SCHEDULE 14A
Information Required in Proxy Statement
(Rule 14a-101)
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment No. )
Filed by the Registrant / X /
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ X / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-12
OPPENHEIMER INTEGRITY FUNDS
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement if Other than Registrant)
Payment of Filing Fee (Check the appropriate box):
/ X / No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is
calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which the
offsetting fee was paid previously.
Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
PROXY CARD OPPENHEIMER BOND FUND,
a series of OPPENHEIMER INTEGRITY FUNDS
PROXY FOR A SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON JANUARY 14, 2005
The undersigned, revoking prior proxies, hereby appoints Brian Wixted,
Philip Vottiero, and Kathleen Ives, and each of them, as attorneys-in-fact
and proxies of the undersigned, with full power of substitution, to vote
shares held in the name of the undersigned on the record date at the Special
Meeting of Shareholders of Oppenheimer Bond Fund (the "Fund") to be held at
6803 South Tucson Way, Centennial, Colorado, 80112, on January 14, 2005, at
1:00 P.M. Mountain time, or at any adjournment thereof, upon the proposals
described in the Notice of Meeting and accompanying Proxy Statement, which
have been received by the undersigned.
This proxy is solicited on behalf of the Fund's Board of Trustees, and all
proposals (set forth on the reverse side of this proxy card) have been
proposed by the Board of Trustees. When properly executed, this proxy will
be voted as indicated on the reverse side or "FOR" a proposal if no choice
is indicated. The proxy will be voted in accordance with the proxy holders'
best judgment as to any other matters that may arise at the Meeting.
VOTE VIA THE TELEPHONE: 1-866-241-6192
999 9999 9999 999
Note: Please sign this proxy exactly as your
name or names appear hereon. Each joint
owner should sign. Trustees and other
fiduciaries should indicate the capacity in
which they sign. If a corporation,
partnership or other entity, this signature
should be that of a duly authorized
individual who should state his or her title.
Signature
Signature of joint owner, if any
Date OBF_14646
PLEASE VOTE ON THE REVERSE SIDE, SIGN AND DATE THIS PROXY AND RETURN PROMPTLY
IN THE ENCLOSED ENVELOPE
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK. Example: [ ]
FOR WITHHOLD FOR ALL
1. To elect a Board of Trustees: ALL AUTHORITY EXCEPT
FOR ALL
01 Robert G. Avis 02 John V. Murphy 03 William L. Armstrong
04 Jon S. Fossel 05 George C. Bowen 06 Edward L. Cameron
07 Robert J. Malone 08 Sam Freedman 09 Beverly L. Hamilton
10 F. William Marshall, Jr. [ ] [ ] [ ]
If you wish to withhold authority to vote your shares "FOR" a
particular nominee, mark the "FOR ALL EXCEPT" box and write the
nominee's number(s) on the line provided below. Your shares will
be voted "FOR" any remaining nominee(s).
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FOR AGAINST ABSTAIN
2. To approve a modification to the Fund's
investment objective.
[ ] [ ] [ ]
OPPENHEIMER INTEGRITY FUNDS, on behalf of its series
OPPENHEIMER BOND FUND
6803 South Tucson Way, Centennial, CO 80112
Notice Of Special Meeting Of Shareholders
To Be Held January 14, 2005
To The Shareholders of Oppenheimer Bond Fund:
Notice is hereby given that a Special Meeting of the Shareholders (the
"Meeting") of Oppenheimer Bond Fund (the "Fund") will be held at 6803 South
Tucson Way, Centennial, Colorado, 80112, at 1:00 P.M. Mountain time, on
January 14, 2005 and any adjustments thereof.
During the Meeting, shareholders of the Fund will vote on the following
proposals:
1. To elect a Board of Trustees;
2. To modify the Fund's investment objective; and
3. To transact such other business as may properly come before the
Meeting, or any adjournments thereof.
Shareholders of record at the close of business on November 1, 2004 are
entitled to vote at the Meeting. The proposals are more fully discussed in
the attached Proxy Statement. Please read it carefully before telling us,
through your proxy or in person, how you wish your shares to be voted. The
Board of Trustees of the Fund recommends a vote to elect each of the nominees
as Trustee and in favor of each proposal. WE URGE YOU TO MARK, SIGN, DATE AND
MAIL THE ENCLOSED PROXY PROMPTLY.
By Order of the Board of Trustees,
Robert G. Zack, Secretary
November 22, 2004
PLEASE RETURN YOUR PROXY BALLOT PROMPTLY.
YOUR VOTE IS IMPORTANT NO MATTER HOW MANY SHARES YOU OWN.
285
TABLE OF CONTENTS
Page
Questions and Answers
Proxy Statement
Proposal 1: To Elect a Board of Trustees
Proposal 2: To Approve a Modification to the Fund's Investment Objective
Information About the Fund
Further Information About Voting and the Meeting
Other Matters
OPPENHEIMER INTEGRITY FUNDS
on behalf of its series
OPPENHEIMER BOND FUND
6803 South Tucson Way, Centennial, CO 80112
PROXY STATEMENT
QUESTIONS AND ANSWERS
Q. Who is Asking for My Vote?
A. The Trustees of Oppenheimer Bond Fund (the "Fund") are asking that you
vote on two matters at the Special Meeting of Shareholders to be held on
January 14, 2005.
Q. Who is Eligible to Vote?
A. Shareholders of record at the close of business on November 1, 2004 are
entitled to vote at the Meeting or any adjournment of the Meeting.
Shareholders are entitled to cast one vote per share (and a fractional
vote for a fractional share) for each matter presented at the Meeting. It
is expected that the Notice of Meeting, Proxy Ballot and Proxy Statement
will be mailed to shareholders of record on or about November 22, 2004.
Q. On What Matters Am I Being Asked to Vote?
A. You are being asked to vote on the following proposals:
1. To elect a Board of Trustees; and
2. To approve a modification to the Fund's investment objective so that
the Fund "seeks total return by investing mainly in debt instruments."
Q. How do the Trustees Recommend that I Vote?
A. The Trustees recommend that you vote:
1. FOR election of all nominees as Trustees; and
2. FOR the modification to the Fund's investment objective.
Q. What are the Reasons for the Proposed Modification to the Fund's
Investment Objective?
A. As described more fully in Proposal 2 below, the Board of Trustees
believes that the proposed modification to the Fund's Investment Objective
will provide the Fund more investment flexibility as market conditions
change (favoring income or capital growth at various times) and will help
achieve better-risk adjusted and relative returns.
Q. How Can I Vote?
A. You can vote in three (3) different ways:
o By mail, with the enclosed ballot
o In person at the Meeting (if you are a record owner)
o By telephone (please see the insert for instructions)
Voting by telephone is convenient and can help reduce the Fund's expenses.
Whichever method you choose, please take the time to read the full text of
the proxy statement before you vote.
Please be advised that the deadline for voting by telephone is 3:00 P.M.
Eastern time ("ET") on the last business day before the Meeting.
Q. How Will My Vote Be Recorded?
A. Proxy ballots that are properly signed, dated and received at or prior
to the Meeting, or any adjournment thereof, will be voted as specified. If
you specify a vote for any of the proposals, your proxy will be voted as
indicated. If you sign and date the proxy ballot, but do not specify a
vote for one or more of the proposals, your shares will be voted in favor
of the Trustees' recommendations. Telephonic votes will be recorded
according to the telephone voting procedures described in the "Further
Information About Voting and the Meeting" section of the Proxy Statement.
How Can I Revoke My Proxy?
A. You may revoke your proxy at any time before it is voted by forwarding a
written revocation or a later-dated proxy ballot to the Fund that is
received at or prior to the Meeting, or any adjournment thereof, or by
attending the Meeting, or any adjournment thereof, and voting in person
(if you are a record owner). Please be advised that the deadline for
revoking your proxy by telephone is 3:00 P.M. (ET) on the last business
day before the Meeting.
Q. How Can I Get More Information About the Fund?
A. Copies of the Fund's Annual Report dated December 31, 2003 and Semi-Annual
Report dated June 30, 2004 have previously been mailed to Shareholders. If
you would like to have copies of the Fund's most recent Annual or
Semi-Annual Report sent to you free of charge, please call us toll-free at
1.800.708.7780, write to the Fund at OppenheimerFunds Services, P.O. Box
5270, Denver, Colorado 80217-5270 or visit the Oppenheimer funds website
at www.oppenheimerfunds.com.
Q. Whom Do I Call If I Have Questions?
A. Please call us at 1.800.708.7780.
The proxy statement is designed to furnish shareholders with the information
necessary to vote on the matters coming before the Meeting. If you have any
questions, please call us at 1.800.708.7780.
OPPENHEIMER BOND FUND
(a series of OPPENHEIMER INTEGRITY FUNDS)
6803 South Tucson Way, Centennial, CO 80112
PROXY STATEMENT
Special Meeting of Shareholders
To Be Held January 14, 2005
This statement is furnished to the shareholders of Oppenheimer Bond Fund (the
"Fund") in connection with the solicitation by the Fund's Board of Trustees
of proxies to be used at a special meeting of shareholders (the "Meeting") to
be held at 6803 South Tucson Way, Centennial, Colorado, 80112, at 1:00 P.M.
Mountain time, on January 14, 2005, or any adjournment thereof. Shareholders
of record at the close of business on November 1, 2004 are entitled to vote
at the Meeting. It is expected that the mailing of this Proxy Statement will
be made on or about November 22, 2004.
SUMMARY OF PROPOSALS
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Proposal Shareholders Voting
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1. To Elect a Board of Trustees All
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2. To Approve a modification to the Fund's All
Investment Objective
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PROPOSAL 1: ELECTION OF TRUSTEES
At the Meeting, ten (10) Trustees are to be elected. If elected, the Trustees
will serve indefinite terms until their successors are properly elected and
qualified. The persons named as attorneys-in-fact in the enclosed proxy have
advised the Fund that, unless a proxy ballot instructs them to withhold
authority to vote for all listed nominees or any individual nominee, all
validly executed proxies will be voted for the election of all of the
nominees named below.
As a Massachusetts business trust, the Fund is not required, and does not
intend, to hold annual shareholder meetings for the purpose of electing
Trustees. As a result, if elected, the Trustees will hold office until their
successors are duly elected and shall have qualified. If a nominee should be
unable to accept election, serve his or her term or resign, the Board of
Trustees may, subject to the Investment Company Act of 1940 (referred to in
this proxy statement as the "Investment Company Act"), in its discretion,
select another person to fill the vacant position.
Although the Fund will not normally hold annual meetings of its shareholders,
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. Also, if at any
time, less than a majority of the Trustees holding office has been elected by
the shareholders, the Trustees then in office will promptly call a
shareholders' meeting for the purpose of electing Trustees.
Each of the nominees currently serves as a Trustee of the Fund. Each of the
nominees has consented to be named as such in this proxy statement and to
serve as Trustee if elected. All present Trustees of the Fund have previously
been elected by the Fund's shareholders, except for Mrs. Hamilton and Mr.
Malone who were appointed as Trustees effective June 1, 2002 and Mr. Murphy
who was appointed as a Trustee effective October 2001. Each of the Trustees
serves as trustee or director of other funds in the Oppenheimer family of
funds. The Oppenheimer funds on which each of the Trustees currently serves
are referred to as "Board II Funds" in this proxy statement.
Except for Mr. Murphy, each of the Trustees is an independent trustee of the
Fund ("Independent Trustee"). Mr. Murphy is an "Interested Trustee" (as that
term is defined in the Investment Company Act) of the Fund because he is
affiliated with OppenheimerFunds, Inc. (the "Manager") by virtue of his
positions as an officer and director of the Manager, and as a shareholder of
its parent company. Mr. Murphy was appointed as a Trustee of the Fund with
the understanding that in the event he ceases to be the chief executive
officer of the Manager, he will resign as a trustee of the Fund and the other
Board II Funds for which he is a trustee or director.
The Fund's Trustees and length of service as well as their principal
occupations and business affiliations during the past five years are listed
below. The information for the Trustees also includes the dollar range of
shares of the Fund as well as the aggregate dollar range of shares
beneficially owned in any of the Oppenheimer funds overseen by the Trustees.
The address of each Trustee in the chart below is 6803 S. Tucson Way,
Centennial, CO 80112-3924. If elected, each Trustee serves for an indefinite
term, until his or her resignation, retirement, death or removal.
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Nominees for Independent Trustees
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Name, Principal Occupation(s) During Past 5 Dollar Aggregate
Dollar
Range Of
Shares
Beneficially
Owned in
Position(s) Held Years; Range of Any of the
with Fund, Other Trusteeships/Directorships Held by Shares Oppenheimer
Length of Service Trustee; BeneficiallFunds
and Number of Portfolios in Fund Complex Owned in Overseen
Age Currently Overseen by Trustee the Fund by Trustee
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As of __________, 2004
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William L. Chairman of the following private Over
Armstrong, mortgage banking companies: Cherry Creek $100,000
Chairman and Mortgage Company (since 1991),
Trustee since 1999 Centennial State Mortgage Company (since
Age: 67 1994), The El Paso Mortgage Company
(since 1993), Transland Financial
Services, Inc. (since 1997); Chairman of
the following private companies: Great
Frontier Insurance (insurance agency)
(since 1995), Ambassador Media
Corporation and Broadway Ventures (since
1984); a director of the following
public companies: Helmerich & Payne,
Inc. (oil and gas drilling/production
company) (since 1992) and UNUMProvident
(insurance company) (since 1991). Mr.
Armstrong is also a Director/Trustee of
Campus Crusade for Christ and the
Bradley Foundation. Formerly a director
of the following: Storage Technology
Corporation (a publicly-held computer
equipment company) (1991-February 2003),
and International Family Entertainment
(television channel) (1992-1997),
Frontier Real Estate, Inc. (residential
real estate brokerage) (1994-1999), and
Frontier Title (title insurance agency)
(1995-June 1999); a U.S. Senator
(January 1979-January 1991). Oversees 38
portfolios in the OppenheimerFunds
complex.
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Robert G. Avis, Formerly, Director and President of A.G. Over
Trustee since 1993 Edwards Capital, Inc. (General Partner $100,000
Age: 73 of private equity funds) (until February
2001); Chairman, President and Chief
Executive Officer of A.G. Edwards
Capital, Inc. (until March 2000); Vice
Chairman and Director of A.G. Edwards,
Inc. and Vice Chairman of A.G. Edwards &
Sons, Inc. (its brokerage company
subsidiary) (until March 1999); Chairman
of A.G. Edwards Trust Company and A.G.E.
Asset Management (investment advisor)
(until March 1999); and a Director
(until March 2000) of A.G. Edwards &
Sons and A.G. Edwards Trust Company.
Oversees 38 portfolios in the
OppenheimerFunds complex.
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George C. Bowen, Formerly Assistant Secretary and a Over
Trustee since 1998 director (December 1991-April 1999) of $100,000
Age: 68 Centennial Asset Management Corporation;
President, Treasurer and a director
(June 1989-April 1999) of Centennial
Capital Corporation; Chief Executive
Officer and a director of MultiSource
Services, Inc. (March 1996-April 1999).
Until April 1999 Mr. Bowen held several
positions in subsidiary or affiliated
companies of the Manager. Oversees 38
portfolios in the OppenheimerFunds
complex.
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Edward L. Cameron, A member of The Life Guard of Mount $50,001-
Trustee since 1999 Vernon, George Washington's home (since $100,000
Age: 66 June 2000). Formerly Director (March
2001-May 2002) of Genetic ID, Inc. and
its subsidiaries (a privately held
biotech company); a partner (July
1974-June 1999) with
PricewaterhouseCoopers LLP (an
accounting firm); and Chairman (July
1994-June 1998) of Price Waterhouse LLP
Global Investment Management Industry
Services Group. Oversees 38 portfolios
in the OppenheimerFunds complex.
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Jon S. Fossel, Director (since February 1998) of Rocky Over
Trustee since 1990 Mountain Elk Foundation (a $100,000
Age: 61 not-for-profit foundation); a director
(since 1997) of Putnam Lovell Finance
(finance company); a director (since
June 2002) of UNUMProvident (an
insurance company). Formerly a director
(October 1999-October 2003) of P.R.
Pharmaceuticals (a privately held
company); Chairman and a director (until
October 1996) and President and Chief
Executive Officer (until October 1995)
of the Manager; President, Chief
Executive Officer and a director (until
October 1995) of Oppenheimer Acquisition
Corp., Shareholders Services Inc. and
Shareholder Financial Services, Inc.
Oversees 38 portfolios in the
OppenheimerFunds complex.
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Sam Freedman, Director of Colorado Uplift (a Over
Trustee since 1996 non-profit charity) (since September $100,000
Age: 63 1984). Formerly (until October 1994) Mr.
Freedman held several positions in
subsidiary or affiliated companies of
the Manager. Oversees 38 portfolios in
the OppenheimerFunds complex.
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Beverly L. Trustee of Monterey International $50,001-
Hamilton, Studies (an educational organization) $100,000
Trustee since 2002 (since February 2000); a director of The
Age: 58 California Endowment (a philanthropic
organization) (since April 2002) and of
Community Hospital of Monterey Peninsula
(educational organization) (since
February 2002); a director of America
Funds Emerging Markets Growth Fund
(since October 1991) (an investment
company); an advisor to Credit Suisse
First Boston's Sprout venture capital
unit. Mrs. Hamilton also is a member of
the investment committees of the
Rockefeller Foundation and of the
University of Michigan. Formerly,
Trustee of MassMutual Institutional
Funds (open-end investment company)
(1996-May 2004); a director of MML
Series Investment Fund (April 1989-May
2004) and MML Services (April 1987-May
2004) (investment companies); member of
the investment committee (2000-2003) of
Hartford Hospital; an advisor
(2000-2003) to Unilever (Holland)'s
pension fund; and President (February
1991-April 2000) of ARCO Investment
Management Company. Oversees 37
portfolios in the OppenheimerFunds
complex.
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Robert J. Malone, Chairman, Chief Executive Officer and Over
Trustee since 2002 Director of Steele Street State Bank (a $100,000
Age: 60 commercial banking entity) (since August
2003); director of Colorado UpLIFT (a
non-profit organization) (since 1986);
trustee (since 2000) of the Gallagher
Family Foundation (non-profit
organization). Formerly, Chairman of
U.S. Bank-Colorado (a subsidiary of U.S.
Bancorp and formerly Colorado National
Bank,) (July 1996-April 1, 1999), a
director of: Commercial Assets, Inc. (a
REIT) (1993-2000), Jones Knowledge, Inc.
(a privately held company) (2001-July
2004) and U.S. Exploration, Inc. (oil
and gas exploration) (1997-February
2004). Oversees 37 portfolios in the
OppenheimerFunds complex.
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F. William Trustee of MassMutual Institutional Over
Marshall, Jr., Funds (since 1996) and MML Series $100,000
Trustee since 2000 Investment Fund (since 1987) (both
Age: 62 open-end investment companies) and the
Springfield Library and Museum
Association (since 1995) (museums) and
the Community Music School of
Springfield (music school) (since 1996);
Trustee (since 1987), Chairman of the
Board (since 2003) and Chairman of the
investment committee (since 1994) for
the Worcester Polytech Institute
(private university); and President and
Treasurer (since January 1999) of the
SIS Fund (a private not for profit
charitable fund). Formerly, member of
the investment committee of the
Community Foundation of Western
Massachusetts (1998 - 2003); Chairman
(January 1999-July 1999) of SIS & Family
Bank, F.S.B. (formerly SIS Bank)
(commercial bank); and Executive Vice
President (January 1999-July 1999) of
Peoples Heritage Financial Group, Inc.
(commercial bank). Oversees 38
portfolios in the OppenheimerFunds
complex.
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The address of Mr. Murphy in the chart below is Two World Financial Center,
225 Liberty Street, 11th Floor, New York, NY 10281-1008. Mr. Murphy serves
for an indefinite term, until his resignation, death or removal.
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Nominee for Interested Trustee and Officer
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Name, Principal Occupation(s) During Past 5 Dollar Aggregate
Dollar
Range Of
Shares
Beneficially
Owned in
Years; Range of Any of the
Position(s) Held Other Trusteeships/Directorships Held by Shares Oppenheimer
with Fund, Trustee; Beneficially Funds
Length of Service, Number of Portfolios in Fund Complex Owned in Overseen
Age Currently Overseen by Trustee the Fund by Trustee
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As of ___________,
2004
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John V. Murphy, Chairman, Chief Executive Officer and Over
President and director (since June 2001) and President $100,000
Trustee and (since September 2000) of the Manager;
Principal President and a director or trustee of
Executive Officer other Oppenheimer funds; President and a
since 2001 director (since July 2001) of Oppenheimer
Age: 55 Acquisition Corp. (the Manager's parent
holding company) and of Oppenheimer
Partnership Holdings, Inc. (a holding
company subsidiary of the Manager); a
director (since November 2001) of
OppenheimerFunds Distributor, Inc. (a
subsidiary of the Manager); Chairman and
a director (since July 2001) of
Shareholder Services, Inc. and of
Shareholder Financial Services, Inc.
(transfer agent subsidiaries of the
Manager); President and a director (since
July 2001) of OppenheimerFunds Legacy
Program (a charitable trust program
established by the Manager); a director
of the following investment advisory
subsidiaries of the Manager: OFI
Institutional Asset Management, Inc.,
Centennial Asset Management Corporation,
Trinity Investment Management Corporation
and Tremont Capital Management, Inc.
(since November 2001), HarbourView Asset
Management Corporation and OFI Private
Investments, Inc. (since July 2001);
President (since November 1, 2001) and a
director (since July 2001) of Oppenheimer
Real Asset Management, Inc.; Executive
Vice President (since February 1997) of
Massachusetts Mutual Life Insurance
Company (the Manager's parent company); a
director (since June 1995) of DLB
Acquisition Corporation (a holding
company that owns the shares of Babson
Capital Management LLC); a member of the
Investment Company Institute's Board of
Governors (elected to serve from October
3, 2003 through September 30, 2006).
Formerly, Chief Operating Officer
(September 2000-June 2001) of the
Manager; President and trustee (November
1999-November 2001) of MML Series
Investment Fund and MassMutual
Institutional Funds (open-end investment
companies); a director (September
1999-August 2000) of C.M. Life Insurance
Company; President, Chief Executive
Officer and director (September
1999-August 2000) of MML Bay State Life
Insurance Company; a director (June
1989-June 1998) of Emerald Isle Bancorp
and Hibernia Savings Bank (a wholly-owned
subsidiary of Emerald Isle Bancorp).
Oversees 73 portfolios as
Trustee/Director and 10 portfolios as
Officer in the OppenheimerFunds complex.
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A. General Information Regarding the Board of Trustees.
The Fund is governed by a Board of Trustees, which is responsible for
protecting the interests of shareholders. The Trustees meet periodically
throughout the year to oversee the Fund's activities, review its performance
and review the actions of the Manager, which is responsible for the Fund's
day-to-day operations. Ten regular meetings of the Trustees were held during
the fiscal year ended December 31, 2003. Each of the incumbent Trustees was
present for at least 75% of the aggregate number of Board of Trustees
meetings and committees on which that Trustee served that were held during
the period.
B. Committees of the Board of Trustees.
The Board of Trustees has appointed standing Audit, Review and Governance
Committees.
The Audit Committee is comprised solely of Independent Trustees. The members
of the Audit Committee are Edward L. Cameron (Chairman), George C. Bowen,
Robert J. Malone and F. William Marshall, Jr. The Audit Committee held 6
meetings during the fiscal year ended December 31, 2003. The Audit Committee
furnishes the Board with recommendations regarding the selection of the
Fund's independent auditors. Other main functions of the Audit Committee
include, but are not limited to: (i) reviewing the scope and results of
financial statement audits and the audit fees charged; (ii) reviewing reports
from the Fund's independent auditors regarding the Fund's internal accounting
procedures and controls; (iii) review reports from the Manager's Internal
Audit Department; (iv) maintaining a separate line of communication between
the Fund's independent auditors and its Independent Trustees; and (v)
exercise all other functions outlined in the Audit Committee Charter,
including but not limited to reviewing the independence of the Fund's
independent auditors and the pre-approval of the performance by the Fund's
independent auditors of any non-audit service, including tax service, for the
Fund and the Manager and certain affiliates of the Manager that is not
prohibited by the Sarbanes-Oxley Act.
The members of the Review Committee are Jon S. Fossel (Chairman), Robert G.
Avis, Sam Freedman, and Beverly Hamilton. The Review Committee held 6
meetings during the fiscal year ended December 31, 2003. Among other
functions, the Review Committee reviews reports and makes recommendations to
the Board concerning the fees paid to the Fund's transfer agent and the
Manager and the services provided to the Fund by the transfer agent and the
Manager. The Review Committee also reviews the Fund's investment performance
and policies and procedures adopted by the Fund to comply with Investment
Company Act and other applicable law.
The members of the Governance Committee are Robert Malone (Chairman), William
Armstrong, Beverly Hamilton and F. William Marshall, Jr. The Governance
Committee is comprised solely of Independent Trustees. The Governance
Committee was established in August 2004 and did not hold any meetings during
the Fund's fiscal year ended December 31, 2003. The Governance Committee is
expected to consider general governance matters, including a formal process
for shareholders to send communications to the Board and the qualifications
of candidates for board positions including consideration of any candidate
recommended by shareholders.
The Governance Committee has not yet adopted a charter, but anticipates that
it will do so by the end of this calendar year. The Committee has
temporarily adopted the process previously adopted by the Audit Committee
regarding shareholder submission of nominees for board positions.
Shareholders may submit names of individuals, accompanied by complete and
properly supported resumes, for the Governance Committee's consideration by
mailing such information to the Committee in care of the Fund. The Committee
may consider such persons at such time as it meets to consider possible
nominees. The Committee, however, reserves sole discretion to determine the
candidates for trustees and independent trustees to recommend to the Board
and/or shareholders and may identify candidates other than those submitted by
Shareholders. The Committee may, but need not, consider the advice and
recommendation of the Manager and its affiliates in selecting nominees. The
full Board elects new trustees except for those instances when a shareholder
vote is required.
Shareholders who desire to communicate with the Board should address
correspondence to the Board of Trustees of Oppenheimer Bond Fund, c/o the
Secretary of the Fund at 6803 South Tucson Way, Centennial, CO 80112 or an
individual Trustee and may submit their correspondence electronically at
WWW.OPPENHEIMERFUNDS.COM under the caption "contact us" or by mail to the
Fund at the address above. If your correspondence is intended for a
particular Trustee, please indicate the name of the Trustee for whom it is
intended. The sender should indicate in the address whether it is intended
for the entire board, the Independent Trustees as a group, or to an
individual Trustee. Communications are forwarded to all Trustees or to a
specifically addressed Trustee if they relate to important substantive
matters. In general, communications relating to corporate governance are more
likely to be forwarded than communications relating to ordinary business
affairs, personal grievances and matters as to which we tend to receive
repetitive or duplicative communications. Communications that are primarily
commercial in nature, relate to an improper or irrelevant topic, or require
investigation to verify their content may not be forwarded. Members of the
Board may, at any time, request copies of any such correspondence. The
Governance Committee will consider if a different process should be
recommended to the Board.
Based on the Audit Committee's recommendation, the Board of Trustees of the
Fund, including a majority of the Independent Trustees, at a meeting held
December 15, 2003, selected Deloitte & Touche LLP ("Deloitte") as auditors of
the Fund for the fiscal year beginning January 1, 2004. Deloitte also serves
as auditors for certain other funds for which the Manager acts as investment
advisor and provides certain auditing and non-auditing services for the
Manager, the Manager's parent company and its subsidiaries.
1. Audit Fees.
During the fiscal years ended December 31, 2002 and December 2003, Deloitte
performed audit services for the Fund including the audit of the Fund's
financial statements, review of the Fund's annual report and registration
statement amendment, consultation on financial accounting and reporting
matters and meetings with the Board of Trustees. The aggregate fees billed by
Deloitte for those services for the fiscal year ended December 31, 2002 were
$15,500 and for the fiscal year ended December 31, 2003 were $16,000.
2. Audit-Related Fees
There were no audit-related fees billed by Deloitte for services rendered to
the Fund for the fiscal years ended December 31, 2002 and December 31, 2003.
During the fiscal years ended December 31, 2002 and 2003, Deloitte audited
the Manager's financial statements as well as the financial statements of the
Manager's parent company and certain affiliated companies that provide
ongoing services to the Fund. Deloitte was paid a total of $65,000 in 2002
and $75,000 in 2003 for those services.
Such fees would include, among others, due diligence related to mergers and
acquisitions, accounting consultations and audits in connection with
acquisitions, internal control reviews and consultation concerning financial
accounting and reporting standards.
3. Tax Fees
There were no tax fees billed by Deloitte for services rendered to the Fund
for the fiscal years ended December 31, 2002 and December 31, 2003.
Deloitte provided certain tax accounting and other consulting services to the
parent company of the Manager as well as the Manager's parent company and
certain affiliated companies that provide ongoing services to the Fund.
Deloitte was paid a total of $6,500 in 2002 and $11,600 in 2003 for those
services.
Such fees would include, among others, tax compliance, tax planning and tax
advice. Tax compliance generally involves preparation of original and amended
tax returns, claims for a refund and tax payment-planning services. Tax
planning and tax advice includes assistance with tax audits and appeals, tax
advice related to mergers and acquisitions and requests for rulings or
technical advice from taxing authorities.
4. All Other Fees.
There were no fees billed by Deloitte for services rendered to the Fund other
than the services described above under "Audit Fees" for the fiscal years
ended December 31, 2002 and December 31, 2003.
During the fiscal years ended December 31, 2002 and 2003, Deloitte billed
$3,500 and $0, respectively, to the Manager as well as the Manager's parent
company and certain affiliated companies that provide ongoing services to the
Fund.
Such fees would include services provided to the Fund's Board of Trustees
with respect to the annual renewal of the Fund's investment advisory
agreement.
During its regularly scheduled periodic meetings, the Audit Committee will
pre-approve all audit, audit-related, tax and other services to be provided
by Deloitte. The Audit Committee has delegated pre-approval authority to its
Chairman for any subsequent new engagements that arise between regularly
scheduled meeting dates provided that any fees such pre-approved are
presented to the Audit Committee at its next regularly scheduled meeting.
Pre-approval of non-audit services is waived provided that: 1) the aggregate
amount of all such services provided constitutes no more than five percent of
the total amount of fees paid by the Fund to it principal accountant during
the fiscal year in which services are provided 2) such services were not
recognized by the Fund at the time of engagement as non-audit services and 3)
such services are promptly brought to the attention of the Audit Committee
and approved prior to the completion of the audit.
The Audit Committee approved 100% of the services under "Audit-Related Fees,"
"Tax Fees" and "All Other Fees".
The aggregate non-audit fees billed by Deloitte for services rendered to the
Manager as well as the Manager's parent company and certain affiliated
companies that provide ongoing services to the Fund for the fiscal years
ended December 31, 2002 and 2003 were $75,000 and $86,600, respectively.
The Audit Committee of the Fund's Board of Trustees has considered whether
the provision of non-audit services that were rendered to the Manager as well
as the Manager's parent company and certain affiliated companies that provide
ongoing services to the Fund that were not pre-approved is compatible with
maintaining Deloitte's independence. No such services were rendered.
Representatives of Deloitte are not expected to be present at the Meeting but
will be available should any matter arise requiring their presence.
C. Additional Information Regarding Trustees.
The Fund's Independent Trustees are paid a retainer plus a fixed fee for
attending each meeting and are reimbursed for expenses incurred in connection
with attending such meetings. Each Board II Fund for which they serve as a
director or trustee pays a share of those expenses.
The officers of the Fund and one Trustee of the Fund (Mr. Murphy) are
affiliated with the Manager and receive no salary or fee from the Fund. The
remaining Trustees of the Fund received the compensation shown below from the
Fund with respect to the Fund's fiscal year ended December 31, 2003. The
compensation from all 43 of the Board II Funds (including the Fund)
represents compensation received for serving as a director or trustee and
member of a committee (if applicable) of the boards of those funds during the
calendar year 2003.
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Trustee Name and Other Fund Aggregate Compensation Total Compensation
From Fund and Fund
Complex Paid to
Position(s) (as applicable) from Fund1 Trustees*
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
William L. Armstrong $1,921 $118,649
Chairman of the Board
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Robert G. Avis $1,643 $101,499
Review Committee Member
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
George C. Bowen $1,643 $101,499
Audit Committee Member
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Edward L. Cameron $1,870 $115,503
Audit Committee Chairman
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Jon S. Fossel $1,870 $115,503
Review Committee Chairman
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Sam Freedman $1,643 $101,499
Review Committee Member
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Beverly Hamilton $1,6222 $150,5423,4
Review Committee Member
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Robert J. Malone $1,6225 $100,1793
Audit Committee Member
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
F. William Marshall, Jr. $1,643 $149,4996
Audit Committee Member
- -------------------------------------------------------------------------------
1. Aggregate Compensation from Fund includes fees and deferred
compensation, if any, for a Trustee.
2. Includes $1,622 deferred under Deferred Compensation Plan described
below.
3. "Total Compensation From Fund and Fund Complex" paid to Mrs. Hamilton
and Mr. Malone was paid by all the Board II Funds, with the exception of
Oppenheimer Senior Floating Rate Fund for which they currently do not
serve as Trustees (total of 37 Oppenheimer funds at December 31, 2003).
4. Includes $50,363 compensation (of which 100% was deferred under a
deferred compensation plan) paid to Mrs. Hamilton for serving as a trustee
by two open-end investment companies (MassMutual Institutional Funds and
MML Series Investment Fund) the investment adviser for which is the
indirect parent company of the Fund's Manager. The Manager also serves as
the Sub-Advisor to the MassMutual International Equity Fund, a series of
MassMutual Institutional Funds.
5. Includes $1,622 deferred under Deferred Compensation Plan described
below.
6. Includes $48,000 compensation paid to Mr. Marshall for serving as a
trustee by two open-end investment companies (MassMutual Institutional
Funds and MML Series Investment Fund) the investment adviser for which is
the indirect parent company of the Fund's Manager. The Manager also serves
as the Sub-Advisor to the MassMutual International Equity Fund, a series
of MassMutual Institutional Funds.
* For purposes of this section only, "Fund Complex" includes the Oppenheimer
funds, MassMutual Institutional Funds and MML Series Investment Fund in
accordance with the instructions for Form N-1A. The Manager does not
consider MassMutual Institutional Funds and MML Series Investment Fund to
be part of the OppenheimerFunds "Fund Complex" as that term may be
otherwise interpreted.
The Board of Trustees has adopted a Deferred Compensation Plan for
Independent Trustees that enables them to elect to defer receipt of all or a
portion of the annual fees they are entitled to receive from the Fund. Under
the plan, the compensation deferred by a Trustee is periodically adjusted as
though an equivalent amount had been invested in shares of one or more
Oppenheimer funds selected by the Trustee. The amount paid to the Trustee
under the plan will be determined based upon the performance of the selected
funds.
Deferral of Trustee's fees under the plan will not materially affect the
Fund's assets, liabilities and net income per share. The plan will not
obligate the Fund to retain the services of any Trustee or to pay any
particular level of compensation to any Trustee. Pursuant to an Order
issued by the SEC, the Fund may invest in the funds selected by the Trustee
under the plan without shareholder approval for the limited purpose of
determining the value of the Trustee's deferred fee account.
D. Information regarding Officers.
Information is given below about the executive officers who are not Trustees
or nominees for Trustee of the Fund, including their business experience
during the past five years. Each officer holds the same offices with one or
more of the other funds in the OppenheimerFunds complex.
The address of the Officers in the chart below is as follows: for Messrs.
Manioudakis, Gillespie, Miao and Zack and Messes. Bloomberg and Lee, Two
World Financial Center, 225 Liberty Street, New York, NY 10281-1008, for
Messrs. Vandehey, Vottiero, Petersen and Wixted and Ms. Ives, 6803 S. Tucson
Way, Centennial, CO 80112-3924. Each Officer serves for an annual term or
until his or her earlier resignation, death or removal.
- -------------------------------------------------------------------------------------
Officers of the Fund
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Name, Principal Occupation(s) During Past 5 Years
Psition(s) Held with
Fund,
Length of Service,
Age
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Angelo Manioudakis, Senior Vice President of the Manager (since April 2002), of
Vice President and HarbourView Asset Management Corporation (since April, 2002
Portfolio Manager and of OFI Institutional Asset Management, Inc. (since June
since 2002 2002); an officer of 14 portfolios in the OppenheimerFunds
Age: 37 complex. Formerly Executive Director and portfolio manager
for Miller, Anderson & Sherrerd, a division of Morgan
Stanley Investment Management (August 1993-April 2002).
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Mark S. Vandehey, Senior Vice President and Chief Compliance Officer (since
Vice President and March 2004) of the Manager; Vice President (since June
Chief Compliance 1983) of OppenheimerFunds Distributor, Inc., Centennial
Officer since 2004 Asset Management Corporation and Shareholder Services, Inc.
Age: 54 Formerly (until February 2004) Vice President and Director
of Internal Audit of OppenheimerFunds, Inc. An officer of
83 portfolios in the Oppenheimer funds complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Brian W. Wixted, Senior Vice President and Treasurer (since March 1999) of
Treasurer, Principal the Manager; Treasurer of HarbourView Asset Management
Financial and Corporation, Shareholder Financial Services, Inc.,
Accounting Officer Shareholder Services, Inc., Oppenheimer Real Asset
since 1999 Management Corporation, and Oppenheimer Partnership
Age: 45 Holdings, Inc. (since March 1999), of OFI Private
Investments, Inc. (since March 2000), of OppenheimerFunds
International Ltd. and OppenheimerFunds plc (since May
2000), of OFI Institutional Asset Management, Inc. (since
November 2000), and of OppenheimerFunds Legacy Program (a
Colorado non-profit corporation) (since June 2003);
Treasurer and Chief Financial Officer (since May 2000) of
OFI Trust Company (a trust company subsidiary of the
Manager); Assistant Treasurer (since March 1999) of
Oppenheimer Acquisition Corp. Formerly Assistant Treasurer
of Centennial Asset Management Corporation (March
1999-October 2003) and OppenheimerFunds Legacy Program
(April 2000-June 2003); Principal and Chief Operating
Officer (March 1995-March 1999) at Bankers Trust
Company-Mutual Fund Services Division. An officer of 83
portfolios in the OppenheimerFunds complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Brian Petersen, Assistant Vice President of the Manager since August 2002;
Assistant Treasurer formerly Manager/Financial Product Accounting (November
since 2004 1998-July 2002) of the Manager. An officer of 83 portfolios
Age: 34 in the OppenheimerFunds complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Philip Vottiero, Vice President/Fund Accounting of the Manager since March
Assistant Treasurer 2002. Formerly Vice President/Corporate Accounting of the
since 2002 Manager (July 1999-March 2002) prior to which he was Chief
Age: 41 Financial Officer at Sovlink Corporation (April 1996-June
1999). An officer of 83 portfolios in the OppenheimerFunds
complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Robert G. Zack, Executive Vice President (since January 2004) and General
Vice President & Counsel (since February 2002) of the Manager; General
Secretary since 2001 Counsel and a director (since November 2001) of the
Age: 56 Distributor; General Counsel (since November 2001) of
Centennial Asset Management Corporation; Senior Vice
President and General Counsel (since November 2001) of
HarbourView Asset Management Corporation; Secretary and
General Counsel (since November 2001) of Oppenheimer
Acquisition Corp.; Assistant Secretary and a director
(since October 1997) of OppenheimerFunds International Ltd.
and OppenheimerFunds plc; Vice President and a director
(since November 2001) of Oppenheimer Partnership Holdings,
Inc.; a director (since November 2001) of Oppenheimer Real
Asset Management, Inc.; Senior Vice President, General
Counsel and a director (since November 2001) of Shareholder
Financial Services, Inc., Shareholder Services, Inc., OFI
Private Investments, Inc. and OFI Trust Company; Vice
President (since November 2001) of OppenheimerFunds Legacy
Program; Senior Vice President and General Counsel (since
November 2001) of OFI Institutional Asset Management, Inc.;
a director (since June 2003) of OppenheimerFunds (Asia)
Limited. Formerly Senior Vice President (May 1985-December
2003), Acting General Counsel (November 2001-February 2002)
and Associate General Counsel (May 1981-October 2001) of
the Manager; Assistant Secretary of Shareholder Services,
Inc. (May 1985-November 2001), Shareholder Financial
Services, Inc. (November 1989-November 2001); and
OppenheimerFunds International Ltd. (October 1997-November
2001). An officer of 83 portfolios in the OppenheimerFunds
complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Kathleen T. Ives, Vice President (since June 1998) and Senior Counsel and
Assistant Secretary Assistant Secretary (since October 2003) of the Manager;
since 2001 Vice President (since 1999) and Assistant Secretary (since
Age: 38 October 2003) of the Distributor; Assistant Secretary
(since October 2003) of Centennial Asset Management
Corporation; Vice President and Assistant Secretary (since
1999) of Shareholder Services, Inc.; Assistant Secretary
(since December 2001) of OppenheimerFunds Legacy Program
and of Shareholder Financial Services, Inc.. Formerly an
Assistant Counsel (August 1994-October 2003) and Assistant
Vice President of the Manager (August 1997-June 1998). An
officer of 83 portfolios in the OppenheimerFunds complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Dina C. Lee, Assistant Vice President and Assistant Counsel of the
Assistant Secretary Manager (since December 2000); formerly an attorney and
since 2004 Assistant Secretary of Van Eck Global (until December
Age: 34 2000). An officer of 83 portfolios in the OppenheimerFunds
complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Lisa I. Bloomberg, Vice President and Associate Counsel of the Manager since
Assistant Secretary May 2004; formerly First Vice President and Associate
since 2004 General Counsel of UBS Financial Services Inc. (formerly,
Age: 36 PaineWebber Incorporated) (May 1999 - April 2004) prior to
which she was an Associate at Skaden, Arps, Slate, Meagher
& Flom, LLP (September 1996 - April 1999). An officer of 83
portfolios in the OppenheimerFunds complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Phillip S. Gillespie, Senior Vice President and Deputy General Counsel of the
Assistant Secretary Manager since September 2004. Formerly Mr. Gillespie held
since 2004 the following positions at Merrill Lynch Investment
Age: 40 Management: First Vice President (2001-September 2004);
Director (from 2000) and Vice President (1998-2000). An
officer of 74 portfolios in the OppenheimerFunds complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Wayne Miao, Assistant Vice President and Assistant Counsel of the
Assistant Secretary Manager since June 2004. Formerly an Associate with Sidley
since 2004 Austin Brown & Wood LLP (September 1999 - May 2004). An
Age: 31 officer of 74 portfolios in the OppenheimerFunds complex.
- -------------------------------------------------------------------------------------
All officers serve at the pleasure of the Board. As of _________ 2004, the
Trustees, nominees for Trustee and officers, individually and as a group,
beneficially ______ of the outstanding Class A shares and no Class B, Class
C, Class N or Class Y shares of the Fund. The foregoing statement does not
reflect ownership of shares of the Fund held of record by an employee benefit
plan for employees of the Manager, other than the shares beneficially owned
under the plan by the officers of the Fund listed above. In addition, each
Independent Trustee, and his or her family members, do not own securities of
either the Manager or OppenheimerFunds Distributor, Inc. (the "Distributor"
of the Board II Funds) or any person directly or indirectly controlling,
controlled by or under common control with the Manager or Distributor.
THE BOARD OF TRUSTEES UNANIMOUSLY RECOMMENDS
A VOTE FOR THE ELECTION OF EACH NOMINEE AS TRUSTEE
PROPOSAL 2: TO APPROVE A MODIFICATION TO THE FUND'S INVESTMENT OBJECTIVE
The Board of Trustees has approved, and recommends that shareholders of the
Fund approve, a proposal to modify the fundamental investment objective of
the Fund. The current investment objective of the Fund is to "seek a high
level of current income by investing mainly in debt instruments." If the
proposal is approved, the Fund will modify its investment objective so that
it "seeks total return by investing mainly in debt instruments." Total
return is generally comprised of both capital appreciation and current
income. The Board of Trustees believes the proposed modification is in the
best interests of the Fund and its shareholders.
- ---------------------------------------------------------------------------------
Current Investment Objective Proposed Investment Objective
---------------------------- -----------------------------
The Fund seeks a high level of current The Fund seeks total return by
income by investing mainly in debt investing mainly in debt instruments.
instruments.
- ---------------------------------------------------------------------------------
If the proposal is approved, the Fund will try to achieve the goal of total
return through current income and capital appreciation consistent with
disciplined risk taking. The Fund will continue to invest mainly in
investment grade debt securities. The Board of Trustees believes that making
the goal of total return an explicit part of the Fund's investment strategies
will provide the Fund more investment flexibility as market conditions change
(favoring income or capital growth at various times) and help achieve
better-risk adjusted and relative returns. The Board of Trustees does not
believe that this modification to the investment objective will result in a
significant change in the Fund's current investment strategy. Along with
the Fund's name change and investment policy modifications discussed below,
the modification to the Fund's investment objective will, however, allow the
Fund to better compete more directly against a number of large,
general-purpose bond funds. The Board of Trustees believes that these
changes will also help the Fund increase assets and reduce overall expenses
by achieving economies of scale.
In addition to approving the investment objective modification, the Board of
Trustees has also approved changing the name of the Fund to "Oppenheimer Core
Bond Fund" and certain investment policies of the Fund. These changes will
be effective on or about January 21, 2005 and are not contingent on
shareholders' approval of the Fund's investment objective modification. The
Board approved (i) limiting the Fund's investments in below-investment grade
securities to 20% from 35% and (ii) the Fund seeking to maintain an average
effective portfolio duration of three to six years and an average credit
quality of "A-" or higher. The Board of Trustees believes these changes are
in the best interest of the Fund and its shareholders and would reduce the
over-all risk of the Fund.
THE BOARD OF TRUSTEES UNANIMOUSLY RECOMMENDS
THAT YOU APPROVE THE PROPOSAL DESCRIBED ABOVE
INFORMATION ABOUT THE FUND
Fund Information. As of the close of business on November 1, 2004, the Fund
had ____________________ shares outstanding, consisting of ______________
Class A, ____________________ Class B, ______________ Class C, ______________
Class N and ____________________ Class Y shares. Each share has voting rights
as stated in this Proxy Statement and is entitled to one vote for each share
(and a fractional vote for a fractional share).
Beneficial Owners. Occasionally, the number of shares of the Fund held in
"street name" accounts of various securities dealers for the benefit of their
clients as well as the number of shares held by other shareholders of record
may exceed 5% of the total shares outstanding. As of November 1, 2004, the
only persons who owned of record or were known by the Fund to beneficially
own 5% or more of any class of the Fund's outstanding shares were:
[to be provided]
The Manager, the Distributor and the Transfer Agent. Subject to the authority
of the Board of Trustees, the Manager is responsible for the day-to-day
management of the Fund's business pursuant to its investment advisory
agreement with the Fund. OppenheimerFunds Distributor, Inc. (the
"Distributor"), a wholly owned subsidiary of the Manager, is the general
distributor of the Fund's shares. The Manager and the Distributor are located
at Two World Financial Center, 225 Liberty Street, 11th Floor, New York, NY
10281-1008. OppenheimerFunds Services, a division of the Manager, located at
6803 South Tucson Way, Centennial, CO 80112, serves as the transfer and
shareholder servicing agent (the "Transfer Agent") for the Fund, for which it
was paid $______________ by the Fund during the fiscal year ended December
31, 2003.
The Manager (including affiliates and subsidiaries) currently manages
investment companies, including the Oppenheimer funds, with assets of more
than $155 billion as of September 30, 2004, including other Oppenheimer with
more than 7 million shareholder accounts. The Manager is a wholly owned
subsidiary of Oppenheimer Acquisition Corp. ("OAC"), a holding company
controlled by Massachusetts Mutual Life Insurance Company ("MassMutual"). The
Manager, the Distributor and OAC are located at Two World Financial
Center,225 Liberty Street, 11th Floor, New York, NY 10281-1008. MassMutual is
located at 1295 State Street, Springfield, Massachusetts 01111. OAC acquired
the Manager on October 22, 1990. As indicated below, the common stock of OAC
is owned by (i) certain officers and/or directors of the Manager, (ii)
MassMutual and (iii) another investor. No institution or person holds 5% or
more of OAC's outstanding common stock except MassMutual. MassMutual has
engaged in the life insurance business since 1851.
The common stock of OAC is divided into three classes. At _____________,
MassMutual held (i) all of the ___________ shares of Class A voting stock,
(ii) _____________ shares of Class B voting stock, and (iii) ___________
shares of Class C non voting stock in OAC. This collectively represented
_________% of the outstanding common stock and ______% of the voting power of
OAC as of that date. Certain officers and/or directors of the Manager held
(i) _______________ shares of the Class B voting stock, representing
________% of the outstanding common stock and _________% of the voting power,
(ii) ___________ shares of Class C non voting stock, and (iii) options
acquired without cash payment which, when they become exercisable, allow the
holders to purchase up to $___ million shares of Class C non voting stock.
That group includes persons who serve as officers of the Fund and John V.
Murphy, who serves as a Trustee of the Fund.
Holders of OAC Class B and Class C common stock may put (sell) their shares
and vested options to OAC or MassMutual at a formula price (based on, among
other things, the revenue, income, working capital, and excess cash of the
Manager). MassMutual may exercise call (purchase) options on all outstanding
shares of both such classes of common stock and vested options at the same
formula price. Since October 1999, the only transaction by a person who will
serve, if elected, as a Trustee of the Fund was by Mr. Bowen. During that
period, Mr. Bowen sold 11,420 Class B shares to MassMutual for a cash payment
of $357,789 and surrendered for cancellation 237,640 options to MassMutual
for combined cash payments of $1,978,140.
The names and principal occupations of the executive officers and directors
of the Manager are as follows: John V. Murphy, Chairman, President, Chief
Executive Officer and a director; Andrew Ruotolo, Executive Vice President
and a director; Kurt Wolfgruber, Executive Vice President, Chief Investment
Officer and a director; Robert G. Zack, Executive Vice President and General
Counsel; Craig Dinsell and James Ruff, Executive Vice Presidents; Brian W.
Wixted, Senior Vice President and Treasurer; Mark Vandehey, Senior Vice
President and Chief Compliance Officer, and Bruce Dunbar, George Evans,
Ronald H. Fielding, John Forrest, Phillip S. Gillespie, Robert B. Grill,
Steve Ilnitzki, Lynn Oberist Keeshan, Thomas W. Keffer, Martin S.Korn, Chris
Leavy, Angelo Manioudakis, Charles McKenzie, Andrew J. Mika, Nikolaos D.
Monoyios, David Pfeffer, David Poiesz, David Robertson, Keith Spencer, Arthur
Steinmetz, John Stoma, Martin Telles, Jerry A. Webman, Diederick Werdmolder,
William L. Wilby, Donna Winn, Philip Witkower, Carol Wolf and Arthur J.
Zimmer, Senior Vice Presidents. These officers are located at one of the four
offices of the Manager: Two World Financial Center,225 Liberty Street, 11th
Floor, New York, NY 10281-1008; 6803 South Tucson Way, Centennial, CO 80112;
350 Linden Oaks, Rochester, NY 14625-2807 or 10 St. James Avenue, Boston, MA
02116.
Custodian. J.P. Morgan Chase Bank, 4 Chase Metro Tech Center, Brooklyn, NY
11245, acts as custodian of the Fund's securities and other assets.
Reports to Shareholders and Financial Statements. The Annual Report to
Shareholders of the Fund, including financial statements of the Fund for the
fiscal year ended December 31, 2003, has previously been sent to
shareholders. The Semi-Annual Report to Shareholders of the Fund as of June
30 2004 also has previously been sent to shareholders. Upon request,
shareholders may obtain without charge a copy of the Annual Report and
Semi-Annual Report by writing the Fund at the address above, or calling the
Fund at 1.800.708.7780 or visiting the Manager's website at
www.oppenheimerfunds.com. The Fund's transfer agent will provide a copy of
the reports promptly upon request.
To avoid sending duplicate copies of materials to households, the Fund mails
only one copy of each prospectus and annual and semi-annual report to
shareholders having the same last name and address on the Fund's records. The
consolidation of these mailings, called householding, benefits the Fund
through reduced mailing expenses.
If you want to receive multiple copies of these materials or request
householding in the future, you may call the Transfer Agent at
1.800.708.7780. You may also notify the Transfer Agent in writing. Individual
copies of prospectuses and reports will be sent to you within 30 days after
the Transfer Agent receives your request to stop householding.
FURTHER INFORMATION ABOUT VOTING AND THE MEETING
Solicitation of Proxies. The cost of preparing, printing and mailing the
proxy ballot, notice of meeting, and this Proxy Statement and all other costs
incurred with the solicitation of proxies, including any additional
solicitation by letter, telephone or otherwise, will be paid equally by the
Fund and the Manager. In addition to solicitations by mail, officers of the
Fund or officers and employees of the Transfer Agent, without extra
compensation, may conduct additional solicitations personally or by
telephone.
Proxies also may be solicited by a proxy solicitation firm hired at the
Fund's expense to assist in the solicitation of proxies. Currently, if the
Fund determines to retain the services of a proxy solicitation firm, the Fund
anticipates retaining Alamo Direct Mail Services, Inc. Any proxy solicitation
firm engaged by the Fund, among other things, will be: (i) required to
maintain the confidentiality of all shareholder information; (ii) prohibited
from selling or otherwise disclosing shareholder information to any third
party; and (iii) required to comply with applicable telemarketing laws.
If the Fund does engage a proxy solicitation firm, as the Meeting date
approaches, certain shareholders may receive telephone calls from a
representative of the solicitation firm if their vote has not yet been
received. Authorization to permit the solicitation firm to execute proxies
may be obtained by telephonic instructions from shareholders of the Fund.
Proxies that are obtained telephonically will be recorded in accordance with
the procedures set forth below. These procedures have been designed to
reasonably ensure that the identity of the shareholder providing voting
instructions is accurately determined and that the voting instructions of the
shareholder are accurately recorded.
In all cases where a telephonic proxy is solicited, the solicitation firm
representative is required to ask for each shareholder's full name, address,
title (if the shareholder is authorized to act on behalf of an entity, such
as a corporation) and to confirm that the shareholder has received the Proxy
Statement and ballot in the mail. If the information solicited agrees with
the information provided to the solicitation firm, the solicitation firm
representative has the responsibility to explain the process, read the
proposals listed on the proxy ballot, and ask for the shareholder's
instructions on such proposals. The solicitation firm representative,
although he or she is permitted to answer questions about the process, is not
permitted to recommend to the shareholder how to vote. The solicitation firm
representative may read any recommendation set forth in the Proxy Statement.
The solicitation firm representative will record the shareholder's
instructions. Within 72 hours, the shareholder will be sent a confirmation of
his or her vote asking the shareholder to call the solicitation firm
immediately if his or her instructions are not correctly reflected in the
confirmation.
It is anticipated the cost of engaging a proxy solicitation firm will not
exceed $25,000 plus the additional out-of-pocket costs, that may be
substantial, incurred in connection with contacting those shareholders that
have not voted. Brokers, banks and other fiduciaries may be required to
forward soliciting material to their principals and to obtain authorization
for the execution of proxies. For those services, they will be reimbursed by
the Fund for their expenses.
If the shareholder wishes to participate in the Meeting, but does not wish to
give his or her proxy telephonically, the shareholder may still submit the
proxy ballot originally sent with the Proxy Statement in the postage paid
envelope provided or attend in person. Should shareholders require additional
information regarding the proxy ballot or a replacement proxy ballot, they
may contact us toll-free at 1.800.708.7780. Any proxy given by a shareholder,
whether in writing or by telephone, is revocable as described below under the
paragraph entitled "Revoking a Proxy."
Please take a few moments to complete your proxy ballot promptly. You may
provide your completed proxy ballot via facsimile, telephonically or by
mailing the proxy ballot in the postage paid envelope provided. You also may
cast your vote by attending the Meeting in person if you are a record owner.
Telephone Voting. The Fund has arranged to have votes recorded by telephone.
Please have the proxy ballet in hand and call the number on the enclosed form
and follow the instructions. After a shareholder provides his or her voting
instructions, those instructions are read back to the shareholder and the
shareholder must confirm his or her voting instructions before disconnecting
the telephone call. The voting procedures used in connection with telephone
voting are designed to reasonably authenticate the identity of shareholders,
to permit shareholders to authorize the voting of their shares in accordance
with their instructions and to confirm that their instructions have been
properly recorded.
Voting By Broker-Dealers. Shares owned of record by a broker-dealer for the
benefit of its customers ("street account shares") will be voted by the
broker-dealer based on instructions received from its customers. If no
instructions are received, the broker-dealer may (if permitted by applicable
stock exchange rules) vote, as record holder of such shares, for the election
of Trustees and on the Proposal in the same proportion as that broker-dealer
votes street account shares for which it has received voting instructions in
time to be voted. Beneficial owners of street account shares cannot vote in
person at the meeting. Only record owners may vote in person at the meeting.
A "broker non-vote" is deemed to exist when a proxy received from a broker
indicates that the broker does not have discretionary authority to vote the
shares on that matter. Abstentions and broker non-votes will have the same
effect as a vote against the proposal.
Voting by the Trustee for OppenheimerFunds-Sponsored Retirement Plans. Shares
held in OppenheimerFunds-sponsored retirement accounts for which votes are
not received as of the last business day before the Meeting Date, will be
voted by the trustee for such accounts in the same proportion as Shares for
which voting instructions from the Fund's other shareholders have been timely
received.
Quorum. The presence in person or by proxy of the holders of record of
one-third of the shares outstanding and entitled to vote constitutes a quorum
at the Meeting for purposes of electing Trustees. The presence in person or
by proxy of the holders of more than 50% of the shares outstanding and
entitled to vote constitutes a quorum at the meeting for purposes of
approving the proposal to modify the Fund's investment objective. Shares over
which broker-dealers have discretionary voting power, shares that represent
broker non-votes and shares whose proxies reflect an abstention on any item
are all counted as shares present and entitled to vote for purposes of
determining whether the required quorum of shares exists.
Required Vote. Persons nominated as Trustees must receive a plurality of the
votes cast, which means that the ten (10) nominees receiving the highest
number of affirmative votes cast at the Meeting will be elected as long as
the votes FOR a nominee exceed the votes AGAINST that nominee. Approval of
Proposal 2 requires the affirmative vote of a "majority of the outstanding
voting securities" (as defined in the Investment Company Act) of the Fund
voting in the aggregate and not by class. This which means the lesser of (i)
67% or more of the voting securities of the Fund present or represented by
proxy at the Meeting, if the holders of more than 50% of the Fund's
outstanding voting securities are present or represented by proxy, or (ii)
more than 50% of the outstanding voting securities of the Fund.
How are votes counted? The individuals named as proxies on the proxy ballots
(or their substitutes) will vote according to your directions if your proxy
ballot is received and properly executed, or in accordance with the
instructions you provide if you vote by telephone. You may direct the proxy
holders to vote or not vote your shares on the proposal to elect Trustees by
checking the appropriate box "For" or "Withhold Authority" or you may direct
the proxy holders to vote your shares on Proposal 2 by checking the
appropriate box "FOR" or "AGAINST," or instruct them not to vote those shares
on the proposal by checking the "ABSTAIN" box. Alternatively, you may simply
sign, date and return your proxy ballot with no specific instructions as to
the proposals. If you properly execute and return a proxy ballot but fail to
indicate how the votes should be cast, the proxy ballot will be voted in
favor of the election of each of the nominees named in this Proxy Statement
for Trustee and in favor of Proposal 2.
Shares of the Fund may be held by certain institutional investors for the
benefit of their clients. If the institutional investor does not timely
receive voting instructions from its clients with respect to such Shares, the
institutional investor may be authorized to vote such Shares, as well as
Shares the institutional investor itself owns, in the same proportion as
Shares for which voting instructions from clients are timely received.
Revoking a Proxy. You may revoke a previously granted proxy at any time
before it is exercised by (1) delivering a written notice to the Fund
expressly revoking your proxy, (2) signing and forwarding to the Fund a
later-dated proxy, or (3) attending the Meeting and casting your votes in
person if you are a record owner. Granted proxies typically will be voted at
the final meeting, but may be voted at an adjourned meeting if appropriate.
Please be advised that the deadline for revoking your proxy by telephone is
3:00 P.M. (ET) on the last business day before the Meeting.
Shareholder Proposals. The Fund is not required and does not intend to hold
shareholder meetings on a regular basis. Special meetings of shareholders may
be called from time to time by either the Fund or the shareholders (for
certain matters and under special conditions described in the Statement of
Additional Information). Under the proxy rules of the SEC, shareholder
proposals that meet certain conditions may be included in a fund's proxy
statement for a particular meeting. Those rules currently require that for
future meetings, the shareholder must be a record or beneficial owner of Fund
shares either (i) with a value of at least $2,000 or (ii) in an amount
representing at least 1% of the fund's securities to be voted, at the time
the proposal is submitted and for one year prior thereto, and must continue
to own such shares through the date on which the meeting is held. Another
requirement relates to the timely receipt by the Fund of any such proposal.
Under those rules, a proposal must have been submitted a reasonable time
before the Fund began to print and mail this Proxy Statement in order to be
included in this Proxy Statement. A proposal submitted for inclusion in the
Fund's proxy material for the next special meeting after the meeting to which
this Proxy Statement relates must be received by the Fund a reasonable time
before the Fund begins to print and mail the proxy materials for that
meeting. Notice of shareholder proposals to be presented at the Meeting must
have been received within a reasonable time before the Fund began to mail
this Proxy Statement. The fact that the Fund receives a proposal from a
qualified shareholder in a timely manner does not ensure its inclusion in the
proxy material because there are other requirements under the proxy rules for
such inclusion.
OTHER MATTERS
The Trustees do not intend to bring any matters before the Meeting other than
Proposals 1 and 2 and the Trustees and the Manager are not aware of any other
matters to be brought before the Meeting by others. Because matters not known
at the time of the solicitation may come before the Meeting, the proxy as
solicited confers discretionary authority with respect to such matters as
properly come before the Meeting, including any adjournment or adjournments
thereof, and it is the intention of the persons named as attorneys-in-fact in
the proxy (or their substitutes) to vote the proxy in accordance with their
judgment on such matters.
In the event a quorum is not present or sufficient votes in favor of one or
more Proposals set forth in the Notice of Meeting of Shareholders are not
received by the date of the Meeting, the persons named in the enclosed proxy
(or their substitutes) may propose and approve one or more adjournments of
the Meeting to permit further solicitation of proxies. All such adjournments
will require the affirmative vote of a majority of the shares present in
person or by proxy at the session of the Meeting to be adjourned. The persons
named as proxies on the proxy ballots (or their substitutes) will vote the
Shares present in person or by proxy (including broker non-votes and
abstentions) in favor of such an adjournment if they determine additional
solicitation is warranted and in the interests of the Fund's shareholders. A
vote may be taken on one or more of the proposals in this proxy statement
prior to any such adjournment if a quorum is present, sufficient votes for
its approval have been received and it is otherwise appropriate.
By Order of the Board of Trustees,
Robert G. Zack, Secretary
November 22, 2004
