Centennial
Money Market Trust
Prospectus dated November 1, 1996
Centennial Money Market Trust is a no-load "money market" mutual fund with the
investment objective of seeking the maximum current income that is consistent
with low capital risk and the maintenance of liquidity. The Trust seeks to
achieve this objective by investing in "money market" securities meeting
specified quality standards. These include U.S. Treasury bills, commercial
paper, bank certificates of deposit and other marketable short-term debt
instruments (issued by the U.S. Government or its agencies, or by corporations
or banks) maturing in or called for redemption in one year or less. Shares of
the Trust are sold at net asset value without a sales charge.
An investment in the Trust is neither insured nor guaranteed by the
U.S. Government. While the Trust seeks to maintain a stable net asset value of
$1.00 per share, there can be no assurance that the Trust will be able to do so.
Shares of the Trust may be purchased directly from brokers or dealers
having sales agreements with the Trust's Distributor and also are offered to
participants in Automatic Purchase and Redemption Programs (the "Programs")
established by certain brokerage firms with which the Trust's Distributor has
entered into agreements for that purpose (See "How to Buy Shares" in the
Appendix). The information in this Prospectus should be read together with the
information in the Appendix which is part of this Prospectus. Program
participants should also read the description of the Program provided by their
broker.
This Prospectus explains concisely what you should know before
investing in the Trust. Please read this Prospectus carefully and keep it for
future reference. You can find more detailed information about the Trust in the
November 1, 1996 Statement of Additional Information. For a free copy, call
Shareholder Services, Inc., the Trust's Transfer Agent, at 1-800-525-9310 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 Trust are not deposits or obligations of any bank, are
not guaranteed by any bank, and 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.
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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.
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Contents
ABOUT THE TRUST
3 Expenses
4 Financial Highlights
5 Performance of the Trust
5 Investment Objective and Policies
9 Investment Restrictions
APPENDIX
A-1 How the Trusts are Managed
A-3 How to Buy Shares
A-5 Purchases Through Automatic Purchase and Redemption
Programs
A-5 Direct Purchases
A-5 Payment by Check
A-5 Payment by Federal Funds Wire
A-6 Guaranteed Payment
A-7 Automatic Investment Plans
A-7 Service Plan
A-8 How to Sell Shares
A-8 Program Participants
A-8 Shares of the Trusts Owned Directly
A-8 Regular Redemption Procedure
A-9 Expedited Redemption Procedure
A-10 Check Writing
A-10 Telephone Redemptions
A-11 Automatic Withdrawal Plans
A-11 Retirement Plans Holding Shares of Government Trust and
Money Market Trust
A-12 General Information on Redemptions
A-13 Exchanges of Shares
A-16 Retirement Plans
A-16 Dividends, Distributions and Taxes
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ABOUT THE TRUST
Expenses
The following table sets forth the fees that an investor in the Trust might pay
and the expenses paid by the Trust during its fiscal year ended June 30, 1996.
o Shareholder Transaction Expenses
Maximum Sales Charge on Purchases
(as a percentage of offering price) None
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Sales Charge on Reinvested Dividends None
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Redemption of Fees None
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Exchange Fee None
o Annual Trust Operating Expenses
(as a percentage of average net assets)
Management Fee 0.36%
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12b-1 (Service Plan) Fees 0.20%
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Other Expenses 0.13%
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Total Trust Operating Expenses 0.69%
The purpose of this table is to assist an investor in understanding the
various costs and expenses that an investor in the Trust will bear directly
(Shareholder Transaction Expenses) or indirectly (Annual Trust Operating
Expenses). "Other Expenses" includes such expenses as custodial and transfer
agent fees, audit and legal and other business operating expenses, but excludes
extraordinary expenses. For further details, see the Trust's financial
statements included in the Statement of Additional Information.
o 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 shares of the Trust, and the Trust's annual return
is 5%, and that its operating expenses are the ones shown in the Annual Trust
Operating Expenses chart above. If you were to redeem your shares at the end of
each period shown below, your investment would incur the
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following expenses by the end of each period shown.
1 year 3 years 5 years 10 years
------ ------- ------- --------
$7 $22 $38 $86
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
Trust, all of which may be more or less than those shown.
Financial Highlights
The table on the following page presents selected information about the Trust,
including per share data and expense ratios and other data based on the Trust's
average net assets. This information has been audited by Deloitte & Touche LLP,
independent auditors, whose report on the financial statements of the Trust for
the fiscal year ended June 30, 1996 is included in the Statement of Additional
Information.
<TABLE>
<CAPTION>
Financial Highlights
Centennial Money Market Trust
Year Ended June 30,
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1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
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Per Share Operating Data:
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
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Income from investment operations - net
investment income and net realized gain .05 .05 .03(1) .03(1) .04(1) .07 .08 .08 .06 .05
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Dividends and distributions to shareholders (.05) (.05) (.03) (.03) (.04) (.07) (.08) (.08) (.06) (.05)
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Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
=======================================================================================
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Total Return, at Net Asset Value(2) 5.11% 5.21% 2.82% 2.91% 4.73% 7.31 8.32% 8.33% 6.29% 5.09%
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Ratios/Supplemental Data:
Net assets, end of period (in millions) $6,753 $4,812 $2,559 $1,991 $1,270 $ 539 $ 470 $ 333 $ 231 $ 191
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Average net assets (in millions) $6,077 $3,342 $2,346 $1,701 $ 821 $ 495 $ 422 $ 272 $ 212 $ 191
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Ratios to average net assets:
Net investment income 4.99% 5.01% 2.84% 2.82% 4.31% 6.66% 7.82% 8.24 6.16% 5.40%
Expenses 0.69% 0.73% 0.76%(1) 0.78%(1) 0.69%(1) 0.84% 0.84% 0.90% 0.98% 1.00%
<FN>
1. Net investment income would have been $.03, $.03, and $.04 per share absent
the voluntary expense limitation, resulting in an expense limitation, resulting
in an expense ration of 0.81%, 0.83%, and 0.81% for the years ended June 30,
1994, 1993 and 1992, respectively. 2. Assumes a hypothetical initial investment
on the business day before the first day of the fiscal period, with all
dividends 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. Total returns are not annualized for periods of less than one
full year. Total returns reflect changes in net investment income only.
</FN>
</TABLE>
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Performance of the Trust
Explanation of "Yield." From time to time, the "yield" and "compounded effective
yield" of an investment in the Trust may be advertised. Both yield figures are
based on historical earnings per share and are not intended to indicate future
performance. The "yield" of the Trust is the income generated by an investment
in the Trust over a seven-day period, which is then "annualized." In
annualizing, the amount of income generated by the investment during that seven
days is assumed to be generated each week over a 52-week period, and is shown as
a percentage of the investment. The "compounded effective yield" is calculated
similarly, but the annualized income earned by an investment in the Trust is
assumed to be reinvested. The "compounded effective yield" therefore will be
slightly higher than the yield because of the effect of the assumed
reinvestment. From time to time the Manager may voluntarily assume a portion of
the Trust's expenses (which may include the management fee), thereby lowering
the overall expense ratio per share and increasing the Trust's yield during the
time such expenses are assumed. See "Yield Information" in the Statement of
Additional Information for additional information about the methods of
calculating these yields.
Investment Objective and Policies
Objective. The Trust is a no-load "money market" fund. It is an open-end,
diversified management investment company organized as a Massachusetts business
trust in 1979. The Trust's investment objective is to seek maximum current
income that is consistent with low capital risk and the maintenance of
liquidity. The value of Trust shares is not insured or guaranteed by any
government agency. However, shares held in brokerage accounts would be eligible
for coverage by the Securities Investor Protection Corporation for losses
arising from the insolvency of the brokerage firm. The Trust's shares may be
purchased at their net asset value, which will remain fixed at $1.00 per share
except under extraordinary circumstances (see "Determination of Net Asset Value
Per Share" in the Statement of Additional Information for further information).
There can be no assurance, however, that the Trust's net asset value will not
vary or that the Trust will achieve its investment objective.
Portfolio Quality/Ratings of Securities. Under Rule 2a-7 of the Investment
Company Act of 1940, as amended (the "Investment Company Act"), the Trust uses
the amortized cost method to value its
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portfolio securities to determine the Trust's net asset value per share. Rule
2a-7 places restrictions on a money market fund's investments. Under the Rule,
the Trust may purchase only those securities that the Manager, under procedures
approved by the Trust's Board of Trustees, has determined have minimal credit
risk and are "Eligible Securities" as defined below.
An "Eligible Security" is (a) one that has received a rating in one of
the two highest short-term rating categories by any two "nationally-recognized
statistical rating organizations" (as defined in the Rule) ("Rating
Organizations"), or, if only one Rating Organization has rated that security, by
that Rating Organization, or (b) an unrated security that is judged by the
Manager to be of comparable quality to investments that are "Eligible
Securities" rated by Rating Organizations. The Rule permits the Trust to
purchase "First Tier Securities," which are Eligible Securities rated in the
highest rating category for short-term debt obligations by at least two Rating
Organizations, or, if only one Rating Organization has rated a particular
security, by that Rating Organization, or comparable unrated securities. Under
the Rule, the Trust may invest only up to 5% of its assets in "Second Tier
Securities," which are Eligible Securities that are not "First Tier Securities."
In addition to the overall 5% limit on Second Tier Securities, the Trust may not
invest more than (i) 5% of its total assets in the securities of any one issuer
(other than the U.S. Government, its agencies or instrumentalities) or (ii) 1%
of its total assets or $1 million (whichever is greater) in Second Tier
Securities of any one issuer. The Trust's Board must approve or ratify the
purchase of Eligible Securities that are unrated or rated by only one Rating
Organization. Additionally, under Rule 2a-7, the Trust must maintain a
dollar-weighted average portfolio maturity of no more than 90 days and the
remaining maturity of any single portfolio investment may not exceed 397 days.
Some of the Trust's existing investment restrictions (which are fundamental
policies that may be changed only by shareholder vote) are more restrictive than
the provisions of Rule 2a-7. For example, as a matter of fundamental policy, the
Trust may not invest in any debt instrument having a maturity in excess of one
year from the date of the investment. The Trust's Board has adopted procedures
under Rule 2a-7 pursuant to which the Board has delegated to the Manager certain
responsibilities, in accordance with the Rule, of conforming the Trust's
investments with the requirements of the Rule and those procedures.
Exhibit A of the Statement of Additional Information contains
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information on the rating categories of Rating Organizations. Ratings at the
time of purchase will determine whether securities may be acquired under the
above restrictions. Subsequent downgrades in ratings may require reassessments
of the credit risk presented by a security and may require its sale. See
"Ratings of Securities" in "Investment Objective and Policies" in the Statement
of Additional Information for further details.
Investment Policies and Strategies. The Trust's investment policies and
practices are not "fundamental" policies as defined in "Investment Restrictions"
unless a particular policy is identified as fundamental. The Board may change
non-fundamental investment policies without shareholder approval. The Trust's
investment objective is a fundamental policy. In seeking its objective, the
Trust may invest in the type of securities listed below and use the following
strategies:
o U.S. Government Securities. The Trust may invest in
obligations issued or guaranteed by the U.S. Government or its
agencies or instrumentalities, maturing in twelve months or less
from the date of purchase.
o Bank Obligations and Instruments Secured By Them. The Trust may
invest in U.S. dollar-denominated certificates of deposit, bankers' acceptances
and other bank obligations if they are obligations of: (1) any U.S. bank having
total assets at least equal to $1 billion or (2) any foreign bank, if such bank
has total assets at least equal to U.S. $1 billion. No more than 25% of the
Trust's assets will be invested in securities issued by foreign banks. That
limitation does not apply to securities issued by foreign branches of U.S.
banks. Investments in securities issued by foreign banks or foreign branches of
U.S. banks subject the Trust to certain additional investment risks, including
future political and economic developments of the country in which the branch is
located, possible imposition of withholding taxes on income payable on the
securities, possible seizure of foreign deposits, establishment of exchange
control restrictions, or other government regulation. While domestic banks are
subject to federal and/or state laws and regulations which, among other things,
require specific levels of reserves to be maintained, not all of those laws
apply to foreign branches of domestic banks or domestic branches or subsidiaries
of foreign banks. For purposes of this section, the term "bank" includes
commercial banks, savings banks and savings and loan associations.
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o Commercial Paper and Certain Debt Obligations. The Trust may invest
in commercial paper maturing in nine months or less from the date of purchase,
or in variable rate notes, variable rate master demand notes or master demand
notes (described in "Investment Objective and Policies" in the Statement of
Additional Information) that meet the requirements of Rule 2a-7. The Trust may
also purchase debt obligations which are Eligible Securities and that either
mature within twelve months from the date of purchase or have been called for
redemption by the issuer, with such redemption to be effective within one year.
o Other Obligations. The Trust may purchase obligations other than
those listed above if they are: (i) guaranteed as to principal and interest by
the U.S. Government or one of its agencies, or by a bank or corporation whose
certificates of deposit or commercial paper may otherwise be purchased by the
Trust (such guaranteed obligations must be due within twelve months or less from
the date of purchase), or (ii) subject to repurchase agreements calling for
delivery in twelve months or less.
o Floating Rate/Variable Rate Notes. Some of the notes the Trust may
purchase may have variable or floating interest rates. Variable rates are
adjustable at stated periodic intervals of no more than one year. Floating rates
are automatically adjusted according to a specified market rate for such
investments, such as the prime rate of a bank, or the 91 day U.S. Treasury bill
rate. The Trust may purchase these obligations if they have a remaining maturity
of one year or less; if their maturity is greater than one year, they may be
purchased if they have a demand feature that permits the Trust to recover the
principal amount of the underlying security at specified intervals not exceeding
one year and upon no more than 30 days' notice. Such obligations may be secured
by bank letters of credit or other credit support arrangements. See "Floating
Rate/Variable Rate Obligations" in the Statement of Additional Information for
more details.
o Board Approved Instruments. The Trust may invest in obligations,
other than those discussed above, approved by the Trust's Board of Trustees and
which are in accordance with the Trust's investment objective, policies and
restrictions.
o Illiquid and Restricted Securities. The Trust will not
purchase or otherwise acquire any security if, as a result, more
than 10% of its net assets would be invested in securities that are
illiquid by virtue of the absence of a readily available market or
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because of legal or contractual restrictions on resale. This policy includes
repurchase agreements maturing in more than seven days and certificates of
deposit of $100,000 or less of a domestic bank (including commercial banks,
savings banks and savings and loan associations) having total assets of less
than $1 billion, if such certificate of deposit is fully insured as to principal
by the Federal Deposit Insurance Corporation. This policy does not limit
purchases of: (i) restricted securities eligible for resale to qualified
institutional purchasers pursuant to Rule 144A under the Securities Act of 1933
that are determined to be liquid by the Board of Trustees or by the Manager
under Board-approved guidelines, or (ii) commercial paper that may be sold
without registration under Section 3(a)(3) or Section 4(2) of the Securities Act
of 1933. Such guidelines take into account trading activity for such securities
and the availability of reliable pricing information, among other factors. If
there is a lack of trading interest in particular Rule 144A securities, the
Trust's holdings of those securities may be illiquid. If due to changes in
relative value, more than 10% of the value of the Trust's net assets consist of
illiquid securities, the Manager would consider appropriate steps to protect the
Trust's maximum flexibility. There may be undesirable delays in selling illiquid
securities at prices representing their fair value. The Trust may invest up to
25% of its net assets in restricted securities, subject to the above 10%
limitation on illiquid securities.
o Repurchase Agreements. The Trust may acquire securities that are
subject to repurchase agreements in order to generate income while providing
liquidity. The Trust's repurchase agreements will be fully collateralized under
the requirements of Rule 2a-7. If the vendor fails to pay the agreed-upon
repurchase price on the delivery date, the Trust's risks may include any costs
of disposing of the collateral, and any loss resulting from any delay in
foreclosing on the collateral. The Trust will not enter into a repurchase
agreement that will cause more than 10% of the Trust's net assets at the time of
purchase to be subject to repurchase agreements maturing in more than seven
days. There is no limit on the amount of the Trust's net assets that may be
subject to repurchase agreements maturing in seven days or less. See "Repurchase
Agreements" in "Investment Objective and Policies" in the Statement of
Additional Information for more details.
Investment Restrictions
The Trust has certain investment restrictions which, together with
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its investment objective, are fundamental policies, which can be changed only by
the vote of a "majority" (as defined in the Investment Company Act) of the
Trust's outstanding voting securities. Under some of those restrictions, the
Trust cannot: (1) invest more than 5% of the value of its total assets in the
securities of any one issuer (other than the U.S. Government or its agencies or
instrumentalities); (2) purchase more than 10% of the outstanding non-voting
securities or more than 10% of the total debt securities of any one issuer; (3)
concentrate investments to the extent of 25% of its assets in any industry;
however, there is no limitation as to investment in obligations issued by banks,
savings and loan associations or the U.S. Government and its agencies or
instrumentalities; (4) invest in any debt instrument having a maturity in excess
of one year from the date of the investment or, in the case of a debt instrument
subject to a repurchase agreement or called for redemption, having a repurchase
or redemption date more than one year from the date of the investment; (5)
borrow money except as a temporary measure for extraordinary or emergency
purposes, and then only up to 10% of the market value of the Trust's assets; the
Trust will not make any investment when such borrowing exceeds 5% of the value
of its assets; no assets of the Trust may be pledged, mortgaged or assigned to
secure a debt; (6) invest more than 5% of the value of its total assets in
securities of companies that have operated less than three years, including the
operations of predecessors; or (7) make loans, except the Trust may: (i)
purchase debt securities, (ii) purchase debt securities subject to repurchase
agreements, or (iii) lend its securities as described in the Statement of
Additional Information. The percentage restrictions described above and in the
Statement of Additional Information apply only at the time of investment and
require no action by the Trust as a result of subsequent changes in value of the
investments or the size of the Trust. A supplementary list of additional
investment restrictions is contained in "Other Investment Restrictions" in the
Statement of Additional Information.
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APPENDIX
This Appendix is part of the Prospectuses of Centennial Money Market Trust
("Money Market Trust"), Centennial Tax Exempt Trust ("Tax Exempt Trust") and
Centennial Government Trust ("Government Trust"), each of which is referred to
in this Appendix individually as a "Trust" and collectively are referred to as
the "Trusts." Unless otherwise indicated, the information in this Appendix
applies to each Trust.
How the Trusts are Managed
Organization and History. The Board of Trustees of each Trust has overall
responsibility for the management of that Trust under the laws of Massachusetts
governing the responsibilities of trustees of business trusts. "Trustees and
Officers" in the Statement of Additional Information identifies the Trustees and
officers and provides information about them. Subject to the authority of the
Board, the Trusts' investment manager, Centennial Asset Management Corporation
(the "Manager"), is responsible for the day-to-day management of each Trust's
business, supervises the investment operations of each Trust and the composition
of its portfolio and furnishes the Trusts advice and recommendations with
respect to investments, investment policies and the purchase and sale of
securities, pursuant to a management agreement (collectively, the "Agreements")
with each Trust. Each of the Agreements sets forth the fees paid by the Trust to
the Manager and the expenses that the Trust is responsible to pay.
The Trust's shares are of one class, are transferrable without
restriction and have equal rights and privileges. Each share of each Trust
represents an interest in that Trust equal to the interest of each other share
of the Trust and entitles the holder to one vote per share (and a fractional
vote for a fractional share) on matters submitted to a shareholder vote. The
Trustees may divide or combine the shares into a greater or lesser number of
shares without thereby changing the proportionate beneficial interest in the
Trust. Shares do not have cumulative voting rights or conversion, preemptive or
subscription rights. Shares of each Trust have equal liquidation rights as to
the assets of that Trust. (Each Trust's Board of Trustees is empowered to issue
additional classes or series of shares of that Trust, which may have separate
assets and liabilities.)
The Trusts will not normally hold annual meetings of the
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shareholders. The Trusts 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 take other action described in the Declaration of Trust. Under
certain principles governing business trusts, shareholders may be held
personally liable as "partners" for the Trust's obligations. However, the risk
of a shareholder incurring any financial loss is limited to the relatively
remote circumstances in which the Trust is unable to meet its obligations. See
"Additional Information" in the Statement of Additional Information for details.
The Manager and Its Affiliates. The Manager, a wholly-owned subsidiary of
OppenheimerFunds, Inc. ("OFI"), has operated as an investment advisor since
1978. The Manager and its affiliates currently advise U.S. investment companies
with assets aggregating over $55 billion as of September 30, 1996, and having
more than 3 million shareholder accounts. OFI is wholly owned by Oppenheimer
Acquisition Corp., a holding company owned in part by senior management of OFI
and the Manager, and ultimately controlled by Massachusetts Mutual Life
Insurance Company, a mutual life insurance company which also advises pension
plans and investment companies.
o Fees and Expenses. The management fee is payable monthly to the
Manager under the terms of each Trust's Agreement and is computed on the average
annual net assets of the respective Trust as of the close of business each day.
The annual rates applicable to Money Market Trust and Government Trust are as
follows: 0.50% of the first $250 million of net assets; 0.475% of the next $250
million of net assets; 0.45% of the next $250 million of net assets; 0.425% of
the next $250 million of net assets; and 0.40% of net assets in excess of $1
billion. The annual rates applicable to Tax Exempt Trust are as follows: 0.50%
of the first $250 million of net assets; 0.475% of the next $250 million of net
assets; 0.45% of the next $250 million of net assets; 0.425% of the next $250
million of net assets; 0.40% of the next $250 million of net assets; 0.375% of
the next $250 million of net assets; 0.35% of the next $500 million of net
assets and 0.325% of net assets in excess of $2 billion. Independently of the
Money Market Trust's Agreement, the Manager has voluntarily agreed to waive a
portion of the management fee otherwise payable to it. This voluntary expense
assumption is described in the Statement of Additional Information. Furthermore,
under Tax Exempt Trust's Agreement, when the value of Tax Exempt Trust's net
assets is less than $1.5 billion, the annual fee payable to the Manager shall be
reduced by $100,000 based on
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average net assets computed daily and paid monthly at the annual rates, but in
no event shall the annual fee be less than $0. See the Statement of Additional
Information for an explanation of the Manager's reimbursement arrangement for
the Trusts set forth in their Agreements. "Investment Management Services" in
the Statement of Additional Information contains more complete information about
the Agreements, including a discussion of expense arrangements, and a
description of the exculpation provisions and portfolio transactions.
o The Custodian. The Custodian of the assets of the Trusts is Citibank,
N.A. The Manager and its affiliates presently have banking relationships with
the Custodian. See "Additional Information" in the Statement of Additional
Information for further information. Each Trust's cash balances in excess of
$100,000 held by the Custodian are not protected by Federal deposit insurance.
Such uninsured balances may at times be substantial. The foregoing rating
restrictions under Rule 2a-7 described under "Investment Objective and Policies"
do not apply to banks in which a Trust's cash is kept.
o The Transfer Agent. Shareholder Services, Inc., a subsidiary of OFI,
acts as Transfer Agent and shareholder servicing agent for the Trusts and the
other mutual funds advised by the Manager, on an at-cost basis. The fees to the
Transfer Agent do not include payments for any services of the type paid, or to
be paid, by the Trusts to the Distributor and to Recipients under the Service
Plan (see "Service Plan"). Direct shareholders should direct any inquiries
regarding the Trusts to the Transfer Agent at the address and toll-free phone
number on the back cover. Program participants should direct any inquiries
regarding the Trust to their broker.
How to Buy Shares
Shares of each Trust may be purchased at their offering price, which is net
asset value per share, without sales charge. The net asset value will remain
fixed at $1.00 per share, except under extraordinary circumstances (see
"Determination of Net Asset Value Per Share" in the Statement of Additional
Information for further details). There can be no guarantee that any Trust will
maintain a stable net asset value of $1.00 per share. Centennial Asset
Management Corporation, which also acts as the distributor for each Trust (and
in that capacity is referred to as the "Distributor"), may in its sole
discretion accept or reject any order for purchase
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of a Trust's shares. OppenheimerFunds Distributor, Inc. ("OFDI"),
an affiliate of the Distributor, acts as the sub-distributor for
each Trust (the "Sub-Distributor").
The minimum initial investment is $500 ($2,500 if by Federal Funds
wire), except as otherwise described in this Prospectus. Subsequent purchases
must be in amounts of $25 or more, and may be made through authorized dealers or
brokers or by forwarding payment to the Distributor at P.O. Box 5143, Denver,
Colorado 80217, with the name(s) of all account owners, the account number and
the name of the Trust. The minimum initial and subsequent purchase requirements
are waived on purchases made by reinvesting dividends from any of the "Eligible
Funds" listed in "Exchange of Shares" in the Statement of Additional Information
or by reinvesting distributions from unit investment trusts for which
reinvestment arrangements have been made with the Distributor. Under an
Automatic Investment Plan or military allotment plan, initial and subsequent
investments must be at least $25. No share certificates will be issued unless
specifically requested in writing by an investor or the dealer or broker.
Each Trust intends to be as fully invested as practicable to maximize
its yield. Therefore, dividends will accrue on newly-purchased shares only
after the Distributor accepts the purchase order at its address in Denver,
Colorado, on a day the New York Stock Exchange is open (a "regular business
day"), under one of the methods of purchasing shares described below. The
purchase will be made at the net asset value next determined after the
Distributor accepts the purchase order.
Each Trust's net asset value per share is determined twice each regular
business day, at 12:00 Noon and the close of The New York Stock Exchange that
day, which is normally 4:00 P.M., but may be earlier on some days (all
references to time in this Prospectus mean New York time), by dividing the net
assets of the Trust by the total number of its shares outstanding. Each Trust's
Board of Trustees has established procedures for valuing the Trust's assets,
using the amortized cost method as described in "Determination of Net Asset
Value Per Share" in the Statement of Additional Information.
Dealers and brokers who process orders for a Trust's shares on behalf
of their customers may charge a fee for this service. That fee can be avoided by
purchasing shares directly from a Trust. The Distributor, in its sole
discretion, may accept or reject any order
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for purchases of the Trust's shares. The sale of shares will be suspended during
any period when the determination of net asset value is suspended, and may be
suspended by the Board of Trustees whenever the Board judges it in the best
interest of a Trust to do so.
Purchases Through Automatic Purchase and Redemption Programs. Shares of each
Trust are available under Automatic Purchase and Redemption Programs
("Programs") of broker-dealers that have entered into agreements with the
Distributor for that purpose. Broker-dealers whose clients participate in such
Programs will invest the "free cash balances" of such client's Program account
in shares of the Trust selected as the primary Trust by the client for the
Program account. Such purchases will be made by the broker-dealer under the
procedures described in "Guaranteed Payment," below. The Program may have
minimum investment requirements established by the broker-dealer. The
description of the Program provided by the broker-dealer should be consulted for
details, and all questions about investing in, exchanging or redeeming shares of
a Trust through a Program should be directed to the broker-dealer.
Direct Purchases. An investor (who is not a program participant, a "direct
shareholder") may directly purchase shares of the Trusts through any broker or
dealer which has a sales agreement with the Distributor or the Sub-Distributor.
There are two ways to make a direct initial investment: either (1) complete a
Centennial Funds New Account Application and mail it with payment to the
Distributor at P.O. Box 5143, Denver, Colorado 80217 (if no dealer is named in
the Application, the Sub-Distributor will act as the dealer), or (2) order the
shares through your dealer or broker. Purchases made by Application should have
a check enclosed, or payment may be made by one of the alternative means
described below.
o Payment by Check. Orders for shares purchased by check in U.S.
dollars drawn on a U.S. bank will be effected on the regular business day on
which the check (and the purchase application, if the account is new) is
accepted by the Distributor. Dividends will begin to accrue on such shares the
next regular business day after the purchase order is accepted. For other
checks, the shares will not be purchased until the Distributor is able to
convert the purchase payment to Federal Funds, and dividends will begin to
accrue on such shares on the next regular business day.
o Payment by Federal Funds Wire. Shares of each Trust may
be purchased by direct shareholders by Federal Funds wire. The
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minimum investment by wire is $2,500. The investor must first call
the Distributor's Wire Department at 1-800-852-8457 to notify the
Distributor of the transmittal of the wire and to order the shares.
The investor's bank must wire the Federal Funds to Citibank, N.A.,
ABA No. 0210-0008-9, for credit to Concentration Account No. 3737-
5674 (Centennial Money Market Trust or Centennial Tax Exempt Trust)
or Concentration Account No. 3741-9796 (Centennial Government
Trust), for further credit to the following account numbers for the
respective Trust: (i) Centennial Money Market Trust Custodian
Account No. 099920, (ii) Centennial Government Trust Custodian
Account No. 099975, or (iii) Centennial Tax Exempt Trust Custodian
Account No. 099862.
The wire must state the investor's name. Shares will be purchased on
the regular business day on which the Federal Funds are received by Citibank,
N.A. (the "Custodian") prior to the close of The New York Stock Exchange (which
is normally 4:00 P.M. but may be earlier on some days) and the Distributor has
received and accepted the investor's notification of the wire order prior to the
close of The New York Stock Exchange. Those shares will be purchased at the net
asset value next determined after receipt of the Federal Funds and the order.
Dividends on newly purchased shares will begin to accrue on the purchase date if
the Federal Funds and order for the purchase are received and accepted by 12:00
Noon. Dividends will begin to accrue on the next regular business day if the
Federal Funds and purchase order are received and accepted between 12:00 Noon
and the close of The New York Stock Exchange. The investor must also send the
Distributor a completed Application when the purchase order is placed to
establish a new account.
o Guaranteed Payment. Broker-dealers with sales agreements with the
Distributor (including broker-dealers who have made special arrangements with
the Distributor for purchases for Program accounts) may place purchase orders
with the Distributor for purchases of a Trust's shares prior to 12:00 Noon on a
regular business day, and the order will be effected at the net asset value
determined at 12:00 Noon that day if the broker-dealer guarantees that payment
for such shares in Federal Funds will be received by the Trust's Custodian prior
to 2:00 P.M. on the same day. Dividends on such shares will begin to accrue on
the purchase date. If an order is received between 12:00 Noon and the close of
The New York Stock Exchange (which is normally 4:00 P.M., but may be earlier on
some days) with the broker-dealer's guarantee that payment for such shares in
Federal Funds will be received by the
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Trust's Custodian by the close of the Exchange on the next regular business day,
the order will be effected at the close of the Exchange on the day the order is
received, and dividends on such shares will begin to accrue on the next regular
business day the Federal Funds are received by the required time. If the
broker-dealer guarantees that the Federal Funds payment will be received by the
Trust's Custodian by 2:00 P.M. on a regular business day on which an order is
placed for shares after 12:00 Noon, the order will be effected at the close of
the Exchange that day and dividends will begin to accrue on such shares on the
purchase date.
o Automatic Investment Plans. Direct investors may purchase shares of a
Trust automatically. Automatic Investment Plans may be used to make regular
monthly investments ($25 minimum) from the investor's account at a bank or other
financial institution. To establish an Automatic Investment Plan from a bank
account, a check (minimum $25) for the initial purchase must accompany the
application. Shares purchased by Automatic Investment Plan payments are subject
to the redemption restrictions for recent purchases described in "How to Sell
Shares." The amount of the Automatic Investment Plan payment may be changed or
the automatic investments terminated at any time by writing to the Transfer
Agent. A reasonable period (approximately 15 days) is required after receipt of
such instructions to implement them. The Trusts reserve the right to amend,
suspend, or discontinue offering Automatic Investment Plans at any time without
prior notice.
Service Plan. Each Trust has adopted a Service Plan (the "Plan") under Rule
12b-1 of the Investment Company Act pursuant to which the Trust will reimburse
the Distributor for all or a portion of its costs incurred in connection with
the personal service and maintenance of accounts that hold Trust shares. The
Distributor will use all the fees received from the Trust to compensate dealers,
brokers, banks, or other financial institutions ("Recipients") each quarter for
providing personal service and maintenance of accounts that hold Trust shares.
The services to be provided by Recipients under each Plan include, but shall not
be limited to, the following: answering routine inquiries from the Recipient's
customers concerning the Trust, providing such customers with information on
their investment in Trust shares, assisting in the establishment and maintenance
of accounts or sub- accounts in the Trust, making the Trust's investment plans
and dividend payment options available, and providing such other information and
customer liaison services and the maintenance of
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accounts as the Distributor or the Trust may reasonably request. Plan payments
by the Trust to the Distributor will be made quarterly in the amount of the
lesser of: (i) 0.05% (0.20% annually) of the net asset value of the Trust,
computed as of the close of each business day or (ii) the Distributor's actual
distribution expenses for that quarter of the type approved by the Board. Each
Trust may make monthly payments to the Distributor (and the Distributor to
Recipients) in any month where Trust assets held by a Recipient for itself or on
behalf of its customers in that month exceed $200 million. Any unreimbursed
expenses incurred for any quarter by the Distributor may not be recovered in
later periods. The Plan has the effect of increasing annual expenses of each
Trust by up to 0.20% of average annual net assets from what its expenses would
otherwise be. In addition, the Manager may, under the Plan, from time to time
from its own resources (which may include the profits derived from the advisory
fee it receives from the Trusts), make payments to Recipients for distribution,
administrative and accounting services performed by Recipients. For further
details, see "Service Plan" in the Statement of Additional Information.
How to Sell Shares
Program Participants. A Program participant may redeem shares in the Program by
writing checks as described below, or by contacting the dealer or broker. A
Program participant may also arrange for "Expedited Redemptions," as described
below, only through his or her dealer or broker.
Shares of the Trusts Owned Directly. Shares of the Trusts owned by a shareholder
directly (not through a Program) (a "direct shareholder"), may be redeemed in
the following ways:
o Regular Redemption Procedure. To redeem some or all shares in an
account (whether or not represented by certificates) under the Trust's regular
redemption procedures, a direct shareholder must send the following to the
Transfer Agent for the Trust, Shareholder Services, Inc., P.O. Box 5143, Denver,
Colorado 80217 [send courier or express mail deliveries to 10200 E. Girard
Avenue, Building D, Denver, Colorado 80231]: (1) a written request for
redemption signed by all registered owners exactly as the shares are registered,
including fiduciary titles, if any, and specifying the account number and the
dollar amount or number of shares to be redeemed; (2) a guarantee of the
signatures of all registered owners on the redemption request or on the
endorsement on the share
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certificate or accompanying stock power, by a U.S. bank, trust company, credit
union or savings association, or a foreign bank having 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,
registered securities association or clearing agency; (3) any share certificates
issued for any of the shares to be redeemed; and (4) any additional documents
which may be required by the Transfer Agent for redemption by corporations,
partnerships or other organizations, executors, administrators, trustees,
custodians, guardians, or from Individual Retirement Accounts ("IRAs") or other
retirement plans, or if the redemption is requested by anyone other than the
shareholder(s) of record. A signature guarantee is not required for redemptions
of $50,000 or less, requested by and payable to all shareholders of record, to
be sent to the address of record for that account. Transfers of shares are
subject to similar requirements. To avoid delay in redemptions or transfers,
shareholders having questions about these requirements should contact the
Transfer Agent in writing or by calling 1-800-525-9310 before submitting a
request. From time to time the Transfer Agent in its discretion may waive any or
certain of the foregoing requirements in particular cases. Redemption or
transfer requests will not be honored until the Transfer Agent receives all
required documents in proper form.
o Expedited Redemption Procedure. In addition to the regular redemption
procedure set forth above, direct shareholders whose shares are not represented
by certificates may arrange to have redemption proceeds of $2,500 or more wired
in Federal Funds to a designated commercial bank if the bank is a member of the
Federal Reserve wire system. To place a wire redemption request, call the
Transfer Agent at 1-800-852-8457. The account number of the designated financial
institution and the bank ABA number must be supplied to the Transfer Agent on
the Application or dealer settlement instructions establishing the account or
may be added to existing accounts or changed only by signature-guaranteed
instructions to the Transfer Agent from all shareholders of record. Such
redemption requests may be made by telephone, wire or written instructions to
the Transfer Agent. The wire for the redemption proceeds of shares redeemed
prior to 12:00 Noon normally will be transmitted by the Transfer Agent to the
shareholder's designated bank account on the day the shares are redeemed (or, if
that day is not a bank business day, on the next bank business day). Shares
redeemed prior to 12:00 Noon do not earn dividends on the redemption date. The
wire for the redemption proceeds of shares
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redeemed between 12:00 Noon and the close of The New York Stock Exchange (which
is normally 4:00 P.M., but may be earlier on some days) normally will be
transmitted by the Transfer Agent to the shareholder's designated bank account
on the next bank business day after the redemption. Shares redeemed between
12:00 Noon and the close of the Exchange earn dividends on the redemption date.
See "Purchase, Redemption and Pricing of Shares" in the Statement of Additional
Information for further details.
o Check Writing. Upon request, the Transfer Agent will provide any
direct shareholder of the Trusts or any Program participant whose shares are not
represented by certificates, with forms of drafts ("checks") payable through a
bank selected by the Trust (the "Bank"). Checks may be made payable to the order
of anyone in any amount not less than $250, and will be subject to the Bank's
rules and regulations governing checks. Program participants' checks will be
payable from the primary account designated by the Program participant. The
Transfer Agent will arrange for checks written by direct shareholders to be
honored by the Bank after obtaining a specimen signature card from the
shareholder(s). Program participants must arrange for Check Writing through
their brokers or dealers. If a check is presented for an amount greater than the
account value, it will not be honored. Shareholders of joint accounts may elect
to have checks honored with a single signature. Checks issued for one Trust
account must not be used if the shareholder's account has been transferred to a
new account or if the account number or registration has changed. Shares
purchased by check or Automatic Investment Plan payments within the prior 10
days may not be redeemed by Check Writing. A check that would require redemption
of some or all of the shares so purchased is subject to non-payment. The Bank
will present checks to the Trust to redeem shares to cover the amount of the
check. Checks may not be presented for cash payment at the offices of the Bank
or the Trust's Custodian. This limitation does not affect the use of checks for
the payment of bills or to obtain cash at other banks. The Trust reserves the
right to amend, suspend, or discontinue Check Writing privileges at any time
without prior notice.
o Telephone Redemptions. Direct shareholders of the Trusts may redeem
their shares by telephone by calling the Transfer Agent at 1-800-852-8457. This
procedure for telephone redemptions is not available to Program participants.
Proceeds of telephone redemptions will be paid by check payable to the
shareholder(s) of record and sent to the address of record for the account.
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Telephone redemptions are not available within 30 days of a change of the
address of record. Up to $50,000 may be redeemed by telephone, in any seven day
period. The Transfer Agent may record any calls. Telephone redemptions may not
be available if all lines are busy, and shareholders would have to use the
Trusts' regular redemption procedures described above. Telephone redemption
privileges are not available for newly-purchased (within the prior 10 days)
shares or for shares represented by certificates. Telephone redemption
privileges apply automatically to each direct shareholder and the dealer
representative of record unless the Transfer Agent receives cancellation
instructions from a shareholder of record. If an account has multiple owners,
the Transfer Agent may rely on the instructions of any one owner.
o Automatic Withdrawal Plans. Direct shareholders of the Trusts can
authorize the Transfer Agent to redeem shares (minimum $50) automatically on a
monthly, quarterly, semi-annual or annual basis under an Automatic Withdrawal
Plan. Shares will be redeemed as of the close of The New York Stock Exchange
(which is normally 4:00 P.M., but may be earlier on some days) three days prior
to the date requested by the shareholder for receipt of the payment. The Trusts
cannot guarantee receipt of payment on the date requested and reserve the right
to amend, suspend or discontinue offering such Plan at any time without prior
notice. Required minimum distributions from OppenheimerFunds-sponsored
retirement plans may not be arranged on this basis. For further details, see the
"Automatic Withdrawal Plan Provisions" included as Exhibit C in the Statement of
Additional Information.
Retirement Plans Holding Shares of Government Trust and Money Market Trust.
Requests for distributions from OppenheimerFunds- sponsored Individual
Retirement Accounts ("IRAs"), 403(b)(7) custodial plans, or pension or
profit-sharing plans of direct shareholders for which the Manager or its
affiliates act as sponsors should be addressed to "Bank of Boston c/o
Shareholder Services, Inc." at the address listed on the cover, and must: (i)
state the reason for distribution; (ii) state the owner's awareness of tax
penalties if the distribution is premature; and (iii) conform to the
requirements of the plan and the Trust's requirements for regular redemptions
discussed above. Participants (other than self-employed persons) in
OppenheimerFunds-sponsored pension or profit-sharing plans may not directly
request redemption of their accounts. The employer or plan administrator must
sign the request. Distributions from such plans are subject to additional
requirements under the Internal Revenue Code and certain
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documents (available from the Transfer Agent) must be completed before the
distribution may be made. Distributions from retirement plans are subject to
withholding requirements under the Internal Revenue Code of 1986, as amended,
and IRS Form W-4P (available from the Transfer Agent) must be submitted to the
Transfer Agent with the distribution request, or the distribution may be
delayed. Unless the shareholder has provided the Transfer Agent with a certified
tax identification number, the Internal Revenue Code requires that tax be
withheld from any distribution even if the shareholder elects not to have tax
withheld. The Trustee, the Trusts, the Manager, the Distributor and the Transfer
Agent assume no responsibility to determine whether a distribution satisfies the
conditions of applicable tax laws and will not be responsible for any penalties
assessed.
General Information on Redemptions. The redemption price will be the net asset
value per share of the applicable Trust next determined after the receipt by the
Transfer Agent of a request in proper form. Under certain unusual circumstances,
the Board of Trustees of Tax Exempt Trust may involuntarily redeem small
accounts (valued at less than $500). Should the Board elect to exercise this
right, it may also fix, in accordance with the Investment Company Act, the
requirements for any notice to be given to the shareholders in question (not
less than 30 days), or may set requirements for permission to allow the
shareholder to increase the investment so that the shares would not be
involuntarily redeemed. The Board of Trustees of Tax Exempt Trust may also
involuntarily redeem shares in amounts sufficient to reimburse the Trust or the
Distributor for any loss due to cancellation of a share purchase order. Under
the Internal Revenue Code, the Trusts may be required to impose "backup"
withholding of Federal income tax at the rate of 31% from any taxable dividends
and distributions (including exchanges) the Trust may make if the shareholder
has not furnished the Trust with a certified taxpayer identification number or
has not complied with provisions of the Internal Revenue Code relating to
reporting dividends.
Payment for redeemed shares is made ordinarily in cash and forwarded
within seven days of the Transfer Agent's receipt of redemption instructions in
proper form, except under unusual circumstances as determined by the Securities
and Exchange Commission. For accounts registered in the name of a broker-dealer,
payment will be forwarded within three business days. The Transfer Agent may
delay forwarding a redemption check for recently purchased shares only until the
purchase check has cleared, which
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may take up to 10 or more days from the purchase date. Such delay may be avoided
if the shareholder arranges telephone or written assurance satisfactory to the
Transfer Agent from the bank on which the purchase payment was drawn, or by
purchasing shares by Federal Funds wire, as described above. The Trust makes no
charge for redemption. Dealers or brokers may charge a fee for handling
redemption transactions, but such fee can be avoided by direct shareholders by
requesting the redemption directly through the Transfer Agent. Under certain
circumstances, the proceeds of redemption of shares of a Trust acquired by
exchange of shares of Eligible Funds that were purchased subject to a contingent
deferred sales charge ("CDSC") may be subject to the CDSC (see "Exchange
Privilege" below).
Exchanges of Shares
Exchange Privilege. Shares of each of the Trusts held under Programs may be
exchanged for shares of Centennial Money Market Trust, Centennial Government
Trust, Centennial Tax Exempt Trust, Centennial California Tax Exempt Trust and
Centennial New York Tax Exempt Trust if available for sale in the shareholder's
state of residence only by instructions of the broker.
Shares of the Trusts may, under certain conditions, be exchanged by
direct shareholders for Class A shares of certain Oppenheimer funds. A list of
the Oppenheimer funds currently available for exchange is included in the
Statement of Additional Information. That list can change from time to time.
(The funds included on the list are collectively referred to as "Eligible
Funds"). There is an initial sales charge on the purchase of Class A shares of
each Eligible Fund except the Money Market Funds (as defined in the Statement of
Additional Information). Under certain circumstances described below, redemption
proceeds of Money Market Fund shares may be subject to a CDSC.
Shares of the Trusts and of the other Eligible Funds may be exchanged
at net asset value, if all of the following conditions are met: (1) shares of
the fund selected for exchange are available for sale in the shareholder's state
of residence; (2) the respective prospectuses of the funds whose shares are to
be exchanged and acquired offer the Exchange Privilege to the investor; (3)
newly-purchased shares (by initial or subsequent investment) are held in an
account for at least seven days prior to the exchange; and (4) the aggregate net
asset value of the shares surrendered for exchange into a new account is at
least equal to
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the minimum investment requirements of the fund whose shares are to
be acquired.
In addition to the conditions stated above, shares of Eligible Funds
may be exchanged for shares of any Money Market Fund; shares of any Money Market
Fund held by direct shareholders (including the Trusts) purchased without a
sales charge may be exchanged for shares of Eligible Funds offered with a sales
charge upon payment of the sales charge (or, if applicable, may be used to
purchase shares of Eligible Funds subject to a CDSC); and shares of a Trust
acquired by reinvestment of dividends and distributions from any Eligible Fund,
except Oppenheimer Cash Reserves, or from any unit investment trust for which
reinvestment arrangements have been made with the Distributor or Sub-Distributor
may be exchanged at net asset value for shares of any Eligible Fund. The
redemption proceeds of shares of a Trust acquired by exchange of Class A shares
of an Eligible Fund purchased subject to a CDSC, that are redeemed within 18
months of the end of the calendar month of the initial purchase of the exchanged
shares, will be subject to the CDSC as described in the prospectus of that other
eligible fund; in determining whether the CDSC is payable, shares of the Trust
not subject to the CDSC are redeemed first, including shares purchased by
reinvestment of dividends and capital gains distributions from any Eligible Fund
or shares of the Trust acquired by exchange of shares of Eligible Funds on which
a front-end sales charge was paid or credited, and then other shares are
redeemed in the order of purchase.
How to Exchange Shares. An exchange may be made by direct shareholders by
submitting an Exchange Authorization Form to the Transfer Agent, signed by all
registered owners. In addition, direct shareholders of the Trusts may exchange
shares of a Trust for shares of any Eligible Fund by telephone exchange
instructions to the Transfer Agent by a shareholder or the dealer representative
of record for an account. The Trusts may modify, suspend or discontinue this
exchange privilege at any time. Although the Trust will attempt to provide you
notice whenever reasonably able to do so, it may impose these changes at any
time. The Trusts reserve the right to reject written requests submitted in bulk
on behalf of more than one account. Exchange requests must be received by the
Transfer Agent by the close of The New York Stock Exchange on a regular business
day to be effected that day. The number of shares exchanged may be less than the
number requested if the number requested would include shares subject to a
restriction cited above or shares covered by a certificate that is not tendered
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with such request. Only the shares available for exchange without
restriction will be exchanged.
Telephone Exchanges. Direct shareholders may place a telephone exchange request
by calling the Transfer Agent at 1-800-852-8457. Telephone exchange calls may be
recorded by the Transfer Agent. Telephone exchanges are subject to the rules
described above. By exchanging shares by telephone, the shareholder is
acknowledging receipt of a prospectus of the fund to which the exchange is made
and that for full or partial exchanges, any special account features such as
Automatic Investment Plans, Automatic Withdrawal Plans and retirement plan
contributions will be switched to the new account unless the Transfer Agent is
otherwise instructed. Telephone exchange privileges automatically apply to each
direct shareholder of record and the dealer representative of record unless and
until the Transfer Agent receives written instructions from a shareholder of
record canceling such privileges. If an account has multiple owners, the
Transfer Agent may rely on the instructions of any one owner. The Transfer Agent
has adopted procedures concerning telephone transactions including confirming
that telephone instructions are genuine by requiring callers to provide tax
identification number(s) and other account data or by using PINs, and by
recording calls and 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 any Trust will be liable
for losses or expenses arising out of telephone instructions reasonably believed
to be genuine. The Transfer Agent reserves the right to require shareholders to
confirm, in writing, telephone transaction privileges for an account. Shares
acquired by telephone exchange must be registered exactly as the account from
which the exchange was made. Certificated shares are not eligible for telephone
exchange. If all telephone exchange lines are busy (which might occur, for
example, during periods of substantial market fluctuations), shareholders might
not be able to request telephone exchanges and would have to submit written
exchange requests.
General Information on Exchanges. Shares to be exchanged are redeemed on the day
the Transfer Agent receives an exchange request in proper form (the "Redemption
Date"), as of the close of The New York Stock Exchange (which is normally 4:00
P.M., but may be earlier some days). Normally, shares of the fund to be acquired
are purchased on the Redemption Date, but such purchases may be delayed by
either fund up to seven business days if it determines
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that it would be disadvantaged by an immediate transfer of the redemption
proceeds. Each Trust in its discretion reserves the right to refuse any exchange
request that will disadvantage it.
The Eligible Funds have different investment objectives and policies.
Each of those funds imposes a sales charge on purchases of Class A shares except
the Money Market Funds. For complete information, including sales charges and
expenses, a prospectus of the fund into which the exchange is being made should
be read prior to an exchange. Dealers and brokers who process exchange orders on
behalf of their customers may charge for their services. Direct shareholders may
avoid those charges by requesting the Trust directly to exchange shares. For
Federal tax purposes, an exchange is treated as a redemption and purchase of
shares.
Retirement Plans
The Distributor has available for direct shareholders who purchase shares of
Government Trust and Money Market Trust: (i) individual retirement accounts
(IRAs), including Simplified Employee Pension Plans (SEP IRAs); (ii) prototype
pension and profit-sharing plans for corporations and self-employed individuals;
and (iii) Section 403(b)(7) custodial plans for employees of public educational
institutions and organizations of the type described in Section 501(c)(3) of the
Internal Revenue Code. The minimum initial IRA, SEP IRA, pension or
profit-sharing plan investment is normally $250. The minimum initial 403(b)(7)
plan investment is $25. For further details, including the administrative fees,
the appropriate retirement plan should be requested from the Distributor.
Retirement plans are not available to direct shareholders who purchase shares of
Tax Exempt Trust. The Trusts reserve the right to discontinue offering their
shares to such plans at any time without prior notice.
Dividends, Distributions and Taxes
This discussion relates solely to Federal tax laws and is not exhaustive; a
qualified tax advisor should be consulted. Dividends and distributions may be
subject to Federal, state and local taxation. Information about the possible
applicability of the Alternative Minimum Tax to Tax Exempt Trust's dividends and
distributions is contained in "Investment Objective and Policies Private
Activity Municipal Securities" in the Statement of Additional Information of Tax
Exempt Trust. The Appendix to the Statement of Additional Information contains a
further discussion
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of tax matters affecting the Trusts and their distributions.
Dividends and Distributions. Each Trust intends to declare all of its net
income, as defined below, as dividends on each regular business day and to pay
dividends monthly. Dividends will be payable to shareholders as described above
in "How To Buy Shares." Dividends accumulated since the prior payment will be
reinvested in full and fractional shares of the respective Trust at net asset
value on the third Thursday of each calendar month. If a shareholder redeems all
shares at any time during a month, the redemption proceeds include all dividends
accrued up to the redemption date for shares redeemed prior to 12:00 Noon, and
include all dividends accrued through the redemption date for shares redeemed
between 12:00 Noon and the close of The New York Stock Exchange. Program
participants may receive cash payments by asking the broker to redeem shares.
All dividends and capital gains distributions for the accounts of
Program participants are automatically reinvested in additional shares of the
Trust selected. Dividends and distributions payable to direct shareholders of
the Trusts will also be automatically reinvested in shares of the respective
Trust at net asset value, on the third Thursday of each calendar month, unless
the shareholder asks the Transfer Agent in writing to pay dividends and
distributions in cash or to reinvest them in another Eligible Fund, as described
in "Dividend Reinvestment in Another Fund" in the Statement of Additional
Information. That notice must be received prior to the record date for a
dividend to be effective as to that dividend. Dividends, distributions and the
proceeds of redemptions of Trust shares represented by checks returned to the
Transfer Agent by the Postal Service as undeliverable will be reinvested in
shares of the respective Trust, as promptly as possible after the return of such
check to the Transfer Agent to enable the investor to earn a return on otherwise
idle funds.
Participants in an A.G. Edwards & Sons, Inc. Cash Convenience Account
Program (other than those whose Account is an Individual Retirement Account)
holding shares of Tax Exempt Trust or Government Trust will receive account
statements five times a year, at the end of March, May, August, October and
December, if the only activity in their account during that period is the
automatic reinvestment of dividends.
Under the terms of a Program, a broker-dealer may pay out the
value of some or all of a Program participant's Trust shares prior
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to redemption of such shares by the Trust. In such cases, the shareholder will
be entitled to dividends on such shares only up to and including the date of
such payment. Dividends on such shares accruing between the date of payment and
the date such shares are redeemed by the Trusts will be paid to the
broker-dealer. Program participants should discuss these arrangements with their
broker-dealer.
A Trust's net investment income for dividend purposes consists of all
interest accrued on portfolio assets, less all expenses of the Trust for such
period. Distributions from net realized gains on securities, if any, will be
paid at least once each year, and may be made more frequently in compliance with
the Internal Revenue Code and the Investment Company Act. Long-term capital
gains, if any, will be identified separately when tax information is
distributed. No Trust will make any distributions from net realized securities
gains unless capital loss carry forwards, if any, have been used or have
expired. Receipt of tax-exempt income must be reported on the taxpayer's Federal
income tax return. To effect its policy of maintaining a net asset value of
$1.00 per share, each Trust, under certain circumstances, may withhold dividends
or make distributions from capital or capital gains. The Statement of Additional
Information describes how dividends and distributions received by direct
shareholders of the Trusts may be reinvested in shares of any Eligible Fund at
net asset value.
Tax Status of Money Market Trust's and Government Trust's Dividends and
Distributions. Dividends paid by these Trusts derived from net investment income
or net short-term capital gains are taxable to shareholders as ordinary income,
whether received in cash or reinvested. If either Trust has net realized
long-term capital gains in a fiscal year, it may pay an annual "long-term
capital gains distribution," which will be so identified when paid and when tax
information is distributed. Long-term capital gains are taxable to shareholders
as long-term capital gains, whether received in cash or reinvested, regardless
of how long Trust shares have been held. Income from securities issued by the
U.S. Government may be exempt from income taxation by various states. The
Government Trust will advise shareholders of the percentage of its income earned
on federal obligations. Rules vary by state regarding the state taxability of
dividends paid by either Trust. You should consult your tax advisor to determine
proper tax treatment of dividends paid by the Trusts.
Tax Status of Tax Exempt Trust's Dividends and Distributions. This
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<PAGE>
Trust intends to qualify under the Internal Revenue Code during each fiscal year
to pay "exempt-interest dividends" to its shareholders and did so qualify during
its last fiscal year. Exempt-interest dividends which are derived from net
investment income earned by the Trust on Municipal Securities will be excludable
from gross income of shareholders for Federal income tax purposes. Net
investment income includes the allocation of amounts of income from the
Municipal Securities in the portfolio of the Trust which is excludable from
gross income for Federal individual income tax purposes, less expenses. Expenses
are accrued daily. This allocation will be made by the use of one designated
percentage applied uniformly to all income dividends made during the calendar
year. Such designation will normally be made following the end of each fiscal
year as to income dividends paid in the prior year. The percentage of income
designated as tax-exempt may substantially differ from the percentage of the
Trust's income that was tax-exempt for a given period. Although from time to
time a portion of the exempt-interest dividends paid by the Trust may be an item
of tax preference for shareholders subject to the alternative minimum tax, all
of the dividends (excluding distributions) paid by the Trust during the calendar
year ended December 31, 1995 were exempt from Federal income taxes. The net
amount of any income on Municipal Securities subject to the alternative minimum
tax will be identified when tax information is distributed by the Trust. The
Trust will report annually to shareholders the percentage of interest income it
received during the preceding year on Municipal Securities. Receipt of
tax-exempt income must be reported on the taxpayer's Federal income tax return.
Shareholders receiving Social Security benefits should be aware that
exempt-interest dividends are a factor in determining whether such benefits are
subject to Federal income tax.
A Trust shareholder treats a dividend as a receipt of ordinary income
(whether paid in cash or reinvested in additional shares) if derived from net
interest income earned by the Trust from one or more of: (i) certain taxable
temporary investments (such as certificates of deposit, commercial paper,
obligations of the U.S. government, its agencies or instrumentalities, and
repurchase agreements), (ii) income from securities loans, or (iii) an excess of
net short-term capital gains over net long-term capital losses. Additionally,
all or a portion of the Trust's exempt-interest dividends may be a component of
the "adjusted current earnings" preference item under the Federal corporate
alternative minimum tax.
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<PAGE>
Under the Internal Revenue Code, interest on loans to purchase shares
of the Trust may not be deducted for Federal tax purposes. In addition, under
rules used by the Internal Revenue Service for determining when borrowed funds
are deemed used for the purpose of purchasing or carrying particular assets, the
purchase of shares of the Trust may be considered to have been made with
borrowed funds even though the borrowed funds are not directly traceable to the
purchase of shares. Furthermore, under Section 147(a) of the Internal Revenue
Code, persons who are "substantial users" (or persons related thereto) of
facilities financed by industrial development bonds or Private Activity
Municipal Securities should refer to "Private Activity Municipal Securities" in
the Statement of Additional Information of Tax Exempt Trust and should consult
their own tax advisors before purchasing shares. No investigation as to the
users of the facilities financed by such bonds is made by the Tax Exempt Trust.
Tax Status of the Trusts. If a Trust qualifies as a "regulated investment
company" under the Internal Revenue Code, it will not be liable for Federal
income taxes on amounts paid by it as dividends and distributions. Each Trust
qualified during its last fiscal year and intends to qualify in the current and
future fiscal years, while reserving the right not to qualify. However, the
Internal Revenue Code contains a number of complex tests relating to such
qualification that a Trust might not meet in any particular year. If a Trust
does not qualify, it would be treated for Federal tax purposes as an ordinary
corporation and receive no tax deduction for payments made to shareholders. Tax
Exempt Trust would then be unable to pay "exempt-interest dividends" as
discussed before. Dividends paid by any Trust will not be eligible for the
dividends-received deduction for corporations. For information as to "backup"
withholding on taxable dividends, see "How to Sell Shares," above.
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<PAGE>
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 respective Trust, the Manager, the Distributor 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 offer in such state.
Investment Advisor and Distributor
Centennial Asset Management Corporation
3410 South Galena Street
Denver, Colorado 80231
Transfer Agent and Shareholder Servicing Agent
Shareholder Services, Inc.
P.O. Box 5143
Denver, Colorado 80217-5143
1-800-525-9310 Centennial
Money Market Trust
Custodian of Portfolio Securities
Citibank, N.A.
399 Park Avenue Prospectus
New York, New York 10043
Dated November 1, 1996
Independent Auditors
Deloitte & Touche LLP
555 Seventeenth Street, Suite 3600
Denver, Colorado 80202-3942
Legal Counsel
Myer, Swanson, Adams & Wolf, P.C.
The Colorado State Bank Building
1600 Broadway, Suite 1480
Denver, Colorado 80202
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<PAGE>
Centennial Money Market Trust
3410 South Galena Street, Denver, Colorado 80231
1-800-525-9310
Statement of Additional Information dated November 1, 1996
This Statement of Additional Information is not a Prospectus. This
document contains additional information about the Trust and supplements
information in the Prospectus dated November 1, 1996. It should be read together
with the Prospectus which may be obtained by writing to the Trust's Transfer
Agent, Shareholder Services, Inc. at P.O. Box 5143, Denver, Colorado 80217- 5143
or by calling the Transfer Agent at the toll-free number shown above.
Contents Page
Investment Objective and Policies...........................................2
Other Investment Restrictions...............................................4
Appendix
Trustees and Officers.................................................A-1
Investment Management Services........................................A-5
Service Plan..........................................................A-8
Purchase, Redemption and Pricing of Shares............................A-10
Exchange of Shares....................................................A-11
Yield Information.....................................................A-13
Additional Information................................................A-14
Independent Auditors' Report..........................................A-16
Financial Statements..................................................A-17
Exhibit A: Description of Securities Ratings........................A-37
Exhibit B: Industry Classifications.................................A-42
Exhibit C: Automatic Withdrawal Plan Provisions.....................A-43
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Investment Objective and Policies
Investment Policies and Strategies. The investment objective and policies of the
Trust are described in the Prospectus. Set forth below is supplemental
information about those policies. Certain capitalized terms used in this
Statement of Additional Information are defined in the Prospectus.
The Trust will not make investments with the objective of seeking
capital growth. However, the value of the securities held by the Trust may be
affected by changes in general interest rates. Because the current value of debt
securities varies inversely with changes in prevailing interest rates, if
interest rates increase after a security is purchased, that security would
normally decline in value. Conversely, should interest rates decrease after a
security is purchased, its value would rise. However, those fluctuations in
value will not generally result in realized gains or losses to the Trust since
the Trust does not usually intend to dispose of securities prior to their
maturity. A debt security held to maturity is redeemable by its issuer at full
principal value plus accrued interest. To a limited degree, the Trust may engage
in short-term trading to attempt to take advantage of short-term market
variations, or may dispose of a portfolio security prior to its maturity if, on
the basis of a revised credit evaluation of the issuer or other considerations,
the Trust believes such disposition advisable or it needs to generate cash to
satisfy redemptions. In such cases, the Trust may realize a capital gain or
loss.
Bank Obligations. The Trust may invest in the bank obligations described in the
Prospectus. In addition, the Trust may invest in certificates of deposit of
$100,000 or less of a domestic bank, regardless of asset size, if such
certificate of deposit is fully insured as to principal by the Federal Deposit
Insurance Corporation. At no time will the Trust hold more than one certificate
of deposit from any such bank. Because of the limited marketability of such
certificates of deposit, no more than 10% of the Trust's net assets will be
invested in certificates of deposit of $100,000 or less of a bank having total
assets less than $1 billion.
U.S. Government Securities. Obligations of certain U.S. Government agencies and
instrumentalities may not be guaranteed or supported by the full faith and
credit of the United States. Some obligations are backed only by the right of
the issuer to borrow from the U.S. Treasury; others by discretionary authority
of the U.S. Government to purchase the agency's obligations; while still others
are supported only by the credit of the instrumentality. In the case of
securities not backed by the full faith and credit of the United States, the
Trust must look to the agency issuing or guaranteeing the obligation for
repayment and may not be able to assert a claim against the United States if the
agency does not meet its commitments. The Trust will invest in securities of
such instrumentalities only when the Trust's investment manager, Centennial
Asset Management Corporation (the "Manager"), is satisfied that the credit risk
with respect to the instrumentality is minimal.
Floating Rate/Variable Rate Obligations. The Trust may invest in instruments
with floating or variable interest rates. The interest rate on a floating rate
obligation is based on a stated prevailing market rate, such as a bank's prime
rate, the 91-day U.S. Treasury Bill rate, the rate of return on commercial paper
or bank certificates of deposit, or some other standard, and is adjusted
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<PAGE>
automatically each time such market rate is adjusted. The interest rate on a
floating rate demand note is based on a stated prevailing market rate, such as
the PSA Municipal Swap Index or the J.J. Kenney Index, or some other standard,
and is adjusted automatically each time such rate is adjusted. The interest rate
on a variable rate demand note is also bases on a stated prevailing market rate
but is adjusted automatically at a specified interval of no less than one year.
Some variable rate or floating rate obligations in which the Trust may invest
have a demand feature entitling the holder to demand payment at an amount
approximately equal to amortized cost or the principal amount thereof plus
accrued interest at any time, or at specified intervals not exceeding one year.
These notes may or may not be backed by bank letters of credit. Variable rate
demand notes may include master demand notes discussed below. The Manager, on
behalf of the Trust, will consider on an ongoing basis the creditworthiness of
the issuers of the floating and variable rate obligations in the Trust's
portfolio.
Master Demand Notes. A master demand note is a corporate obligation that permits
the investment of fluctuating amounts by the Trust at varying rates of interest
pursuant to direct arrangements between the Trust, as lender, and the corporate
borrower that issues the note. These notes permit daily changes in the amounts
borrowed. The Trust has the right to increase the amount under the note at any
time up to the full amount provided by the note agreement, or to decrease the
amount, and the borrower may repay up to the full amount of the note at any time
without penalty. Because variable amount master demand notes are direct lending
arrangements between the lender and the borrower, it is not generally
contemplated that such instruments will be traded. There is no secondary market
for these notes, although they are redeemable and thus immediately repayable by
the borrower at face value, plus accrued interest, at any time. Accordingly, the
Trust's right to redeem is dependent on the ability of the borrower to pay
principal and interest on demand. In evaluating the master demand note
arrangements, the Manager considers the earning power, cash flow, and other
liquidity ratios of the issuer. Master demand notes are not typically rated by
credit rating agencies. If they are not rated, the Trust may invest in them only
if, at the time of an investment, they are Eligible Securities. The Manager will
continuously monitor the borrower's financial ability to meet all of its
obligations because the Trust's liquidity might be impaired if the borrower were
unable to pay principal and interest on demand.
Repurchase Agreements. In a repurchase transaction, the Trust acquires a
security from, and simultaneously resells it to, an approved vendor (a U.S.
commercial bank or the U.S. branch of a foreign bank having total domestic
assets of at least $1 billion or a broker-dealer with a net capital of at least
$50 million and which has been designated a primary dealer in government
securities). The resale price exceeds the purchase price by an amount that
reflects an agreed-upon interest rate effective for the period during which the
repurchase agreement is in effect. The majority of these transactions run from
day to day, and delivery pursuant to the resale typically will occur within one
to five days of the purchase. Repurchase agreements are considered "loans" under
the Investment Company Act, collateralized by the underlying security. The
Trust's repurchase agreements require that at all times while the repurchase
agreement is in effect, the value of the collateral must equal or exceed the
repurchase price to fully collateralize the repayment obligation. Additionally,
the Manager will impose creditworthiness requirements to confirm that the vendor
is financially sound and will continuously monitor the collateral's value.
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<PAGE>
Loans of Portfolio Securities. To attempt to increase its income for liquidity
purposes, the Trust may lend its portfolio securities to qualified borrowers
(other than in repurchase transactions) if the loan is collateralized in
accordance with applicable regulatory requirements, and if, after any loan, the
value of the securities loaned does not exceed 25% of the value of the Trust's
total assets. The Trust will not enter into any securities lending agreements
having a duration of greater than one year. Any securities received as
collateral for a loan must mature in twelve months or less. The Trust presently
does not intend that the value of securities loaned will exceed 5% of the value
of the Trust's net assets in the coming year.
Under applicable regulatory requirements (which are subject to change),
the loan collateral must, on each business day, at least equal the market value
of the loaned securities and must consist of cash, bank letters of credit or
U.S. Government Securities or other cash equivalents which the Fund is permitted
to purchase. To be acceptable as collateral, letters of credit must obligate a
bank to pay amounts demanded by the Trust if the demand meets the terms of the
letter. The Trust receives an amount equal to the dividends or interest on
loaned securities and also receives one or more of (a) negotiated loan fees, (b)
interest on securities used as collateral, or (c) interest on short-term debt
securities purchased with such loan collateral; either type of interest may be
shared with the borrower. The Trust may also pay reasonable finder's, custodian
and administrative fees and will not lend its portfolio securities to any
officer, trustee, employee or affiliate of the Trust or the Manager. The terms
of the Trust's loans must meet applicable tests under the Internal Revenue Code
and permit the Trust to reacquire loaned securities on five days' notice or in
time to vote on any important matter.
Ratings of Securities. The prospectus describes "Eligible Securities" in which
the Trust may invest and indicates that if a security's rating is downgraded,
the Manager and/or the Board may have to reassess the security's credit risks.
If a security has ceased to be a First Tier Security, the Manager will promptly
reassess whether the security continues to present "minimal credit risks." If
the Manager becomes aware that any Rating Organization has downgraded its rating
of a Second Tier Security or rated an unrated security below its second highest
rating category, the Trust's Board of Trustees shall promptly reassess whether
the security presents minimal credit risks and whether it is in the best
interests of the Trust to dispose of it. If a security is in default, or ceases
to be an Eligible Security, or is determined no longer to present minimal credit
risks, the Board must determine whether it would be in the best interests of the
Trust to dispose of the security. In each of the foregoing instances, Board
action is not required if the Trust disposes of the security within five days of
the Manager learning of the downgrade, in which event the Manager will provide
the Board with subsequent notice of such downgrade. The Rating Organizations
currently designated as such by the Securities and Exchange Commission ("SEC")
are Standard & Poor's Corporation, Moody's Investors Service, Inc., Fitch
Investors Services, Inc., Duff and Phelps, Inc., IBCA Limited and its affiliate,
IBCA, Inc., and Thomson BankWatch, Inc. A description of the ratings categories
of those Rating Organizations is contained in Exhibit A.
Other Investment Restrictions
The Trust's significant investment restrictions are described in the Prospectus.
The following investment restrictions are also fundamental investment policies
and, together with the fundamental
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<PAGE>
policies and restrictions described in the Prospectus, cannot be changed without
the vote of a "majority" of the Trust's outstanding shares. Under the Investment
Company Act, such a "majority" vote is defined as the vote of the holders of the
lesser of: (i) 67% or more of the shares present or represented by proxy at a
shareholder's meeting, if the holders of more than 50% of the outstanding shares
are present or represented by proxy, or (ii) more than 50% of the outstanding
shares. Under these additional restrictions, the Trust cannot: (1) invest in
commodities or commodity contracts or invest in interests in oil, gas or other
mineral exploration or mineral development programs; (2) invest in real estate;
however the Trust may purchase debt securities issued by companies which invest
in real estate or interests therein; (3) purchase securities on margin or make
short sales of securities; (4) invest in or hold securities of any issuer if
those officers and Trustees of the Trust or the Manager who beneficially own
individually more than 0.5% of the securities of such issuer together own more
than 5% of the securities of such issuer; (5) underwrite securities of other
companies; or (6) invest in securities of other investment companies, except in
connection with a consolidation or merger.
For purposes of the Trust's policy not to concentrate in securities of
issuers as described in the investment restrictions listed in the Prospectus,
the Trust has adopted the industry classification set forth in Exhibit B to this
Statement of Additional Information. This is not a fundamental policy.
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<PAGE>
APPENDIX
This Appendix is part of the Statement of Additional Information of Centennial
Money Market Trust ("Money Market Trust"), Centennial Tax Exempt Trust ("Tax
Exempt Trust") and Centennial Government Trust ("Government Trust"), each of
which is referred to in this Appendix individually as a "Trust" and collectively
are referred to as the "Trusts." Unless otherwise indicated, the information in
this Appendix applies to each Trust.
Trustees and Officers
The Trustees and officers of the Trusts and their principal business
affiliations and occupations during the past five years are listed below. All
Trustees are Trustees of each of the Trusts. The Trustees are also trustees,
directors, or managing general partners of Centennial America Fund, L.P.,
Centennial California Tax Exempt Trust, Centennial New York Tax Exempt Trust,
Daily Cash Accumulation Fund, Inc., Oppenheimer Cash Reserves, Oppenheimer
Champion Income Fund, Oppenheimer Equity Income Fund, Oppenheimer High Yield
Fund, Oppenheimer Integrity Funds, Oppenheimer International Bond Fund,
Oppenheimer Limited-Term Government Fund, Oppenheimer Main Street Funds, Inc.,
Oppenheimer Municipal Fund, Oppenheimer Strategic Income Fund, Oppenheimer
Strategic Income & Growth Fund, Oppenheimer Total Return Fund, Inc.,
Oppenheimer Total Return Fund, Inc. Capital Accumulation Plan, Oppenheimer
Variable Account Funds, Panorama Series Fund, Inc. and The New York Tax Exempt
Income Fund, Inc. (all of the foregoing funds are collectively referred to as
the "Denver Oppenheimer funds") except for Mr. Fossel and Ms. Macaskill, who
are Trustees, Directors or Managing Partners of all the Denver-based
Oppenheimer funds except Oppenheimer Integrity Funds, Oppenheimer Strategic
Income Fund, Oppenheimer Variable Account Funds and Panorama Series Fund Inc.
Mr. Fossel is also not a trustee of Centennial New York Tax Exempt Trust and he
is not a Managing General Partner of Centennial America Fund, L.P. Ms.
Macaskill is President and Mr. Swain is Chairman of the Denver Oppenheimer
funds. All of the officers except Mr. Carbuto, Ms. Wolf, Mr. Zimmer and Ms.
Warmack hold similar positions with each of the Denver Oppenheimer funds. As
of October 1, 1996, the Trustees and officers of the Trust in the aggregate
owned less than 1% of the outstanding shares of the Trust.
ROBERT G. AVIS, Trustee*; Age 65
One North Jefferson Avenue, St. Louis, Missouri 63103
Vice Chairman of A.G. Edwards & Sons, Inc. (a broker-dealer) and A.G.
Edwards, Inc. (its parent holding company); Chairman of A.G.E. Asset
Management and A.G. Edwards Trust Company (its affiliated investment
advisor and trust company, respectively).
WILLIAM A. BAKER, Trustee; Age 81
197 Desert Lakes Drive, Palm Springs, California 92264
Management Consultant.
CHARLES CONRAD, JR., Trustee; Age 66
1501 Quail Street, Newport Beach, California 92660
Chairman and Chief Executive Officer of Universal Space Lines, Inc. (A
space services management company); formerly, Vice President of
McDonnell Douglas Space Systems Co. and associated with National
Aeronautics and Space Administration.
JON S. FOSSEL, Trustee*; Age 54
Box 44 Mead Street, Waccabuc, New York 10597
Member of the Board of Governors of the Investment Company Institute (a
national trade association of investment companies), Chairman of the
Investment Company Institute Education Foundation; Formerly Chairman
and a director of OppenheimerFunds, Inc. ("OFI"), the immediate parent
of Centennial Asset Management Corporation ("Manager"); formerly
President and a director of Oppenheimer Acquisition Corp.("OAC"), OFI's
parent holding company; formerly a director of Shareholder Services,
Inc. ("SSI") and Shareholder Financial Services, Inc. ("SFSI"),
transfer agent subsidiaries of OFI.
SAM FREEDMAN, Trustee; Age 56
4975 Lakeshore Drive, Littleton, Colorado 80123
Formerly, Chairman and Chief Executive Officer of OppenheimerFunds
Services (a transfer agent); Chairman, Chief Executive Officer and a
director of SSI; Chairman, Chief Executive Officer and director of
Shareholder Financial Services, Inc. ("SFSI"); Vice President and a
director of OAC and a director of OFI.
RAYMOND J. KALINOWSKI, Trustee; Age 67
44 Portland Drive, St. Louis, Missouri 63131
Director of Wave Technologies International, Inc.(a computer products
training company), formerly Vice Chairman and a director of A.G.
Edwards, Inc., parent holding company of A.G. Edwards & Sons, Inc.
(a broker-dealer), of which he was a Senior Vice President.
C. HOWARD KAST, Trustee; Age 74
2552 E. Alameda, Denver, Colorado 80209
Formerly Managing Partner of Deloitte, Haskins & Sells (an accounting
firm).
ROBERT M. KIRCHNER, Trustee; Age 75
7500 East Arapahoe Road, Englewood, Colorado 80112
President of The Kirchner Company (management consultants).
BRIDGET A. MACASKILL, President and Trustee*; Age 48
Two World Trade Center, New York, New York 10048-0203
President, Chief Executive Officer and a director of the OFI and
HarbourView Asset Management Corporation ("HarbourView"), a subsidiary
of OFI; Chairman and a director of SSI and SFSI; President and a
director of OAC and Oppenheimer Partnership Holdings Inc., a holding
company subsidiary of OFI; a director of Oppenheimer Real Asset
Management, Inc. ("Real Asset"); formerly an Executive Vice President
of OFI.
NED M. STEEL, Trustee; Age 81
3416 South Race Street, Englewood, Colorado 80110
Chartered Property and Casualty Underwriter; Director of Visiting
Nurse Corporation of
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Colorado; formerly Senior Vice President and a director of the Van
Gilder Insurance Corp. (insurance brokers).
JAMES C. SWAIN, Chairman, Chief Executive Officer and Trustee*; Age 62
3410 South Galena Street, Denver, Colorado 80231
Vice Chairman of OFI; formerly President and a director of the Manager,
and formerly Chairman of the Board of SSI.
MICHAEL A. CARBUTO, Vice President and Portfolio Manager of Tax Exempt Trust;
Age 41
Two World Trade Center, New York, New York 10048-0203
Vice President of the Manager and OFI; an officer of other Oppenheimer
funds.
DOROTHY WARMACK, Vice President and Portfolio Manager of Money Market Trust and
Government Trust; Age 60
3410 South Galena Street, Denver, Colorado 80231
Vice President of the Manager and OFI; an officer of other Oppenheimer
funds.
CAROL E. WOLF, Vice President and Portfolio Manager of Money Market Trust and
Government Trust; Age 44
3410 South Galena Street, Denver, Colorado 80231
Vice President of the Manager and OFI; an officer of other Oppenheimer
funds.
ARTHUR J. ZIMMER, Vice President and Portfolio Manager of Money Market Trust and
Government Trust; Age 50
3410 South Galena Street, Denver, Colorado 80231
Vice President of the Manager and OFI; an officer of other Oppenheimer
funds.
ANDREW J. DONOHUE, Vice President and Secretary; Age 46
Two World Trade Center, New York, New York 10048-0203
Executive Vice President and General Counsel of OFI and
OppenheimerFunds Distributor, Inc. ("OFDI"); President and a director
of the Manager; Executive Vice President, General Counsel and a
director of HarbourView, SFSI, SSI and Oppenheimer Partnership Holdings
Inc.; President and a director of Real Asset; General Counsel of OAC;
Executive Vice President, Chief Legal Officer and a director of
MultiSource Services, Inc. (A broker-dealer); an officer of other
Oppenheimer funds; formerly Senior Vice President and Associate General
Counsel of OFI and OFDI; Partner in Kraft & McManimon (a law firm); an
officer of First Investors Corporation (a broker-dealer) and First
Investors Management Company, Inc. (broker-dealer and investment
advisor); director and an officer of First Investors Family of Funds
and First Investors Life Insurance Company.
GEORGE C. BOWEN, Vice President, Treasurer and Assistant Secretary; Age 60
3410 South Galena Street, Denver, Colorado 80231
Senior Vice President and Treasurer of OFI; Vice President and
Treasurer of OFDI and HarbourView; Senior Vice President, Treasurer
Assistant Secretary and a director of the Manager; Vice President,
Treasurer and Secretary of SSI and SFSI; Treasurer of OAC; Vice
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President and Treasurer of Real Asset; Chief Executive Officer,
Treasurer and a director of MultiSource Services, Inc.; an officer of
other Oppenheimer funds.
ROBERT J. BISHOP, Assistant Treasurer; Age 37
3410 South Galena Street, Denver, Colorado 80231
Vice President of the OFI/Mutual Fund Accounting; an officer of other
Oppenheimer funds; formerly a Fund Controller for OFI, prior to which
he was an Accountant for Yale & Seffinger, P.C., an accounting firm,
and previously an Accountant and Commissions Supervisor for Stuart
James Company, Inc., a broker-dealer.
SCOTT T. FARRAR, Assistant Treasurer; Age 31
3410 South Galena Street, Denver, Colorado 80231
Vice President of OFI/Mutual Fund Accounting; an officer of other
Oppenheimer funds; formerly a Fund Controller for OFI, prior to which
he was an International Mutual Fund Supervisor for Brown Brothers,
Harriman Co., a bank, and previously a Senior Fund Accountant for State
Street Bank & Trust Company.
ROBERT G. ZACK, Assistant Secretary; Age 48
Two World Trade Center, New York, New York 10048-0203
Senior Vice President and Associate General Counsel of OFI; Assistant
Secretary of SSI and SFSI; an officer of other Oppenheimer funds.
- ---------------------
* A Trustee who is an "interested person" of the Trusts as defined in the
Investment Company Act.
Remuneration of Trustees. The officers of the Trusts are affiliated with the
Manager. They and the Trustees of the Trusts who are affiliated with the Manager
(Ms. Macaskill and Mr. Swain) receive no salary or fee from the Trusts. The
remaining Trustees of the Trusts (excluding Mr. Freedman, who did not become a
Trustee until June 27, 1996) received the compensation shown below from the
Trusts, during its fiscal year ended June 30, 1996, and from all of the
Denver-based Oppenheimer funds (including the Trust) for which they served as
Trustee, Director or Managing General Partner. Compensation is paid for services
in the positions listed beneath their names:
<TABLE>
<CAPTION>
Aggregate Aggregate Aggregate Total
Compensation Compensation Compensation Compensation
from the from the from the from all
Money Market Tax Exempt Government Denver-based
Name and Position Trust Trust Trust Oppenheimer funds1
- ----------------- ------------ ------------ ------------- ------------------
<S> <C> <C> <C> <C>
Robert G. Avis $2,495 $2,147 $ 941 $53,000
Trustee
William A. Baker $3,449 $2,968 $1,300 $73,255
Audit and Review
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Committee Chairman
and Trustee
Charles Conrad, Jr. $3,028 $2,605 $1,142 $64,309
Audit and Review
Committee Member
and Trustee
Raymond J. Kalinowski $3,061 $2,633 $1,154 $65,000
Risk Management
Oversight Committee
Member and Trustee
C. Howard Kast $3,061 $2,633 $1,154 $65,000
Risk Management
Oversight Committee
Member and Trustee
Robert M. Kirchner $3,215 $2,766 $1,212 $68,292
Audit and Review
Committee Member
and Trustee
Ned M. Steel $2,495 $2,147 $ 941 $53,000
Trustee
<FN>
1 For the 1995 calendar year during which the Denver-based Oppenheimer funds
listed in the first paragraph of this section included Oppenheimer Strategic
Investment Grade Bond Fund and Oppenheimer Strategic Short-Term Income Fund
(which ceased operations following the acquisition of their assets by other
Oppenheimer funds.)
</FN>
</TABLE>
Major Shareholders. As of October 1, 1996, A.G. Edwards & Sons, Inc. ("A.G.
Edwards"), 1 North Jefferson Avenue, St. Louis, MO 63103 was the record owner
of 7,293,504,730.510 shares of Money Market Trust, 1,472,207,497 shares of Tax
Exempt Trust and 978,301,664 shares of Government Trust (approximately 99.85%,
97.81 and 96.82% of outstanding shares, respectively, of these Trusts). A.G.
Edwards has advised the Trusts that all such shares are held for the benefit
of brokerage clients and that no such client owned beneficially 5% or more of
the outstanding shares of any of the Trusts.
Investment Management Services
The Manager is wholly-owned by OFI, which is a wholly-owned subsidiary of
Oppenheimer Acquisition Corp. ("OAC"), a holding company controlled by
Massachusetts Mutual Life Insurance Company. The remaining stock of OAC is owned
by (i) certain of OFI's directors and officers, some of whom may serve as
officers of the Trust, and two of whom (Mr. Swain and Ms. Macaskill) serve as
Trustees of the Trust and (ii) Edwards, which owns less than 5% of its equity.
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<PAGE>
The management fee is payable monthly to the Manager under the terms of
the investment advisory agreements between the Manager and each Trust
(collectively, the "Agreements"), and is computed on the aggregate net assets of
the respective Trust as of the close of business each day. The management fees
paid to the Manager by the Trusts during their last three fiscal periods were as
follows: (a) $9,435,959, $12,657,193 and $21,572,5143 paid for the fiscal years
ended June 30, 1994, 1995 and 1996, respectively, of Money Market Trust; (b)
$4,761,673, $5,050,991 and $6,380,737 paid for the fiscal years ended June 30,
1994, 1995 and 1996, respectively, of Tax Exempt Trust; and (c) $3,182,956,
$3,414,212 and $4,468,617 paid for the fiscal years ended June 30, 1994, 1995
and 1996, respectively, of Government Trust.
The Agreements require the Manager, at its expense, to provide the
Trusts with adequate office space, facilities and equipment, and to provide and
supervise the activities of all administrative and clerical personnel required
to provide effective administration for the Trusts, including the compilation
and maintenance of records with respect to operations, the preparation and
filing of specified reports, and the composition of proxy materials and
registration statements for continuous public sale of shares of the Trusts.
Expenses not expressly assumed by the Manager under the Agreements or as
Distributor of the shares of the Trusts, are paid by the Trusts. The Agreements
list examples of expenses paid by the Trusts, the major categories of which
relate to interest, taxes, certain insurance premiums, fees to unaffiliated
Trustees, legal, bookkeeping and audit expenses, brokerage, custodian and
transfer agent expenses, share issuance costs, certain printing costs (excluding
the cost of printing prospectuses for sales materials) and registration fees,
and non-recurring expenses, including litigation.
Under its Agreements with the Money Market Trust and the Government
Trust, respectively, the Manager has agreed to reimburse each Trust to the
extent that the Trust's total expenses (including the management fee but
excluding interest, taxes, brokerage commissions, and extraordinary expenses
such as litigation costs) exceed in any fiscal year the lesser of: (i) 1.5% of
average annual net assets of the Trust up to $30 million plus 1% of the average
annual net assets in excess of $30 million or; (ii) 25% of the total annual
investment income of the Trust.
Independently of the Money Market Trust's Agreement, the Manager has
voluntarily agreed to waive a portion of the management fee otherwise payable to
it by the Money Market Trust to the extent necessary to: (a) permit the Money
Market Trust to have a seven-day yield at least equal to that of Daily Cash
Accumulation Fund, Inc., and (b) to reduce, on an annual basis, the management
fee paid on the average net assets of the Trust in excess of $1 billion from
0.40% to: 0.40% of average net assets in excess of $1 billion but less than
$1.25 billion; 0.375% of average net assets in excess of $1.25 billion but less
than $1.50 billion; 0.35% of average net assets in excess of $1.50 billion but
less than $2 billion; and 0.325% of average net assets in excess of $2 billion.
This undertaking became effective as of December 1, 1991, and may be modified or
terminated by the Manager any time. For fiscal year ended June 30, 1994, June
30, 1995 and June 30, 1996, the reimbursements by the Manager to Money Market
Trust were $1,201,403, $0 and $0, respectively.
Under its Agreement with Tax Exempt Trust, the Manager has agreed to
assume that Trust's expenses to the extent that the total expenses (as described
above) of the Trust exceed the most
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<PAGE>
stringent limits prescribed by any state in which the Trust's shares are offered
for sale. The payment of the management fee at the end of any month will be
reduced so that at no time will there be any accrued but unpaid liabilities
under any of these expense assumptions. No reimbursement or assumption was
necessary by the Manager to Government Trust during its three most recent fiscal
years. The Agreements permit the Manager to act as investment advisor for any
other person, firm or corporation.
The Tax Exempt Trust Agreement provides that the Manager assumes no
responsibility under the Agreement other than that which is imposed by law, and
shall not be responsible for any action of the Board of Trustees of the Trust in
following or declining to follow any advice or recommendations of the Manager.
The Agreement provides that the Manager shall not be liable for any error of
judgment or mistake of law, or for any loss suffered by the Trust in connection
with matters to which the Agreement relates, except a loss resulting by reason
of the Manager's willful misfeasance, bad faith or gross negligence in the
performance of its duties, or its reckless disregard of its obligations and
duties under the Agreement.
The Agreements of Money Market Trust and Government Trust provide that
the Manager shall not be liable for any loss sustained by reason of the adoption
of an investment policy or the purchase, sale or retention of any security on
its recommendation, whether or not such recommendation shall have been based
upon its own investigation and research or upon investigation and research made
by any other individual, firm or corporation, if such recommendation shall have
been made and such other individual, firm or corporation shall have been
selected with due care and in good faith, provided that nothing in the
Agreements shall be construed to protect the Manager against any liability to
such Trusts or their shareholders by reason of willful misfeasance, bad faith or
gross negligence in the performance of its duties, or by reason of its reckless
disregard of its obligations and duties under such Agreements.
Portfolio Transactions. Portfolio decisions are based upon the recommendations
and judgment of the Manager subject to the overall authority of the Board of
Trustees. As most purchases made by the Trust are principal transactions at net
prices, the Trust incurs little or no brokerage costs. Purchases of portfolio
securities from underwriters include a commission or concession paid by the
issuer to the underwriter, and purchases from dealers include a spread between
the bid and asked prices. The Trust's policy of investing in short-term debt
securities with maturities of less than one year results in high portfolio
turnover. However, since brokerage commissions, if any, are small and securities
are usually held to maturity, high turnover does not have an appreciable adverse
effect upon the net asset value or income of the Trust in periods of stable or
declining rates, and may have a positive effect in periods of rising interest
rates.
The Trust seeks to obtain prompt and reliable execution of orders at
the most favorable net price. If brokers are used for portfolio transactions,
transactions are directed to brokers furnishing execution and research services.
The research services provided by a particular broker may be useful only to one
or more of the advisory accounts of the Manager and its affiliates, and
investment research received for the commissions of those other accounts may be
useful both to the Trust and one or more of such other accounts. Such research,
which may be supplied by a third party at the instance of a broker, includes
information and analyses on particular companies and industries as
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<PAGE>
well as market or economic trends and portfolio strategy, receipt of market
quotations for portfolio evaluations, information systems, computer hardware and
similar products and services. If a research service also assists the Manager in
a non-research capacity (such as bookkeeping or other administrative functions),
then only the percentage or component that provides assistance to the Manager in
the investment decision-making process may be paid for in commission dollars.
The research services provided by brokers broaden the scope and
supplement the research activities of the Manager to make available additional
views for consideration and comparisons, and to enable the Manager to obtain
market information for the valuation of securities held in the Trust's portfolio
or being considered for purchase. In the rare instances where the Trust pays
commissions for research, the Board of Trustees, including the independent
Trustees of the Trust, will review information furnished by the Manager as to
the commissions paid to brokers furnishing such services in an effort to
ascertain that the amount of such commissions was reasonably related to the
value or the benefit of such services. The Trust does not direct the handling of
purchases or sales of portfolio securities, whether on a principal or agency
basis, to brokers for selling shares of the Trust. No portfolio transactions are
handled by brokers which are affiliated with the Trust or the Manager if that
broker is acting as principal.
Service Plan
Each Trust has adopted a Service Plan (the "Plan") under Rule 12b-1 of the
Investment Company Act, pursuant to which the Trust will reimburse the
Distributor for a portion of its costs incurred in connection with the services
rendered to the Trust, as described in the Prospectus. Each Plan has been
approved: (i) by a vote of the Board of Trustees of the Trust, including a
majority of the "Independent Trustees" (those Trustees of the Trust who are not
"interested persons," as defined in the Investment Company Act, and who have no
direct or indirect financial interest in the operation of the Plan or in any
agreements relating to the Plan) cast in person at a meeting called for the
purpose of voting on the Plan; and (ii) by the vote of the holders of a
"majority" (as defined under the Investment Company Act) of that Trust's
outstanding voting securities. In approving each Plan, the Board determined that
it is likely each Plan will benefit the shareholders of that Trust.
The Distributor has entered into Supplemental Distribution Assistance
Agreements ("Supplemental Agreements") under the Plan with selected dealers
distributing shares of Centennial America Fund, L.P., Centennial California Tax
Exempt Trust, Centennial Government Trust, Centennial New York Tax Exempt Trust
and Oppenheimer Cash Reserves. Quarterly payments by the Distributor, which are
not a Trust expense, for distribution-related services will range from 0.10% to
0.30%, annually, of the average net asset value of shares of these funds owned
during the quarter beneficially or of record by the dealer or its customers.
However, no payment shall be made to any dealer for any quarter during which the
average net asset value of shares of such funds owned during that quarter by the
dealer or its customers is less than $5 million. Payments made pursuant to
Supplemental Agreements are not a fund expense, but are made by the Distributor
out of its own resources or out of the resources of the Manager which may
include profits derived from the advisory fee it receives from each such fund.
No such supplemental payments will be paid to any dealer which is an "affiliate"
(as defined in the Investment Company Act) of the Distributor.
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<PAGE>
Each Plan, unless terminated as described below, shall continue in
effect from year to year but only so long as such continuance is specifically
approved at least annually by each Trust's Board of Trustees, including its
Independent Trustees, by a vote cast in person at a meeting called for that
purpose. The Supplemental Agreements are subject to the same renewal
requirement. A Plan and the Supplemental Agreements may be terminated at any
time by the vote of a majority of the Trust's Independent Trustees or by the
vote of the holders of a "majority" (as defined in the Investment Company Act)
of the Trust's outstanding voting securities. The Supplemental Agreements will
automatically terminate in the event of their "assignment" (as defined in the
Investment Company Act), and each may be terminated by the Distributor: (i) in
the event a Trust amends its Plan, or (ii) if the net asset value of shares of
the funds covered by the Supplemental Agreements held by the dealer or its
customers is less than $5 million for two or more consecutive quarters. A dealer
may terminate a Supplemental Agreement at any time upon giving 30 days' notice.
Each Plan may not be amended to increase materially the amount of payments to be
made unless such amendment is approved by the shareholders of that Trust. All
material amendments must be approved by the Independent Trustees.
Under each Plan, no payment will be made to any Recipient in any
quarter if the aggregate net asset value of all Trust shares held by the
Recipient for itself and its customers did not exceed a minimum amount, if any,
that may be determined from time to time by a majority of the Trust's
Independent Trustees. The Board of Trustees has set the fee at the maximum rate
and set no minimum amount. The Plans permit the Distributor and the Manager to
make additional distribution payments to Recipients from their own resources
(including profits from advisory fees) at no cost to a Trust. The Distributor
and the Manager may, in their sole discretion, increase or decrease the amount
of distribution assistance payments they make to Recipients from their own
assets.
Each Recipient who is to receive distribution payments for any month or
quarter is required to certify in writing that the aggregate payments to be
received from the applicable Trust during that month or quarter do not exceed
the Recipient's administrative and sales related costs in rendering distribution
assistance during the month or quarter, and will reimburse the Trust for any
excess.
For each Trust's fiscal year ended June 30, 1996, payments to the
Distributor under its Plan totaled $12,171,435, $2,929,180 and $1,929,551 for
Money Market Trust, Tax Exempt Trust and Government Trust, respectively, of
which $12,170,702, $2,876,667 and $1,868,803 was paid by Money Market Trust, Tax
Exempt Trust and Government Trust, respectively, to an affiliate of the
Distributor, as a Recipient. Payments received by the Distributor under the
Plans will not be used to pay any interest expense, carrying charge, or other
financial costs, or allocation of overhead by the Distributor. Any unreimbursed
expenses incurred for any fiscal quarter by the Distributor may not be recovered
under that Plan in subsequent fiscal quarters.
While the Plan is in effect, the Treasurer of each Trust shall provide
a report to the Board of Trustees in writing at least quarterly on the amount of
all payments made pursuant to the Plan, the identity of each Recipient that
received any such payment, and the purposes for which the payments were made.
The Plan further provides that while it is in effect, the election and
nomination of those Trustees of a Trust who are not "interested persons" of the
Trust is committed to the discretion of the Independent Trustees. This does not
prevent the involvement of others in such selection and
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<PAGE>
nomination if the final decision on any such selection or nomination is approved
by a majority of the Independent Trustees.
Purchase, Redemption and Pricing of Shares
Determination of Net Asset Value Per Share. The net asset value of each Trust's
shares is determined twice each day as of 12:00 Noon and the close of The New
York Stock Exchange (the "Exchange") which is normally 4:00 P.M., but may be
earlier on some days, each day the Exchange is open (a "regular business day")
(all references to time mean New York time) by dividing that Trust's net assets
(the total value of the Trust's portfolio securities, cash and other assets less
all liabilities) by the total number of shares outstanding. The Exchange's most
recent annual holiday schedule states that it will close New Year's Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day. The Exchange may also close on other days.
Dealers other than Exchange members may conduct trading in Municipal Securities
on certain days on which the Exchange is closed (e.g., Good Friday), so that
securities of the same type held by Tax Exempt Trust may be traded, and its net
asset value per share may be affected significantly, on such days when
shareholders may not purchase or redeem shares.
Each Trust's Board of Trustees has established procedures for the
valuation of the Trust's securities, generally as follows: (i) long-term debt
securities having a remaining maturity in excess of 60 days are valued based on
the mean between the "bid" and "ask" prices determined by a portfolio pricing
service approved by the Trust's Board of Trustees or obtained by the Manager
from two active market makers in the security on the basis of reasonable
inquiry; (ii) debt instruments having a maturity of more than 397 days when
issued, and non-money market type instruments having a maturity of 397 days or
less when issued, which have a remaining maturity of 60 days or less are valued
at the mean between the "bid" and "ask" prices determined by a pricing service
approved by the Trust's Board of Trustees or obtained by the Manager from two
active market makers in the security on the basis of reasonable inquiry; (iii)
money market debt securities that had a maturity of less than 397 days when
issued that have a remaining maturity of 60 days or less are valued at cost,
adjusted for amortization of premiums and accretion of discounts; and (iv)
securities (including restricted securities) not having readily-available market
quotations are valued at fair value determined under the Board's procedures. If
the Manager is unable to locate two market makers willing to give quotes (see
(i) and (ii) above), the security may be priced at the mean between the "bid"
and "ask" prices provided by a single active market maker (which in certain
cases may be the "bid" price if no "ask" price is available).
In the case of Municipal Securities, when last sale information is not
generally available, such pricing procedures may include "matrix" comparisons to
the prices for comparable instruments on the basis of quality, yield, maturity,
and other special factors involved (such as the tax-exempt status of the
interest paid by Municipal Securities). The Manager may use pricing services
approved by the Board of Trustees to price any of the types of securities
described above. The Manager will monitor the accuracy of such pricing services,
which may include comparing prices used for portfolio evaluation to actual sales
prices of selected securities.
In the case of U.S. Government Securities and mortgage-backed
securities, where last sale
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<PAGE>
information is not generally available, such pricing procedures may include
"matrix" comparisons to the prices for comparable instruments on the basis of
quality, yield, maturity and other special factors involved. The Manager may use
pricing services approved by the Board of Trustees to price U.S. Government
Securities for which last sale information is not generally available. The
Manager will monitor the accuracy of such pricing services, which may include
comparing prices used for portfolio evaluation to actual sales prices of
selected securities.
Redemptions. Each Trust's Board of Trustees has the right, in conformity with
the Trust's Declaration of Trust and applicable law, to cause the involuntary
redemption of the shares held in any account if the aggregate net asset value of
such shares is less than $500 or such lesser amount as the Board may decide.
Should the Board elect to exercise this right, it will establish the terms of
any notice of such redemption required to be provided to the shareholder under
the Investment Company Act, including any provision the Board may establish to
enable the shareholder to increase the amount of the investment to avoid
involuntary redemption.
Expedited Redemption Procedures. Under the Expedited Redemption Procedure
available to shareholders of the Trusts, as discussed in the Appendix to the
Prospectus, the wiring of redemption proceeds may be delayed if the Trust's
Custodian bank is not open for business on a day that the Trust would normally
authorize the wire to be made, which is usually the same day for redemptions
prior to 12:00 Noon, and the Trust's next regular business day for redemptions
between 12:00 Noon and the close of The New York Stock Exchange, which is
normally 4:00 P.M., but may be earlier on some days. In those circumstances, the
wire will not be transmitted until the next bank business day on which the Trust
is open for business, and no dividends will be paid on the proceeds of redeemed
shares waiting transfer by wire.
Dividend Reinvestment in Another Fund. Direct shareholders of the Trusts may
elect to reinvest all dividends and/or distributions in Class A shares of any of
the other funds listed in the Prospectus as "Eligible Funds" at net asset value
without sales charge. To elect this option, a shareholder must notify the
Transfer Agent in writing, and either must have an existing account in the fund
selected for reinvestment or must obtain a prospectus for that fund and an
application from the Transfer Agent to establish an account. The investment will
be made at the net asset value per share next determined on the payable date of
the dividend or distribution.
Exchange of Shares
Eligible Funds. As stated in the Prospectus, shares of the Trust may, under
certain circumstances, be exchanged by direct shareholders for Class A shares of
the following Oppenheimer funds ("Eligible Funds"):
Bond Fund Series-Oppenheimer Bond Fund for Growth
Oppenheimer Asset Allocation Fund
Oppenheimer California Municipal Fund
Oppenheimer Champion Income Fund
Oppenheimer Discovery Fund
Oppenheimer Enterprise Fund
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<PAGE>
Oppenheimer Equity Income Fund
Oppenheimer Fund
Oppenheimer Global Emerging Growth Fund
Oppenheimer Global Fund
Oppenheimer Global Growth & Income Fund
Oppenheimer Gold & Special Minerals Fund
Oppenheimer Growth Fund
Oppenheimer High Yield Fund
Oppenheimer Integrity Funds
Oppenheimer International Bond Fund
Oppenheimer International Growth Fund
Oppenheimer Limited-Term Government Fund
Oppenheimer Main Street Funds, Inc.
Oppenheimer Multi-Sector Income Trust
Oppenheimer Multi-State Municipal Trust
Oppenheimer Municipal Bond Fund
Oppenheimer Municipal Fund
Oppenheimer New York Municipal Fund
Oppenheimer Quest for Value Funds
Oppenheimer Quest Global Value Fund, Inc.
Oppenheimer Quest Value Fund, Inc.
Oppenheimer Series Fund, Inc.
Oppenheimer Strategic Income Fund
Oppenheimer Strategic Income & Growth Fund
Oppenheimer Target Fund
Oppenheimer Total Return Fund, Inc.
Oppenheimer U.S. Government Trust
Oppenheimer World Bond Fund
Rochester Fund Municipals*
Rochester Portfolio Series - Limited Term New York Municipal Fund*
The New York Tax Exempt Income Fund, Inc.
the following "Money Market Funds":
Centennial America Fund, L.P.
Centennial California Tax Exempt Trust
Centennial Government Trust
Centennial Money Market Trust
Centennial New York Tax Exempt Trust
Centennial Tax Exempt Trust
Daily Cash Accumulation Fund, Inc.
Oppenheimer Cash Reserves
Oppenheimer Money Market Fund, Inc.
- ----------------------------------------------------
*Shares of the Trust are not presently exchangeable for shares of these funds.
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<PAGE>
Yield Information
Each Trust's current yield is calculated for a seven-day period of time, in
accordance with regulations adopted under the Investment Company Act, as
follows: First, a base period return is calculated for the seven-day period by
determining the net change in the value of a hypothetical pre-existing account
having one share at the beginning of the seven-day period. The change includes
dividends declared on the original share and dividends declared on any shares
purchased with dividends on that share, but such dividends are adjusted to
exclude any realized or unrealized capital gains or losses affecting the
dividends declared. Next, the base period return is multiplied by 365/7 to
obtain the current yield to the nearest hundredth of one percent. The compounded
effective yield for a seven-day period is calculated by (a) adding 1 to the base
period return (obtained as described above), (b) raising the sum to a power
equal to 365 divided by 7 and (c) subtracting 1 from the result. For the seven
day period ended June 30, 1996, the "current yield" for each Money Market Trust,
Tax Exempt Trust and Government Trust was 4.74%, 2.89% and 4.58%, respectively.
The seven-day compounded effective yield for that period was 4.85%, 2.93% and
4.69%, respectively.
The yield as calculated above may vary for accounts less than
approximately $100 in value due to the effect of rounding off each daily
dividend to the nearest full cent. Since the calculation of yield under either
procedure described above does not take into consideration any realized or
unrealized gains or losses on each Trust's portfolio securities which may affect
dividends, the return on dividends declared during a period may not be the same
on an annualized basis as the yield for that period.
Tax Exempt Trust's "tax equivalent yield" adjusts Tax Exempt Trust's
current yield, as calculated above, by a stated Federal tax rate. The tax
equivalent yield is computed by dividing the tax-exempt portion of the Trust's
current yield by one minus a stated income tax rate and adding the result to the
portion (if any) of the Trust's current yield that is not tax-exempt. The tax
equivalent yield may be compounded as described above to provide a compounded
effective tax equivalent yield. The tax equivalent yield may be used to compare
the tax effects of income derived from the Trust with income from taxable
investments at the tax rates stated. Exhibit D, which is applicable only to Tax
Exempt Trust, includes a tax equivalent yield table, based on various effective
tax brackets for individual taxpayers. Such tax brackets are determined by a
taxpayer's Federal taxable income (the net amount subject to Federal income tax
after deductions and exemptions). The tax equivalent yield table assumes that
the investor is taxed at the highest bracket, regardless of whether a switch to
non-taxable investments would cause a lower bracket to apply and that state
income tax payments are fully deductible for income tax purposes. For taxpayers
with income above certain levels, otherwise allowable itemized deductions are
limited. The Tax Exempt Trust's tax equivalent yield for the seven-day period
ended June 30, 1996 was 4.52%. Its tax-equivalent compounded effective yield for
the same period was 4.58% for an investor in the highest Federal tax bracket.
Yield information may be useful to investors in reviewing each Trust's
performance. A Trust may make comparisons between its yield and that of other
investments, by citing various indices such as The Bank Rate Monitor National
Index (provided by Bank Rate Monitor TM), which measures the average rate paid
on bank money market accounts, NOW accounts and certificates of
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<PAGE>
deposit by the 100 largest banks and thrift institutions in the top ten
metropolitan areas. However, a number of factors should be considered before
using yield information as a basis for comparison with other investments. An
investment in a Trust is not insured. Its yield is not guaranteed and normally
will fluctuate on a daily basis. The yield for any given past period is not an
indication or representation by the Trust of future yields or rates of return on
its shares. Each Trust's yield is affected by portfolio quality, portfolio
maturity, type of instruments held and operating expenses. When comparing a
Trust's yield with that of other investments, investors should understand that
certain other investment alternatives such as certificates of deposit, U.S.
Government Securities, money market instruments or bank accounts may provide
fixed yields or yields that may vary above a stated minimum, and also that bank
accounts may be insured. Certain types of bank accounts may not pay interest
when the balance falls below a specified level and may limit the number of
withdrawals by check per month. In order to compare the Tax Exempt Trust's
dividends to the rate of return on taxable investments, Federal income taxes on
such investments should be considered.
Additional Information
Description of the Trusts. Each Trust's Declaration of Trust contains an express
disclaimer of shareholder and Trustee liability for the Trust's obligations, and
provides for indemnification and reimbursement of expenses out of its property
for any shareholder held personally liable for its obligations. Each Declaration
of Trust also provides that the Trust shall, upon request, assume a defense of
any claim made against any shareholder for any act or obligation of the Trust
and satisfy any judgment thereon. Thus, while Massachusetts law permits a
shareholder of a trust (such as the Trust) to be held personally liable as a
"partner" for the Trust's obligations under certain circumstances, the risk of a
Trust shareholder incurring any financial loss on account of shareholder
liability is highly unlikely and is limited to the relatively remote
circumstance in which the Trust would be unable to meet its obligations
described above. Any person doing business with the Trust, and any shareholder
of the Trust, agrees under the Trust's Declaration of Trust to look solely to
the assets of the Trust for satisfaction of any claim or demand which may arise
out of any dealings with the Trust, and the Trustees shall have no personal
liability to any such person, to the extent permitted by law.
It is not contemplated that regular annual meetings of shareholders
will be held. The Trust will hold meetings when required to do so by the
Investment Company Act or other applicable law, or when a shareholder meeting is
called by the Trustees. Shareholders have the right, upon the declaration in
writing or vote of two-thirds of the outstanding shares of the Trust, to remove
a Trustee. The Trustees will call a meeting of shareholders to vote on the
removal of a Trustee upon the written request of the shareholders of 10% of its
outstanding shares. In addition, if the Trustees receive a request from at least
10 shareholders (who have been shareholders for at least six months) holding in
the aggregate shares of the Trust valued at $25,000 or more or holding 1% or
more of the Trust's outstanding shares, whichever is less, that they wish to
communicate with other shareholders to request a meeting to remove a Trustee,
the Trustees will then either make the Trust's shareholder list available to the
applicants or mail their communication to all other shareholders at the
applicants' expense, or the Trustees may take such other action as set forth in
Section 16(c) of the Investment Company Act.
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Tax Status of the Trust's Dividends and Distributions. The Federal tax treatment
of the Trust's dividends and distributions to shareholders is explained in the
Prospectus under the caption "Dividends, Distributions and Taxes." Under the
Internal Revenue Code, the Trust must distribute by December 31 each year 98% of
its taxable investment income earned from January 1 through December 31 of that
year and 98% of its capital gains realized from the prior November 1 through
October 31 of that year or else pay an excise tax on the amounts not
distributed. While it is presently anticipated that the Trust's distributions
will meet those requirements, the Trust's Board and the Manager might determine
in a particular year that it is in the best interest of the Trust's shareholders
not to distribute income or capital gains at the mandated levels and to pay the
excise tax on the undistributed amounts.
The Custodian and the Transfer Agent. The Custodian's responsibilities include
safeguarding and controlling the Trusts' portfolio securities and handling the
delivery of portfolio securities to and from the Trusts. The Manager has
represented to the Trusts that its banking relationships with the Custodian have
been and will continue to be unrelated to and unaffected by the relationships
between the Trusts and the Custodian. It will be the practice of the Trusts to
deal with the Custodian in a manner uninfluenced by any banking relationship the
Custodian may have with the Manager or its affiliates. Shareholder Services,
Inc., the Transfer Agent, is responsible for maintaining each Trust's
shareholder registry and shareholder accounting records, and for shareholder
servicing and administrative functions.
General Distributor's Agreement. Under the General Distributor's Agreement
between each Trust and the Distributor, the Distributor acts as each Trust's
principal underwriter in the continuous public offering of its shares but is not
obligated to sell a specific number of shares. Expenses normally attributable to
sales (other than those paid under the General Distributor's Agreement and the
Service Plan), including advertising and the cost of printing and mailing
prospectuses other than those furnished to existing shareholders, are borne by
the Distributor.
Independent Auditors and Financial Statements. The independent auditors of the
Trusts examine the Trusts' financial statements and perform other related audit
services. They also act as auditors for the Manager and for OFI, the Manager's
immediate parent, as well as for certain other funds advised by the Manager and
OFI.
A-19
<PAGE>
INDEPENDENT AUDITORS' REPORT
Centennial Money Market Trust
The Board of Trustees and Shareholders of Centennial Money Market Trust:
We have audited the accompanying statement of assets and liabilities, including
the statement of investments, of Centennial Money Market Trust as of June 30,
1996, the related statement of operations for the year then ended, the
statements of changes in net assets for the years ended June 30, 1996 and 1995,
and the financial highlights for the period July 1, 1991 to June 30, 1996. These
financial statements and financial highlights are the responsibility of the
Trust's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned at June 30,
1996 by correspondence with the custodian and brokers; where replies were not
received from brokers, we performed other auditing procedures. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of Centennial Money
Market Trust at June 30, 1996, the results of its operations, the changes in its
net assets, and the financial highlights for the respective stated periods, in
conformity with generally accepted accounting principles.
/s/ Deloitte & Touche LLP
- --------------------------
DELOITTE & TOUCHE LLP
Denver, Colorado
July 22, 1996
<PAGE>
STATEMENT OF INVESTMENTS June 30, 1996
Centennial Money Market Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
------------ ------------
<S> <C> <C>
BANKERS' ACCEPTANCES - 0.4%
Chase Manhattan Bank, N.A., 4.94%, 8/19/96 (Cost
$24,831,903).............................................. $ 25,000,000 $ 24,831,903
------------
CERTIFICATES OF DEPOSIT - 5.9%
DOMESTIC CERTIFICATES OF DEPOSIT - 1.6%
Bank of New York, 5.07%, 8/27/96 ............................ 15,000,000 15,000,000
LaSalle National Bank:
5%, 8/19/96 .............................................. 10,000,000 10,000,000
5%, 8/7/96 ............................................... 10,000,000 10,000,000
5.05%, 8/26/96 ........................................... 10,000,000 10,000,000
5.35%, 11/5/96 ........................................... 5,000,000 5,000,000
5.35%, 7/15/96 ........................................... 15,000,000 15,000,000
5.35%, 8/14/96 ........................................... 10,000,000 10,000,000
5.35%, 8/19/96 ........................................... 15,000,000 15,000,000
5.38%, 8/5/96 ............................................ 10,000,000 10,000,000
5.40%, 7/5/96 ............................................ 5,000,000 5,000,000
------------
105,000,000
------------
EURODOLLAR CERTIFICATES OF DEPOSIT - 1.5%
Abbey National PLC, 5.01%, 8/1/96 ........................... 15,000,000 15,000,379
Deutsche Bank:
5%, 8/12/96 .............................................. 20,000,000 19,999,385
5.10%, 8/23/96 ........................................... 19,000,000 19,000,273
Rabobank Nederland, 5.02%, 8/22/96 .......................... 20,000,000 19,999,155
Societe Generale, 5.10%, 7/26/96 ............................ 30,000,000 30,001,347
------------
104,000,539
------------
YANKEE CERTIFICATES OF DEPOSIT - 2.8%
ABN Amro Bank:
5.01%, 8/7/96 ............................................ 20,000,000 19,998,798
5.03%, 8/20/96 ........................................... 10,000,000 10,000,136
Deutsche Bank:
4.96%, 8/20/96 ........................................... 23,000,000 22,992,920
5.06%, 8/19/96 ........................................... 15,000,000 15,000,000
Dresdner Bank, 5.13%, 11/22/96 .............................. 20,000,000 19,964,757
Rabobank Nederland, 5.06%, 7/26/96 .......................... 20,000,000 20,000,097
</TABLE>
3
<PAGE>
STATEMENT OF INVESTMENTS June 30, 1996 (Continued)
Centennial Money Market Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
------------ ------------
<S> <C> <C>
YANKEE CERTIFICATES OF DEPOSIT - 2.8% (CONTINUED)
Societe Generale:
5.05%, 8/23/96 ....................................................................... $ 15,000,000 $ 14,999,061
5.07%, 8/23/96 ....................................................................... 10,000,000 10,000,000
5.07%, 8/6/96 ........................................................................ 20,000,000 20,000,962
5.10%, 8/29/96 ....................................................................... 10,000,000 10,000,000
5.36%, 7/1/96 ........................................................................ 10,000,000 10,000,000
Swiss Bank Corp., 5.32%, 7/12/96 ........................................................ 15,000,000 15,000,000
------------
187,956,731
------------
Total Certificates of Deposit (Cost $396,957,270) ....................................... 396,957,270
------------
DIRECT BANK OBLIGATIONS - 12.7%
ABN Amro Bank Canada, 5.31%, 8/7/96 ..................................................... 15,000,000 14,918,215
ABN Amro Bank North America Finance, Inc.:
4.89%, 8/6/96 ........................................................................ 15,000,000 14,926,650
4.90%, 7/8/96 ........................................................................ 30,000,000 29,971,417
4.93%, 8/5/96 ........................................................................ 10,000,000 9,952,069
5.10%, 7/24/96 ....................................................................... 12,350,000 12,309,760
5.35%, 11/12/96 ...................................................................... 15,000,000 14,701,403
Bank of Scotland Treasury Services PLC, 5.35%, 10/7/96 .................................. 40,000,000 39,417,444
Bank One, Cleveland, guaranteeing commercial paper of Capital One Funding Corp.:
Series 1995F, 5.50%, 7/5/96(1)(2)(3) ................................................. 10,900,000 10,900,000
Series 1996C, 5.50%, 7/5/96(1)(2)(3) ................................................. 9,000,000 9,000,000
Barclays Bank PLC, guaranteeing commercial paper of:
Banco Nacional de Mexico S.A., 5.36%, 10/7/96 ........................................ 15,000,000 14,781,133
Banco Nacional de Mexico S.A.-Series A, 4.96%, 7/17/96 ............................... 5,000,000 4,988,155
Banco Real S.A.-Grand Cayman Branch, 5.36%, 7/8/96 ................................... 19,250,000 19,231,434
Petroleo Brasileiro, S.A.-Petrobras, 4.96%, 8/5/96 ................................... 5,000,000 4,975,889
Petroleo Brasileiro, S.A.-Petrobras, 5.01%, 8/15/96 .................................. 15,000,000 14,906,062
Petroleo Brasileiro, S.A.-Petrobras, 5.18%, 7/19/96 .................................. 15,000,000 14,961,150
Petroleo Brasileiro, S.A.-Petrobras, 5.29%, 8/14/96 .................................. 10,000,000 9,935,344
Bayerische Vereinsbank AG, guaranteeing commercial paper of:
Galicia Funding Corp.-Series B, 5.35%, 10/7/96(4) .................................... 12,000,000 11,825,233
COSCO (Cayman) Co., Ltd., 5.31%, 7/16/96 ................................................ 6,000,000 5,986,725
Credit Suisse, guaranteeing commercial paper of:
Cemex, S.A. de C.V.-Series A, 5.30%, 8/21/96 ......................................... 15,000,000 14,887,375
Cemex, S.A. de C.V.-Series B, 5.32%, 7/22/96 ......................................... 10,000,000 9,968,967
Cemex, S.A. de C.V.-Series B, 5.35%, 7/10/96 ......................................... 18,000,000 17,975,925
Cemex, S.A. de C.V.-Series A, 5.31%, 7/25/96 ......................................... 10,000,000 9,964,600
</TABLE>
4
<PAGE>
STATEMENT OF INVESTMENTS June 30, 1996 (Continued)
Centennial Money Market Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
------------ ------------
<S> <C> <C>
DIRECT BANK OBLIGATIONS (CONTINUED)
Cemex, S.A. de C.V.-Series A, 5.35%, 7/18/96 ... $ 10,000,000 $ 9,974,878
Daewoo International Corp., 5.05%, 8/29/96 ..... 10,000,000 9,917,236
Queensland Alumina Ltd., 5.30%, 7/26/96 ........ 15,000,000 14,944,792
Dresdner U.S. Finance, Inc.:
4.94%, 7/22/96 ................................. 11,650,000 11,616,429
5.03%, 8/26/96 ................................. 86,500,000 85,831,858
FCC National Bank:
5.36%, 12/27/96(1) ............................. 40,000,000 39,988,490
5.47%, 10/7/96 ................................. 10,000,000 10,000,000
First National Bank of Boston:
5.32%, 7/19/96 ................................. 15,000,000 15,000,000
5.35%, 7/3/96 .................................. 10,000,000 10,000,000
5.37%, 11/13/96(1) ............................. 7,000,000 6,998,947
5.53%, 9/16/96 ................................. 10,000,000 10,000,000
5.65%, 8/28/96(1) .............................. 15,000,000 15,000,000
5.88%, 10/30/96(1) ............................. 10,000,000 10,000,000
Huntington National Bank:
5.09%, 8/21/96 ................................. 10,000,000 10,000,000
5.33%, 7/10/96 ................................. 20,000,000 20,000,000
5.52%, 11/13/96(1) ............................. 15,000,000 15,000,000
<PAGE>
5.33%, 8/29/96(1) .............................. 15,000,000 14,998,536
National Westminster Bank of Canada, 5.19%,
7/31/96 ........................................ 5,000,000 4,978,375
Societe Generale North America, Inc.:
4.89%, 8/8/96 .................................. 30,000,000 29,845,150
4.90%, 8/13/96 ................................. 30,000,000 29,824,417
4.92%, 8/23/96 ................................. 25,000,000 24,818,917
4.92%, 8/23/96 ................................. 10,000,000 9,927,567
4.95%, 8/21/96 ................................. 25,000,000 24,824,865
5.10%, 7/22/96 ................................. 10,000,000 9,970,250
Societe Generale, guaranteeing commercial paper of:
Banco Nacional de Comercio Exterior, SNC:
Series A, 5.17%, 7/15/96 ....................... 22,500,000 22,454,685
Series A, 5.20%, 7/10/96 ....................... 20,000,000 19,974,000
Series B, 5.20%, 7/11/96 ....................... 10,000,000 9,985,556
Series A, 5.20%, 7/16/96 ....................... 13,000,000 12,971,833
Series A, 5.37%, 10/7/96 ....................... 10,000,000 9,853,817
Nacionale Financiera, SNC:
Series A, 5.30%, 8/28/96 ....................... 15,000,000 14,871,917
Series A, 5.35%, 8/27/96 ....................... 20,000,000 19,830,583
------------
Total Direct Bank Obligations (Cost
$863,888,048) .................................. 863,888,048
------------
</TABLE>
5
<PAGE>
STATEMENT OF INVESTMENTS June 30, 1996 (Continued)
Centennial Money Market Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
------------ ------------
<S> <C> <C>
SHORT-TERM NOTES - 80.0%
BANKS - 3.6%
Barnett Banks, Inc., 5.36%, 7/1/96 ........... $ 84,000,000 $ 84,000,000
Chase Manhattan Bank, N.A., 5.36%, 10/4/96 ... 10,000,000 9,858,556
Chemical Banking Corp.:
4.90%, 7/15/96 ............................ 30,000,000 29,942,056
4.93%, 8/15/96 ............................ 10,000,000 9,938,375
CoreStates Capital Corp.:
5.40%, 10/25/96(1) ........................ 15,000,000 15,000,000
5.84%, 8/13/96(1) ......................... 15,000,000 15,000,000
Fleet Financial Group, Inc., 5.34%, 7/19/96 .. 25,000,000 24,933,250
J.P. Morgan Delaware, 5.02%, 9/6/96 .......... 7,900,000 7,826,192
NationsBank Corp.:
5.28%, 8/26/96 ............................ 10,000,000 9,917,867
5.31%, 7/31/96 ............................ 20,000,000 19,911,500
Societe Generale, 5.33%, 7/1/96 .............. 10,000,000 10,000,000
------------
236,327,796
------------
BEVERAGES - 2.9% Coca-Cola Enterprises, Inc.:
5.30%, 7/9/96(4) .......................... 25,000,000 24,970,556
5.30%, 8/8/96(4) .......................... 35,000,000 34,803,772
5.30%, 9/4/96(4) .......................... 20,000,000 19,808,611
5.32%, 7/10/96(4) ......................... 10,500,000 10,486,035
5.32%, 7/3/96(4) .......................... 20,000,000 19,994,089
5.32%, 8/12/96(4) ......................... 15,000,000 14,906,900
5.35%, 8/5/96(4) .......................... 15,000,000 14,921,979
5.37%, 7/11/96(4) ......................... 45,000,000 44,932,917
5.40%, 7/12/96(4) ......................... 10,000,000 9,983,500
------------
194,808,359
------------
BROADCASTING - 0.3%
Walt Disney Co., 5.26%, 10/23/96 ............. 17,584,000 17,291,109
------------
</TABLE>
6
<PAGE>
STATEMENT OF INVESTMENTS June 30, 1996 (Continued)
Centennial Money Market Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
------------ ------------
<S> <C> <C>
BROKER/DEALERS - 7.8% CS First Boston, Inc.:
5.10%, 7/12/96(4) ................... $ 10,000,000 $ 9,984,417
5.39%, 8/8/96 ....................... 30,000,000 29,829,317
5.41%, 7/31/96 ...................... 25,000,000 24,887,292
5.44%, 3/4/97(1)(2) ................. 20,000,000 20,000,000
5.55%, 1/21/97(1)(2) ................ 15,000,000 15,000,000
Dean Witter, Discover & Co.:
5.58%, 9/29/96(1) ................... 6,000,000 6,003,300
5.76%, 11/22/96(1) .................. 15,000,000 15,013,842
5.71%, 2/3/97(1) .................... 20,000,000 20,029,110
Merrill Lynch & Co., Inc.:
4.94%, 8/19/96 ...................... 25,000,000 24,831,903
4.95%, 8/28/96 ...................... 15,000,000 14,880,375
5.10%, 7/29/96 ...................... 16,000,000 15,936,533
5.21%, 7/3/96 ....................... 25,000,000 24,992,764
5.25%, 7/2/96 ....................... 15,000,000 14,997,812
5.31%, 7/17/96 ...................... 24,966,000 24,907,080
5.36%, 7/11/96 ...................... 48,000,000 47,928,367
5.36%, 7/8/96 ....................... 10,000,000 9,989,597
5.40%, 1/31/97(1) ................... 30,000,000 30,000,000
5.44%, 11/1/96(1) ................... 15,000,000 15,000,000
5.45%, 9/19/96(1) ................... 20,000,000 20,000,000
5.47%, 10/24/96(1) .................. 15,000,000 15,000,000
Morgan Stanley Group, Inc.:
4.91%, 9/20/96 ...................... 7,000,000 6,922,667
5.12%, 7/26/96 ...................... 25,000,000 24,911,111
5.21%, 7/15/96 ...................... 10,000,000 9,979,739
5.27%, 9/30/96(1) ................... 33,600,000 33,600,000
5.30%, 7/12/96 ...................... 15,000,000 14,975,708
5.62%, 7/1/96 ....................... 37,250,000 37,250,000
------------
526,850,934
------------
BUILDING MATERIALS - 0.4% Compagnie de Saint Gobain:
4.98%, 8/29/96 ...................... 10,000,000 9,918,465
5.01%, 9/5/96 ....................... 5,000,000 4,954,075
Redland Finance, 5.35%, 7/12/96 ........ 12,000,000 11,980,383
------------
26,852,923
------------
</TABLE>
7
<PAGE>
STATEMENT OF INVESTMENTS June 30, 1996 (Continued)
Centennial Money Market Trust
<TABLE>
<CAPTION>
<PAGE>
Face Value
Amount See Note 1
----------- -----------
<S> <C> <C>
CHEMICALS - 0.4%
Monsanto Co., 4.93%, 8/9/96 ............ $25,000,000 $24,866,479
-----------
COMMERCIAL FINANCE - 16.8% CIT Group Holdings, Inc.:
5.30%, 7/31/96 ...................... 33,330,000 33,182,792
5.31%, 9/26/96(1) ................... 25,000,000 24,995,757
5.32%, 8/2/96 ....................... 15,000,000 14,929,067
5.35%, 5/1/97(1) .................... 35,000,000 34,966,696
5.35%, 6/11/97(1) ................... 15,000,000 14,983,164
5.55%, 11/18/96(1) .................. 20,000,000 19,992,391
6.02%, 7/10/96(1)(3) ................ 11,000,000 11,000,000
Countrywide Home Loan:
5.32%, 7/24/96 ...................... 50,000,000 49,830,056
5.32%, 7/25/96 ...................... 29,000,000 28,896,120
5.32%, 8/12/96 ...................... 20,000,000 19,875,867
5.32%, 8/23/96 ...................... 10,000,000 9,921,678
5.35%, 7/17/96 ...................... 30,000,000 29,928,667
5.35%, 7/3/96 ....................... 47,000,000 46,986,031
5.36%, 7/22/96 ...................... 30,000,000 29,906,200
5.38%, 7/12/96 ...................... 25,000,000 24,958,750
5.38%, 7/8/96 ....................... 45,000,000 44,952,828
5.40%, 7/11/96 ...................... 25,000,000 24,962,361
5.42%, 8/9/96 ....................... 20,000,000 19,882,567
FINOVA Capital Corp.:
4.97%, 8/30/96 ...................... 10,000,000 9,917,167
5.36%, 8/5/96 ....................... 15,000,000 14,921,833
5.37%, 8/14/96 ...................... 37,500,000 37,253,417
5.38%, 7/25/96 ...................... 15,000,000 14,946,200
5.39%, 9/5/96 ....................... 15,000,000 14,851,775
5.40%, 2/21/97(1) ................... 35,000,000 35,000,000
5.40%, 7/10/96 ...................... 30,000,000 29,959,387
5.40%, 7/19/96 ...................... 10,000,000 9,973,000
5.40%, 7/22/96 ...................... 20,000,000 19,937,000
5.40%, 7/30/96 ...................... 15,000,000 14,934,992
5.41%, 8/16/96 ...................... 36,000,000 35,751,217
5.42%, 7/26/96 ...................... 8,000,000 7,969,889
5.43%, 7/15/96 ...................... 25,000,000 24,947,208
</TABLE>
8
<PAGE>
STATEMENT OF INVESTMENTS June 30, 1996 (Continued)
Centennial Money Market Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
-------------- --------------
<S> <C> <C>
COMMERCIAL FINANCE (CONTINUED)
5.45%, 7/18/96 ................................................................. $ 20,000,000 $ 19,948,528
5.45%, 7/9/96 .................................................................. 10,000,000 9,987,889
5.45%, 9/3/96 .................................................................. 23,000,000 22,779,200
5.49%, 8/9/96 .................................................................. 5,000,000 4,970,235
5.52%, 8/26/96 ................................................................. 3,000,000 2,974,240
Fleet Mortgage Group, Inc., 5.55%, 11/20/96(1) .................................... 10,000,000 9,997,104
Heller Financial, Inc.:
5.38%, 7/26/96 ................................................................. 20,000,000 19,925,278
5.39%, 7/15/96 ................................................................. 10,000,000 9,979,039
5.40%, 7/25/96 ................................................................. 20,000,000 19,928,000
5.41%, 7/11/96 ................................................................. 50,000,000 49,924,778
5.42%, 9/30/96(1) .............................................................. 10,000,000 10,000,315
5.47%, 10/4/96(1) .............................................................. 27,000,000 26,995,883
5.47%, 10/7/96(1) .............................................................. 20,000,000 19,999,546
5.48%, 8/15/96 ................................................................. 5,000,000 4,965,750
5.50%, 10/7/96(1) .............................................................. 10,000,000 9,998,317
5.50%, 10/7/96(1) .............................................................. 12,000,000 12,000,000
5.50%, 3/31/97(1) .............................................................. 7,500,000 7,510,443
5.51%, 8/28/96(1) .............................................................. 20,000,000 20,000,000
5.55%, 6/2/97(1) ............................................................... 20,000,000 19,994,267
5.66%, 1/15/97(1) .............................................................. 10,000,000 10,007,331
5.67%, 3/28/97(1) .............................................................. 30,000,000 30,006,770
5.70%, 12/1/96(1) .............................................................. 20,970,000 20,981,858
5.98%, 10/1/96(1) .............................................................. 20,000,000 20,000,000
--------------
1,137,388,848
--------------
COMPUTER SOFTWARE - 0.8% First Data Corp.:
5.37%, 7/15/96 ................................................................. 20,000,000 19,958,233
5.38%, 7/2/96 .................................................................. 13,000,000 12,998,057
5.38%, 9/3/96 .................................................................. 20,000,000 19,808,711
--------------
52,765,001
--------------
CONGLOMERATES - 0.5% Mitsubishi International Corp.:
5.23%, 7/5/96 .................................................................. 5,000,000 4,997,094
5.37%, 9/30/96 ................................................................. 6,301,000 6,215,549
Pacific Dunlop Holdings, Inc., guaranteed by Pacific Dunlop Ltd., 5.66%,
1/17/97(1) ..................................................................... 20,000,000 20,010,556
--------------
31,223,199
--------------
</TABLE>
9
<PAGE>
STATEMENT OF INVESTMENTS June 30, 1996 (Continued)
Centennial Money Market Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
------------ ------------
<S> <C> <C>
CONSUMER FINANCE - 3.0%
American Express Credit Corp.:
4.92%, 8/23/96 ................................ $ 15,000,000 $ 14,891,350
5.10%, 7/19/96 ................................ 20,000,000 19,949,000
5.22%, 7/3/96 ................................. 15,000,000 14,995,550
5.22%, 7/8/96 ................................. 18,000,000 17,981,275
5.30%, 10/28/96 ............................... 10,000,000 9,824,806
Commercial Credit Co., 8%, 9/1/96 ................ 5,000,000 5,019,167
Island Finance Puerto Rico, Inc.:
5.31%, 7/10/96 ................................ 20,000,000 19,973,450
5.31%, 7/8/96 ................................. 15,000,000 14,984,512
5.40%, 8/12/96 ................................ 20,300,000 20,172,110
5.45%, 8/2/96 ................................. 5,500,000 5,473,356
Sears Roebuck Acceptance Corp.:
5.10%, 7/1/96 ................................. 40,000,000 40,000,000
5.36%, 7/10/96 ................................ 16,800,000 16,777,488
------------
200,042,064
------------
DIVERSIFIED FINANCIAL - 7.1%
Associates Corp. of North America, 5.60%,
7/1/96 ........................................ 10,000,000 10,000,000
Ford Motor Credit Co.:
5.31%, 7/12/96 ................................ 10,000,000 9,983,775
5.31%, 7/2/96 ................................. 10,000,000 9,998,525
5.35%, 10/3/96 ................................ 20,000,000 19,720,611
5.36%, 10/7/96 ................................ 15,000,000 14,781,133
8.88%, 8/1/96 ................................. 5,500,000 5,516,613
<PAGE>
General Electric Capital Corp.:
4.92%, 8/22/96 ................................ 35,000,000 34,751,267
4.94%, 8/19/96 ................................ 10,000,000 9,932,761
4.94%, 8/21/96 ................................ 12,000,000 11,916,020
5.15%, 7/15/96 ................................ 20,000,000 19,959,944
5.24%, 7/2/96 ................................. 10,000,000 9,998,544
5.36%, 10/4/96 ................................ 30,000,000 29,575,667
5.39%, 8/6/96 ................................. 12,600,000 12,532,086
General Electric Capital Services, 5.28%,
10/28/96 ...................................... 20,000,000 19,650,933
</TABLE>
10
<PAGE>
STATEMENT OF INVESTMENTS June 30, 1996 (Continued)
Centennial Money Market Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
------------ ------------
<S> <C> <C>
DIVERSIFIED FINANCIAL (CONTINUED)
General Motors Acceptance Corp.:
5.33%, 7/12/96 .................................................... $ 40,000,000 $ 39,934,856
5.39%, 10/2/96 .................................................... 15,000,000 14,791,137
5.39%, 7/2/96 ..................................................... 25,000,000 24,996,257
5.40%, 7/5/96 ..................................................... 25,000,000 24,985,000
5.42%, 11/8/96 .................................................... 10,000,000 9,804,278
5.42%, 8/19/96 .................................................... 8,000,000 7,940,982
5.43%, 8/12/96 .................................................... 9,500,000 9,439,817
5.64%, 7/1/96 ..................................................... 40,000,000 40,000,000
5.66%, 8/19/96(1) ................................................. 30,000,000 29,999,789
5.67%, 7/19/96(1) ................................................. 23,300,000 23,299,998
8.25%, 8/1/96 ..................................................... 8,400,000 8,419,869
8.63%, 7/15/96 .................................................... 10,000,000 10,011,847
Household Finance Corp., 5.28%, 8/19/96 .............................. 10,000,000 9,928,133
Prudential Funding Corp., 5.06%, 7/8/96 .............................. 10,000,000 9,990,161
------------
481,860,003
------------
DRUG WHOLESALERS - 1.1% Glaxo Wellcome PLC:
5.28%, 8/16/96(4) ................................................. 8,000,000 7,946,027
5.28%, 8/22/96(4) ................................................. 14,000,000 13,893,227
5.29%, 7/26/96(4) ................................................. 40,000,000 39,852,892
5.30%, 7/12/96(4) ................................................. 5,000,000 4,991,903
5.35%, 7/8/96(4) .................................................. 9,200,000 9,190,429
------------
75,874,478
------------
ELECTRIC UTILITIES - 0.4%
Vattenfall Treasury, Inc. guaranteed by Vattenfall AB, 5.35%,
10/16/96............................................................. 30,000,000 29,522,958
-------------
ELECTRICAL EQUIPMENT - 0.4% Xerox Corp.:
4.93%, 8/19/96 .................................................... 10,000,000 9,932,897
5.30%, 7/26/96 .................................................... 15,000,000 14,944,792
------------
24,877,689
------------
</TABLE>
11
<PAGE>
STATEMENT OF INVESTMENTS June 30, 1996 (Continued)
Centennial Money Market Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
------ ----------
<S> <C> <C>
ELECTRONICS-1.8%
Avnet, Inc., 5.30%, 7/18/96 ................... $ 10,000,000 $ 9,974,972
ITT Industries, Inc.:
5.31%, 7/12/96(4) .......................... 20,000,000 19,967,306
5.35%, 7/22/96(4) .......................... 10,000,000 9,968,792
5.40%, 7/8/96(4) ........................... 7,000,000 6,992,650
Mitsubishi Electric Finance America, Inc.:
5.12%, 7/24/96(4) .......................... 12,000,000 11,960,747
5.30%, 8/21/96(4) .......................... 10,000,000 9,924,917
5.35%, 7/31/96(4) .......................... 25,000,000 24,888,542
5.41%, 8/7/96(4) ........................... 8,000,000 7,955,518
Panasonic Finance, Inc.:
5.28%, 8/23/96(4) .......................... 11,277,000 11,189,340
5.28%, 8/8/96(4) ........................... 10,000,000 9,944,267
------------
122,767,051
------------
ENERGY SERVICES & PRODUCERS-0.4%
Union Pacific Resources Group, Inc.:
5.34%, 7/11/96(4) .......................... 10,000,000 9,985,167
5.35%, 7/9/96(4) ........................... 15,700,000 15,681,334
------------
25,666,501
------------
ENVIRONMENTAL-1.9% WMX Technologies, Inc.:
4.90%, 11/15/96(4) ......................... 12,600,000 12,365,045
5.10%, 8/16/96(4) .......................... 20,000,000 19,869,667
5.21%, 7/11/96(4) .......................... 15,000,000 14,977,792
5.22%, 7/9/96(4) ........................... 20,000,000 19,976,311
5.32%, 9/10/96(4) .......................... 10,000,000 9,895,078
5.35%, 10/15/96(4) ......................... 15,000,000 14,763,708
5.35%, 7/18/96(4) .......................... 20,000,000 19,949,472
5.36%, 7/16/96(4) .......................... 8,700,000 8,680,715
5.38%, 8/12/96(4) .......................... 10,000,000 9,937,233
------------
130,415,021
------------
HEALTHCARE/DRUGS-0.4%
Sandoz Corp.:
5.28%, 7/25/96(4) .......................... 10,000,000 9,964,767
5.30%, 7/17/96 ............................. 20,000,000 19,952,889
------------
29,917,656
------------
</TABLE>
12
<PAGE>
STATEMENT OF INVESTMENTS June 30, 1996 (Continued)
Centennial Money Market Trust
<TABLE>
<CAPTION>
<PAGE>
Face Value
Amount See Note 1
------------ ------------
<S> <C> <C>
HEALTHCARE/SUPPLIES & SERVICES-1.7%
A.H. Robins Co., Inc., guaranteed by American Home Products:
5.32%, 7/26/96(4) ....................................... $ 40,000,000 $ 39,851,181
5.42%, 8/21/96(4) ....................................... 15,000,000 14,884,825
American Home Products, 5.32%, 7/26/96(4) .................. 40,000,000 39,852,222
Sherwood Medical Co., guaranteed by American Home Products:
5.31%, 8/2/96(4) ........................................ 13,447,000 13,383,530
5.43%, 7/19/96(4) ....................................... 5,000,000 4,986,425
------------
112,958,183
------------
INDUSTRIAL SERVICES-0.4% Atlas Copco AB:
5.02%, 9/3/96(4) ........................................ 8,000,000 7,928,604
5.32%, 10/30/96(4) ...................................... 5,000,000 4,910,594
PHH Corp., 5.45%, 3/26/97(1) ............................... 15,000,000 14,993,554
------------
27,832,752
------------
INSURANCE-5.1%
Allstate Life Insurance Co., 5.44%, 7/1/96(1)(2)(3) ........ 40,000,000 40,000,000
General American Life Insurance Co., 6%, 7/1/96(1)(2)(3) ... 50,000,000 50,000,000
Jackson National Life, 5.46%, 7/1/96(1)(2)(3) .............. 40,000,000 40,000,000
Pacific Mutual Life Insurance Co., 5.57%, 2/14/97(1)(2)(3) . 25,000,000 25,000,000
Protective Life Insurance Co., 5.59%, 7/1/96(1)(2)(3) ...... 10,000,000 10,000,000
TransAmerica Life Insurance & Annuity Co.:
5.44%, 10/15/96(1)(2)(3) ................................ 50,000,000 50,000,000
5.44%, 9/27/96(1)(2)(3) ................................. 25,000,000 25,000,000
5.44%, 9/30/96(1)(2)(3) ................................. 30,000,000 30,000,000
5.52%, 8/1/96(1)(2)(3) .................................. 43,000,000 43,000,000
5.52%, 7/10/96(1)(2)(3) ................................. 30,000,000 30,000,000
------------
343,000,000
------------
LEASING & FACTORING-3.6% CSW Credit, Inc.:
5.30%, 7/19/96 .......................................... 17,300,000 17,254,155
5.31%, 7/8/96 ........................................... 15,100,000 15,084,409
5.42%, 8/12/96 .......................................... 20,200,000 20,072,269
</TABLE>
13
<PAGE>
STATEMENT OF INVESTMENTS June 30, 1996 (Continued)
Centennial Money Market Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
-------- ---------
<S> <C> <C>
LEASING & FACTORING-3.6% (CONTINUED)
International Lease Finance Corp.:
5.27%, 8/2/96 ............................................... $ 25,000,000 $ 24,882,889
5.28%, 8/13/96 .............................................. 20,000,000 19,873,867
5.28%, 8/15/96 .............................................. 33,750,000 33,527,250
5.30%, 7/8/96 ............................................... 35,000,000 34,963,931
5.35%, 7/12/96 .............................................. 30,600,000 30,550,351
The Hertz Corp.:
5.20%, 7/12/96 .............................................. 15,000,000 14,976,167
5.31%, 7/17/96 .............................................. 30,000,000 29,929,200
------------
241,114,488
------------
MANUFACTURING-0.5%
Rexam PLC:
5.30%, 7/24/96(4) ........................................... 23,115,000 23,036,730
5.35%, 7/1/96(4) ............................................ 10,000,000 10,000,000
------------
33,036,730
------------
METALS/MINING-0.6%
English China Clays PLC, 5.30%, 7/8/96(4) ...................... 15,700,000 15,683,804
RTZ America, Inc., guaranteed by RTC Corp. PLC, 5.35%,
7/8/96(4) ................................................... 27,000,000 26,971,912
------------
42,655,716
------------
NONDURABLE HOUSEHOLD GOODS-0.5%
Colgate-Palmolive Co., 5.20%, 9/23/96(4) ....................... 35,000,000 34,575,508
------------
SAVINGS & LOANS-1.5%
Great Western Bank FSB, 5.32%, 7/12/96 ......................... 25,000,000 24,959,361
Household Bank FSB:
5.35%, 8/15/96 .............................................. 25,000,000 24,999,691
5.39%, 8/7/96 ............................................... 10,000,000 10,000,000
5.39%, 9/27/96(1) ........................................... 45,000,000 44,997,169
------------
104,956,221
------------
SPECIAL PURPOSE FINANCIAL-13.5% Asset-Securitization Cooperative:
5.28%, 7/12/96(4) ........................................... 15,000,000 14,975,800
5.30%, 7/18/96(4) ........................................... 25,000,000 24,937,431
5.30%, 7/23/96(4) ........................................... 20,000,000 19,935,222
5.31%, 7/17/96(4) ........................................... 15,000,000 14,964,600
5.31%, 7/31/96(4) ........................................... 8,665,000 8,626,657
5.41%, 8/19/96(4) ........................................... 25,000,000 24,815,910
</TABLE>
14
<PAGE>
STATEMENT OF INVESTMENTS June 30, 1996 (Continued)
Centennial Money Market Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
-------- ---------
<S> <C> <C>
SPECIAL PURPOSE FINANCIAL-13.5%
CIESCO L.P.:
5.35%, 7/11/96 ................................................... $10,000,000 $ 9,985,139
5.42%, 5/19/97(1)(4) ............................................. 17,000,000 16,997,422
Cooperative Association of Tractor Dealers, Inc.:
5%, 8/22/96 ...................................................... 6,300,000 6,250,405
5.08%, 7/2/96 .................................................... 12,000,000 11,998,248
5.17%, 7/15/96 ................................................... 7,000,000 6,985,926
Corporate Asset Funding Co., Inc.:
5%, 9/3/96 ....................................................... 10,100,000 10,010,222
5.27%, 9/12/96 ................................................... 25,000,000 24,732,840
CXC, Inc.:
5.32%, 8/5/96(4) ................................................. 30,000,000 29,844,833
5.32%, 9/13/96(4) ................................................ 25,000,000 24,726,611
5.35%, 7/1/96(4) ................................................. 25,000,000 25,000,000
5.35%, 7/11/96(4) ................................................ 6,300,000 6,290,637
5.39%, 8/20/96(4) ................................................ 25,000,000 24,812,847
5.40%, 8/22/96(4) ................................................ 44,000,000 43,656,800
Falcon Asset Securitization Corp.:
5.31%, 8/7/96(4) ................................................. 15,100,000 15,017,592
5.35%, 7/10/96(4) ................................................ 9,200,000 9,187,695
5.41%, 7/25/96(4) ................................................ 12,860,000 12,813,618
First Deposit Master Trust 1993-3:
5.10%, 8/8/96(4) ................................................. 5,000,000 4,973,083
5.33%, 7/25/96(4) ................................................ 5,000,000 4,982,233
5.42%, 8/12/96(4) ................................................ 15,400,000 15,302,621
Fleet Funding Corp.:
5.35%, 7/8/96(4) ................................................. 19,900,000 19,879,298
5.37%, 7/12/96(4) ................................................ 21,268,000 21,233,103
<PAGE>
New Center Asset Trust:
5.29%, 8/5/96 .................................................... 15,000,000 14,922,854
5.36%, 7/12/96 ................................................... 20,000,000 19,967,244
5.37%, 9/12/96 ................................................... 25,000,000 24,727,771
Sheffield Receivables Corp.:
5.28%, 7/1/96 .................................................... 27,685,000 27,685,000
5.35%, 7/11/96(4) ................................................ 19,200,000 19,171,467
5.35%, 7/8/96 .................................................... 39,360,000 39,318,936
Short-Term Card Account Trust 1995-1, Class A1, 5.51%,
1/15/97(1)(2) .................................................... 25,000,000 25,000,000
</TABLE>
15
<PAGE>
STATEMENT OF INVESTMENTS June 30, 1996 (Continued)
Centennial Money Market Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
-------- ----------
<S> <C> <C>
SPECIAL PURPOSE FINANCIAL (CONTINUED)
SMM Trust:
1995-I, 5.48%, 5/29/97(1)(2) ........................................ $ 35,000,000 $ 35,000,000
1995-B, 5.49%, 8/2/96(1)(2) ......................................... 20,000,000 20,000,000
1995-B, 5.91%, 11/15/96(1)(2) ....................................... 10,000,000 10,000,000
1996-V, 5.62%, 3/26/97(1)(2) ........................................ 20,000,000 20,000,000
Structured Enhanced Return Trust 1993 Series A-02, 5.54%,
11/18/96(1)(2) ...................................................... 10,000,000 10,000,000
WCP Funding:
5.30%, 7/25/96(4) ................................................... 30,000,000 29,894,000
5.30%, 7/26/96(4) ................................................... 20,000,000 19,926,389
5.31%, 7/12/96(4) ................................................... 25,000,000 24,959,437
5.34%, 7/2/96(4) .................................................... 25,000,000 24,996,292
5.35%, 7/10/96(4) ................................................... 20,000,000 19,973,250
5.35%, 7/11/96(4) ................................................... 12,000,000 11,982,167
5.40%, 8/21/96(4) ................................................... 50,000,000 49,617,500
5.42%, 8/16/96(4) ................................................... 15,000,000 14,896,117
--------------
914,975,217
--------------
SPECIALTY RETAILING-0.5%
St. Michael Finance Ltd., guaranteed by Marks & Spencer PLC:
5.03%, 8/29/96 ...................................................... 10,000,000 9,918,056
5.28%, 8/20/96 ...................................................... 15,000,000 14,890,000
5.31%, 8/28/96 ...................................................... 6,739,000 6,681,348
--------------
31,489,404
--------------
TELECOMMUNICATIONS-TECHNOLOGY-1.0%
NYNEX Corp.:
5.33%, 7/12/96 ...................................................... 26,600,000 26,556,679
5.33%, 8/14/96 ...................................................... 15,000,000 14,902,283
5.35%, 7/29/96 ...................................................... 15,000,000 14,937,583
5.38%, 8/5/96 ....................................................... 10,000,000 9,947,694
--------------
66,344,239
--------------
TELEPHONE UTILITIES-1.1% GTE Corp.:
5.37%, 7/18/96 ...................................................... 6,400,000 6,383,771
5.37%, 7/8/96 ....................................................... 31,890,000 31,856,701
5.40%, 7/10/96 ...................................................... 37,000,000 36,950,050
--------------
75,190,522
--------------
Total Short-Term Notes (Cost $5,397,447,049) ........................... 5,397,447,049
--------------
</TABLE>
16
<PAGE>
STATEMENT OF INVESTMENTS June 30, 1996 (Continued)
Centennial Money Market Trust
<TABLE>
<CAPTION>
Face Value
Amount See Note 1
-------- ----------
<S> <C> <C>
U.S. GOVERNMENT OBLIGATIONS-0.3%
U.S. Treasury Bills, 4.87%, 8/15/96 (Cost $19,878,375) .......................... $ 20,000,000 $ 19,878,375
---------------
FOREIGN GOVERNMENT OBLIGATIONS-1.3% Bayerische Landesbank Girozentrale:
5.06%, 8/27/96 ............................................................... 25,000,000 25,000,000
5.07%, 8/21/96 ............................................................... 25,000,000 25,000,346
Finnish Export Credit, Ltd., supported by the Republic of Finland, 5.08%,
7/26/96 ...................................................................... 15,000,000 14,947,083
Unibanco-Uniao de Brancos Brasileiros SA-Grand Cayman,
guaranteed by Westdeutsche Landesbank Girozentrale, 5.37%, 7/5/96 ............ 25,000,000 24,985,083
---------------
Total Foreign Government Obligations (Cost $89,932,512) ......................... 89,932,512
---------------
Total Investments, at Value ..................................................... 100.6% 6,792,935,157
--------------- ---------------
Liabilities in Excess of Other Assets ........................................... (0.6) (40,051,124)
--------------- ---------------
Net Assets ...................................................................... 100.0% $ 6,752,884,033
================ ================
</TABLE>
Short-term notes, bankers' acceptances, and direct bank obligations are
generally traded on a discount basis; the interest rate is the discount rate
received by the Trust at the time of purchase. Other securities normally bear
interest at the rates shown.
1. Floating or variable rate obligation maturing in more than one year. The
interest rate, which is based on specific, or an index of, market interest
rates, is subject to change periodically and is the effective rate on June
30, 1996. This instrument may also have a demand feature which allows the
recovery of principal at any time, or at specified intervals not exceeding
one year, on up to 30 days' notice. Maturity date shown represents effective
maturity based on variable rate and, if applicable, demand feature.
2. Restricted securities amount to $517,900,000, or 7.67% of the Trust's net
assets, at June 30, 1996. In addition to being restricted, the security may
be considered illiquid by virtue of the absence of a readily available market
or because of legal or contractual restrictions on resale. Illiquid
securities amount to $190,000,000, or 2.81% of the Trust's net assets, at
June 30, 1996. The Trust may not invest more than 10% of its net assets
(determined at the time of purchase) in illiquid securities.
3. Put obligation redeemable at full face value on the date reported.
4. Security issued in an exempt transaction without registration under the
Securities Act of 1933 (the Act). The securities are carried at amortized
cost, and amount to $1,405,786,822, or 20.82% of the Trust's net assets.
See accompanying Notes to Financial Statements.
17
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES June 30, 1996 Centennial Money Market Trust
<TABLE>
<S> <C>
ASSETS:
Investments, at value-see accompanying statement ............. $6,792,935,157
Cash ......................................................... 208,823
Receivables:
Shares of beneficial interest sold .......................... 27,411,186
Interest .................................................... 18,308,069
Securities sold ............................................. 6,800,000
Other ........................................................ 43,878
--------------
Total assets ............................................... 6,845,707,113
--------------
LIABILITIES:
Payables and other liabilities:
Shares of beneficial interest redeemed ...................... 81,487,588
Dividends ................................................... 8,884,619
Transfer and shareholder servicing agent fees ............... 721,994
Service plan fees ........................................... 377,260
Shareholder reports ......................................... 347,170
Trustees' fees .............................................. 3,120
Other ....................................................... 1,001,329
--------------
Total liabilities .......................................... 92,823,080
NET ASSETS ................................................... $6,752,884,033
==============
COMPOSITION OF NET ASSETS:
Paid-in capital .............................................. $6,752,559,664
Accumulated net realized gain on investment transactions ..... 324,369
--------------
NET ASSETS-applicable to 6,752,559,664 shares of beneficial
interest outstanding ...................................... $6,752,884,033
==============
NET ASSET VALUE, REDEMPTION PRICE AND OFFERING PRICE PER
SHARE ..................................................... $ 1.00
</TABLE>
See accompanying Notes to Financial Statements.
18
<PAGE>
STATEMENT OF OPERATIONS For the Year Ended June 30, 1996
Centennial Money Market Trust
<TABLE>
<CAPTION>
<S> <C>
INVESTMENT INCOME-Interest ........................... $345,130,867
------------
EXPENSES:
Management fees-Note 3 ............................... 21,572,513
Service plan fees-Note 3 ............................. 12,171,435
Transfer and shareholder servicing agent fees -
Note 3 ............................................. 5,648,855
Registration and filing fees ......................... 1,002,403
Custodian fees and expenses .......................... 625,400
Shareholder reports .................................. 590,603
Trustees' fees and expenses .......................... 20,804
Other ................................................ 86,307
------------
Total expenses ..................................... 41,718,320
------------
NET INVESTMENT INCOME ................................ 303,412,547
NET REALIZED GAIN ON INVESTMENTS ..................... 265,465
------------
NET INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS ......................................... $303,678,012
============
</TABLE>
===============================================================================
STATEMENTS OF CHANGES IN NET ASSETS
Centennial Money Market Trust
<TABLE>
<CAPTION>
Year Ended June 30,
1996 1995
---- ----
<S> <C> <C>
OPERATIONS:
Net investment income ....................................... $ 303,412,547 $ 167,484,276
Net realized gain ........................................... 265,465 431,897
--------------- ---------------
Net increase in net assets resulting from operations ........ 303,678,012 167,916,173
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS ................. (303,849,237) (167,484,999)
BENEFICIAL INTEREST TRANSACTIONS
Net increase in net assets resulting from beneficial interest
transactions-Note 2 ...................................... 1,940,862,519 2,252,373,243
--------------- ---------------
NET ASSETS:
Total increase .............................................. 1,940,691,294 2,252,804,417
Beginning of period ......................................... 4,812,192,739 2,559,388,322
--------------- ---------------
End of period ............................................... $ 6,752,884,033 $ 4,812,192,739
=============== ===============
</TABLE>
See accompanying Notes to Financial Statements.
19
<PAGE>
FINANCIAL HIGHLIGHTS
Centennial Money Market Trust
<TABLE>
<CAPTION>
Year Ended June 30,
-------------------------------------------------------------------------------
1996 1995 1994 1993 1992
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning
of period ................................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from investment
operations-net investment
<PAGE>
income and net realized gain .............. .05 .05 .03(1) .03(1) .04(1)
Dividends and distributions to shareholders... (.05) (.05) (.03) (.03) (.04)
--------- --------- --------- --------- ---------
Net asset value, end of period ............... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========= ========= ========= ========= =========
TOTAL RETURN, AT
NET ASSET VALUE(2) ........................ 5.11% 5.21% 2.82% 2.91% 4.73%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in millions) ...... $ 6,753 $ 4,812 $ 2,559 $ 1,991 $ 1,270
Average net assets (in millions) ............. $ 6,077 $ 3,342 $ 2,346 $ 1,701 $ 821
RATIOS TO AVERAGE NET ASSETS:
Net investment income ........................ 4.99% 5.01% 2.84% 2.82% 4.31%
Expenses ..................................... 0.69% 0.73% 0.76%(1) 0.78%(1) 0.69%(1)
</TABLE>
1. Net investment income would have been $.03, $.03 and $.04 per share absent
the voluntary expense limitation, resulting in an expense ratio of 0.81%,
0.83%, and 0.81% for the years ended June 30, 1994, 1993 and 1992,
respectively.
2. Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period, with all dividends 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. Total returns are
not annualized for periods of less than one full year. Total returns reflect
changes in net investment income only.
See accompanying Notes to Financial Statements.
20
<PAGE>
NOTES TO FINANCIAL STATEMENTS
Centennial Money Market Trust
1. SIGNIFICANT ACCOUNTING POLICIES
Centennial Money Market Trust (the Trust) is registered under the Investment
Company Act of 1940, as amended, as a diversified, open-end management
investment company. The Trust's investment objective is to seek the maximum
current income that is consistent with low capital risk and the maintenance of
liquidity. The Trust's investment advisor is Centennial Asset Management
Corporation (the Manager), a subsidiary of OppenheimerFunds, Inc. (OFI). The
following is a summary of significant accounting policies consistently followed
by the Trust.
Investment Valuation-Portfolio securities are valued on the basis of amortized
cost, which approximates market value.
Federal Taxes-The Trust intends to continue to comply with provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income to shareholders. Therefore, no federal
income or excise tax provision is required.
Distributions to Shareholders-The Trust intends to declare dividends from net
investment income each day the New York Stock Exchange is open for business and
pay such dividends monthly. To effect its policy of maintaining a net asset
value of $1.00 per share, the Trust may withhold dividends or make distributions
of net realized gains.
Other-Investment transactions are accounted for on the date the investments are
purchased or sold (trade date). Realized gains and losses on investments are
determined on an identified cost basis, which is the same basis used for federal
income tax purposes.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of income and expenses during the reporting period. Actual
results could differ from those estimates.
21
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued)
Centennial Money Market Trust
2. SHARES OF BENEFICIAL INTEREST
The Trust has authorized an unlimited number of no par value shares of
beneficial interest. Transactions in shares of beneficial interest were as
follows:
<TABLE>
<CAPTION>
Year Ended June 30, 1996 Year Ended June 30, 1995
---------------------------------------- ----------------------------------------
Shares Amount Shares Amount
------ ------ ------ ------
<S> <C> <C> <C> <C>
Sold ...................... 21,158,638,888 $ 21,158,638,888 14,974,552,413 $ 14,974,552,413
Dividends and distributions
reinvested .............. 297,883,433 297,883,433 156,243,456 156,243,456
Redeemed .................. (19,515,659,802) (19,515,659,802) (12,878,422,626) (12,878,422,626)
---------------- ---------------- ---------------- ----------------
Net increase .............. 1,940,862,519 $ 1,940,862,519 2,252,373,243 $ 2,252,373,243
================ ================ ================ ================
</TABLE>
3. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Trust which provides for a fee of 0.50% on the first
$250 million of average annual net assets with a reduction of 0.025% on each
$250 million thereafter, to 0.40% on net assets in excess of $1 billion. The
Manager has agreed to reimburse the Trust if aggregate expenses (with specified
exceptions) exceed the lesser of 1.5% of the first $30 million of average annual
net assets of the Trust, plus 1% of average annual net assets in excess of $30
million; or 25% of the total annual investment income of the Trust.
Independent of the investment advisory agreement, the Manager has voluntarily
agreed to waive a portion of the management fee otherwise payable to it by the
Trust to the extent necessary to: (a) permit the Trust to have a seven-day yield
equal to that of Daily Cash Accumulation Fund, Inc., and (b) to reduce, on an
annual basis, the management fee paid on the average net assets of the Trust in
excess of $1 billion from 0.40% to: 0.40% of average net assets in excess of $1
billion but less than $1.25 billion; 0.375% of average net assets in excess of
$1.25 billion but less than $1.50 billion; 0.35% of average net assets in excess
of $1.50 billion but less than $2 billion; and 0.325% of average net assets in
excess of $2 billion. This undertaking became effective as of December 1, 1991,
and may be modified or terminated by the Manager at any time.
Shareholder Services, Inc. (SSI), a subsidiary of OFI, is the transfer and
shareholder servicing agent for the Trust, and for other registered investment
companies. SSI's total costs of providing such services are allocated ratably to
these companies.
Under an approved service plan, the Trust may expend up to 0.20% of its net
assets annually to reimburse certain securities dealers and other financial
institutions and organizations for costs incurred in distributing Trust shares.
22
<PAGE>
Exhibit A
DESCRIPTION OF SECURITIES RATINGS
Below is a description of the two highest rating categories for Short Term Debt
and Long Term Debt by the "Nationally-Recognized Statistical Rating
Organizations" which the Manager evaluates in purchasing securities on behalf of
the Trust. The ratings descriptions are based on information supplied by the
ratings organizations to subscribers.
Short Term Debt Ratings.
Moody's Investors Service, Inc. ("Moody's"): The following rating designations
for commercial paper (defined by Moody's as promissory obligations not having
original maturity in excess of nine months), are judged by Moody's to be
investment grade, and indicate the relative repayment capacity of rated
issuers:
Prime-1: Superior capacity for repayment. Capacity will normally be
evidenced by the following characteristics: (a) leveling market
positions in well-established industries; (b) high rates of return
on funds employed; (c) conservative capitalization structures with
moderate reliance on debt and ample asset protection; (d) broad
margins in earning coverage of fixed financial charges and high
internal cash generation; and (e) well established access to a
range of financial markets and assured sources of alternate
liquidity.
Prime-2: Strong capacity for repayment. This will normally be evidenced by
many of the characteristics cited above but to a lesser degree.
Earnings trends and coverage ratios, while sound, will be more
subject to variation. Capitalization characteristics, while still
appropriate, may be more affected by external conditions. Ample
alternate liquidity is maintained.
Moody's ratings for state and municipal short-term obligations are designated
"Moody's Investment Grade" ("MIG"). Short-term notes which have demand features
may also be designated as "VMIG".
These rating categories are as follows:
MIG1/VMIG1: Best quality. There is present strong protection by
established cash flows, superior liquidity support or
demonstrated broadbased access to the market for
refinancing.
MIG2/VMIG2: High quality. Margins of protection are ample although
not so large as in the preceding group.
Standard & Poor's Corporation ("S&P"): The following ratings by S&P for
commercial paper (defined by S&P as debt having an original maturity of no more
than 365 days) assess the likelihood of payment:
A-1: Strong capacity for timely payment. Those issues determined to possess
extremely strong safety characteristics are denoted with a plus sign
(+) designation.
A-23
<PAGE>
A-2: Satisfactory capacity for timely payment. However, the relative
degree of safety is not as high as for issues designated "A-1".
S&P's ratings for Municipal Notes due in three years or less are:
SP-1: Very strong or strong capacity to pay principal and interest. Those
issues determined to possess overwhelming safety characteristics will
be given a plus (+) designation.
SP-2: Satisfactory capacity to pay principal and interest.
S&P assigns "dual ratings" to all municipal debt issues that have a demand
or double feature as part of their provisions. The first rating addresses the
likelihood of repayment of principal and interest as due, and the second rating
addresses only the demand feature. With short-term demand debt, S&P's note
rating symbols are used with the commercial paper symbols (for example, "SP-
1+/A-1+").
Fitch Investors Service, Inc. ("Fitch"): Fitch assigns the following short-
term ratings to debt obligations that are payable on demand or have original
maturities of generally up to three years, including commercial paper,
certificates of deposit, medium-term notes, and municipal and investment notes:
F-1+: Exceptionally strong credit quality; the strongest degree of assurance for
timely payment.
F-1: Very strong credit quality; assurance of timely payment is only
slightly less in degree than issues rated "F-1+".
F-2: Good credit quality; satisfactory degree of assurance for timely
payment, but the margin of safety is not as great as for issues
assigned "F-1+" or "F-1" ratings.
Duff & Phelps, Inc. ("Duff & Phelps"): The following ratings are for commercial
paper (defined by Duff & Phelps as obligations with maturities, when issued, of
under one year), asset-backed commercial paper, and certificates of deposit (the
ratings cover all obligations of the institution with maturities, when issued,
of under one year, including bankers' acceptance and letters of credit):
Duff 1+: Highest certainty of timely payment. Short-term liquidity,
including internal operating factors and/or access to alternative
sources of funds, is outstanding, and safety is just below
risk-free U.S. Treasury short-term obligations.
Duff 1: Very high certainty of timely payment. Liquidity factors are
excellent and supported by good fundamental protection factors.
Risk factors are minor.
Duff 1-: High certainty of timely payment. Liquidity factors are strong
and supported by good fundamental protection factors. Risk
factors are very small.
Duff 2: Good certainty of timely payment. Liquidity factors and company
fundamentals are sound. Although ongoing funding needs may enlarge
total financing requirements, access to capital markets is good.
Risk factors are small.
IBCA Limited or its affiliate IBCA Inc. ("IBCA"): Short-term ratings,
including commercial paper (with maturities up to 12 months), are as follows:
A1: Obligations supported by the highest capacity for timely repayment.
A1: Obligations supported by a very strong capacity for timely repayment.
A2: Obligations supported by a strong capacity for timely repayment,
although such capacity may be susceptible to adverse changes in
business, economic, or financial conditions.
Thomson BankWatch, Inc. ("TBW"): The following short-term ratings apply to
commercial paper, certificates of deposit, unsecured notes, and other
securities having a maturity of one year or less.
TBW-1: The highest category; indicates the degree of safety regarding
timely repayment of principal and interest is very strong.
TBW-2: The second highest rating category; while the degree of safety regarding
timely repayment of principal and interest is strong, the relative
degree of safety is not as high
as for issues rated "TBW-1".
Long Term Debt Ratings. These ratings are relevant for securities purchased by
the Trust with a remaining maturity of 397 days or less, or for rating issuers
of short-term obligations.
Moody's: Bonds (including municipal bonds) are rated as follows:
Aaa: Judged to be the best quality. They carry the smallest degree of
investment risk and are generally referred to as "gilt edge." Interest
payments are protected by a large or by an exceptionally stable margin,
and principal is secure. While the various protective elements are
likely to change, such changes as can be visualized are most unlikely
to impair the fundamentally strong positions of such issues.
Aa: Judged to be of high quality by all standards. Together with the "Aaa"
group they comprise what are generally known as high-grade bonds. They
are rated lower than the best bonds because margins of protection may
not be as large as in "Aaa" securities or fluctuations of protective
elements may be of greater amplitude or there may be other elements
present which make the long-term risks appear somewhat larger than in
"Aaa" securities.
Moody's applies numerical modifiers "1", "2" and "3" in its "Aa" rating
classification. The modifier "1" indicates that the security ranks in the higher
end of its generic rating category; the modifier "2" indicates a mid-range
ranking; and the modifier "3" indicates that the issue ranks in the lower end of
its generic rating category.
A-24
<PAGE>
Standard & Poor's: Bonds (including municipal bonds) are rated as follows:
AAA: The highest rating assigned by S&P. Capacity to pay interest and
repay principal is extremely strong.
AA: A strong capacity to pay interest and repay principal and differ
from "AAA" rated issues only in small degree.
Fitch:
AAA: Considered to be investment grade and of the highest credit quality.
The obligor has an exceptionally strong ability to pay interest and
repay principal, which is unlikely to be affected by reasonably
foreseeable events.
AA: Considered to be investment grade and of very high credit quality.
The obligor's ability to pay interest and repay principal is very
strong, although not quite as strong as bonds rated "AAA". Plus (+)
and minus (-) signs are used in the "AA" category to indicate the
relative position of a credit within that category.
Because bonds rated in the "AAA" and "AA" categories are not significantly
vulnerable to foreseeable future developments, short-term debt of these issuers
is generally rated "F-1+".
Duff & Phelps:
AAA: The highest credit quality. The risk factors are negligible, being
only slightly more than for risk-free U.S. Treasury debt.
AA: High credit quality. Protection factors are strong. Risk is modest
but may vary slightly from time to time because of economic
conditions. Plus (+) and minus (-) signs are used in the "AA"
category to indicate the relative position of a credit within that
category.
IBCA: Long-term obligations (with maturities of more than 12 months) are
rated as follows:
AAA: The lowest expectation of investment risk. Capacity for timely
repayment of principal and interest is substantial such that adverse
changes in business, economic, or financial conditions are unlikely
to increase investment risk significantly.
AA: A very low expectation for investment risk. Capacity for timely
repayment of principal and interest is substantial. Adverse changes
in business, economic, or financial conditions may increase
investment risk albeit not very significantly.
A plus (+) or minus (-) sign may be appended to a long term rating to denote
relative status within a rating category.
TBW: TBW issues the following ratings for companies. These ratings assess the
likelihood of
A-25
<PAGE>
receiving payment of principal and interest on a timely basis and incorporate
TBW's opinion as to the vulnerability of the company to adverse developments,
which may impact the market's perception of the company, thereby affecting the
marketability of its securities.
A: Possesses an exceptionally strong balance sheet and earnings record,
translating into an excellent reputation and unquestioned access to
its natural money markets. If weakness or vulnerability exists in any
aspect of the company's business, it is entirely mitigated by the
strengths of the organization.
A/B: The company is financially very solid with a favorable track record
and no readily apparent weakness. Its overall risk profile, while low,
is not quite as favorable as for companies in the highest rating
category.
A-26
<PAGE>
Exhibit B
CORPORATE 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
<PAGE>
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
A-23
<PAGE>
Exhibit C
AUTOMATIC WITHDRAWAL PLAN PROVISIONS
By requesting an Automatic Withdrawal Plan, the shareholder agrees to the terms
and conditions applicable to such plans, as stated below and elsewhere in the
Application for such Plans, and the Prospectus and this Statement of Additional
Information as they may be amended from time to time by the Trust and/or the
Distributor. When adopted, such amendments will automatically apply to existing
Plans.
Trust shares will be redeemed as necessary to meet withdrawal payments.
Shares acquired without a sales charge will be redeemed first and thereafter
shares acquired with reinvested dividends and distributions followed by shares
acquired with a sales charge will be redeemed to the extent necessary to make
withdrawal payments. Depending upon the amount withdrawn, the investor's
principal may be depleted. Payments made to shareholders under such plans should
not be considered as a yield or income on investment. Purchases of additional
shares concurrently with withdrawals are undesirable because of sales charges on
purchases when made. Accordingly, a shareholder may not maintain an Automatic
Withdrawal Plan while simultaneously making regular purchases.
1. Shareholder Services, Inc., the Transfer Agent of the Trust, will
administer the Automatic Withdrawal Plan (the "Plan") as agent for the person
(the "Planholder") who executed the Plan authorization and application submitted
to the Transfer Agent.
2. Certificates will not be issued for shares of the Trust purchased for
and held under the Plan, but the Transfer Agent will credit all such shares to
the account of the Planholder on the records of the Trust. Any share
certificates now held by the Planholder may be surrendered unendorsed to the
Transfer Agent with the Plan application so that the shares represented by the
certificate may be held under the Plan. Those shares will be carried on the
Planholder's Plan Statement.
3. Distributions of capital gains must be reinvested in shares of the
Trust, which will be done at net asset value without a sales charge. Dividends
may be paid in cash or reinvested.
4. Redemptions of shares in connection with disbursement payments will be
made at the net asset value per share determined on the redemption date.
5. Checks or ACH payments will be transmitted three business days prior to
the date selected for receipt of the monthly or quarterly payment (the date of
receipt is approximate), according to the choice specified in writing by the
Planholder.
6. The amount and the interval of disbursement payments and the address to
which checks are to be mailed may be changed at any time by the Planholder on
written notification to the Transfer Agent. The Planholder should allow at least
two weeks' time in mailing such notification before the requested change can be
put in effect.
A-24
<PAGE>
7. The Planholder may, at any time, instruct the Transfer Agent by written
notice (in proper form in accordance with the requirements of the then current
Prospectus of the Trust) to redeem all, or any part of, the shares held under
the Plan. In such case, the Transfer Agent will redeem the number of shares
requested at the net asset value per share in effect in accordance with the
Trust's usual redemption procedures and will mail a check for the proceeds of
such redemption to the Planholder.
8. The Plan may, at any time, be terminated by the Planholder on written
notice to the Transfer Agent, or by the Transfer Agent upon receiving directions
to that effect from the Trust. The Transfer Agent will also terminate the Plan
upon receipt of evidence satisfactory to it of the death or legal incapacity of
the Planholder. Upon termination of the Plan by the Transfer Agent or the Trust,
shares remaining unredeemed will be held in an uncertificated account in the
name of the Planholder, and the account will continue as a
dividend-reinvestment, uncertificated account unless and until proper
instructions are received from the Planholder, his executor or guardian, or as
otherwise appropriate.
9. For purposes of using shares held under the Plan as collateral, the
Planholder may request issuance of a portion of his shares in certificated form.
Upon written request from the Planholder, the Transfer Agent will determine the
number of shares as to which a certificate may be issued, so as not to cause the
withdrawal checks to stop because of exhaustion of uncertificated shares needed
to continue payments. Should such uncertificated shares become exhausted, Plan
withdrawals will terminate.
10. The Transfer Agent shall incur no liability to the Planholder for any
action taken or omitted by the Transfer Agent in good faith.
11. In the event that the Transfer Agent shall cease to act as transfer
agent for the Trust, the Planholder will be deemed to have appointed any
successor transfer agent to act as his agent in administering the Plan.
A-25
<PAGE>
Investment Advisor and Distributor
Centennial Asset Management Corporation
3410 South Galena Street
Denver, Colorado 80231
Transfer Agent and Shareholder Servicing Agent
Shareholder Services, Inc.
P.O. Box 5143
Denver, Colorado 80217-5143
1-800-525-9310
Custodian
Citibank, N.A.
399 Park Avenue
New York, New York 10043
Independent Auditors
Deloitte & Touche LLP
555 Seventeenth Street, Suite 3600
Denver, Colorado 80202-3942
Legal Counsel
Myer, Swanson, Adams & Wolf, P.C.
The Colorado State Bank Building
1600 Broadway - Suite 1480
Denver, Colorado 80202
PXO150.001 1196
A-26
