover and short-term trading may cause the Fund to have relatively
larger commission expenses and transaction costs than funds that do not
engage in short-term trading. Additionally, high portfolio turnover may
affect the ability of the Fund to qualify as a "regulated investment
company" under the Internal Revenue Code for tax deductions for dividends
and capital gain distributions the Fund pays to shareholders. The Fund
qualified in its last fiscal year and intends to do so in the coming year,
although it reserves the right not to qualify.
Other Investment Techniques and Strategies. The Fund may also use the
investment techniques and strategies described below. These techniques
involve certain risks. The Statement of Additional Information contains
more information about these practices, including limitations on their use
that may help reduce some of the risks.
-- Special Risks - Borrowing for Leverage. The Fund may borrow up
to 10% of the value of its net assets from banks on an unsecured basis to
buy securities. This is a speculative investment method known as
"leverage." This technique may subject the Fund to greater risks and
costs than funds that do not borrow. These risks may include the
possibility that the Fund's net asset value per share will fluctuate more
than funds that don't borrow, since the Fund pays interest on borrowings
and interest expense affects the Fund's share price. Borrowing is subject
to regulatory limits under the Investment Company Act, described in more
detail in the Statement of Additional Information.
-- Investing in Small, Unseasoned Companies. The Fund may invest in
securities of small, unseasoned companies. These are companies that have
been in operation for less than three years, counting the operations of
any predecessors. Securities of these companies may have limited
liquidity (which means that the Fund may have difficulty selling them at
an acceptable price when it wants to) and the prices of these securities
may be volatile. The Fund currently intends to invest no more than 10% of
its total assets in securities of small, unseasoned issuers, while
reserving the right to invest up to 25% of its total assets in these
issuers.
-- Hedging. As described below, the Fund may purchase and sell
certain kinds of futures contracts, put and call options, forward
contracts, and options on futures and broadly-based stock indices. These
are all referred to as "hedging instruments." The Fund does not use
hedging instruments for speculative purposes, and has limits on the use
of them, described below. The hedging instruments the Fund may use are
described below and in greater detail in "Other Investment Techniques and
Strategies" in the Statement of Additional Information.
The Fund may buy and sell options, futures and forward contracts for
a number of purposes. It may do so to try to manage its exposure to the
possibility that the prices of its portfolio securities may decline, or
to establish a position in the securities market as a temporary substitute
for purchasing individual securities. Some of these strategies, such as
selling futures, buying puts and writing covered calls, hedge the Fund's
portfolio against price fluctuations. Other hedging strategies, such as
buying futures and call options, tend to increase the Fund's exposure to
the securities market.
Forward contracts are used to try to manage foreign currency risks
on the Fund's foreign investments. Foreign currency options are used to
try to protect against declines in the dollar value of foreign securities
the Fund owns, or to protect against an increase in the dollar cost of
buying foreign securities. Writing covered call options may also provide
income to the Fund for liquidity purposes.
Futures. The Fund may buy and sell futures contracts that relate to
broadly-based stock indices (these are referred to as Stock Index Futures)
or foreign currencies (these are called Forward Contracts and are
discussed below).
Put and Call Options. The Fund may buy and sell certain kinds of put
options (puts) and call options (calls). Calls the Fund buys or sells
must be listed on a securities or commodities exchange, or quoted on the
automated quotation system of NASDAQ, or traded in the over-the-counter
market. In the case of puts and calls on a foreign currency, they must
be traded on a securities or commodities exchange or in the over-the-
counter market, or must be quoted by recognized dealers in those options.
A call or put option must not be purchased by the Fund if the value of all
of the Fund's put and call options would exceed 5% of the Fund's total
assets.
The Fund may buy calls only on securities, broadly-based stock
indices, foreign currencies or Stock Index Futures. The Fund may buy
calls to terminate its obligation on a call the Fund previously wrote.
The Fund may write (that is, sell) covered call options. Each call
the Fund writes must be "covered" while it is outstanding. That means the
Fund must own the investment on which the call was written or it must own
other securities that are acceptable for the escrow arrangements required
for calls. The Fund may write calls on Futures contracts it owns, but
those calls must be covered by securities or other liquid assets the Fund
owns and segregates to enable it to satisfy its obligations if the call
is exercised. After the Fund writes a call, not more than 25% of the
Fund's assets may be subject to calls. When the Fund writes a call, it
receives cash (called a premium). The call gives the buyer the ability
to buy the investment on which the call was written from the Fund at the
call price during the period in which the call may be exercised. If the
value of the investment does not rise above the call price, it is likely
that the call will lapse without being exercised, while the Fund keeps the
cash premium (and the investment).
The Fund may purchase and sell put options. Buying a put on an
investment gives the Fund the right to sell the investment at a set price
to a seller of a put on that investment. The Fund can buy only those puts
that relate to securities that the Fund owns, broadly-based stock indices,
foreign currencies or Stock Index Futures. The Fund can buy a put on a
Stock Index Future whether or not the Fund owns the particular Stock Index
Future in its portfolio.
The Fund may write puts on securities, broadly-based stock indices,
foreign currencies or Stock Index Futures in an amount up to 50% of its
total assets, but only if those puts are covered by segregated liquid
assets.
Forward Contracts. Forward contracts are foreign currency exchange
contracts. They are used to buy or sell foreign currency for future
delivery at a fixed price. The Fund uses them to try to "lock in" the
U.S. dollar price of a security denominated in a foreign currency that the
Fund has bought or sold, or to protect against possible losses from
changes in the relative values of the U.S. dollar and foreign currency.
The Fund limits its exposure in foreign currency exchange contracts in a
particular foreign currency to the amount of its assets denominated in
that currency or in a closely-correlated currency.
Hedging instruments can be volatile investments and may involve
special risks. The use of hedging instruments requires special skills and
knowledge of investment techniques that are different than what is
required for normal portfolio management. If the Manager uses a hedging
instrument at the wrong time or judges market conditions incorrectly,
hedging strategies may reduce the Fund's return. The Fund could also
experience losses if the prices of its futures and options positions were
not correlated with its other investments or if it could not close out a
position because the market for the future or option was illiquid.
Options trading involves the payment of premiums and has special tax
effects on the Fund. There are also special risks in particular hedging
strategies. For example, if a covered call written by the Fund is
exercised on an investment that has increased in value, the Fund will be
required to sell the investment at the call price and will not be able to
realize any profit if the investment has increased in value above the call
price. In writing puts, there is a risk that the Fund may be required to
buy the underlying security at a disadvantageous price. The use of
forward contracts may reduce the gain that would otherwise result from a
change in the relationship between the U.S. dollar and a foreign currency.
These risks are described in greater detail in the Statement of Additional
Information.
-- Derivative Investments. In general, a "derivative investment" is
a specially-designed investment. Its performance is linked to the
performance of another investment or security such as an option, future,
index or currency. In the broadest sense, exchange-traded options and
futures contracts and other hedging instruments the Fund can use may be
defined as "derivative" investments.
There are special risks in investing in derivative investments. The
company issuing the investment might not pay the amount due on the
maturity of the instrument. Also, the underlying investment or security
on which the derivative is based might not perform the way the Manager
expected it to perform. These risks mean that the Fund can lose part of
the value of its investments, which will affect the Fund's share price.
Certain derivative investments held by the Fund may trade in the over-the-
counter markets and may be "illiquid." If that is the case, the Fund's
use of them will be limited, as discussed in "Illiquid and Restricted
Securities," below.
-- Illiquid and Restricted Securities. Under the policies and
procedures established by the Fund's Board of Trustees, the Manager
determines the liquidity of certain of the Fund's investments. Investments
may be illiquid because of the absence of an active trading market, making
it difficult to value them or dispose of them promptly at an acceptable
price. A restricted security is one that has a contractual restriction on
its resale or which cannot be sold publicly until it is registered under
the Securities Act of 1933.
The Fund will not invest more than 10% of its net assets in illiquid
or restricted securities (that limit may increase to 15% if certain state
laws are changed or the Fund's shares are no longer sold in those states).
The Fund's percentage limitation on these investments does not apply to
certain restricted securities that are eligible for resale to qualified
institutional purchasers.
-- Loans of Portfolio Investments. To raise cash for liquidity
purposes, the Fund may lend its portfolio investments to brokers, dealers
and other financial institutions. As a fundamental policy, these loans
are limited to not more than 25% of the value of the Fund's total assets
and are subject to other conditions described in the Statement of
Additional Information. The Fund presently does not intend to lend its
portfolio securities, but if it does, the value of securities loaned is
not expected to exceed 5% of the value of the Fund's total assets in the
current year.
-- Repurchase Agreements. The Fund may enter into repurchase
agreements. They are used primarily for liquidity purposes. In a
repurchase transaction, the Fund buys a security and simultaneously sells
it to the vendor for delivery at a future date.
Repurchase agreements must be fully collateralized. However, if the
vendor fails to pay the resale price on the delivery date, the Fund may
incur costs in disposing of the collateral and may experience losses if
there is any delay in its ability to do so. The Fund will not enter into
a repurchase agreement that causes more than 10% of its net assets to be
subject to repurchase agreements having a maturity beyond seven days.
There is no limit on the amount of the Fund's net assets that may be
subject to repurchase agreements of seven days or less.
-- Short Sales "Against-the-Box." In a short sale, the seller does
not own the security that is sold, but normally borrows the security to
fulfill its delivery obligation. The seller later buys the security to
repay the loan, in the expectation that the price of the security will be
lower when the purchase is made, resulting in a gain. The Fund may not
sell securities short except in collateralized transactions referred to
as short sales "against-the-box," where the Fund owns an equivalent amount
of the securities sold short. This technique is primarily used for tax
purposes. No more than 15% of the Fund's net assets will be held as
collateral for short sales at any one time.
-- Temporary Defensive Investments. When stock market prices are
falling, or in other unusual economic, political or business
circumstances, the Fund may invest all or a portion of its assets in
defensive securities. Securities selected for defensive purposes may
include debt securities. These may be rated or unrated bonds and
debentures, preferred stocks, cash or cash equivalents (such as U.S.
Treasury Bills and other short-term obligations of the U.S. Government,
its agencies or instrumentalities) or commercial paper rated "A-1" or
better by Standard & Poor's Corporation or "P-1" or better by Moody's
Investors Service, Inc. Generally, short-term debt securities (which are
securities maturing in one year or less from the date of purchase) will
be emphasized for defensive purposes.
Other Investment Restrictions. The Fund has other investment restrictions
that are fundamental policies. Under these fundamental policies, the Fund
cannot do any of the following:
-- The Fund cannot invest in securities of any one issuer (other
than the U.S. Government or its agencies or instrumentalities) if
immediately thereafter more than 5% of the Fund's assets would be invested
in securities of that issuer.
-- With respect to 75% of its assets, the Fund cannot invest in
securities of any one issuer (other than the U.S. Government or its
agencies or instrumentalities) if the Fund would then own more than 10%
of the voting securities or 10% of any class of securities of that issuer.
All debt and all preferred stock of an issuer are respectively considered
single classes for this purpose.
-- The Fund cannot borrow money in excess of 10% of the value of
its net assets.
-- The Fund cannot invest in other open-end investment companies,
except in a merger, consolidation, reorganization or acquisition of
assets, or invest more than 10% of its net assets through open-market
purchases in closed-end investment companies, including small business
investment companies, nor make any such investments at commission rates
that are not in excess of normal brokerage commissions.
-- The Fund cannot deviate from the percentage restrictions listed
under "Borrowing," "Warrants and Rights," "Loans of Portfolio Investments"
and "Short Sales Against-the-Box" or from the restrictions under "Foreign
Securities" as to what foreign securities may be purchased.
All of the percentage restrictions described above and elsewhere in
this Prospectus (other than the regulatory percentage limits that apply
to borrowing, described in the Statement of Additional Information) apply
only at the time the Fund purchases a security. The Fund need not dispose
of a security merely because the size of the Fund's assets has changed or
the security has increased in value relative to the size of the Fund.
There are other fundamental policies discussed in the Statement of
Additional Information.
How the Fund is Managed
Organization and History. The Fund was organized in 1987 as a
Massachusetts business trust. The Fund is an open-end, diversified
management investment company, with an unlimited number of authorized
shares of beneficial interest.
The Fund is governed by a Board of Trustees, which is responsible for
protecting the interests of shareholders under Massachusetts law. The
Trustees periodically meet throughout the year to oversee the Fund's
activities, review its performance, and review the actions of the Manager.
"Trustees and Officers of the Fund" in the Statement of Additional
Information names the Trustees and officers of the Fund and provides more
information about them. Although the Fund is not required by law to hold
annual meetings, it may hold shareholder meetings from time to time on
important matters, and shareholders have the right to call a meeting to
remove a Trustee or to take other action described in the Fund's
Declaration of Trust.
Presently, the Fund has only one class of shares. However, the Board
of Trustees has the power, without shareholder approval, to divide
unissued shares of the Fund into two or more classes. Those classes could
have different dividends and distributions and could be subject to
different expenses. Shares of the Fund are freely transferrable.
The Manager and Its Affiliates. The Fund is managed by the Manager,
Oppenheimer Management Corporation, which is responsible for selecting the
Fund's investments and handling its day-to-day business. The Manager
carries out its duties, subject to the policies established by the Board
of Trustees, under an Investment Advisory Agreement which states the
Manager's responsibilities. The agreement sets forth the fees paid by the
Fund to the Manager, and describes the expenses that the Fund is
responsible to pay to conduct its business.
The Manager has operated as an investment adviser since 1959. The
Manager (including a subsidiary) currently manages investment companies,
including other OppenheimerFunds, with assets of more than $35 billion as
of June 30, 1995, and with more than 2.6 million shareholder accounts.
The Manager is owned by Oppenheimer Acquisition Corp., a holding company
that is owned in part by senior officers of the Manager and controlled by
Massachusetts Mutual Life Insurance Company.
-- Portfolio Manager. The Portfolio Manager of the Fund is James C.
Ayer, Jr. Mr. Ayer is a Vice President of the Fund. He is an Assistant
Vice President of the Manager. He has been the person principally
responsible for the day-to-day management of the Fund's portfolio since
August, 1994. Prior to joining the Manager in 1992, Mr. Ayer was an
international equities investment officer with Brown Brothers Harriman &
Co.
-- Fees and Expenses. Under the investment advisory agreement, the
Fund pays the Manager the following annual fees, which decline on
additional assets as the Fund grows: 1.0% of the first $50 million of
average annual net assets; 0.75% of the next $150 million; 0.72% of the
next $200 million; 0.69% of the next $200 million; 0.66% of the next $200
million; and 0.60% of net assets in excess of $800 million. The Fund's
management fee for its last fiscal year ended September 30, 1994 was 0.81%
of average annual net assets of the Fund.
The Fund pays expenses related to its daily operations, such as
custodian fees, Trustees' fees, transfer agency fees, legal fees and
auditing costs. Those expenses are paid out of the Fund's assets and are
not paid directly by shareholders. However, those expenses reduce the net
asset value of shares, and therefore are indirectly borne by shareholders
through their investment. More information about the investment advisory
agreement and the other expenses paid by the Fund is contained in the
Statement of Additional Information.
There is also information about the Fund's brokerage policies and
practices in "Brokerage Policies of the Fund" in the Statement of
Additional Information. That section discusses how brokers and dealers are
selected for the Fund's portfolio transactions. When deciding which
brokers to use, the Manager is permitted by the investment advisory
agreement to consider whether brokers have sold shares of the Fund or any
other funds for which the Manager serves as investment adviser.
-- The Distributor. The Fund's shares are sold through dealers,
brokers and financial institutions that have a sales agreement with
Oppenheimer Funds Distributor, Inc., a subsidiary of the Manager that acts
as the Fund's Distributor. The Distributor also distributes the shares
of other mutual funds managed by the Manager (the "OppenheimerFunds") and
is sub-distributor for funds managed by a subsidiary of the Manager.
-- The Transfer Agent. The Fund's transfer agent is Oppenheimer
Shareholder Services, a division of the Manager, which acts as the
shareholder servicing agent for the Fund and the other OppenheimerFunds
on an "at-cost" basis. Shareholders should direct inquiries about their
account to the Transfer Agent at the address and toll-free numbers shown
below in this Prospectus and on the back cover.
Performance of the Fund
Explanation of Performance Terminology. The Fund uses the terms "total
return" and "average annual total return" to illustrate its performance.
These returns measure the performance of a hypothetical account in the
Fund over various periods, and do not show the performance of each
shareholder's account (which will vary if any dividends are received in
cash or shares are sold or repurchased). This performance information may
help you see how your Fund has done and to compare it to other funds or
market indices, as we have done below.
It is important to understand that the Fund's total returns represent
past performance and should not be considered to be predictions of future
returns or performance. This performance data is described below, but
more detailed information about how total returns are calculated is
contained in the Statement of Additional Information, which also contains
information about other ways to measure and compare the Fund's
performance. The Fund's investment performance will vary over time,
depending on market conditions, the composition of the portfolio and
expenses.
-- Total Returns. There are different types of total returns used to
measure the Fund's performance. Total return is the change in value of
a hypothetical investment in the Fund over a given period, assuming that
all dividends and capital gains distributions are reinvested in additional
shares. The cumulative total return measures the change in value over the
entire period (for example, ten years). An average annual total return
shows the average rate of return for each year in a period that would
produce the cumulative total return over the entire period. However,
average annual total returns do not show the Fund's actual year-by-year
performance.
When total returns are quoted for shares of the Fund, they reflect
the payment of the maximum initial sales charge. Total returns may also
be quoted "at net asset value," without considering the effect of the
sales charge, and those returns would be reduced if sales charges were
deducted.
How Has the Fund Performed? Below is a discussion by the Manager of the
Fund's performance during its last fiscal year ended September 30, 1994,
followed by a graphical comparison of the Fund's performance to an
appropriate broad-based market index as well as an index of global
securities.
-- Management's Discussion of Performance. In anticipation of the
change in investment policies approved by the Fund's shareholders on
September 19, 1994, the Manager had been building the Fund's cash
position, selling smaller positions, particularly in biotechnology and
environmental issues, and taking profits in stocks that the Manager
believed to have reached their peak. Following shareholder approval of
the investment policy change, the Fund began to use its cash position to
make investments to diversify the portfolio by country, investing in
established and emerging markets in Europe, Asia and Latin America. The
Manager also sought to begin to shift the portfolio's emphasis from
biotechnology and environmental issues to other emerging growth issuers.
Global stock markets were particularly volatile during the Fund's last
fiscal year, which limited the Fund's ability to dispose of holdings of
biotechnology issues, which suffered setbacks during that market
volatility, depressing the Fund's share price.
-- Comparing the Fund's Performance to the Market. The chart below
shows the performance of a hypothetical $10,000 investment in shares of
the Fund held from the inception of the Fund (December 30, 1987) until
September 30, 1994.
For the fiscal year ended September 30, 1994, the Fund has selected
a different broad market index against which to compare its performance,
the Morgan Stanley World Index, an unmanaged index of issuers listed on
the stock exchanges of 20 foreign countries and the United States. It is
widely recognized as a measure of global stock market performance. For
the fiscal year ended September 30, 1993, the Fund had compared its
performance to that of the S & P 500 Index, a broad-based index of U.S.
equity securities widely regarded as a general measurement of the
performance of the U.S. equity securities market. The newly-selected
index reflects the Manager's judgment that the Fund's global investing
focus is more fairly measured against an index that includes major foreign
stock markets, rather than just the U.S. A comparison of the Fund's
performance to the S & P 500 Index is also included for reference.
Index performance reflects reinvestment of dividends but does not
consider the effect of capital gains or transaction costs, and none of the
data below shows the effect of taxes. Also, the Fund's performance
reflects the effect of Fund business and operating expenses. While index
comparisons may be useful to provide a benchmark for the Fund's
performance, it must be noted that the Fund's investments are not limited
to the securities in either the Morgan Stanley World Index or the S & P
500 Index, and that index data does not reflect any assessment of the risk
of the investments included in the index.
Comparison of a Change
in Value of $10,000 [graph]
Hypothetical Investments in
Oppenheimer Global
Emerging Growth Fund, the
Morgan Stanley World Index
and the S&P 500 Index
Average Annual Total Returns of the Fund at 9/30/94
1-Year 5-Year Life 1
<15.09>% 8.93% 9.79%
Past performance is not predictive of future performance.
1. The Fund began operations on 12/30/87. The average annual total returns
and the ending account value reflect reinvestment of all dividends and
capital gains distributions and are shown net of the 5.75% maximum initial
sales charge.
A B O U T Y O U R A C C O U N T
How to Buy Shares
When you buy shares of the Fund, you pay an initial sales charge on
investments up to $1 million (up to $500,000 for purchases by
OppenheimerFunds prototype 401(k) Plans). If you purchase shares of the
Fund as part of an investment of at least $1 million ($500,000 for
OppenheimerFunds prototype 401(k) plans) in shares of one or more
OppenheimerFunds, you will not pay any initial sales charge, but if you
sell any of those shares within 18 months of buying them, you may pay a
contingent deferred sales charge. The amount of that sales charge will
vary depending on the amount you invested. Sales charges are described
below.
How Much Must You Invest? You can open a Fund account with a minimum
initial investment of $1,000 and make additional investments at any time
with as little as $25. There are reduced minimum investments under special
investment plans.
With Asset Builder Plans, Automatic Exchange Plans, 403(b)(7)
custodial plans and military allotment plans, you can make initial and
subsequent investments of as little as $25. Subsequent purchases of at
least $25 can be made by telephone through AccountLink.
Under pension and profit-sharing plans and Individual Retirement
Accounts (IRAs), you can make an initial investment of as little as $250.
If your IRA is established under an Asset Builder Plan, the $25 minimum
applies. Subsequent investments may be as little as $25.
There is no minimum investment requirement if you are buying
shares by reinvesting dividends from the Fund or other OppenheimerFunds
(a list of them appears in the Statement of Additional Information, or you
can ask your dealer or call the Transfer Agent), or by reinvesting
distributions from unit investment trusts that have made arrangements with
the Distributor.
-- How Are Shares Purchased? You can buy shares several ways --
through any dealer, broker or financial institution that has a sales
agreement with the Distributor, or directly through the Distributor, or
automatically from your bank account through an Asset Builder Plan under
the OppenheimerFunds AccountLink service.
-- Buying Shares Through Your Dealer. Your dealer will place your
order with the Distributor on your behalf.
-- Buying Shares Through the Distributor. Complete an
OppenheimerFunds New Account Application and return it with a check
payable to "Oppenheimer Funds Distributor, Inc." Mail it to P.O. Box 5270,
Denver, Colorado 80217. If you don't list a dealer on the application,
the Distributor will act as your agent in buying the shares. However, it
is recommended that you discuss your investment first with a financial
advisor, to be sure that it is appropriate for you.
-- Buying Shares Through OppenheimerFunds AccountLink. You can use
AccountLink to link your Fund account with an account at a U.S. bank or
other financial institution that is an Automated Clearing House (ACH)
member. You can then transmit funds electronically to purchase shares,
to send redemption proceeds, or to transmit dividends and distributions.
Shares are purchased for your account on the regular business day the
Distributor is instructed by you to initiate the ACH transfer to buy
shares. You can provide those instructions automatically, under an Asset
Builder Plan, described below, or by telephone instructions using
OppenheimerFunds PhoneLink, also described below. You should request
AccountLink privileges on the application or dealer settlement
instructions used to establish your account. Please refer to "AccountLink"
below for more details.
-- Asset Builder Plans. You may purchase shares of the Fund (and up
to four other OppenheimerFunds) automatically each month from your account
at a bank or other financial institution under an Asset Builder Plan with
AccountLink. Details are on the Application and in the Statement of
Additional Information.
-- At What Price Are Shares Sold? Shares are sold at the public
offering price based on the net asset value (and any initial sales charge
that applies) that is next determined after the Distributor receives the
purchase order in Denver, Colorado. In most cases, to enable you to
receive that day's offering price, the Distributor must receive your order
by the time of day The New York Stock Exchange closes, which is normally
4:00 P.M., New York time, but may be earlier on some days (all references
to time in this Prospectus mean "New York time").
If you buy shares through a dealer, the dealer must receive your
order by the close of The New York Stock Exchange on a regular business
day and transmit it to the Distributor so that it is received before the
Distributor's close of business that day, which is normally 5:00 P.M. The
Distributor may reject any purchase order for the Fund's shares, in its
sole discretion.
The public offering price is normally net asset value plus an initial
sales charge. However, in some cases, described below, purchases are not
subject to an initial sales charge, and the offering price will be the net
asset value. In some cases, reduced sales charges may be available, as
described below. Out of the amount you invest, the Fund receives the net
asset value to invest for your account. The sales charge varies depending
on the amount of your purchase. A portion of the sales charge may be
retained by the Distributor and allocated to your dealer. The current
sales charge rates and commissions paid to dealers and brokers are as
follows:
<TABLE>
<CAPTION>
Front-End Front-End
Sales Charge Sales Charge Commission
As a As a as Percentage
Percentage of as Percentage of Offering
Amount of Purchase Offering Price Amount Invested Price
<S> <C> <C> <C>
Less than $25,000 5.75% 6.10% 4.75%
$25,000 or more 5.50% 5.82% 4.75%
but less than
$50,000
$50,000 or more 4.75% 4.99% 4.00%
but less than
$100,000
$100,000 or more 3.75% 3.90% 3.00%
but less than
$250,000
$250,000 or more 2.50% 2.56% 2.00%
but less than
$500,000
$500,000 or more 2.00% 2.04% 1.60%
but less than
$1 million
</TABLE>
The Distributor reserves the right to reallow the entire commission
to dealers. If that occurs, the dealer may be considered an "underwriter"
under Federal securities laws.
-- Contingent Deferred Sales Charge. There is no initial sales
charge on purchases of Class A shares of any one or more of the
OppenheimerFunds in the following cases:
-- Purchases aggregating $1 million or more
-- Purchases by an OppenheimerFunds prototype 401(k) plan that (1)
buys shares costing $500,000 or more, or (2) has, at the time of purchase,
100 or more eligible participants, or (3) certifies that it projects to
have annual plan purchases of $200,000 or more.
Shares of the Fund and other OppenheimerFunds that offer only one
class of shares that has no class designation are considered "Class A
Shares" for this purpose. The Distributor pays dealers of record
commissions on these purchases in an amount equal to the sum of 1.0% of
the first $2.5 million, plus 0.50% of the next $2.5 million, plus 0.25%
of share purchases over $5 million. That commission will be paid only on
the amount of those purchases in excess of $1 million ($500,000, for
purchases by OppenheimerFunds 401(k) Plans) that were not previously
subject to a front-end sales charge and dealer commission.
If you redeem any of those shares within 18 months of the end of the
calendar month of their purchase, a contingent deferred sales charge may
be deducted from the redemption proceeds. That sales charge will be equal
to 1.0% of the aggregate net asset value of either (1) the redeemed shares
(not including shares purchased by reinvestment of dividends or capital
gain distributions) or (2) the original cost of the shares, whichever is
less. However, the contingent deferred sales charge will not exceed the
aggregate commissions the Distributor paid to your dealer on all Class A
shares of all OppenheimerFunds you purchased subject to the Class A
contingent deferred sales charge.
In determining whether a contingent deferred sales charge is payable,
the Fund will first redeem shares that are not subject to the sales
charge, including shares purchased by reinvestment of dividends and
capital gains, and then will redeem other shares in the order that you
purchased them. The contingent deferred sales charge is waived in certain
cases described in "Waivers of Sales Charges" below.
No contingent deferred sales charge is charged on exchanges of shares
under the Fund's Exchange Privilege (described below). However, if the
shares acquired by exchange are redeemed within 18 months of the end of
the calendar month of the purchase of the exchanged shares, the sales
charge will apply.
-- Special Arrangements With Dealers. The Distributor may advance
up to 13 months' commissions to dealers that have established special
arrangements with the Distributor for Asset Builder Plans for their
clients. Dealers whose sales of Class A shares of OppenheimerFunds (other
than money market funds) under OppenheimerFunds-sponsored 403(b)(7)
custodial plans exceed $5 million per year (calculated per quarter), will
receive monthly one-half of the Distributor's retained commissions on
those sales, and if those sales exceed $10 million per year, those dealers
will receive the Distributor's entire retained commission on those sales.
Reduced Sales Charges. You may be eligible to buy shares of the Fund at
reduced sales charge rates in one or more of the following ways:
-- Right of Accumulation. To qualify for the lower sales charge rates
that apply to larger purchases, you and your spouse can add together Fund
shares and Class A and B shares of other OppenheimerFunds you purchase for
your individual accounts, or jointly, or for trustee custodial accounts
on behalf of your children who are minors. A fiduciary can count all
shares purchased for a trust, estate or other fiduciary account (including
one or more employee benefit plans of the same employer) that has multiple
accounts.
Additionally, you can add together current purchases of shares of the
Fund and Class A and Class B shares of other OppenheimerFunds to reduce
the sales charge rate that applies to current purchases of Class A and
Class B shares. You can also include shares of the Fund and Class A Class
B shares of other OppenheimerFunds you previously purchased subject to a
sales charge, provided that you still hold your investment in one of the
OppenheimerFunds. The value of those shares will be based on the greater
of the amount you paid for the shares or their current value (at offering
price). The OppenheimerFunds are listed in "Reduced Sales Charges" in the
Statement of Additional Information, or a list can be obtained from the
Distributor. The reduced sales charge will apply only to current purchases
and must be requested when you buy your shares.
-- Letter of Intent. Under a Letter of Intent, if you purchase
shares of the Fund and Class A and Class B shares of other
OppenheimerFunds during a 13-month period you can reduce the sales charge
that applies to your purchases of Class A shares. The total amount of
your intended purchases of both Class A and Class B shares will determine
the reduced sales charge rate that applies to the Class A shares purchased
during that period. This can include purchases made up to 90 days before
the date of the Letter. More information is contained in the Application
and in "Reduced Sales Charges" in the Statement of Additional Information.
-- Waivers of Sales Charges. The Class A sales charges are not
imposed in the circumstances described below. There is an explanation of
this policy in "Reduced Sales Charges" in the Statement of Additional
Information.
Waivers of Initial and Contingent Deferred Sales Charges for Certain
Purchasers. Class A shares purchased by the following investors are not
subject to any Class A sales charges:
-- the Manager or its affiliates;
-- present or former officers, directors, trustees and employees
(and their "immediate families" as defined in "Reduced Sales Charges" in
the Statement of Additional Information) of the Fund, the Manager and its
affiliates, and retirement plans established by them for their employees;
-- registered management investment companies, or separate accounts
of insurance companies having an agreement with the Manager or the
Distributor for that purpose;
-- dealers or brokers that have a sales agreement with the
Distributor, if they purchase shares for their own accounts or for
retirement plans for their employees;
-- employees and registered representatives (and their spouses) of
dealers or brokers described above or financial institutions that have
entered into sales arrangements with such dealers or brokers (and are
identified to the Distributor) or with the Distributor; the purchaser must
certify to the Distributor at the time of purchase that the purchase is
for the purchaser's own account (or for the benefit of such employee's
spouse or minor children);
-- dealers, brokers or registered investment advisers that have
entered into an agreement with the Distributor providing specifically for
the use of shares of the Fund in particular investment products made
available to their clients; or
-- dealers, brokers or registered investment advisers that have
entered into an agreement with the Distributor to sell shares to defined
contribution employee retirement plans for which the dealer, broker or
investment adviser provides administration services.
Waivers of Initial and Contingent Deferred Sales Charges in Certain
Transactions. Class A shares issued or purchased in the following
transactions are not subject to Class A sales charges:
-- shares issued in plans of reorganization, such as mergers, asset
acquisitions and exchange offers, to which the Fund is a party;
-- shares purchased by the reinvestment of loan repayments by a
participant in a retirement plan for which the Manager or its affiliates
acts as sponsor;
-- shares purchased by the reinvestment of dividends or other
distributions reinvested from the Fund or other OppenheimerFunds (other
than Oppenheimer Cash Reserves) or unit investment trusts for which
reinvestment arrangements have been made with the Distributor; or
-- shares purchased and paid for with the proceeds of shares
redeemed in the past 12 months from a mutual fund (other than a fund
managed by the Manager or any of its subsidiaries) on which an initial
sales charge or contingent sales charge was paid (this waiver also applies
to shares purchased by exchange of shares of Oppenheimer Money Market
Fund, Inc. that were purchased and paid for in this manner); this waiver
must be requested when the purchase order is placed for your shares of the
Fund, and the Distributor may require evidence of your qualification for
this waiver.
Waivers of the Class A Contingent Deferred Sales Charge for Certain
Redemptions. The Class A contingent deferred sales charge is also waived
if shares that would otherwise be subject to the contingent deferred sales
charge are redeemed in the following cases:
-- for retirement distributions or loans to participants or
beneficiaries from qualified retirement plans, deferred compensation plans
or other employee benefit plans, including OppenheimerFunds prototype
401(k) plans (these are all referred to as "Retirement Plans");
-- to return excess contributions made to Retirement Plans;
-- to make Automatic Withdrawal Plan payments that are limited
annually to no more than 12% of the original account value;
-- involuntary redemptions of shares by operation of law or
involuntary redemptions of small accounts (see "Shareholder Account Rules
and Policies," below); or
-- if, at the time a purchase order is placed for Class A shares
that would otherwise be subject to the Class A contingent deferred sales
charge, the dealer agrees in writing to accept the dealer's portion of the
commission payable on the sale in installments of 1/18th of the commission
per month (and no further commission will be payable if the shares are
redeemed within 18 months of purchase); or
-- for distributions from OppenheimerFunds prototype 401(k) plans
for any of the following cases or purposes: (1) following death or
disability (as defined in the Internal Revenue Code) of the participant
or beneficiary (the death or disability must occur after the participant's
account was established); (2) hardship withdrawals, as defined in the
plan; (3) under a Qualified Domestic Relations Order, as defined in the
Internal Revenue Code; (4) to meet the minimum distribution requirements
of the Internal Revenue Code; (5) to establish "substantially equal
periodic payments" as described in Section 72(t) of the Internal Revenue
Code, or (6) separation from service.
-- Service Plan. The Fund has adopted a Service Plan to reimburse
the Distributor for a portion of its costs incurred in connection with the
personal service and maintenance of shareholder accounts that hold shares
of the Fund. Reimbursement is made quarterly at an annual rate that may
not exceed 0.25% of the average annual net assets of the Fund. The
Distributor uses all of those fees to compensate dealers, brokers, banks
and other financial institutions quarterly for providing personal service
and maintenance of accounts of their customers that hold shares of the
Fund and to reimburse itself for its other expenditures under the Plan (if
the Fund's Board of Trustees authorizes such reimbursements, which it has
not yet done).
Services to be provided include, among others, answering customer
inquiries about the Fund, assisting in establishing and maintaining
accounts in the Fund, making the Fund's investment plans available and
providing other services at the request of the Fund or the Distributor.
Payments are made by the Distributor quarterly at an annual rate not to
exceed 0.25% of the average annual net assets of shares of the Fund held
in accounts of the dealer or its customers. The payments under the Plan
increase the annual expenses of the Fund. For more details, please refer
to "Service Plan" in the Statement of Additional Information.
Special Investor Services
AccountLink. OppenheimerFunds AccountLink links your Fund account to your
account at your bank or other financial institution to enable you to send
money electronically between those accounts to perform a number of types
of account transactions. These include purchases of shares by telephone
(either through a service representative or by PhoneLink, described
below), automatic investments under Asset Builder Plans, and sending
dividends and distributions or Automatic Withdrawal Plan payments directly
to your bank account. Please refer to the Application for details or call
the Transfer Agent for more information.
AccountLink privileges must be requested on the Application you use
to buy shares, or on your dealer's settlement instructions if you buy your
shares through your dealer. After your account is established, you can
request AccountLink privileges on signature-guaranteed instructions to the
Transfer Agent. AccountLink privileges will apply to each shareholder
listed in the registration on your account as well as to your dealer
representative of record unless and until the Transfer Agent receives
written instructions terminating or changing those privileges. After you
establish AccountLink for your account, any change of bank account
information must be made by signature-guaranteed instructions to the
Transfer Agent signed by all shareholders who own the account.
-- Using AccountLink to Buy Shares. Purchases may be made by
telephone only after your account has been established. To purchase shares
in amounts up to $250,000 through a telephone representative, call the
Distributor at 1-800-852-8457. The purchase payment will be debited from
your bank account.
-- PhoneLink. PhoneLink is the OppenheimerFunds automated telephone
system that enables shareholders to perform a number of account
transactions automatically using a touch-tone phone. PhoneLink may be
used on already-established Fund accounts after you obtain a Personal
Identification Number (PIN), by calling the special PhoneLink number: 1-
800-533-3310.
-- Purchasing Shares. You may purchase shares in amounts up to
$100,000 by phone, by calling 1-800-533-3310. You must have established
AccountLink privileges to link your bank account with the Fund, to pay for
these purchases.
-- Exchanging Shares. With the OppenheimerFunds Exchange Privilege,
described below, you can exchange shares automatically by phone from your
Fund account to another OppenheimerFunds account you have already
established by calling the special PhoneLink number. Please refer to "How
to Exchange Shares," below, for details.
-- Selling Shares. You can redeem shares by telephone automatically
by calling the PhoneLink number and the Fund will send the proceeds
directly to your AccountLink bank account. Please refer to "How to Sell
Shares," below, for details.
Automatic Withdrawal and Exchange Plans. The Fund has several plans that
enable you to sell shares automatically or exchange them to another
OppenheimerFunds account on a regular basis:
-- Automatic Withdrawal Plans. If your Fund account is worth $5,000
or more, you can establish an Automatic Withdrawal Plan to receive
payments of at least $50 on a monthly, quarterly, semi-annual or annual
basis. The checks may be sent to you or sent automatically to your bank
account on AccountLink. You may even set up certain types of withdrawals
of up to $1,500 per month by telephone. You should consult the
Application and Statement of Additional Information for more details.
-- Automatic Exchange Plans. You can authorize the Transfer Agent to
exchange automatically an amount you establish in advance for shares of
up to five other OppenheimerFunds on a monthly, quarterly, semi-annual or
annual basis under an Automatic Exchange Plan. The minimum purchase for
each OppenheimerFunds account is $25. These exchanges are subject to the
terms of the Exchange Privilege, described below.
Reinvestment Privilege. If you redeem some or all of your Fund shares,
you have up to 6 months to reinvest all or part of the redemption proceeds
in shares of the Fund or Class A shares of other OppenheimerFunds without
paying sales charge. This privilege applies to Fund shares that you
purchased with an initial sales charge or on which you paid a contingent
deferred sales charge when you redeemed them. You must be sure to ask the
Distributor for this privilege when you send your payment. Please consult
the Statement of Additional Information for more details.
Retirement Plans. Fund shares are available as an investment for
retirement plans. If you participate in a plan sponsored by your employer,
the plan trustee or administrator must make the purchase of shares for
your retirement plan account. The Distributor offers a number of different
retirement plans that can be used by individuals and employers:
-- Individual Retirement Accounts including rollover IRAs, for
individuals and their spouses
-- 403(b)(7) Custodial Plans for employees of eligible tax-exempt
organizations, such as schools, hospitals and charitable organizations
-- SEP-IRAs (Simplified Employee Pension Plans) for small business
owners or people with income from self-employment, including SARSEP-IRAs
-- Pension and Profit-Sharing Plans for self-employed persons and
other employers
-- 401(k) prototype retirement plans for businesses
Please call the Distributor for the OppenheimerFunds plan documents,
which contain important information and applications.
How to Sell Shares
You can arrange to take money out of your account on any regular business
day by selling (redeeming) some or all of your shares. Your shares will
be sold at the next net asset value calculated after your order is
received and accepted by the Transfer Agent. The Fund offers you a number
of ways to sell your shares in writing or by telephone. You can also set
up Automatic Withdrawal Plans to redeem shares on a regular basis, as
described above. If you have questions about any of these procedures, and
especially if you are redeeming shares in a special situation, such as due
to the death of the owner, or from a retirement plan, please call the
Transfer Agent first, at 1-800-525-7048, for assistance.
-- Retirement Accounts. To sell shares in an OppenheimerFunds
retirement account in your name, call the Transfer Agent for a
distribution request form. There are special income tax withholding
requirements for distributions from retirement plans and you must submit
a withholding form with your request to avoid delay. If your retirement
plan account is held for you by your employer, you must arrange for the
distribution request to be sent by the plan administrator or trustee.
There are additional details in the Statement of Additional Information.
-- Certain Requests Require a Signature Guarantee. To protect you
and the Fund from fraud, certain redemption requests must be in writing
and must include a signature guarantee in the following situations (there
may be other situations also requiring a signature guarantee):
-- You wish to redeem more than $50,000 worth of shares and receive
a check
-- The redemption check is not payable to all shareholders listed on
the account statement
-- The redemption check is not sent to the address of record on your
statement
-- Shares are being transferred to a Fund account with a different
owner or name
-- Shares are redeemed by someone other than the owners (such as an
Executor)
-- Where Can I Have My Signature Guaranteed? The Transfer Agent will
accept a guarantee of your signature by a number of financial
institutions, including: a U.S. bank, trust company, credit union or
savings association, or by a foreign bank that has a U.S. correspondent
bank, or by a U.S. registered dealer or broker in securities, municipal
securities or government securities, or by a U.S. national securities
exchange, a registered securities association or a clearing agency. If you
are signing on behalf of a corporation, partnership or other business, or
as a fiduciary, you must also include your title in the signature.
Selling Shares by Mail. Write a "letter of instructions" that includes:
-- Your name
-- The Fund's name
-- Your Fund account number (from your account statement)
-- The dollar amount or number of shares to be redeemed
-- Any special payment instructions
-- Any share certificates for the shares you are selling
-- The signatures of all registered owners exactly as the account is
registered, and
-- Any special requirements or documents requested by the Transfer
Agent to assure proper authorization of the person asking to sell shares.
Use the following address for requests by mail:
Oppenheimer Shareholder Services
P.O. Box 5270, Denver, Colorado 80217
Send courier or Express Mail requests to:
Oppenheimer Shareholder Services
10200 E. Girard Avenue, Building D
Denver, Colorado 80231
Selling Shares by Telephone. You and your dealer representative of record
may also sell your shares by telephone. To receive the redemption price
on a regular business day, your call must be received by the Transfer
Agent by the close of The New York Stock Exchange that day, which is
normally 4:00 P.M. but may be earlier on some days. You may not redeem
shares held in an OppenheimerFunds retirement plan or under a share
certificate by telephone.
-- To redeem shares through a service representative, call
1-800-852-8457
-- To redeem shares automatically on PhoneLink, call 1-800-533-3310
Whichever method you use, you may have a check sent to the address
on the account statement, or, if you have linked your Fund account to your
bank account on AccountLink, you may have the proceeds sent to that
account.
-- Telephone Redemptions Paid by Check. Up to $50,000 may be redeemed
by telephone, in any 7-day period. The check must be payable to all
owners of record of the shares and must be sent to the address on the
account. This service is not available within 30 days of changing the
address on an account statement.
-- Telephone Redemptions Through AccountLink. There are no dollar
limits on telephone redemption proceeds sent to a bank account designated
when you establish AccountLink. Normally the ACH transfer to your bank is
initiated on the business day after the redemption. You do not receive
dividends on the proceeds of the shares you redeemed while they are
waiting to be transferred.
Selling Shares Through Your Dealer. The Distributor has made arrangements
to repurchase Fund shares from dealers and brokers on behalf of their
customers. Brokers or dealers may charge for that service. Please refer
to "Special Arrangements for Repurchase of Shares from Dealers and
Brokers" in the Statement of Additional Information for more details.
How to Exchange Shares
Shares of the Fund may be exchanged for shares of certain
OppenheimerFunds at net asset value per share at the time of exchange,
without sales charge. To exchange shares, you must meet several
conditions:
-- Shares of the fund selected for exchange must be available for
sale in your state of residence
-- The prospectuses of this Fund and the fund whose shares you want
to buy must offer the exchange privilege
-- You must hold the shares you buy when you establish your account
for at least 7 days before you can exchange them; after the account is
open 7 days, you can exchange shares every regular business day
-- You must meet the minimum purchase requirements for the fund you
purchase by exchange
-- Before exchanging into a fund, you should obtain and read its
prospectus
Shares of a particular class may be exchanged only for shares of the
same class in the other OppenheimerFunds. For example, you can exchange
shares of this Fund only for Class A shares of another fund. At present,
not all of the OppenheimerFunds offer the same classes of shares. If a
fund has only one class of shares that does not have a class designation,
they are "Class A" shares for exchange purposes. In some cases, sales
charges may be imposed on exchange transactions. Certain OppenheimerFunds
offer Class A shares and Class B or Class C shares, and a list can be
obtained by calling the Distributor at 1-800-525-7048. Please refer to
"How to Exchange Shares" in the Statement of Additional Information for
more details.
Exchanges may be requested in writing or by telephone:
-- Written Exchange Requests. Submit an OppenheimerFunds Exchange
Request form, signed by all owners of the account. Send it to the
Transfer Agent at the addresses listed in "How to Sell Shares."
-- Telephone Exchange Requests. Telephone exchange requests may be
made either by calling a service representative at 1-800-852-8457 or by
using PhoneLink for automated exchanges, by calling 1-800-533-3310.
Telephone exchanges may be made only between accounts that are registered
with the same name(s) and address. Shares held under certificates may not
be exchanged by telephone.
You can find a list of OppenheimerFunds currently available for
exchanges in the Statement of Additional Information or by calling a
service representative at 1-800-525-7048. That list can change from time
to time.
There are certain exchange policies you should be aware of:
-- Shares are normally redeemed from one fund and purchased from the
other fund in the exchange transaction on the same regular business day
on which the Transfer Agent receives an exchange request that is in proper
form by the close of The New York Stock Exchange that day, which is
normally 4:00 P.M. but may be earlier on some days. However, either fund
may delay the purchase of shares of the fund you are exchanging into up
to 7 days if it determines it would be disadvantaged by a same-day
transfer of the proceeds to buy shares. For example, the receipt of
multiple exchange requests from a dealer in a "market-timing" strategy
might require the sale of securities at a time or price disadvantageous
to the Fund.
-- Because excessive trading can hurt fund performance and harm
shareholders, the Fund reserves the right to refuse any exchange request
that will disadvantage it, or to refuse multiple exchange requests
submitted by a shareholder or dealer.
-- The Fund may amend, suspend or terminate the exchange privilege
at any time. Although the Fund will attempt to provide you notice
whenever it is reasonably able to do so, it may impose these changes at
any time.
-- For tax purposes, exchanges of shares involve a redemption of the
shares of the fund you own and a purchase of shares of the other fund,
which may result in a capital gain or loss. For more information about
taxes affecting exchanges, please refer to "How to Exchange Shares" in the
Statement of Additional Information.
-- If the Transfer Agent cannot exchange all the shares you request
because of a restriction cited above, only the shares eligible for
exchange will be exchanged.
Shareholder Account Rules and Policies
-- Net Asset Value Per Share is determined as of the close of The New
York Stock Exchange on each day the Exchange is open (a regular business
day) by dividing the value of the Fund's net assets by the number of
shares that are outstanding. The Fund's Board of Trustees has established
procedures to value the Fund's securities to determine net asset value.
In general, securities values are based on market value. There are
special procedures for valuing illiquid and restricted securities,
obligations for which market values cannot be readily obtained, and call
options and hedging instruments. These procedures are described more
completely in the Statement of Additional Information.
-- The offering of shares may be suspended during any period in which
the determination of net asset value is suspended, and the offering may
be suspended by the Board of Trustees at any time the Board believes it
is in the Fund's best interest to do so.
-- Telephone Transaction Privileges for purchases, redemptions or
exchanges may be modified, suspended or terminated by the Fund at any
time. If an account has more than one owner, the Fund and the Transfer
Agent may rely on the instructions of any one owner. Telephone privileges
apply to each owner of the account and the dealer representative of record
for the account unless and until the Transfer Agent receives cancellation
instructions from an owner of the account.
-- The Transfer Agent will record any telephone calls to verify data
concerning transactions and has adopted other procedures to confirm that
telephone instructions are genuine, by requiring callers to provide tax
identification numbers and other account data or by using PINs, and by
confirming such transactions in writing. If the Transfer Agent does not
use reasonable procedures it may be liable for losses due to unauthorized
transactions, but otherwise neither it nor the Fund will be liable for
losses or expenses arising out of telephone instructions reasonably
believed to be genuine. If you are unable to reach the Transfer Agent
during periods of unusual market activity, you may not be able to complete
a telephone transaction and should consider placing your order by mail.
-- Redemption or transfer requests will not be honored until the
Transfer Agent receives all required documents in proper form. From time
to time, the Transfer Agent in its discretion may waive certain of the
requirements for redemptions stated in this Prospectus.
-- Dealers that can perform account transactions for their clients
by participating in NETWORKING through the National Securities Clearing
Corporation are responsible for obtaining their clients' permission to
perform those transactions and are responsible to their clients who are
shareholders of the Fund if the dealer performs any transaction
erroneously or improperly.
-- The redemption price for shares will vary from day to day because
the value of the securities in the Fund's portfolio fluctuates. Therefore,
the redemption value of your shares may be more or less than their
original cost.
-- Payment for redeemed shares is made ordinarily in cash and
forwarded by check or through AccountLink (as elected by the shareholder
under the redemption procedures described above) within 7 days after the
Transfer Agent receives redemption instructions in proper form, except
under unusual circumstances determined by the Securities and Exchange
Commission delaying or suspending such payments. The Transfer Agent may
delay forwarding a check or processing a payment via AccountLink for
recently purchased shares, but only until the purchase payment has
cleared. That delay may be as much as 10 days from the date the shares
were purchased. That delay may be avoided if you purchase shares by
certified check or arrange to have your bank provide telephone or written
assurance to the Transfer Agent that your purchase payment has cleared.
-- Involuntary redemptions of small accounts may be made by the Fund
if the account value has fallen below $200 for reasons other than the fact
that the market value of shares has dropped, and in some cases involuntary
redemptions may be made to repay the Distributor for losses from the
cancellation of share purchase orders.
-- Under unusual circumstances, shares of the Fund may be redeemed
"in kind", which means that the redemption proceeds will be paid with
securities from the Fund's portfolio. Please refer to "How to Sell
Shares" in the Statement of Additional Information for more details.
-- "Backup Withholding" of Federal income tax may be applied at the
rate of 31% from dividends, distributions and redemption proceeds
(including exchanges) if you fail to furnish the Fund a certified Social
Security or Employer Identification Number when you sign your application,
or if you violate Internal Revenue Service regulations on tax reporting
of income.
-- The Fund does not charge a redemption fee, but if your dealer or
broker hand les your redemption, they may charge a fee. That fee can be
avoided by redeeming your Fund shares directly through the Transfer Agent.
Under the circumstances described in "How to Buy Shares," you may be
subject to a contingent deferred sales charge when redeeming certain
shares of the Fund.
-- To avoid sending duplicate copies of materials to households, the
Fund will mail only one copy of each annual and semi-annual report to
shareholders having the same last name and address on the Fund's records.
However, each shareholder may call the Transfer Agent at 1-800-525-7048
to ask that copies of those materials be sent personally to that
shareholder.
Dividends, Capital Gains and Taxes
Dividends. The Fund declares dividends from net investment income on an
annual basis and normally pays those dividends to shareholders in
December, but the Board of Trustees can change that date. The Board may
also cause the Fund to declare dividends after the close of the Fund's
fiscal year (which ends September 30th). Because the Fund does not have
an objective of seeking current income, the amounts of dividends it pays,
if any, will likely be small.
Capital Gains. The Fund may make distributions annually in December out
of any net short-term or long-term capital gains and the Fund may make
supplemental distributions of capital gains following the end of its
fiscal year. Long-term capital gains will be separately identified in the
tax information the Fund sends you after the end of the year. There can
be no assurances that the Fund will pay any capital gains distributions
in a particular year.
Distribution Options. When you open your account, specify on your
application how you want to receive your distributions. For
OppenheimerFunds retirement accounts, all distributions are reinvested.
For other accounts, you have four options:
-- Reinvest All Distributions in the Fund. You can elect to reinvest
all dividends and long-term capital gains distributions in additional
shares of the Fund.
-- Reinvest Long-Term Capital Gains Only. You can elect to reinvest
long-term capital gains in the Fund while receiving dividends by check or
sent to your bank account on AccountLink.
-- Receive All Distributions in Cash. You can elect to receive a
check for all dividends and long-term capital gains distributions or have
them sent to your bank on AccountLink.
-- Reinvest Your Distributions in Another OppenheimerFunds Account.
You can reinvest all distributions in another OppenheimerFunds account you
have established.
Taxes. If your account is not a tax-deferred retirement account, you
should be aware of the following tax implications of investing in the
Fund. Long-term capital gains are taxable as long-term capital gains when
distributed to shareholders. It does not matter how long you held your
shares. Dividends paid from short-term capital gains and net investment
income are taxable as ordinary income. Distributions are subject to
federal income tax and may be subject to state or local taxes. Your
distributions are taxable when paid, whether you reinvest them in
additional shares or take them in cash. Every year the Fund will send you
and the IRS a statement showing the amount of all taxable distributions
you received in the previous year.
-- "Buying a Dividend". When a fund goes ex-dividend, its share
price is reduced by the amount of the distribution. If you buy shares on
or just before the ex-dividend date, or just before the Fund declares a
capital gains distribution, you will pay the full price for the shares and
then receive a portion of the price back as a taxable dividend or capital
gain.
-- Taxes on Transactions. Share redemptions, including redemptions
for exchanges, are subject to capital gains tax. Generally speaking, a
capital gain or loss is the difference between the price you paid for the
shares and the price you received when you sold them.
-- Returns of Capital. In certain cases distributions made by the
Fund may be considered a non-taxable return of capital to shareholders.
If that occurs, it will be identified in notices to shareholders. A non-
taxable return of capital may reduce your tax basis in your Fund shares.
This information is only a summary of certain federal tax information
about your investment. More information is contained in the Statement of
Additional Information, and in addition you should consult with your tax
adviser about the effect of an investment in the Fund on your particular
tax situation.
<PAGE>
Appendix
-- Industry Classifications. In determining whether 25% or more of its
assets are concentrated in a particular industry or group of industries,
the Fund has adopted the following list of industry classifications:
Aerospace/Defense
Air Transportation
Auto Parts Distribution
Automotive
Bank Holding Companies
Banks
Beverages
Broadcasting
Broker-Dealers
Building Materials
Cable Television
Chemicals
Commercial Finance
Computer Hardware
Computer Software
Conglomerates
Consumer Finance
Containers
Convenience Stores
Department Stores
Diversified Financial
Diversified Media
Drug Stores
Drug Wholesalers
Durable Household Goods
Education
Electric Utilities
Electrical Equipment
Electronics
Energy Services & Producers
Entertainment/Film
Environmental
Food
Gas Utilities
Gold
Health Care/Drugs
Health Care/Supplies & Services
Homebuilders/Real Estate
Hotel/Gaming
Industrial Services
Insurance
Leasing & Factoring
Leisure
Manufacturing
Metals/Mining
Nondurable Household Goods
Oil - Integrated
Paper
Publishing/Printing
Railroads
Restaurants
Savings & Loans
Shipping
Special Purpose Financial
Specialty Retailing
Steel
Supermarkets
Telecommunications - Technology
Telephone - Utility
Textile/Apparel
Tobacco
Toys
Trucking
<PAGE>
APPENDIX TO PROSPECTUS OF
OPPENHEIMER GLOBAL EMERGING GROWTH FUND
Graphic material included in Prospectus of Oppenheimer Global
Emerging Growth Fund: "Comparison of Total Return of Oppenheimer Global
Emerging Growth Fund with the S&P 500 Index - Change in Value of a $10,000
Hypothetical Investment"
A linear graph will be included in the Prospectus of Oppenheimer
Global Emerging Growth Fund (the "Fund") depicting the initial account
value and subsequent account value of a hypothetical $10,000 investment
in the Fund. That graph will cover the period from 12/30/87 (inception
of the Fund) through 9/30/94. The graph will compare such values with
hypothetical $10,000 investments over the same time periods in the Morgan
Stanley World Index and the S&P 500 Index. Set forth below are the
relevant data points that will appear on the linear graph. Additional
information with respect to the foregoing, including a description of the
Morgan Stanley World Index and the S&P 500 Index, is set forth in the
Prospectus under "Performance of the Fund - Comparing the Fund's
Performance to the Market."
Oppenheimer Morgan
Fiscal Year Global Emerging Stanley S&P
(Period Ended) Growth Fund World Index 500 Index
12/30/87 $ 9,425 $10,000 $10,000
09/30/88 $10,019 $ 9,355 $11,308
09/30/89 $11,542 $11,709 $15,034
09/30/90 $11,275 $ 9,184 $13,645
09/30/91 $25,681 $11,437 $17,887
09/30/92 $19,339 $11,322 $19,862
09/30/93 $20,846 $13,613 $22,438
09/30/94 $18,780 $14,642 $23,264
<PAGE>
Oppenheimer Global Emerging Growth Fund
Two World Trade Center
New York, New York 10048-0203
1-800-525-7048
Investment Advisor
Oppenheimer Management Corporation
Two World Trade Center
New York, New York 10048-0203
Distributor
Oppenheimer Funds Distributor, Inc.
Two World Trade Center
New York, New York 10048-0203
Transfer Agent O P P E N H E I M E R
Oppenheimer Shareholder Services Global
P.O. Box 5270 Emerging
Denver, Colorado 80217 Growth
1-800-525-7048 Fund
Custodian of Portfolio Securities
The Bank of New York
One Wall Street Prospectus
New York, New York 10015 Effective January 24, 1995
Independent Auditors Revised August 4, 1995
KPMG Peat Marwick LLP
707 Seventeenth Street
Denver, Colorado 80202 OppenheimerFunds
Legal Counsel
Gordon Altman Butowsky Weitzen
Shalov & Wein
114 West 47th Street
New York, New York 10036
No dealer, broker, salesperson or any other person
has been authorized to give any information or to
make any representations other than those
contained in this Prospectus or the Statement of
Additional Information and, if given or made, such
information and representations must not be relied
upon as having been authorized by the Fund,
Oppenheimer Management Corporation, Oppenheimer
Funds Distributor, Inc. or any affiliate thereof.
This Prospectus does not constitute an offer to
sell or a solicitation of an offer to buy any of
the securities offered hereby in any state to any
person to whom it is unlawful to make such an
offer in such state.
PR750.0195.N
