Registration No. 2-69653
File No. 811-3104
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / X /
PRE-EFFECTIVE AMENDMENT NO. ___ / /
POST-EFFECTIVE AMENDMENT NO. 29 / X /
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 / X /
AMENDMENT NO. 26 / X /
CENTENNIAL TAX EXEMPT TRUST
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(Exact Name of Registrant as Specified in Charter)
3410 South Galena Street
Denver, Colorado, 80231
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(Address of Principal Executive Offices)
(303) 671-3200
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(Registrant's Telephone Number)
ANDREW J. DONOHUE, ESQ.
Oppenheimer Management Corporation
Two World Trade Center, New York, New York 10048-0203
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(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check appropriate
box):
/ / Immediately upon filing pursuant to paragraph (b)
/ X / On November 1, 1995 pursuant to paragraph (b)
/ / 60 days after filing pursuant to paragraph (a) (i)
/ / On -------- pursuant to paragraph (a) (i)
/ / 75 days after filing, pursuant to paragraph (a) (ii)
/ / On ____________, pursuant to paragraph (a) (ii) of Rule 485
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The Registrant has registered an indefinite number of its shares under the
Securities Act of 1933 pursuant to Rule 24f-2 promulgated under the
Investment Company Act of 1940. A Rule 24f-2 Notice for the Registrant's
fiscal year ended June 30, 1995 was filed on August 28, 1995.
<PAGE>
FORM N-1A
CENTENNIAL TAX EXEMPT TRUST
Cross Reference Sheet
Part A of
Form N-1A
Item No. Prospectus Heading
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1 Front Cover Page
2 Trust Expenses
3 Financial Highlights; Yield Information
4 Cover Page; The Trust and Its Investment Policies;
Investment Restrictions
5 Management of the Trusts; Trust Expenses; Inside Back Cover;
Additional Information - The Custodian and the Transfer
Agent
6 Dividends, Distributions and Taxes; Additional Information;
Management of the Trusts
7 How to Buy Shares; Exchanges of Shares and Retirement Plans;
Service Plan; Back Cover; How To Redeem Shares
8 How to Redeem Shares; Exchanges of Shares and Retirement
Plans
9 *
Part B of
Form N-1A
Item No. Statement of Additional Information Heading
- --------- -------------------------------------------
10 Cover Page
11 Cover Page
12 Additional Information
13 Investment Objective and Policies; Investment Restrictions;
Exhibit A - Description of Securities Ratings
14 Trustees and Officers; Investment Management Services
15 Trustees and Officers - Major Shareholders; Investment
Management Services
16 Investment Management Services; Service Plan; Additional
Information; Back Cover
17 Investment Management Services - Portfolio Transactions
18 Additional Information - Description of the Trusts
19 Purchase, Redemption and Pricing of Shares; Automatic
Withdrawal Plan Provisions; Yield Information
20 Additional Information - Tax Status of the Trust's Dividends
and Distributions
21 Investment Management Services; Additional Information -
General Distributor's Agreement; Service Plan
22 Yield Information
23 Financial Statements
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* Not applicable or negative answer.
<PAGE>
Centennial
Tax Exempt Trust
3410 South Galena Street, Denver, Colorado 80231
Telephone 1-800-525-9310
Centennial Tax Exempt Trust (the "Trust") is a no-load "money
market" mutual fund with the investment objective of seeking the
maximum short-term interest income exempt from Federal income taxes
that is consistent with low capital risk and the maintenance of
liquidity. The Trust seeks to achieve this objective by investing in
obligations issued by states, territories and possessions of the United
States or by the District of Columbia, or their political subdivisions,
authorities and corporations, the income from which is exempt from
Federal income taxes. 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 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 sets forth concisely information about the Trust
that a prospective investor should know before investing. A Statement
of Additional Information about the Trust (the "Additional Statement")
dated November 1, 1995, has been filed with the Securities and Exchange
Commission and is available without charge upon written request to
Shareholder Services, Inc. (the "Transfer Agent"), P.O. Box 5143,
Denver, Colorado 80217-5143 or by calling the Transfer Agent at the
toll-free number shown above. The Additional Statement (which is
incorporated by reference in its entirety in this Prospectus) contains
more detailed information about the Trust and its management.
Investors are advised to read and retain this Prospectus for future
reference.
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.
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.
This Prospectus is effective November 1, 1995.
<PAGE>
Table of Contents
Page
Trust Expenses 3
Financial Highlights 4
Yield Information 5
The Trust and Its Investment Policies 5
Investment Restrictions 8
Appendix
Management of the Trusts A-1
How to Buy Shares A-1
Purchases Through Automatic Purchase and
Redemption Programs A-2
Direct Purchases A-2
Payment by Check
Payment by Federal Funds Wire
Guaranteed Payment A-3
Automatic Investment Plans A-3
General A-4
Service Plan A-4
How to Redeem Shares A-4
Program Participants A-4
Shares of the Trusts Owned Directly A-4
Regular Redemption Procedure A-4
Expedited Redemption Procedure A-5
Check Writing A-5
Telephone Redemptions A-6
Retirement Plans Holding Shares of
Government Trust and Money Market Trust A-6
Automatic Withdrawal Plans A-6
General Information on Redemptions A-6
Exchanges of Shares and Retirement Plans A-7
Dividends, Distributions and Taxes A-9
Additional Information A-12
<PAGE>
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, 1995.
Shareholder Transaction Expenses
Maximum Sales Charge on Purchases
(as a percentage of offering price) None
Sales Charge on Reinvested Dividends None
Redemption Fees None
Exchange Fee None
Annual Trust Operating Expenses
(as a percentage of average net assets)
Management Fees 0.45%
12b-1 (Service Plan) Fees 0.20%
Other Expenses 0.08%
-----
Total Trust Operating Expenses 0.73%
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 Additional Statement.
The following example applies the above-stated expenses to a
hypothetical $1,000 investment in shares of the Trust over the time
periods shown below, assuming a 5% annual rate of return on the
investment and also assuming that the shares are redeemed at the end of
each stated period. The amounts shown below are the cumulative costs
of such hypothetical $1,000 investment for the periods shown.
1 year 3 years 5 years 10 years
------ ------- ------- --------
$7 $23 $41 $91
This example should not be considered a representation of past or
future expenses or performance. Expenses are subject to change and
actual performance and expenses may be less or greater than those
illustrated above.
<PAGE>
Financial Highlights
Selected data for a share of beneficial interest outstanding throughout
each period
The table on the following pages 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, 1995 is included in the Additional Statement.
<TABLE>
<CAPTION>
Year Ended June 30, SIX MONTHS YEAR ENDED
---------------------------------------------------------------------- ENDED JUNE 30, DECEMBER 31
1995 1994 1993 1992 1991 1990 1989 1988 1987 1986 1985
----- ----- ----- ----- ----- ----- ----- ----- ----- ------------ -----------
<S> <C> <C> <C> <C> <C> <C> <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 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Income from investment
operations--net investment
income and net realized gain
on investments .03 .02 .02 .03 .04 .05 .05 .04 .04 .02 .05
Dividends and distributions to
shareholders (.03) (.02) (.02) (.03) (.04) (.05) (.05) (.04) (.04) (.02) (.05)
----- ---- - ---- ----- ---- ---- ----- ---- ---- ---- ----
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
$1.00
====== ====== ===== ===== ===== ===== =====
===== ===== ===== =====
TOTAL RETURN, AT NET ASSET
VALUE(1) 3.17% 1.90% 2.19% 3.55% 5.09% 5.70% 5.55% 4.35% 3.83% 2.25%
5.00%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in
millions) $1,315 $1,039 $ 981 $ 917 $787 $ 575 $ 486 $ 518 $ 459 $ 469 $ 212
Average net assets (in
millions) $1,127 $1,057 $ 977 $ 900 $711 $ 561 $ 504 $ 485 $ 522 $ 385 $ 154
Number of shares outstanding at
end of period (in millions) 1,315 1,039 981 917 787 575 486 518 459 469 212
Ratios to average net assets:
Net investment income 3.13% 1.87% 2.08% 3.40% 4.84% 5.44% 5.45% 4.30% 3.71%
4.34%(2) 4.59%
Expenses .73% .76% .76% .75% .77% .79% .78% .78% .79% .82%(2)
.82%
</TABLE>
1. 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.
2. Annualized.
<PAGE>
Yield Information
From time to time, the "yield," "compounded effective yield" and
"tax-equivalent yield" of an investment in the Trust may be advertised.
These 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" will therefore be slightly higher than the yield because of the
effect of the assumed reinvestment. The Trust's "tax-equivalent yield"
is calculated by dividing that portion of the Trust's "yield"
(calculated as described above) which is tax-exempt by one minus a
stated income tax rate and adding the result to the portion (if any) of
the Trust's yield that is not tax-exempt. See "Yield Information" in
the Additional Statement for additional information about the methods
of calculating these yields.
The Trust and Its Investment Policies
The Trust is a no-load tax-exempt "money market" fund. It is an
open-end, diversified management investment company organized as a
Massachusetts business trust in 1985. The Trust was initially
organized in 1980 as a Maryland corporation. The Trust's investment
objective is to seek maximum short-term interest income exempt from
Federal income taxes 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 Additional Statement 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. In
seeking its objective, the Trust may invest in the securities discussed
below. The Trust's investment policies and practices are not
"fundamental" policies (as defined below) 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.
The Trust seeks to achieve its objective by investing in municipal
bonds, municipal notes (including tax anticipation notes, bond
anticipation notes, revenue anticipation notes, construction loan notes
and other short-term loans), tax-exempt commercial paper, certificates
of participation, participation interests and other debt obligations
issued by or on behalf of the states and the District of Columbia, any
commonwealth or territory of the United States, or their respective
political subdivisions, agencies, instrumentalities or authorities, the
interest from which is not subject to Federal individual income tax, in
the opinion of bond counsel to the respective issuer at the time of
issue (collectively, "Municipal Securities"). Such obligations having
maturities of (a) one year or more when issued are referred to as
"Municipal Bonds," and (b) less than one year are referred to as
"Municipal Notes." The Trust may invest in Municipal Bonds and Notes
offered on a "when-issued" basis, as discussed below and in the
Additional Statement. The Trust will not invest in foreign securities.
No independent investigation has been made by Centennial Asset
Management Corporation, the Trust's investment manager (the "Manager")
as to the users of proceeds of such offerings or the application of
such proceeds. The Trust may also purchase Municipal Securities with
demand features that meet the requirements of Rule 2a-7 (discussed
below) and are approved under standards adopted by the Trust's Board of
Trustees. All Municipal Securities in which the Trust invests must
have, or, pursuant to regulations adopted by the Securities and
Exchange Commission, be deemed to have, remaining maturities of 397
days or less at the date the Trust purchases them. The two principal
classifications of Municipal Securities are "general obligations"
(secured by the issuer's pledge of its full faith, credit and taxing
power for the payment of principal and interest) and "revenue
obligations" (payable only from the revenues derived from a particular
facility or class of facilities, or specific excise tax or other
revenue source).
Under normal market conditions, the Trust attempts to invest 100%
of its assets in Municipal Securities, and the Trust will make no
investment that will reduce the portion of its total assets that are
invested in Municipal Securities to less than 80%. The balance of the
Trust's assets may be invested in investments the income from which may
be taxable, including: (i) repurchase agreements (explained below);
(ii) Municipal Securities issued to benefit a private user ("Private
Activity Municipal Securities"), the interest from which may be subject
to Federal alternative minimum tax (see "Dividends, Distributions and
Taxes" below and "Private Activity Municipal Securities" in the
Additional Statement); and (iii) certain "Temporary Investments"
defined below in "Temporary Investments." However, in times of
unstable economic or market conditions, when the Manager determines it
appropriate to do so, the Trust may assume a temporary defensive
position and invest an unlimited amount of its assets in Temporary
Investments. The Trust may also hold Temporary Investments pending the
investment of proceeds from the sale of Trust shares or portfolio
securities, pending settlement of Municipal Securities purchases or to
meet anticipated redemptions. Normally, the Trust will not invest more
than 20% of its total assets in Private Activity Municipal Securities
and other taxable investments described above. The Trust will
generally use its best efforts to dispose of such securities within
sixty days of acquisition. To the extent the Trust receives income
from taxable investments, it may not achieve its investment objective.
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 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 Trust's Board of Trustees has determined have
minimal credit risks and are "Eligible Securities."
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." The Trust's Board must approve or
ratify the purchase of Eligible Securities that are unrated or are
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 maturity of any single portfolio
investment may not exceed 397 days. 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 that Rule, of
conforming the Trust's investments with the requirements of the Rule
and those procedures.
Exhibit A of the Additional Statement contains 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 risks presented by a security and may
require its sale. The rating restrictions described in this Prospectus
do not apply to banks in which the Trust's cash is kept. See "Ratings
of Securities" in "Investment Objective and Policies" in the Additional
Statement for further details.
- 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.
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 (taken at current value)
would be invested in securities that are illiquid by virtue of the
absence of a readily available market, or because of legal or
contractual restrictions on resale ("restricted securities"). This
policy does not limit the acquisition 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.
Floating Rate/Variable Rate Obligations
Some of the Municipal Securities 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 PSA Municipal Swap Index or the J.J. Kenney
Index. The Trust may purchase these obligations if they have a
remaining maturity of 397 days or less; if their maturity is greater
than 397 days, 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 397 days and upon no more
than 30 days notice. The Manager may determine that an unrated
floating rate or variable rate demand obligation meets the Trust's
quality standards by reason of being backed by a letter of credit or
guarantee issued by a bank that meets the Trust's quality standards.
See "Floating Rate/Variable Rate Obligations" in the Additional
Statement for more details.
Puts and Standby Commitments
For liquidity purposes, the Trust may purchase Municipal
Securities with puts from banks, brokers, dealers or other
institutions. A put gives the Trust the right to sell the underlying
security within a specified time at a stated price. Under a standby
commitment, a dealer agrees to purchase, at the Trust's option,
specified Municipal Securities at a stated price on same-day
settlement. The aggregate price of a security subject to a put or
standby commitment may be higher than the price which otherwise would
be paid for the security without such put or standby commitment,
thereby increasing the cost of such security and reducing its yield.
See "Puts and Standby Commitments" in the Additional Statement for
further details.
When-Issued and Delayed Delivery Securities
The Trust may invest in Municipal Securities on a "when-issued" or
"delayed delivery" basis. In those transactions, the Trust obligates
itself to purchase or sell securities, with delivery and payment to
occur at a later date, to secure what is considered to be an
advantageous price and yield at the time the obligation is entered
into. The price, which is generally expressed in yield terms, is fixed
at the time the commitment to purchase is made, but delivery and
payment for when-issued securities take place at a later date (normally
within 30 days of purchase). During the period between purchase and
settlement, no payment is made by the Trust to the issuer and no
interest accrues to the Trust from the investment. Although the Trust
is subject to the risk of adverse market fluctuation during that
period, the Manager does not believe that the Trust's net asset value
or income will be materially adversely affected by the Trust's purchase
of Municipal Securities on a "when-issued" or "delayed delivery" basis.
See "When-Issued and Delayed Delivery Transactions" in the Additional
Statement for more details.
Participation Interests
The Trust may acquire participation interests in senior, fully-
secured floating rate loans that are made primarily to municipal
borrowers. The Trust currently intends to invest no more than 5% of
its net assets during the coming year in participation interests. Such
participation interests, which may take the form of interests in, or
assignments of, the loan, may be acquired from banks or other lenders
who have made loans or are members of a lending syndicate. The Trust's
investments in participation interests are subject to its 10% of net
assets limitation on investments in illiquid securities (see
"Investment Restrictions - "Illiquid and Restricted Securities,"
above). Further details are set forth in the Additional Statement
under "Municipal Notes - Participation Interests."
Temporary Investments
The Trust may hold the following "Temporary Investments" that are
Eligible Securities: (i) obligations issued or guaranteed by the U.S.
Government or its agencies or instrumentalities; (ii) bankers
acceptances; (iii) taxable commercial paper rated in the highest
category by a Rating Organization; (iv) short-term taxable debt
obligations rated in one of the two highest rating categories of a
Rating Organization; or (v) certificates of deposit of domestic banks
with assets of $1 billion or more.
Repurchase Agreements
The Trust may acquire securities that are subject to repurchase
agreements. The Trust's repurchase agreements must comply with the
collateral requirements of Rule 2a-7. If the vendor fails to pay the
agreed-upon resale 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
ordinarily will not purchase or otherwise acquire any security or
invest in a repurchase agreement, if as a result, more than 10% of its
net assets (taken at current value) at the time of purchase would be
invested in repurchase agreements not entitling the holder to payment
of principal within seven days. However, when the Trust assumes a
temporary defensive position, there is no limit on the amount of the
Trust's assets that may be subject to repurchase agreements having a
maturity of seven days or less. Income earned on repurchase
transactions is not tax-exempt and accordingly, under normal market
conditions, the Trust will limit its investments in repurchase
transactions to 20% of its total assets. See "Repurchase Agreements"
in the Additional Statement for further details.
Investment Restrictions
The Trust has certain investment restrictions which, together with
its investment objective, are fundamental policies, changeable 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) make loans, except by purchasing
debt obligations in accordance with its investment policies as approved
by the Board, or by entering into repurchase agreements, or by lending
portfolio securities in accordance with applicable regulations; (2)
borrow money except as a temporary measure for extraordinary or
emergency purposes, and then only up to 10% of the value of its assets;
no more than 10% of the Trust's net assets may be pledged, mortgaged or
assigned to secure a debt; no investments may be made while outstanding
borrowings, other than by means of reverse repurchase agreements (which
are not considered borrowings under this restriction), exceed 5% of its
assets; (3) invest more than 5% of the value of its total assets taken
at market value in the securities of any one issuer (not including the
U.S. Government or its agencies or instrumentalities, whose securities
may be purchased without limitation for defensive purposes); (4)
purchase more than 10% of the outstanding voting securities of any one
issuer or invest in companies for the purpose of exercising control; or
(5) concentrate investments to the extent of 25% of its assets in any
industry; however, there is no limitation as to investment, for
liquidity purposes, in obligations issued by banks or savings and loan
associations or in obligations issued by the U.S. Government or its
agencies or instrumentalities. The percentage restrictions above and
in the Additional Statement 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 investment restrictions is contained in "Investment
Restrictions" in the Additional Statement.
<PAGE>
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.
Management of the Trusts
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 Additional Statement 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. The management fee is payable monthly
to the Manager under the terms of each Trust's Agreement and is
computed on the aggregate 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. See the Additional Statement for an explanation of the
Manager's reimbursement arrangement for the Trusts set forth in their
Agreements and the Manager's voluntary expense assumption for Money
Market Trust. 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. 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 average net assets computed daily and paid monthly at
the annual rates, but in no event shall the annual fee be less than $0.
"Investment Management Services" in the Additional Statement contains
more complete information about the Agreements, including a discussion
of expense arrangements, description of the exculpation provisions and
portfolio transactions.
The Manager, a wholly-owned subsidiary of Oppenheimer Management
Corporation ("OMC"), has operated as an investment adviser since 1978.
The Manager and its affiliates currently advise U.S. investment
companies with assets aggregating over $38 billion as of September 30,
1995, and having more than 2.8 million shareholder accounts. OMC is
wholly owned by Oppenheimer Acquisition Corp., a holding company owned
in part by senior management of OMC 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.
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 Additional Statement 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 of a Trust's shares. Oppenheimer Funds
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 Privilege" below 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 Additional Statement.
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 may directly purchase shares of the Trusts through any
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.
- 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.
- Payment by Federal Funds Wire. Shares of each Trust may be
purchased by direct shareholders by Federal Funds wire. The 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.) 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 (which is normally
4:00 P.M.). 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, which is normally 4:00 P.M., but may be earlier on some days.
The investor must also send the Distributor a completed Application
when the purchase order is placed to establish a new account.
- 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 on a regular business
day with the broker-dealer's guarantee that payment for such shares in
Federal Funds will be received by the Trust's Custodian by the close of
the Exchange on the next regular business day, the order will be
effected at 4:00 P.M. 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. 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.
- 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
Redeem Shares." The amount of the Automatic Investment Plan payment
may be changed or the automatic investments terminated at any time by
writing to Shareholder Services, Inc. (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.
General
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 for
purchases of the Fund'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.
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 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 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 Additional Statement.
How to Redeem 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 the 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:
- 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. (the "Transfer Agent"), 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 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.
- 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 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 Additional Statement for further details.
- 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 should 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.
- 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. 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 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.
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 above address, 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 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.
- 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, 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 B to the Additional Statement.
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 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 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
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 and Retirement Plans
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 the following
funds, all collectively referred to as "Eligible Funds": (i)
Oppenheimer Target Fund, Oppenheimer Champion Income Fund, Oppenheimer
Asset Allocation Fund, Oppenheimer Discovery Fund, Oppenheimer U.S.
Government Trust, Oppenheimer Global Growth & Income Fund, Oppenheimer
Global Emerging Growth Fund, Oppenheimer Limited-Term Government Fund,
Oppenheimer Intermediate Tax-Exempt Fund, Oppenheimer Insured Tax-
Exempt Fund, Oppenheimer Fund, Oppenheimer Global Fund, Oppenheimer
Growth Fund, Oppenheimer Equity Income Fund, Oppenheimer Main Street
California Tax-Exempt Fund, Oppenheimer Main Street Income & Growth
Fund, Oppenheimer Gold & Special Minerals Fund, Oppenheimer Bond Fund,
Oppenheimer Value Stock Fund, Oppenheimer California Tax-Exempt Fund,
Oppenheimer Pennsylvania Tax-Exempt Fund, Oppenheimer Florida Tax-
Exempt Fund, Oppenheimer New Jersey Tax-Exempt Fund, Oppenheimer New
York Tax-Exempt Fund, Oppenheimer High Yield Fund, Oppenheimer Total
Return Fund, Inc., Oppenheimer Tax-Free Bond Fund, Oppenheimer
Strategic Income Fund, Oppenheimer Strategic Income & Growth Fund, and
(ii) the following "Money Market Funds": Centennial Money Market Trust,
Centennial Government Trust, Centennial America Fund, L.P., Centennial
California Tax Exempt Trust, Centennial New York Tax Exempt Trust and
Centennial Tax Exempt Trust (collectively, the "Centennial Trusts"),
Oppenheimer Money Market Fund, Inc., Oppenheimer Cash Reserves and
Daily Cash Accumulation Fund, Inc. There is an initial sales charge on
the purchase of Class A shares of each Eligible Fund except the Money
Market Funds (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 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 (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 it is 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 10 or more accounts. 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
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 the shareholder(s) of record
cancelling 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 reasonable procedures to confirm that
telephone instructions are genuine, by requiring callers to provide tax
identification number(s) and other account data and by recording calls
and confirming such transactions in writing. If the Transfer Agent
does not use such 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
exchange 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
five business days if it determines that it would be disadvantaged by
an immediate transfer of the redemption proceeds. The 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 adviser 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 Additional Statement. The Additional Statement
contains a further discussion 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". All dividends and capital gains distributions
for the accounts of Program participants are automatically reinvested
in additional shares of the Trust selected. 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.
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.
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 Additional Statement. 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.
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 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 Additional Statement 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 Fund shares have been held. Although income from securities
issued by the U.S. Government may be exempt from income taxation by
various states, such exemptions may not apply when the income is
received in the form of a dividend from either of these Trusts. The
Government Trust will advise shareholders of the percentage of its
income earned on federal obligations.
Tax Status of Tax Exempt Trust's Dividends and Distributions
This 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, 1994 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.
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 Additional Statement of Tax Exempt Trust
and should consult their own tax advisers before purchasing shares. No
investigation as to the users of the facilities financed by such bonds
has been 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 Redeem Shares,"
above.
Additional Information
Description of Shares and of the Trusts
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 "series" of shares of that
Trust, which may have separate assets and liabilities.
The Trusts do not anticipate holding annual meetings. Under
certain circumstances, shareholders of each Trust have the right to
remove a Trustee. Although the Declaration of Trust of each Trust
states that when issued, shares are fully-paid and nonassessable,
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 Additional Statement for details.
The Custodian and the Transfer Agent
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 Additional
Statement 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 "The Trust and Its Investment Policies" do not apply to
banks in which a Trust's cash is kept.
Shareholder Services, Inc., a subsidiary of Oppenheimer Management
Corporation, 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. 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.
<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 Additional Statement,
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 Adviser 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 of Portfolio Securities
Citibank, N.A.
399 Park Avenue
New York, New York 10043
Independent Auditors
Deloitte & Touche LLP
555 Seventeeth Street, Suite 3600
Denver, Colorado 80202-3942
Legal Counsel
Myer, Swanson, Adams & Wolf, P.C.
The Colorado State Bank Building
1600 Broadway - Suite 1850
Denver, Colorado 80202
<PAGE>
Centennial Tax Exempt Trust
Prospectus
Effective November 1, 1995
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
CENTENNIAL TAX EXEMPT TRUST
3410 South Galena Street, Denver, Colorado 80231
1-800-525-9310
This Statement of Additional Information (the "Additional
Statement") is not a Prospectus. This Additional Statement should be
read together with the Prospectus dated November 1, 1995 (the
"Prospectus") of Centennial Tax Exempt Trust (the "Trust"), which may
be obtained by writing to Shareholder Services, Inc. (the "Transfer
Agent"), P.O. Box 5143, Denver, Colorado 80217 or by calling the toll-
free number shown above.
TABLE OF CONTENTS
Page
Investment Objective and Policies 2
Investment Restrictions 8
Appendix
Trustees and Officers A-1
Investment Management Services A-5
Service Plan A-7
Purchase, Redemption and Pricing of Shares A-9
Yield Information A-11
Additional Information A-13
Exhibit A: Description of Securities Ratings A-15
Exhibit B: Automatic Withdrawal Plan Provisions A-20
Exhibit C: Tax Equivalent Yield Table A-22
Independent Auditors' Report A-24
Financial Statements A-25
This Additional Statement is effective November 1, 1995.
<PAGE>
INVESTMENT OBJECTIVE AND POLICIES
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 the Additional
Statement 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 needs to generate cash to
satisfy redemptions. In such cases, the Trust may realize a capital
gain or loss.
There are, or course, variations in Municipal Securities, both
within a particular classification and between classifications,
depending on numerous factors. The yields of Municipal Securities
depend on, among other things, general money market conditions, general
conditions of the Municipal Securities market, the size of a particular
offering, the maturity of the obligation and rating of the issue. The
market value of Municipal Securities will vary as a result of changing
evaluations of the ability of their issuers to meet interest and
principal payments, as well as changes in the interest rates payable on
new issues of Municipal Securities.
Municipal Securities.
Municipal Bonds. The principal classifications of long-term
Municipal Bonds are "general obligation," "revenue" and "industrial
development" bonds.
General Obligation Bonds. Issuers of general obligation bonds
include states, counties, cities, towns, and regional districts. The
proceeds of these obligations are used to fund a wide range of public
projects, including construction or improvement of schools, highways
and roads, and water and sewer systems. The basic security behind
general obligation bonds is the issuer's pledge of its full faith and
credit and taxing power for the payment of principal and interest. The
taxes that can be levied for the payment of debt service may be limited
or unlimited as to the rate or amount of special assessments.
Revenue Bonds. The principal security for a revenue bond is
generally the net revenues derived from a particular facility, group of
facilities, or, in some cases, the proceeds of a special excise or
other specific revenue source. Revenue bonds are issued to finance a
wide variety of capital projects including: electric, gas, water and
sewer systems; highways, bridges, and tunnels; port and airport
facilities; colleges and universities; and hospitals. Although the
principal security behind these bonds may vary, many provide additional
security in the form of a debt service reserve fund whose money may be
used to make principal and interest payments on the issuer's
obligations. Housing finance authorities have a wide range of
security, including partially or fully insured mortgages, rent-
subsidized and/or collateralized mortgages, and/or the net revenues
from housing or other public projects. Some authorities provide
further security in the form of a state's ability (without obligation)
to make up deficiencies in the debt service reserve fund.
Industrial Development Bonds. Industrial development bonds,
which are considered municipal bonds if the interest paid is exempt
from federal income tax, are issued by or on behalf of public
authorities to raise money to finance various privately operated
facilities for business and manufacturing, housing, sports, and
pollution control. These bonds are also used to finance public
facilities such as airports, mass transit systems, ports, and parking.
The payment of the principal and interest on such bonds is dependent
solely on the ability of the facility's user to meet its financial
obligations and the pledge, if any, of real and personal property so
financed as security for such payment.
- Municipal Notes. Municipal Securities having a maturity when
issued of less than one year are generally known as municipal notes.
Municipal notes generally are used to provide for short-term working
capital needs and include:
Tax Anticipation Notes. Tax anticipation notes are issued to
finance working capital needs of municipalities. Generally, they are
issued in anticipation of various seasonal tax revenue, such as income,
sales, use or business taxes, and are payable from these specific
future taxes.
Revenue Anticipation Notes. Revenue anticipation notes are
issued in expectation of receipt of other types of revenue, such as
federal revenues available under Federal revenue sharing programs.
Bond Anticipation Notes. Bond anticipation notes are issued
to provide interim financing until long-term financing can be arranged.
In most cases, the long-term bonds then provide the money for the
repayment of the notes.
Construction Loan Notes. Construction loan notes are sold to
provide construction financing. After successful completion and
acceptance, many projects receive permanent financing through the
Federal Housing Administration.
Tax-Exempt Commercial Paper. Tax-exempt commercial paper is a
short-term obligation issued by state and local governments or their
agencies to finance seasonal working capital needs or as short-term
financing in anticipation of longer-term financing.
- Participation Interests. The Trust may purchase participation
interests in all or part of loans to municipal borrowers from financial
institutions such as banks, insurance companies and savings and loan
associations. Such institutions frequently provide, or secure from
another financial institution, letters of credit or guarantees to
secure the interests, and give the buyer the right to demand payment of
the principal amount of the participation interests plus accrued
interest on short notice (normally within seven days). In the event of
a failure by the issuer to pay scheduled interest or principal payments
on the underlying municipal security, the Trust could experience a
decline in its net asset value. In the event of a failure by the
financial institution to perform its obligations in connection with the
participation interest, the Trust might incur certain costs and delays
in realizing payment or may suffer a loss of principal and/or interest.
The Trust may buy participation interests in Municipal Securities
having maturities of more than one year if the participation interests
include the right to demand payment from the financial institution
(which may charge fees in connection with their repurchase commitments)
consistent with the Trust's other investment policies and restrictions.
- Certificates of Participation. Subject to the provisions of
Rule 2a-7 and the limitation on illiquid securities described in the
Prospectus, the Trust may invest in certificates of participation,
which are tax-exempt obligations that evidence the holder's right to
share in lease, installment loan or other financing payments by a
public entity. Projects financed with certificates of participation
generally are not subject to state constitutional debt limitations or
other statutory requirements that may be applicable to Municipal
Securities.
- Floating Rate/Variable Rate Obligations. Floating rate put
bonds and variable rate demand notes are tax-exempt obligations which
may have a stated maturity in excess of one year, but may include
features that permit the holder to recover the principal amount of the
underlying security at specified intervals not exceeding one year on
not more than thirty days' notice at any time. The issuer of such
notes normally has a corresponding right, after a given period, to
prepay in its discretion the outstanding principal amount of the note
plus accrued interest upon a specified number of days notice to the
holder. 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 based on a stated prevailing market
rate but is adjusted automatically at specified intervals of no more
than one year. Generally, the changes in the interest rate on such
securities reduce the fluctuation in their market value. There is no
limit on the amount of the Trust's assets that may be invested in
floating rate and variable rate obligations. Floating rate or variable
rate obligations which do not provide for recovery of principal and
interest within thirty days may be subject to the limitations
applicable to illiquid securities described in "The Trust and Its
Investment Policies "Illiquid and Restricted Securities" in the
Prospectus.
Puts and Standby Commitments. When the Trust buys Municipal
Securities, it may obtain a standby commitment from the seller to
repurchase the securities that entitles the Trust to achieve same day
settlement from the repurchaser and to receive an exercise price equal
to the amortized cost of the underlying security plus accrued interest,
if any, at the time of exercise. A put purchased in conjunction with a
Municipal Security enables the Trust to sell the underlying security
within a specified period of time at a fixed exercise price. The Trust
may pay for a standby commitment or put either separately in cash or by
paying a higher price for the securities acquired subject to the
standby commitment or put. The Trust will enter into these
transactions only with banks and dealers which, in the Manager's
opinion, present minimal credit risks. The Trust's purchases of puts
are subject to the provisions of Rule 2a-7 under the Investment Company
Act because the Trust uses the amortized cost method to value its
portfolio securities. That Rule, which is subject to change, states
(among other things) that the Trust may not, with respect to 75% of the
amortized cost of its assets, have invested more than 5% of the total
amortized cost value of its assets in securities issued by or subject
to puts from the same institution. An unconditional put or guarantee
with respect to a security will not be deemed to be issued by the
institution providing the guarantee or put, provided that the value of
all securities held by the Trust and issued or guaranteed by the issuer
providing the guarantee or put shall not exceed 10% of the Trust's
total assets.
The Trust's ability to exercise a put or standby commitment will
depend on the ability of the bank or dealer to pay for the securities
if the put or standby commitment is exercised. If the bank or dealer
should default on its obligation, the Trust might not be able to
recover all or a portion of any loss sustained from having to sell the
security elsewhere. Puts and standby commitments are not transferrable
by the Trust, and therefore terminate if the Trust sells the underlying
security to a third party. The Trust intends to enter into these
arrangements to facilitate portfolio liquidity, although such
arrangements may enable the Trust to sell a security at a pre-arranged
price which may be higher than the prevailing market price at the time
the put or standby commitment is exercised. Any consideration paid by
the Trust for the put or standby commitment (which increases the cost
of the security and reduces the yield otherwise available from the
security) will be reflected on the Trust's books as unrealized
depreciation while the put or standby commitment is held, and a
realized gain or loss when the put or commitment is exercised or
expires.
- When-Issued and Delayed Delivery Transactions. As stated in
the Prospectus, the Trust may invest in Municipal Securities on a
"when-issued" or "delayed delivery" basis. Payment for and delivery of
the securities generally settles within 30 days of the date the offer
is accepted. The purchase price and yield are fixed at the time the
buyer enters into the commitment. During the period between the time
of commitment and settlement, no payment is made by the Trust to the
issuer and no interest accrues to the Trust from this investment.
However, the Trust intends to be as fully invested as possible and will
not invest in when-issued securities if its income or net asset value
will be materially adversely affected. At the time the Trust makes the
commitment to purchase a Municipal Security on a when-issued basis, it
will record the transaction on its books and reflect the value of the
security in determining its net asset value. It will also segregate
cash or other liquid high quality Municipal Securities equal in value
to the commitment for the when-issued securities. While when-issued
securities may be sold prior to settlement date, the Trust intends to
acquire the securities upon settlement unless a prior sale appears
desirable for investment reasons. There is a risk that the yield
available in the market when delivery occurs may be higher than the
yield on the security acquired.
- Private Activity Municipal Securities. The Tax Reform Act of
1986 (the "Tax Reform Act") reorganized, as well as amended, the rules
governing tax exemption for interest on Municipal Securities. The Tax
Reform Act generally did not change the tax treatment of bonds issued
in order to finance governmental operations. Thus, interest on
obligations issued by or on behalf of a state or local government, the
proceeds of which are used to finance the operations of such
governments (e.g., general obligation bonds) continues to be tax-
exempt. However, the Tax Reform Act further limited the use of tax-
exempt bonds for non-governmental (private) purposes. More stringent
restrictions were placed on the use of proceeds of such bonds.
Interest on certain private activity bonds (other than those specified
as "qualified" tax-exempt private activity bonds, e.g., exempt facility
bonds including certain industrial development bonds, qualified
mortgage bonds, qualified Section 501(c)(3) bonds, qualified student
loan bonds, etc.) is taxable under the revised rules.
Interest on certain private activity bonds issued after August 7,
1986, which continues to be tax-exempt will be treated as a tax
preference item subject to the alternative minimum tax (discussed
below) to which certain taxpayers are subject. Further, a private
activity bond which would otherwise be a qualified tax-exempt private
activity bond will not, under Internal Revenue Code Section 147(a), be
a qualified bond for any period during which it is held by a person who
is a "substantial user" of the facilities or by a "related person" of
such a substantial user. This "substantial user" provision is
applicable primarily to exempt facility bonds, including industrial
development bonds. The Trust may not be an appropriate investment for
entities which are "substantial users" (or persons related thereto) of
such exempt facilities, and such persons should consult their own tax
advisers before purchasing shares. A "substantial user" of such
facilities is defined generally as a "non-exempt person who regularly
uses part of a facility" financed from the proceeds of exempt facility
bonds. Generally, an individual will not be a "related person" under
the Internal Revenue Code unless such investor or the investor's
immediate family (spouse, brothers, sisters and immediate descendants)
own directly or indirectly in the aggregate more than 50% in value of
the equity of a corporation or partnership which is a "substantial
user" of a facility financed from the proceeds of exempt facility
bonds. In addition, limitations as to the amount of private activity
bonds which each state may issue were revised downward by the Tax
Reform Act, which will reduce the supply of such bonds. The value of
the Trust's portfolio could be affected if there is a reduction in the
availability of such bonds. That value may also be affected by a 1988
U.S. Supreme Court decision upholding the constitutionality of the
imposition of a Federal tax on the interest earned on Municipal
Securities issued in bearer form.
A Municipal Security is treated as a taxable private activity bond
under a test for: (a) a trade or business use and security interest, or
(b) a private loan restriction. Under the trade or business use and
security interest test, an obligation is a private activity bond if:
(i) more than 10% of bond proceeds are used for private business
purposes and (ii) 10% or more of the payment of principal or interest
on the issue is directly or indirectly derived from such private use or
is secured by the privately used property or the payments related to
the use of the property. For certain types of uses, a 5% threshold is
substituted for this 10% threshold. (The term "private business use"
means any direct or indirect use in a trade or business carried on by
an individual or entity other than a governmental unit.) Under the
private loan restriction, the amount of bond proceeds which may be used
to make private loans is limited to the lesser of 5% or $5.0 million of
the proceeds. Thus, certain issues of Municipal Securities could lose
their tax-exempt status retroactively if the issuer fails to meet
certain requirements as to the expenditure of the proceeds of that
issue or use of the bond-financed facility. The Trust makes no
independent investigation of the users of such bonds or their use of
proceeds. Should the Trust hold a bond that loses its tax-exempt
status retroactively, there might be an adjustment to the tax-exempt
income previously paid to shareholders.
The Federal alternative minimum tax is designed to ensure that all
taxpayers pay some tax, even if their regular tax is zero. This is
accomplished in part by including in taxable income certain tax
preference items in arriving at alternative minimum taxable income.
The Tax Reform Act made tax-exempt interest from certain private
activity bonds a tax preference item for purposes of the alternative
minimum tax on individuals and corporations. Any exempt-interest
dividend paid by a regulated investment company will be treated as
interest on a specific private activity bond to the extent of its
proportionate share of the interest on such bonds received by the
regulated investment company. In addition, corporate taxpayers subject
to the alternative minimum tax may, under some circumstances, have to
include exempt-interest dividends in calculating their alternative
minimum taxable income in situations where the "adjusted current
earnings" of the corporation exceeds its alternative minimum taxable
income. The Trust may hold Municipal Securities the interest on which
(and thus a proportionate share of the exempt-interest dividends paid
by the Trust) will be subject to the Federal alternative minimum tax on
individuals and corporations. The Trust anticipates that under normal
circumstances it will not purchase any such securities in an amount
greater than 20% of its total assets.
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;
but if the Trust disposes of the security within five days of the
Manager learning of the downgrade, the Manager will provide the Board
with subsequent notice of such downgrade. 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. 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.
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 of 1940, as amended (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.
Diversification. For purposes of diversification under the Investment
Company Act, and the Trust's investment restrictions, the
identification of the issuer of a Municipal Bond or Note depends on the
terms and conditions of the security. When the assets and revenues of
an agency, authority, instrumentality or other political subdivision
are separate from those of the government creating the subdivision and
the security is backed only by the assets and revenues of the
subdivision, such subdivision would be deemed to be the sole issuer.
Similarly, in the case of an industrial development bond, if that bond
is backed only by the assets and revenues of the nongovernmental user,
then such nongovernmental user would be deemed to be the sole issuer.
If, however, in either case, the creating government or some other
entity guarantees a security, such a guarantee would be considered a
separate security and is to be treated as an issue of such government
or other entity.
INVESTMENT RESTRICTIONS
The Trust's significant investment restrictions are set forth
in the Prospectus. The following investment restrictions are also
fundamental investment policies of the Trust and, together with the
fundamental 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 development programs; (2) invest in real estate; however
the Trust may purchase Municipal Bonds or Notes secured by interests in
real estate; (3) make short sales of securities or purchase securities
on margin, except for short-term credits necessary for the clearance of
purchases and sales of portfolio securities; (4) invest in or hold
securities of any issuer if those officers and trustees or directors of
the Trust or its adviser 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 issued by other
persons except to the extent that, in connection with the disposition
of its portfolio investments, it may be deemed to be an underwriter for
purposes of the Securities Act of 1933; or (6) invest in securities of
other investment companies except as they may be acquired as part of a
merger, consolidation or acquisition of assets.
<PAGE>
APPENDIX
This Appendix is part of the Additional Statement 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 California Tax Exempt Trust, Centennial New York Tax Exempt
Trust, Daily Cash Accumulation Fund, Inc., Oppenheimer Champion Income
Fund, Centennial America Fund, L.P., Oppenheimer Limited-Term
Government Fund, Oppenheimer Tax-Exempt Fund, Oppenheimer Main Street
Funds, Inc., Oppenheimer Cash Reserves, Oppenheimer Equity Income Fund,
Oppenheimer High Yield Fund, Oppenheimer Integrity Funds, Oppenheimer
International Bond Fund, Oppenheimer Strategic Income Fund, Oppenheimer
Strategic Income & Growth Fund, Oppenheimer Total Return Fund, Inc.,
Oppenheimer Variable Account Funds 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, who is a
Trustee, Director of Managing Partner of all the Denver-based
Oppenheimer funds except Oppenheimer Bond Fund and Oppenheimer
Strategic Income Fund. Mr. Fossel 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 September
30, 1995, the Trustees and officers of each Trust in the aggregate
owned less than 1% of the outstanding shares of that Trust.
ROBERT G. AVIS, Trustee*; Age 64
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
adviser and trust company, respectively).
WILLIAM A. BAKER, Trustee; Age 80
197 Desert Lakes Drive, Palm Springs, California 92264
Management Consultant.
CHARLES CONRAD, JR., Trustee; Age 65
19411 Merion Circle, Huntington Beach, California 92648
Vice President of McDonnell Douglas Space Systems Co.; formerly
associated with National Aeronautics and Space Administration.
_____________________
* A Trustee who is an "interested person" of the Trusts as defined in
the Investment Company Act.
JON S. FOSSEL, President and Trustee*; Age 53
Two World Trade Center, New York, New York 10048-0203
Chairman and a Director of Oppenheimer Management Corporation ("OMC"),
the immediate parent of Centennial Asset Management Corporation (the
"Manager"); President and director of Oppenheimer Acquisition Corp.
("OAC"), OMC's parent holding company; President and a director of
HarbourView Asset Management Corporation, a subsidiary of OMC
("HarbourView"); a director of Shareholder Services, Inc. ("SSI"), the
Trust's Transfer Agent, and Shareholder Financial Services, Inc.
("SFSI"), transfer agent subsidiaries of OMC; formerly President of
OMC.
RAYMOND J. KALINOWSKI, Trustee; Age 66
44 Portland Drive, St. Louis, Missouri 63131
Director of Wave Technologies International, Inc., 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 73
2552 E. Alameda, Denver, Colorado 80209
Formerly Managing Partner of Deloitte Haskins & Sells (an accounting
firm).
ROBERT M. KIRCHNER, Trustee; Age 74
7500 East Arapahoe Road, Englewood, Colorado 80112
President of The Kirchner Company (management consultants).
NED M. STEEL, Trustee; Age 80
3416 South Race Street, Englewood, Colorado 80110
Chartered Property and Casualty Underwriter; Director of Visiting Nurse
Corporation of Colorado; formerly Senior Vice President and a director
of the Van Gilder Insurance Corp. (insurance brokers).
JAMES C. SWAIN, Chairman and Trustee*; Age 61
3410 South Galena Street, Denver, Colorado 80231
President and a Director of the Manager; Vice Chairman and a Director
of OMC; formerly Chairman of the Board of SSI.
MICHAEL A. CARBUTO, Vice President and Portfolio Manager of Tax Exempt
Trust; Age 40
Two World Trade Center, New York, New York 10048-0203
Vice President of the Manager; an officer of other Oppenheimer funds.
DOROTHY WARMACK, Vice President and Portfolio Manager of Money Market
Trust and Government Trust; Age 59
3410 South Galena Street, Denver, Colorado 80231
Vice President of the Manager and OMC; an officer of other Oppenheimer
funds.
_____________________
* A Trustee who is an "interested person" of the Trusts as defined in
the Investment Company Act.
CAROL E. WOLF, Vice President and Portfolio Manager of Money Market
Trust and Government Trust; Age 43
3410 South Galena Street, Denver, Colorado 80231
Vice President of the Manager and OMC; an officer of other Oppenheimer
funds.
ARTHUR J. ZIMMER, Vice President and Portfolio Manager of Money Market
Trust and Government Trust; Age 49
3410 South Galena Street, Denver, Colorado 80231
Vice President of the Manager and OMC; an officer of other Oppenheimer
funds; formerly Vice President of Hanifen Imhoff Management Company
(mutual fund investment advisor).
ANDREW J. DONOHUE, Vice President; Age 45
Two World Trade Center, New York, New York 10048-0203
Executive Vice President and General Counsel of OMC and Oppenheimer
Funds Distributor, Inc. ("OFDI"); an officer of other Oppenheimer
funds; formerly Senior Vice President and Associate General Counsel of
OMC 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 adviser);
director and an officer of First Investors Family of Funds and First
Investors Life Insurance Company.
GEORGE C. BOWEN, Vice President, Secretary and Treasurer; Age 59
3410 South Galena Street Denver, Colorado 80231
Senior Vice President, Treasurer, Assistant Secretary and a director of
the Manager; Vice President and Treasurer of OFDI and HarbourView;
Senior Vice President and Treasurer of OMC; Vice President, Treasurer
and Secretary of SSI and SFSI; an officer of other Oppenheimer funds.
ROBERT BISHOP, Assistant Treasurer; Age 36
3410 South Galena Street, Denver, Colorado 80231
Assistant Vice President of OMC/Mutual Fund Accounting; an officer of
other Oppenheimer funds; formerly a Fund Controller for OMC, 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 FARRAR, Assistant Treasurer; Age 30
3410 South Galena Street, Denver, Colorado 80231
Assistant Vice President of OMC/Mutual Fund Accounting; an officer of
other Oppenheimer funds; formerly a Fund Controller for OMC, 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, before which he was a sales
representative for Central Colorado Planning.
ROBERT G. ZACK, Assistant Secretary; Age 47
Two World Trade Center, New York, New York 10048-0203
Senior Vice President and Associate General Counsel of OMC; Assistant
Secretary of SSI and SFSI; an officer of other Oppenheimer funds.
Remuneration of Trustees and Officers. The officers of the Trusts
(including Messrs. Swain and Fossel) are affiliated with the Manager
and receive no salary or fee from the Trusts. The Trusts have an Audit
and Review Committee, composed of William A. Baker (Chairman), Charles
Conrad, Jr. and Robert M. Kirchner. This Committee meets regularly to
review audit procedures, financial statements and other financial and
operational matters of the Trusts. The Trustees of the Trusts
(including Messrs. Swain and Fossel) received the total amounts shown
below (i) from Money Market Trust, Tax Exempt Trust and Government
Trust, respectively, during the fiscal year ended June 30, 1995, and
(ii) from all 21 of the Denver Oppenheimer funds (including the Trust)
listed in the first paragraph of this section, for services in the
positions shown:
<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 $5,012.74 $2,439 $2,595.32 $53,000.00
Trustee
Wiiliam A. Baker $6,928.62 $3,375 $3,587.28 $73,257.01
Audit and Review
Committee Chairman
and Trustee
Charles Conrad, Jr. $6,459.21 $3,145 $3,344.22 $68,293.67
Audit and Review
Committee Member
and Trustee
Raymond J. Kalinowski $5,012.74 $2,439 $2,595.32 $53,000.00
Trustee
C. Howard Kast $5,012.74 $2,439 $2,595.32 $53,000.00
Trustee
Robert M. Kirchner $6,459.21 $3,145 $3,344.22 $68,293.67
Audit and Review
Committee Member
and Trustee
Ned M. Steel $5,012.74 $2,439 $2,595.32 $53,000.00
Trustee
<FN>
________________________
1 For the 1994 calendar year.
</TABLE>
Major Shareholders. As of October 6, 1995, A.G. Edwards & Sons, Inc.
("A.G. Edwards"), 1 North Jefferson Avenue, St. Louis, MO 63103 was the
record owner of 5,476,779,005.180 shares of Money Market Trust,
1,390,087,350.600 shares of Tax Exempt Trust and 901,979,139.200 shares
of Government Trust (approximately 99.56%, 97.40% and 96.99% 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 OMC, which is a wholly-owned
subsidiary of OAC, a holding company controlled by Massachusetts Mutual
Life Insurance Company. The remaining stock of OAC is owned by: (i)
certain of OMC's directors and officers, some of whom may serve as
officers of the Trusts, and two of whom (Messrs. James C. Swain and Jon
S. Fossel) serve as a Trustee of the Trusts and (ii) A.G. Edwards,
which owns less than 5% of its equity.
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)
$7,254,206, $9,435,959 and $12,657,193 paid for the fiscal years ended
June 30, 1993, 1994 and 1995, respectively, of Money Market Trust; (b)
$4,426,198, $4,761,673 and $5,050,991 paid for the fiscal years ended
June 30, 1993, 1994 and 1995, respectively, of Tax Exempt Trust; and
(c) $3,035,760, $3,182,956 and $3,414,212 paid for the fiscal years
ended June 30, 1993, 1994 and 1995, 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 Agreement with the Money Market Trust and the Government
Trust, 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 at any time.
For the fiscal years ended June 30, 1994, the Manager reimbursed Money
Market Trust for its expenses in the amount of $1,201,403.
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 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 or Tax
Exempt Trust during their respective three most recent fiscal years.
The Agreements permit the Manager to act as investment adviser 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 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 Government Trust,
Centennial America Fund, L.P., Oppenheimer Cash Reserves, Centennial
New York Tax Exempt Trust and Centennial California Tax Exempt Trust.
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.
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 Government 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. Initially, 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 shall 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, 1995, payments to the
Distributor under its Plan totalled $6,674,126, $2,246,219 and
$1,426,765 for Money Market Trust, Tax Exempt Trust and Government
Trust, respectively, of which $43, $13,658 and $31,386 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 nomination if the final
decision on any such selection or nomination is approved by a majority
of the Independent Trustees.
The Glass-Steagall Act and other applicable laws and regulations,
among other things, generally prohibit Federally-chartered or
supervised banks from engaging in the business of underwriting, selling
or distributing securities as principals. Accordingly, the Distributor
may pay banks only for sales made on an agency basis or for the
performance of administrative and shareholder servicing functions.
While the matter is not free from doubt, the Manager believes that such
laws do not preclude a bank from performing the services required of a
Recipient. However, judicial or administrative decisions or
interpretations of such laws, as well as changes in either Federal or
state statutes or regulations relating to the permissible activities of
banks or their subsidiaries or affiliates, could prevent certain
banks from continuing to perform all or a part of these services. If a
bank were so prohibited, shareholders of a Trust who were clients of
such bank would be permitted to remain as shareholders, and if a bank
could no longer provide those service functions, alternate means for
continuing the servicing of such shareholders would be sought. In such
event, shareholders serviced by such bank might no longer be able to
avail themselves of any automatic investment or other services then
being provided by such bank. It is not expected that shareholders
would suffer any adverse financial consequences as a result of any of
those occurrences. The Board of Trustees will consider appropriate
modifications to each Trust's operations, including discontinuance of
payments under the Plan to such institutions, in the event of any
future change in such laws or regulations which may adversely affect
the ability of such institutions to provide these services. In
addition, certain banks and financial institutions may be required to
register as dealers under state law.
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 closse 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.
The Trusts will seek to maintain a net asset value of $1.00 per
share for purchases and redemptions. There can be no assurance that
each Trust will do so. Each Trust operates under Rule 2a-7 under which
a Trust may use the amortized cost method of valuing their shares. The
amortized cost method values a security initially at its cost and
thereafter assumes a constant amortization of any premium or accretion
of any discount, regardless of the impact of fluctuating interest rates
on the market value of the security. This method does not take into
account unrealized capital gains or losses.
Each Trust's Board of Trustees has established procedures intended
to stabilize the Trust's net asset value at $1.00 per share. If a
Trust's net asset value per share were to deviate from $1.00 by more
than 0.5%, Rule 2a-7 requires the Board promptly to consider what
action, if any, should be taken. If the Trustees find that the extent
of any such deviation may result in material dilution or other unfair
effects on shareholders, the Board will take whatever steps it
considers appropriate to eliminate or reduce such dilution or unfair
effects, including, without limitation, selling portfolio securities
prior to maturity, shortening the average portfolio maturity,
withholding or reducing dividends, reducing the outstanding number of
Trust shares without monetary consideration, or calculating net asset
value per share by using available market quotations.
As long as the Trusts use Rule 2a-7, each Trust must abide by
certain conditions described in the Prospectus. Some of those
conditions which relate to portfolio management are that each Trust
must: (i) maintain a dollar-weighted average portfolio maturity not in
excess of 90 days; (ii) limit its investments, including repurchase
agreements, to those instruments which are denominated in U.S. dollars
and which are rated in one of the two highest short-term rating
categories by at least two "nationally-recognized statistical rating
organizations" ("Rating Organizations") as defined in Rule 2a-7, or by
one Rating Organization if only one Rating Organization has rated the
security; an instrument that is not rated must be of comparable quality
as determined by the Manager under guidelines approved by the Board;
and (iii) not purchase any instruments with a remaining maturity of
more than 397 days. The Trust's fundamental investment policy that the
remaining maturity of an instrument shall not exceed one year is more
restrictive than the provisions of Rule 2a-7. Under Rule 2a-7, the
maturity of an instrument is generally considered to be its stated
maturity (or in the case of an instrument called for redemption, the
date on which the redemption payment must be made), with special
exceptions for certain variable rate demand and floating rate
instruments. Repurchase agreements and securities loan agreements are,
in general, treated as having a maturity equal to the period scheduled
until repurchase or return, or if subject to demand, equal to the
notice period.
While the amortized cost method provides certainty in valuation,
there may be periods during which the value of an instrument, as
determined by amortized cost, is higher or lower than the price the
Trust would receive if it sold the instrument. During periods of
declining interest rates, the daily yield on shares of the Trust may
tend to be lower (and net investment income and daily dividends higher)
than a like computation made by a fund with identical investments
utilizing a method of valuation based upon market prices or estimates
of market prices for its portfolio. Thus, if the use of amortized cost
by the Trusts resulted in a lower aggregate portfolio value on a
particular day, a prospective investor in one of the Trusts would be
able to obtain a somewhat higher yield than would result from
investment in a fund utilizing solely market values, and existing
investors in the Trusts would receive less investment income than if
the Trust were priced at market value. Conversely, during periods of
rising interest rates, the daily yield on Trust shares will tend to be
higher and its aggregate value lower than that of a portfolio priced at
market value. A prospective investor would receive a lower yield than
from an investment in a portfolio priced at market value, while
existing investors in the Trust would receive more investment income
than if the Trust were priced at market value.
Redemptions. The Fund's Board of Directors 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 direct 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 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.
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,
1995, the "current yield" for Money Market Trust, Tax Exempt Trust and
Government Trust was 5.41%, 3.51% and 5.30%, respectively. The seven-
day compounded effective yield for that period was 5.55%, 3.57% and
5.43%, 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 C, 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, 1995 was 5.81%. Its tax-
equivalent compounded effective yield for the same period was 5.91% 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 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.
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 must 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 might be 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, which would reduce the amount available for
distribution to shareholders.
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 Distribution 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 Oppenheimer Management Corporation, the Manager's
immediate parent, as well as for certain other funds advised by the
Manager and Oppenheimer Management Corporation.
<PAGE>
INDEPENDENT AUDITORS' REPORT
Centennial Tax Exempt Trust
The Board of Trustees and Shareholders of Centennial Tax Exempt Trust:
We have audited the accompanying statement of assets and liabilities,
including the statement of investments, of Centennial Tax Exempt Trust as of
June 30, 1995, the related statement of operations for the year then ended,
the statements of changes in net assets for the years ended June 30, 1995 and
1994, and the financial highlights for the period January 1, 1985 to June 30,
1995. 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, 1995 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 Tax
Exempt Trust at June 30, 1995, the results of its operations, the changes in
its net assets, and the financial highlights for the respective stated
periods, in conformity with generally accepted accounting principles.
DELOITTE & TOUCHE LLP
Denver, Colorado
July 24, 1995
<PAGE>
STATEMENT OF INVESTMENTS June 30, 1995
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Amortized Cost
Amount See Note 1
---------- ---------------
<S> <C> <C>
SHORT-TERM TAX-EXEMPT OBLIGATIONS--103.3%
ALABAMA--0.4%
Bessemer, Alabama Industrial Development Revenue Bonds, Big B,
Inc. Project, Series A, 4.25% (1) $ 3,150,000 $ 3,150,000
Winfield City, Alabama Industrial Development Revenue Bonds,
Union Underwear Co., 4.25% (1) 1,900,000 1,900,000
-------------
5,050,000
-------------
ALASKA--0.3%
Alaska Industrial Development Authority Revenue Bonds, Providence Medical
Office Building, 3.65% (1) 3,880,000 3,880,000
-------------
ARIZONA--2.3%
Maricopa County, Arizona Industrial Development Authority Revenue Bonds, Grand
Canyon University Project, 4.20% (1) 5,500,000 5,500,000
Phoenix, Arizona Industrial Development Authority Multifamily Housing Revenue
Refunding Bonds, Paradise Lakes Apts. Project, 1995 Series, 3.40% (2) 18,000,000 18,000,000
Pima County, Arizona Industrial Development Authority Revenue Bonds, Tucson
Electric Power Project, Series 1983-A, 3.95% (1) 6,300,000 6,300,000
-------------
29,800,000
-------------
ARKANSAS--0.4%
Harrison, Arkansas Industrial Development Revenue Refunding Bonds, McKesson
Corp. Project, 4.15% (1) 3,940,000 3,940,000
Jonesboro, Arkansas Industrial Development Revenue Bonds, Farr Co. Project,
4.25% (1) 645,000 645,000
Subiaco, Arkansas Industrial Development Revenue Bonds, Cloves Gear & Products,
Inc., 4.35% (1) 550,000 550,000
-------------
5,135,000
-------------
CALIFORNIA--7.2%
California Health Facilities Financing Authority Revenue Bonds, Adventist
Health System, Series B, 3.80% (1) 1,000,000 1,000,000
California Health Facilities Financing Authority Revenue Bonds, Kaiser
Permanente Medical Center Project, Series B, 3.90% (1) 3,000,000 3,000,000
California Health Facilities Financing Authority Revenue Refunding Bonds,
Memorial Health Services Project, 4% (1) 1,200,000 1,200,000
California Health Facilities Financing Revenue Bonds, Huntington Memorial
Hospital, 3.75% (1) 1,900,000 1,900,000
California Health Facilities Financing Revenue Bonds, Pooled Loan Program,
Series B, FGIC Insured, 4.05% (1) 500,000 500,000
California Health Facilities Financing Revenue Bonds, Santa Barbara Cottage
Project, Series C, 3.80% (1) 6,300,000 6,300,000
</TABLE>
2
<PAGE>
STATEMENT OF INVESTMENTS (Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Amortized Cost
Amount See Note 1
---------- ---------------
<S> <C> <C>
SHORT-TERM TAX-EXEMPT OBLIGATIONS (CONTINUED)
CALIFORNIA (CONTINUED)
California Health Facilities Financing Revenue Bonds, Scripps Memorial
Hospital, Series A, MBIA Insured, 4.05% (1) $ 500,000 $ 500,000
California Higher Education Loan Authority Student Loan Revenue Refunding
Bonds, Series 1987A, 4.35%, 5/1/96 (3) 13,750,000 13,750,804
California Higher Education Loan Authority Student Loan Revenue Refunding
Bonds, Series 1992A-2, 4.35%, 5/1/96 (3) 14,000,000 14,000,819
California Housing Finance Agency Home Mtg. Revenue Bonds, Series 1995-E, FGIC
Insured, 4.60%, 2/1/96 (3) 4,000,000 4,000,000
California Pollution Control Financing Authority Revenue Bonds, Chevron USA,
Inc. Project, 4.50%, 5/15/96 (3) 1,800,000 1,803,797
California Pollution Control Financing Authority Solid Waste Disposal Revenue
Bonds, Western Waste Industries, Series A, 4.25% (1) 3,000,000 3,000,000
California State General Obligation Bonds, Series A-3, MBIA Insured, 4.35% (1) 500,000 500,000
California State Revenue Anticipation Wts., Series C, FGIC Insured, 5.75%,
4/25/96 400,000 403,869
California Statewide Communities Development Authority Apt. Development Revenue
Refunding Bonds, Series 1995A, 3.75% (1) 1,560,000 1,560,000
Fairfield, California Industrial Development Authority Revenue Bonds, Herman G.
Rowland, 4.182% (1) 950,000 950,000
Huntington Park, California Redevelopment Agency Multifamily Housing Revenue
Bonds, Casa Rita Apts., Series A, 4.30% (1) 1,500,000 1,500,000
Kern County, California Union High School District Certificates of
Participation, Finance Project, 3.85% (1) 1,500,000 1,500,000
Los Angeles County, California Housing Authority Revenue Bonds, Park Sierra
Project, 4.05% (1) 2,000,000 2,000,000
Los Angeles County, California Metropolitan Transportation Authority Revenue
Anticipation Nts., Series 1995A, Swiss Bank Letter of Credit, 5%, 4/25/96 12,000,000 12,072,352
Oceanside, California Multifamily Revenue Bonds, Lakeridge Apts. Project, CCSB
Insured, 4.30% (1) 10,000,000 10,000,000
Ontario, California Multifamily Residential Mtg. Revenue Bonds, Park Centre
Project, Series A, 3.80% (1) 2,300,000 2,300,000
Orange County, California Apt. Development Revenue Refunding Bonds,
Series A, 4.05% (1) 1,000,000 1,000,000
Orange County, California Municipal Water District Refunding Certificates of
Participation, Allen McColloch Project, Series A, 4.45% (1) 1,000,000 1,000,000
Pittsburg, California Mtg. Obligation Gtd. Revenue Bonds, Series A, 4.30% (1) 3,300,000 3,300,000
San Bernardino County, California Housing Authority Multifamily Housing Revenue
Refunding Bonds, Arrowview Park Apts. Project, Series A, Federal Home Loan
Bank Letter of Credit, 4.55% (1) 1,400,000 1,400,000
San Bernardino County, California Multifamily Housing Authority Revenue
Refunding Bonds, Monterey Villas Apts. Project, Series A, 4.25% (1) 600,000 600,000
</TABLE>
3
<PAGE>
STATEMENT OF INVESTMENTS (Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Amortized Cost
Amount See Note 1
---------- ---------------
<S> <C> <C>
SHORT-TERM TAX-EXEMPT OBLIGATIONS (CONTINUED)
CALIFORNIA (CONTINUED)
San Diego County, California Regional Transportation Commission Second Senior
Sales Tax Revenue Bonds, Series A, FGIC Insured, 4.75%, 4/1/96 $ 800,000 $ 804,407
San Francisco, California City & County Redevelopment Agency Multifamily
Revenue Refunding Bonds, Fillmore Center Housing Project,
Series A-1, 3.90% (1) 500,000 500,000
Southern California Public Power Authority Sub. Revenue Refunding Bonds,
Southern Transmission Project, AMBAC Insured, 3.90% (1) 2,000,000 2,000,000
Visalia, California Certificates of Participation, Visalia Convention Center
Expansion Project, 4.70% (1) 400,000 400,000
-------------
94,746,048
-------------
COLORADO--5.9%
Arapahoe County, Colorado Capital Improvement Trust Fund Highway Revenue Bonds,
E-470 Project, Series E, 4.45%, 8/31/95 (3) 20,000,000 20,001,447
Arapahoe County, Colorado Capital Improvement Trust Fund Highway Revenue Bonds,
E-470 Project, Series G, 4.45%, 8/31/95 (3) 5,015,000 5,015,000
Arapahoe County, Colorado Multifamily Revenue Refunding Bonds, Hunters Run
Rental Housing, 4.30% (1) 25,600,000 25,600,000
Aurora, Colorado Industrial Development Revenue Refunding Bonds, La Quinta
Motor Inns, 4.25% (1) 3,000,000 3,000,000
Colorado Health Facilities Authority Revenue Bonds, Sisters of Charity Project,
Series S, 4.20% (1) 4,400,000 4,400,000
Westminster, Colorado Multifamily Revenue Bonds, Wexford Station Apts., Series
A, CCSB Insured, 4.875%, 12/1/95 (3) 17,095,000 17,095,000
Wheat Ridge, Colorado Industrial Development Revenue Refunding Bonds, La Quinta
Motor Inns, 4.25% (1) 2,275,000 2,275,000
-------------
77,386,447
-------------
CONNECTICUT--0.5%
Connecticut State Special Assessment Unemployment Compensation Advance Funding
Revenue Bonds, Series B, 4.20% (1)(2) 6,100,000 6,100,000
-------------
DELAWARE--0.5%
Sussex County, Delaware Economic Development Revenue Bonds, Route 113 LP
Project, 3.95% (1) 6,000,000 6,000,000
-------------
FLORIDA--7.3%
Dade County, Florida Industrial Development Authority Pollution Control Revenue
Refunding Bonds, Florida Power & Light Co. Project, 4.30% (1) 2,235,000 2,235,000
Dade County, Florida School District General Obligation Bonds, Series A, 4.25%
(1) 2,000,000 2,000,000
Dade County, Florida School District General Obligation Bonds, Series B, 4.25%
(1) 2,000,000 2,000,000
</TABLE>
4
<PAGE>
STATEMENT OF INVESTMENTS (Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Amortized Cost
Amount See Note 1
---------- ---------------
<S> <C> <C>
SHORT-TERM TAX-EXEMPT OBLIGATIONS (CONTINUED)
FLORIDA (CONTINUED)
Dade County, Florida School District General Obligation School Improvement
Bonds, FGIC Insured, 7%, 8/1/95 $ 2,000,000 $ 2,004,588
Dade County, Florida Water & Sewer System Revenue Bonds, FGIC Insured,
4.20% (1) 14,400,000 14,400,000
Escambia County, Florida Health Facilities Authority Revenue Refunding Bonds,
Florida Convertible Centers Project, Series A, 4.05% (1) 1,400,000 1,400,000
Florida State Board of Education Public Education Capital Outlay Refunding
Bonds, Series A, 4.188% (1) 13,230,000 13,230,000
Hillsborough County, Florida Industrial Development Authority Pollution Control
Revenue Bonds, Tampa Electric Co. Project, 5.40% (1) 17,975,000 17,975,000
Jacksonville, Florida Electric Authority Revenue Refunding Bonds, St. John's
River Power Park System Project, Series 11, 5%, 10/1/95 2,575,000 2,583,137
Jacksonville, Florida Pollution Control Revenue Bonds, Florida Power & Light
Co. Project, 4.05%, 12/4/95 (3) 5,000,000 5,000,000
Jacksonville, Florida Pollution Control Revenue Refunding Bonds, Florida Power
& Light Co. Project, 4.05%, 12/4/95 (3) 10,510,000 10,510,000
Orange County, Florida Housing Finance Authority Revenue Refunding Bonds,
Monterey Multifamily Housing Project, Series B, 4.30% (1) 4,965,000 4,965,000
Putnam County, Florida Development Authority Pollution Control Revenue Bonds,
National Rural Utilities-Seminole Electric Project, Series H-4, 4.30%,
9/15/95 (3) 10,000,000 10,000,000
Putnam County, Florida Development Authority Pollution Control Revenue
Refunding Bonds, Seminole Electric Co-op, Series D, 3.40%, 12/15/95 (3) 8,565,000 8,565,000
-------------
96,867,725
-------------
GEORGIA--3.9%
Burke County, Georgia Development Authority Pollution Control Revenue Bonds,
Oglethorpe Power Corp., Series A, 3.652% (1) 27,940,000 27,940,000
De Kalb County, Georgia Housing Authority Apts. Development Revenue Refunding
Bonds, Winter Peachtree Project, 4.30% (1) 5,000,000 5,000,000
Floyd County, Georgia Development Authority Pollution Control Revenue Refunding
Bonds, Inland-Rome, Inc. Project, 4.35% (1) 4,735,000 4,735,000
Georgia State General Obligation Bonds, Series 1995B, 4.30% (1) 12,000,000 12,000,000
Newton County, Georgia Industrial Development Authority Revenue Refunding
Bonds, John H. Harland Co. Project, 4.20% (1) 1,000,000 1,000,000
-------------
50,675,000
-------------
HAWAII--0.2%
Hawaii State Department of Budget & Finance Special Purpose Mtg. Revenue Bonds,
Kuakini Medical Center Project, FGIC Insured, 4% (1) 2,900,000 2,900,000
-----------
</TABLE>
5
<PAGE>
STATEMENT OF INVESTMENTS (Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Amortized Cost
Amount See Note 1
---------- ---------------
<S> <C> <C>
SHORT-TERM TAX-EXEMPT OBLIGATIONS (CONTINUED)
ILLINOIS--10.8%
Centralia City, Illinois Industrial Development Revenue Bonds, Consolidated
Foods Corp./Hollywood Brands, Inc., 4.15% (1) $ 5,500,000 $ 5,500,000
Chicago, Illinois General Obligation Tender Nts., Series A, 4.60%, 10/31/95
(3) 15,300,000 15,300,000
Elk Grove Village, Illinois Industrial Development Revenue Bonds, La Quinta
Motor Inns, Inc., 3.95% (1) 3,700,000 3,700,000
Illinois Development Finance Authority Pollution Control Revenue Bonds, Diamond
Star Motors Co. Project, 4.60% (1) 12,700,000 12,700,000
Illinois Development Finance Authority Pollution Control Revenue Bonds,
Illinois Power Co. Project, Series C, 3.90%, 8/3/95 (3) 4,000,000 4,000,000
Illinois Development Finance Authority Revenue Bonds, Latin School of Chicago
Project, 3.60% (1) 9,000,000 9,000,000
Illinois Educational Facilities Authority Revenue Bonds, National-Louis
University, 4.05% (1) 6,500,000 6,500,000
Illinois Health Facilities Authority Revenue Bonds, Lake Forest Hospital
Project, 4.50% (1) 13,000,000 13,000,000
Lakemoor Village, Illinois Multifamily Housing Mtg. Revenue Bonds, Lakemoor
Apts. Project, 5%, 3/1/96 (3) 4,832,000 4,832,000
Lakemoor Village, Illinois Multifamily Housing Mtg. Revenue Bonds, Lakemoor
Apts. Project, 5.25%, 3/1/96 (3) 15,000,000 15,000,000
Oakbrook Terrace, Illinois Multifamily Housing Mtg. Revenue Bonds, 5.25%,
3/1/96 (3) 35,000,000 35,033,652
Oakbrook Terrace, Illinois Multifamily Housing Mtg. Revenue Bonds, Renaissance
Project, Series 1985A, 4.75%, 4/1/96 (3) 14,000,000 14,000,000
West Chicago, Illinois Industrial Development Revenue Refunding Bonds, Liquid
Container Project, 4.25% (1) 3,810,000 3,810,000
-------------
142,375,652
-------------
INDIANA--4.1%
Crawfordsville, Indiana Economic Development Revenue Refunding Bonds, Pedcor
Investments-Shady Knoll I Apts. Project, 4.30% (1) 3,475,000 3,475,000
Gary, Indiana Industrial Environmental Improvement Revenue Bonds, U.S. Steel
Corp. Project, 3.60% (1) 1,000,000 1,000,000
Hobart, Indiana Economic Development Revenue Refunding Bonds, MMM Invest, Inc.
Project, 4.20% (1) 2,220,000 2,220,000
Indiana Bond Bank, Advance Funding Program Nts., Series A-2, 5.75%, 1/10/96 12,530,000 12,577,218
Indiana Health Facilities Finance Authority Revenue Bonds, Cardinal Center
Project, 4.313% (1) 3,000,000 3,000,000
Indiana State Development Finance Authority Economic Development Revenue Bonds,
Saroyan Hardwoods, Inc., 4.35% (1) 2,300,000 2,300,000
</TABLE>
6
<PAGE>
STATEMENT OF INVESTMENTS (Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Amortized Cost
Amount See Note 1
---------- ---------------
<S> <C> <C>
SHORT-TERM TAX-EXEMPT OBLIGATIONS (CONTINUED)
INDIANA (CONTINUED)
Indianapolis, Indiana Local Public Improvement Bond Bank Nts., Series F, 5.25%,
7/14/95 $18,850,000 $18,852,606
Indianapolis, Indiana Local Public Improvement Bond Bank Nts., Series G, 5.25%,
7/14/95 2,675,000 2,675,370
Marion County, Indiana Hospital Authority Hospital Facility Revenue Bonds,
Indianapolis Osteopathic, 4.313% (1) 4,100,000 4,100,000
St. Joseph County, Indiana Hospital Authority Special Obligation Bonds, Madison
Center, Inc. Project, 4.41% (1) 3,000,000 3,000,000
St. Joseph County, Indiana Industrial Educational Facilities Revenue Bonds,
Holy Cross College, 4.20% (1) 1,000,000 1,000,000
-------------
54,200,194
-------------
IOWA--1.8%
Des Moines, Iowa Commercial Development Revenue Bonds, Series A, 4.10% ((1)) 6,900,000 6,900,000
Iowa School Corp. Warrant Certificates, Series B, CGIC Insured, 5.75%, 2/1/96 15,000,000 15,107,100
Mason City, Iowa Industrial Development Revenue Bonds, SuperValu Stores, Inc.
Project, 4.30% (1) 2,000,000 2,000,000
-------------
24,007,100
-------------
KANSAS--0.6%
Kansas City, Kansas Private Activity Revenue Refunding Bonds, Inland Container
Corp., 4.35% (1) 5,200,000 5,200,000
Olathe, Kansas Industrial Revenue Refunding Bonds, William F. Bieber Project,
5.60% (1) 1,925,000 1,925,000
Ottawa, Kansas Industrial Development Revenue Bonds, Laich Industries Project,
4.35% (1) 800,000 800,000
-------------
7,925,000
-------------
KENTUCKY--0.1%
Jamestown, Kentucky Industrial Building Revenue Bonds, Union Underwear Co.,
4.25% (1) 1,000,000 1,000,000
-------------
LOUISIANA--0.2%
East Baton Rouge Parish, Louisiana Industrial Development Board Revenue
Refunding Bonds, La Quinta Motor Inns, Inc., 4.25% (1) 2,625,000 2,625,000
-------------
MARYLAND--4.1%
Hartford County, Maryland Revenue Refunding Bonds, 1001 Participation Facility
Project, 3.95% (1) 2,850,000 2,850,000
Maryland State Health & Higher Educational Facilities Authority Revenue Bonds,
Carroll General Pooled Loan Program, Series A, 4.20% (1) 1,555,000 1,555,000
</TABLE>
7
<PAGE>
STATEMENT OF INVESTMENTS (Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Amortized Cost
Amount See Note 1
---------- ---------------
<S> <C> <C>
SHORT-TERM TAX-EXEMPT OBLIGATIONS (CONTINUED)
MARYLAND (CONTINUED)
Maryland State Health & Higher Educational Facilities Authority Revenue Bonds,
University of Maryland Pooled Loan Program, Series B, 3.95% (1) $ 1,285,000 $ 1,285,000
Montgomery County, Maryland Consolidated Public Improvement General Obligation
Bonds, Series A, 5.20%, 10/1/95 5,000,000 5,005,000
Montgomery County, Maryland Multifamily Housing Opportunities Commission
Revenue Bonds, Grosvenor House Project, Series A, 3.95% (1) 19,700,000 19,700,000
Montgomery County, Maryland Multifamily Housing Opportunities Commission
Revenue Bonds, Issue A, 4.15% (1) 15,800,000 15,800,000
Worcester County, Maryland Revenue Refunding Bonds, White Marlin Mall Project,
3.95% (1) 8,250,000 8,250,000
-------------
54,445,000
-------------
MASSACHUSETTS--2.7%
Massachusetts Bay Transportation Authority Tax-Exempt Commercial Paper, 3.50%,
9/8/95 (3) 12,000,000 12,000,000
Massachusetts State Commonwealth General Obligation Bonds, Series C, 4.056% (1) 15,400,000 15,400,000
Massachusetts State Housing Finance Agency Single Family Housing Revenue Bonds,
Series 34, FGIC Insured, 4.15%, 6/1/96 (3) 2,750,000 2,750,000
Massachusetts State Housing Finance Agency Single Family Housing Revenue Bonds,
Series 35, FGIC Insured, 4.10%, 6/1/96 (3) 5,000,000 5,000,000
Massachusetts State Industrial Finance Agency Revenue Bonds, Hazen Paper, 4.48%
(1) 400,000 400,000
North Andover Town, Massachusetts Industrial Revenue Bonds, Atlee-Oak Realty
Trust of Delaware, Inc., 4.48% (1) 450,000 450,000
-------------
36,000,000
-------------
MICHIGAN--4.8%
Madison Heights, Michigan Economic Development Revenue Bonds, Red Roof Inns
Project, 4.15% (1) 1,000,000 1,000,000
Michigan State Full Faith & Credit General Obligation Nts., 5%, 9/29/95 60,000,000 60,130,222
Michigan State Job Development Authority Revenue Bonds, East Lansing Residence
Associates Project, 4% (1) 1,900,000 1,900,000
-------------
63,030,222
-------------
MINNESOTA--4.6%
Anoka, Minnesota Multifamily Housing Revenue Bonds, Walker Plaza, Series B,
4.10% (1) 1,950,000 1,950,000
Austin, Minnesota Industrial Development Revenue Refunding Bonds, SuperValu
Stores, Inc. Project, 4.30% (1) 4,600,000 4,600,000
Bloomington, Minnesota Port Authority Tax Revenue Refunding Bonds, Mall of
America Project, Series C, FSA Insured, 4.15% (1) 8,300,000 8,300,000
</TABLE>
8
<PAGE>
STATEMENT OF INVESTMENTS (Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Amortized Cost
Amount See Note 1
---------- ---------------
<S> <C> <C>
SHORT-TERM TAX-EXEMPT OBLIGATIONS (CONTINUED)
MINNESOTA (CONTINUED)
Burnsville, Minnesota Commercial Development Revenue Bonds, SuperValu Stores,
Inc. Project, Series 83, 4.30% (1) $5,500,000 $ 5,500,000
Dakota County, Minnesota Housing & Redevelopment Multifamily Mtg. Revenue
Bonds, Westwood Ridge Rental Housing Project, Series A, 4.10% (1) 2,500,000 2,500,000
Eden Prairie, Minnesota Commercial Development Revenue Refunding Bonds,
Lakeview Business Center, 4.10% (1) 1,200,000 1,200,000
Eden Prairie, Minnesota Industrial Development Revenue Bonds, SuperValu Stores,
Inc. Project, 4.30% (1) 1,000,000 1,000,000
Maplewood, Minnesota Revenue Bonds, 5.58% (1) 1,145,000 1,145,000
Minneapolis, Minnesota Commercial Development Revenue Refunding
Bonds, Minnehaha/Lake Partners Project, 4.15% (1) 2,750,000 2,750,000
Minneapolis, Minnesota Housing Development Revenue Refunding Bonds, One Ten
Grant Project, 3.645% (1) 3,000,000 3,000,000
New Ulm, Minnesota Hospital Facilities Revenue Bonds, Health Center Systems,
4.25% (1) 2,500,000 2,500,000
North Suburban Hospital District, Minnesota Revenue Bonds, Anoka & Ramsey
Counties Hospital Health Center, 4.25% (1) 3,400,000 3,400,000
Southern Minnesota Municipal Power Agency Power Supply Systems Revenue Bonds,
Prerefunded, Series A, 9.50%, 1/1/96 (3) 1,700,000 1,775,767
St. Paul, Minnesota Port Authority Parking Revenue Refunding Bonds, City
Walking Ramp Project, 4.10%, (1) 2,410,000 2,410,000
St. Paul, Minnesota Port Authority Tax Increment Revenue Bonds, Westgate Office
& Industrial Center Project, 4.10% (1) 5,500,000 5,500,000
Stillwater, Minnesota Industrial Development Revenue Refunding Bonds, SuperValu
Stores, Inc. Project, 4.30% (1) 5,500,000 5,500,000
Western Minnesota Municipal Power Agency Revenue Refunding Bonds, Prerefunded,
Series 1985A, 9.50%, 1/1/96 (3) 7,000,000 7,310,178
-------------
60,340,945
-------------
MISSOURI--0.5%
St. Charles County, Missouri Industrial Development Revenue Refunding Bonds,
Remington Apts. Project, 4.30% (1) 6,300,000 6,300,000
-------------
MONTANA--0.1%
Great Falls, Montana Industrial Development Revenue Refunding Bonds, SuperValu
Stores, Inc. Project, 4.30% (1) 1,000,000 1,000,000
-------------
NEBRASKA--0.6%
Nebraska Investment Finance Authority Single Family Mtg. Revenue Refunding
Bonds, GNMA Mtg. Series B, FGIC Insured, 4.75%, 7/15/95 (3) 4,765,000 4,765,000
</TABLE>
9
<PAGE>
STATEMENT OF INVESTMENTS (Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Amortized Cost
Amount See Note 1
---------- ---------------
<S> <C> <C>
SHORT-TERM TAX-EXEMPT OBLIGATIONS (CONTINUED)
NEBRASKA (CONTINUED)
Norfolk, Nebraska Industrial Development Revenue Refunding Bonds, SuperValu
Stores, Inc. Project, 4.30% (1) $ 2,800,000 $ 2,800,000
-------------
7,565,000
-------------
NEVADA--1.9%
Nevada State General Obligation Bonds, Colorado River Commission, 3.85% (1) 25,000,000 25,000,000
-------------
NEW JERSEY--0.7%
New Jersey Economic Development Authority Manufacturing Facilities Revenue
Bonds, VPR Commerce Center Project, 4.20% (1) 3,750,000 3,750,000
New Jersey State General Obligation Revenue Refunding Bonds, 7.90%, 8/1/95 5,000,000 5,013,189
-------------
8,763,189
-------------
NEW MEXICO--0.8%
Albuquerque, New Mexico Airport Revenue Refunding Bonds, Sub. Lien, AMBAC
Insured, 2.55% (1) 11,000,000 11,000,000
-------------
NEW YORK--3.3%
Albany County, New York General Obligation Revenue Refunding Bonds, South Mall
Construction Project, Series A, FGIC Insured, 4.30%, 4/1/96 1,000,000 1,001,490
Babylon, New York General Obligation Bonds, Series B, AMBAC Insured, 3.95% (1) 700,000 700,000
City of New York Development Corp. Mtg. Revenue Bonds, Columbus Multi-
family Project, Series A, 4% (1) 2,700,000 2,700,000
City of New York Housing Development Corp. Mtg. Revenue Bonds, East 96th Street
Project, Series A, 3.75% (1) 400,000 400,000
City of New York Housing Development Corp. Mtg. Revenue Bonds, Multifamily-
James Tower Development, Series A, 3.85% (1) 3,000,000 3,000,000
City of New York Trust Cultural Resources Revenue Refunding Bonds, American
Museum of Natural History, Series A, MBIA Insured, 3.95% (1) 2,400,000 2,400,000
City of New York Trust Cultural Resources Revenue Refunding Bonds, American
Museum of Natural History, Series B, MBIA Insured, 3.95% (1) 900,000 900,000
Erie County, New York General Obligation Revenue Anticipation Nts., 4.75%,
8/15/95 1,800,000 1,799,938
Erie County, New York Water Authority Revenue Bonds, Series A, AMBAC Insured,
4% (1) 1,000,000 1,000,000
New York State Environmental Facilities Corp. Solid Waste Disposal Revenue
Refunding Bonds, General Electric Co. Project, Series A, 3.95%, 9/8/95 (3) 800,000 800,000
New York State Job Development Authority Gtd. Revenue Bonds, 1984 Series E-1 to
E-55, 3.60% (1) 355,000 355,000
</TABLE>
10
<PAGE>
STATEMENT OF INVESTMENTS (Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Amortized Cost
Amount See Note 1
---------- ---------------
<S> <C> <C>
SHORT-TERM TAX-EXEMPT OBLIGATIONS (CONTINUED)
NEW YORK (CONTINUED)
New York State Job Development Authority Gtd. Revenue Bonds, 1984 Series F-1 to
F-17, 3.60% (1) $ 160,000 $ 160,000
New York State Job Development Authority Gtd. Revenue Bonds, Series C-1 to
C-30, 4.60% (1) 895,000 895,000
New York State Job Development Authority Gtd. Revenue Bonds, Special Purpose,
Series C-1, 3.70% (1) 815,000 815,000
New York State Local Government Assistance Corp. Revenue Bonds, Series A,
3.70% (1) 700,000 700,000
New York State Medical Care Facilities Finance Agency Revenue Bonds, Mt. Sinai
Hospital Project, Prerefunded, Series C, FHA Insured, 8.875%, 1/15/96 (3) 3,000,000 3,131,324
New York State Medical Care Facilities Finance Agency Revenue Bonds, St. Mary's
Hospital-Private Insurance Program, Prerefunded, AMBAC Insured, 8.375%,
11/1/95 (3) 3,300,000 3,401,546
New York State Urban Development Corp. Correctional Facilities Revenue Bonds,
Prerefunded, Series B, 8%, 1/1/96 (3) 8,300,000 8,609,396
New York State Urban Development Corp. Revenue Refunding Bonds, Prerefunded,
8%, 1/1/96 (3) 6,500,000 6,723,139
North Hempstead, New York Solid Waste Management Authority Revenue Refunding
Bonds, Series A, 3.75% (1) 700,000 700,000
Suffolk County, New York Industrial Development Agency Revenue Bonds,
Nissequogue Cogen Partners Project, 4.30% (1) 700,000 700,000
Triborough Bridge & Tunnel Authority of New York Revenue Bonds, FGIC Insured,
3.75% (1) 2,000,000 2,000,000
-------------
42,891,833
-------------
NORTH CAROLINA--0.9%
North Carolina National Bank Pooled Tax-Exempt Trust Certificates of
Participation, Series 1990A, 4.50% (1) 8,080,000 8,080,000
North Carolina National Bank Pooled Tax-Exempt Trust Certificates of
Participation, Series 1990B, 4.50% (1) 4,500,000 4,500,000
-------------
12,580,000
-------------
NORTH DAKOTA--0.2%
Bismarck, North Dakota Industrial Development Revenue Bonds, SuperValu Stores,
Inc. Project, 4.30% (1) 1,500,000 1,500,000
Bismarck, North Dakota Industrial Development Revenue Refunding Bonds,
SuperValu Stores, Inc. Project, 4.30% (1) 800,000 800,000
-------------
2,300,000
-------------
OHIO--5.4%
Cuyahoga County, Ohio Industrial Development Revenue Bonds, Southwest LP,
4.70%, 12/1/95 (3) 500,000 500,000
</TABLE>
11
<PAGE>
STATEMENT OF INVESTMENTS (Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Amortized Cost
Amount See Note 1
---------- ---------------
<S> <C> <C>
SHORT-TERM TAX-EXEMPT OBLIGATIONS (CONTINUED)
OHIO (CONTINUED)
Gallia County, Ohio Industrial Development Mtg. Revenue Refunding Bonds,
Jackson Pike Assn., 3.85%, 12/15/95 (3) $ 1,750,000 $ 1,750,000
Greene County, Ohio Industrial Development Revenue Refunding Bonds, SuperValu
Holdings, Inc. Project, 4.30% (1) 1,000,000 1,000,000
Licking County, Ohio Industrial Development Revenue Bonds, Power Industries,
Inc. Project, 4.20%, 12/1/95 (3) 315,000 315,000
Lucas County, Ohio Industrial Development Revenue Refunding Bonds, H.H. Motel,
Inc. Project, 4.20% (1) 3,905,000 3,905,000
Marion County, Ohio Hospital Revenue Bonds, Pooled Lease Program, 4.20% (1) 6,960,000 6,960,000
Marion County, Ohio Hospital Revenue Bonds, Pooled Lease Program, 4.25%,
11/1/95 (3) 9,150,000 9,150,000
Miami Valley, Ohio Tax-Exempt Mtg. Trust Revenue Bonds, Series 86, 4.88%,
10/15/95 (3) 2,835,000 2,835,000
Ohio State Air Quality Development Authority Pollution Control Revenue
Refunding Bonds, Series B, 4.95%, 10/4/95 (3) 4,655,000 4,655,000
Ohio State Water Development Authority Pollution Control Facilities Revenue
Refunding Bonds, Duquesne Light Co., Series A, 4.95%, 10/4/95 (3) 33,955,000 33,955,000
Scioto County, Ohio Health Care Facilities Revenue Bonds, Hill View Retirement
Center, 4.20%, 12/1/95 (3) 2,895,000 2,895,000
Warren County, Ohio Industrial Development Revenue Refunding Bonds, Liquid
Container Project, 4.25% (1) 1,670,000 1,670,000
Whitehall, Ohio Industrial Development Revenue Refunding Bonds, First Mtg.
Continental Commercial, 4.70%, 8/1/95 (3) 1,590,000 1,590,000
-------------
71,180,000
-------------
OKLAHOMA--0.9%
Claremore, Oklahoma Industrial & Redevelopment Authority Revenue Refunding
Bonds, Worthington Cylinder Project, 4.25% (1) 2,370,000 2,370,000
Cleveland County, Oklahoma Public Facilities Revenue Bonds, Hunt Development
Project, Series A, 4.55% (1) 1,000,000 1,000,000
Mid-West Tax-Exempt Mtg. Board Trust Revenue Bonds, 3.85% (1) 1,635,000 1,635,000
Tulsa, Oklahoma Industrial Authority Revenue Bonds, 4.15% (1) 6,500,000 6,500,000
-------------
11,505,000
-------------
OREGON--2.2%
Clackamas County, Oregon Hospital Facility Authority Revenue Bonds, Kaiser
Permanente Medical Center Project, 4.20%, 10/1/95 (3) 2,300,000 2,300,000
Hillsboro, Oregon Revenue Bonds, Oregon Graduate Institute, 4.20% (1) 7,000,000 7,000,000
Klamath Falls, Oregon Electric Revenue Bonds, Salt Caves Hydroelectric Project,
Series D, 4.40%, 5/1/96(3) 16,000,000 16,000,000
</TABLE>
12
<PAGE>
STATEMENT OF INVESTMENTS (Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Amortized Cost
Amount See Note 1
---------- ---------------
<S> <C> <C>
SHORT-TERM TAX-EXEMPT OBLIGATIONS (CONTINUED)
OREGON (CONTINUED)
Oregon State Economic & Industrial Development Commission Revenue Bonds,
Eagel-Picher Industries Project, 4.80% (1) $ 3,600,000 $ 3,600,000
-------------
28,900,000
-------------
PENNSYLVANIA--1.2%
Commonwealth of Pennsylvania Tax-Exempt Mtg. Bond Trust Certificates, Series A,
4.50%, 11/1/95 (3) 3,470,000 3,470,000
Littlestown, Pennsylvania Industrial Development Authority Revenue Refunding
Bonds, Hanover House Industries Project, 4.20% (1) 3,000,000 3,000,000
Montgomery County, Pennsylvania Industrial Development Authority Revenue Bonds,
Quaker Chemical Corp. Project, 3.90% (1) 1,600,000 1,600,000
Philadelphia, Pennsylvania Authority for Industrial Development Revenue Bonds,
Commercial Development, 1100 Walnut St. Assn., 3.90% (1) 7,400,000 7,400,000
-------------
15,470,000
-------------
SOUTH CAROLINA--2.0%
Charleston Center Tax-Exempt Bonds, Grantor Trust No. 2, 4.30%, 11/1/95 (3) 4,407,500 4,407,500
Charleston Center Tax-Exempt Bonds, Grantor Trust No. 3, 4.80%, 7/1/95 (3) 9,452,500 9,452,500
Charleston Center Tax-Exempt Bonds, Grantor Trust No. 6, 4.35%, 10/1/95 (3) 8,075,000 8,075,000
Dorchester County, South Carolina Pollution Control Facilities Revenue
Refunding Bonds, The BOC Group, Inc. Project, 4.15% (1) 3,500,000 3,500,000
South Carolina Jobs & Economic Development Authority Revenue Bonds, Wellman
Income Project, 4.25% (1) 1,000,000 1,000,000
-------------
26,435,000
-------------
SOUTH DAKOTA--2.7%
Grant County, South Dakota Pollution Control Revenue Refunding Bonds, Otter
Tail Power Co. Project, 4.15% (1) 10,400,000 10,400,000
South Dakota State Health & Educational Bonds, Sioux Valley Hospital
Issue, 4.15% (1) 20,600,000 20,600,000
Watertown, South Dakota Industrial Development Revenue Bonds, SuperValu Stores,
Inc. Project, 4.30% (1) 3,900,000 3,900,000
-------------
34,900,000
-------------
TENNESSEE--2.4%
Clarksville, Tennessee Public Building Authority Revenue Bonds, Pooled
Financing-Tennessee Municipal Bond Fund, 4.20% (1) 12,000,000 12,000,000
Covington, Tennessee Industrial Development Board, Charms Co. Project, 4.10%
(1) 4,100,000 4,100,000
Dayton, Tennessee Industrial Development Board Revenue Refunding Bonds,
La-Z Boy Chair Co. Project, 4.15% (1) 4,350,000 4,350,000
</TABLE>
13
<PAGE>
STATEMENT OF INVESTMENTS (Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Amortized Cost
Amount See Note 1
---------- ---------------
<S> <C> <C>
SHORT-TERM TAX-EXEMPT OBLIGATIONS (CONTINUED)
TENNESSEE (CONTINUED)
Knox County, Tennessee Industrial Development Board Revenue Bonds, Weisgarber
Partners, FGIC Insured, 4.10% (1) $ 3,000,000 $ 3,000,000
Metropolitan Government of Nashville & Davidson County, Tennessee Health &
Educational Facilities Board Revenue Bonds, Vanderbilt University Project,
Series 1985B, 4.35%, 5/1/96 (3) 2,250,000 2,250,000
Metropolitan Government of Nashville & Davidson County, Tennessee Health &
Educational Facilities Board Revenue Bonds, Vanderbilt University Project,
Series 85A, 5.10%, 1/15/96 (3) 1,000,000 1,000,000
Metropolitan Government of Nashville & Davidson County, Tennessee Health &
Educational Facilities Board Revenue Bonds, Vanderbilt University Project,
Series 85A, 5.10%, 1/15/96 (3) 700,000 700,000
Metropolitan Government of Nashville & Davidson County, Tennessee Multifamily
Housing Revenue Bonds, Arbor Crest Project, Series B, 4.20% (1) 3,550,000 3,550,000
Rutherford County, Tennessee Industrial Development Board Industrial Building
Revenue Bonds, Derby Industries, Inc. Project, 4.35% (1) 1,000,000 1,000,000
-------------
31,950,000
-------------
TEXAS--9.0%
Angelina & Neches River Authority Texas Pollution Control Revenue Refunding
Bonds, Temple-Inland Forest Project, 4.35% (1) 7,350,000 7,350,000
Austin, Texas Travis & Williamson Counties Combined Utility Systems Tax-Exempt
Commercial Paper, Swiss Bank Insured, 4.20%, 10/5/95 (3) 8,200,000 8,200,000
Harris County, Texas Custodial Receipts, Series A, 3.65% (1) 5,000,000 5,000,000
Hockley County, Texas Industrial Development Corp. Pollution Control Revenue
Bonds, Amoco Project-Standard Oil Co., 4.75%, 9/1/95 (3) 20,000,000 20,011,993
Lower Neches Valley Authority Texas Revenue Bonds, Chevron USA, Inc. Project,
4.45%, 8/15/95 (3) 9,400,000 9,400,000
Texas State Tax & Revenue Anticipation Nts., 5%, 8/31/95 60,050,000 60,075,386
Texas Water Resource Finance Authority Revenue Bonds, Series 1989, 7%, 8/15/95 4,455,000 4,469,129
Travis County, Texas Housing Finance Corp. Multifamily Housing Revenue Bonds,
Bent Oaks Apts., 4.665% (1) 4,400,000 4,400,000
-------------
118,906,508
-------------
UTAH--1.3%
Intermountain Power Agency of Utah Power Supply Revenue Refunding Bonds,
Series E, 3.85%, 6/17/96 (3) 2,100,000 2,100,000
Intermountain Power Agency of Utah Power Supply Revenue Refunding Bonds,
Series F, 4.15%, 9/15/95 (3) 5,500,000 5,500,000
</TABLE>
14
<PAGE>
STATEMENT OF INVESTMENTS (Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Amortized Cost
Amount See Note 1
---------- ---------------
<S> <C> <C>
SHORT-TERM TAX-EXEMPT OBLIGATIONS (CONTINUED)
UTAH (CONTINUED)
Utah State Housing Finance Agency Multifamily Housing Revenue Refunding Bonds,
Candlestick Apts. Project, 4.15% (1) $ 6,400,000 $ 6,400,000
Weber County, Utah Industrial Development Revenue Refunding Bonds, Parker
Properties, Inc. Project, 3.90% (1) 2,600,000 2,600,000
-------------
16,600,000
-------------
VERMONT--0.4%
Vermont Educational & Health Buildings Financing Agency Revenue Bonds,
Middlebury College Project, Series 1988A, 4.35%, 5/1/96 (3) 3,500,000 3,500,000
Vermont Industrial Development Authority Revenue Bonds, Sherburne Corp.,
4.48% (1) 1,885,000 1,885,000
-------------
5,385,000
-------------
VIRGINIA--0.8%
Roanoke, Virginia Industrial Development Authority Hospital Revenue Bonds,
Roanoke Memorial Hospital Project, Series A, 4.50% (1) 100,000 100,000
Virginia State Housing Development Authority Commonwealth Mtg. Bonds, Series D,
4.12%, 9/12/95 (3) 4,000,000 4,000,140
Virginia State Housing Development Authority Commonwealth Mtg. Bonds, Series F,
4.12%, 9/12/95 (3) 7,000,000 7,000,244
-------------
11,100,384
-------------
WASHINGTON--1.4%
Port Longview, Washington Industrial Development Revenue Bonds, Longview Fibre
Co. Project, 4.10% (1) 2,500,000 2,500,000
Redmond, Washington Public Corp. Industrial Revenue Refunding Bonds, Genie
Industries, Lot 1, 4.25% (1) 1,100,000 1,100,000
Redmond, Washington Public Corp. Industrial Revenue Refunding Bonds, Genie
Industries, Lot 2, 4.25% (1) 1,770,000 1,770,000
Seattle, Washington Industrial Development Corp. Revenue Bonds, RICS LP,
4.30% (1) 5,700,000 5,700,000
Washington State Housing Finance Commission Non-profit Housing Revenue Bonds,
Horizon House Project, 3.80% (1) 4,505,000 4,505,000
Washington State Housing Finance Commission Single Family Program Bonds, FGIC
Insured, 4.10%, 6/1/96 (3) 2,500,000 2,500,000
-------------
18,075,000
-------------
WEST VIRGINIA--1.9%
Grant County, West Virginia Pollution Control Revenue Bonds, Virginia Electric
& Power Co. Project, Series 1994, 3.80%, 9/13/95 (3) 19,500,000 19,500,000
Harrison County, West Virginia Industrial Development Revenue Refunding Bonds,
Fox Grocery Co. Project, 4.25% (1) 4,140,000 4,140,000
</TABLE>
15
<PAGE>
STATEMENT OF INVESTMENTS (Continued)
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Face Amortized Cost
Amount See Note 1
---------- ---------------
<S> <C> <C>
SHORT-TERM TAX-EXEMPT OBLIGATIONS (CONTINUED)
WEST VIRGINIA (CONTINUED)
West Virginia School Building Authority Capital Improvement Revenue Bonds,
MBIA Insured, 5%, 7/1/95 $1,795,000 $ 1,795,000
-------------
25,435,000
-------------
Total Investments, at Amortized Cost 103.3% 1,357,731,247
Liabilities in Excess of Other Assets (3.3) (42,810,270)
----- -------------
Net Assets 100.0% $1,314,920,977
===== =============
</TABLE>
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, 1995. 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. When-issued security to be delivered and settled after June 30, 1995.
3. Put obligation redeemable at full face value on the date reported.
See accompanying Notes to Financial Statements.
16
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES June 30, 1995
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
<S> <C>
ASSETS:
Investments, at amortized cost--see accompanying statement $1,357,731,247
Cash 2,477,832
Receivables:
Interest 12,804,526
Shares of beneficial interest sold 33,622,017
Other 279,760
-----------
Total assets 1,406,915,382
-----------
LIABILITIES:
Payables and other liabilities:
Investments purchased 71,707,195
Shares of beneficial interest redeemed 18,068,864
Dividends 1,906,239
Service plan fees--Note 3 120,368
Transfer and shareholder servicing agent fees--Note 3 23,467
Trustees' fees 1,113
Other 167,159
-----------
Total liabilities 91,994,405
-----------
NET ASSETS $1,314,920,977
===========
COMPOSITION OF NET ASSETS:
Paid-in capital $1,314,882,597
Accumulated net realized gain from investment transactions 38,380
-----------
NET ASSETS -- applicable to 1,314,898,565 shares of beneficial interest
outstanding $1,314,920,977
===========
NET ASSET VALUE, REDEMPTION PRICE AND OFFERING PRICE PER SHARE $1.00
</TABLE>
See accompanying Notes to Financial Statements.
17
<PAGE>
STATEMENT OF OPERATIONS For the Year Ended June 30, 1995
Centennial Tax Exempt Trust
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest $43,517,674
EXPENSES:
Management fees -- Note 3 5,050,991
Service plan fees -- Note 3 2,246,219
Transfer and shareholder servicing agent
fees -- Note 3 579,024
Registration and filing fees 166,390
Shareholder reports 77,337
Legal and auditing fees 42,350
Trustees' fees and expenses 19,421
Custodian fees and expenses 12,774
Other 50,383
----------
Total expenses 8,244,889
----------
NET INVESTMENT INCOME 35,272,785
NET REALIZED GAIN ON INVESTMENTS 69,768
----------
NET INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS $35,342,553
==========
</TABLE>
See accompanying Notes to Financial Statements.
18
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Year Ended June 30,
--------------------------------
1995 1994
--------------- --------------
<S> <C> <C>
OPERATIONS:
Net investment income $ 35,272,785 $ 19,775,488
Net realized gain on investments 69,768 2,423
-------------- --------------
Net increase in net assets resulting from operations 35,342,553 19,777,911
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS (35,284,282) (19,846,407)
BENEFICIAL INTEREST TRANSACTIONS:
Net increase in net assets resulting from beneficial interest
transactions--Note 2 275,476,883 58,297,214
-------------- --------------
NET ASSETS
Total increase 275,535,154 58,228,718
Beginning of period 1,039,385,823 981,157,105
-------------- --------------
End of period $1,314,920,977 $1,039,385,823
============== ==============
</TABLE>
See accompanying Notes to Financial Statements.
19
<PAGE>
FINANCIAL HIGHLIGHTS
Centennial Tax Exempt Trust
<TABLE>
<CAPTION>
Year Ended June 30, SIX MONTHS YEAR ENDED
---------------------------------------------------------------------- ENDED JUNE 30, DECEMBER 31
1995 1994 1993 1992 1991 1990 1989 1988 1987 1986 1985
----- ----- ----- ----- ----- ----- ----- ----- ----- ------------ -----------
<S> <C> <C> <C> <C> <C> <C> <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 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Income from investment
operations--net investment
income and net realized gain
on investments .03 .02 .02 .03 .04 .05 .05 .04 .04 .02 .05
Dividends and distributions to
shareholders (.03) (.02) (.02) (.03) (.04) (.05) (.05) (.04) (.04) (.02) (.05)
----- ---- - ---- ----- ---- ---- ----- ---- ---- ---- ----
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
$1.00
====== ====== ===== ===== ===== ===== =====
===== ===== ===== =====
TOTAL RETURN, AT NET ASSET
VALUE(1) 3.17% 1.90% 2.19% 3.55% 5.09% 5.70% 5.55% 4.35% 3.83% 2.25%
5.00%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in
millions) $1,315 $1,039 $ 981 $ 917 $787 $ 575 $ 486 $ 518 $ 459 $ 469 $ 212
Average net assets (in
millions) $1,127 $1,057 $ 977 $ 900 $711 $ 561 $ 504 $ 485 $ 522 $ 385 $ 154
Number of shares outstanding at
end of period (in millions) 1,315 1,039 981 917 787 575 486 518 459 469 212
Ratios to average net assets:
Net investment income 3.13% 1.87% 2.08% 3.40% 4.84% 5.44% 5.45% 4.30% 3.71%
4.34%(2) 4.59%
Expenses .73% .76% .76% .75% .77% .79% .78% .78% .79% .82%(2)
.82%
</TABLE>
1. 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.
2. Annualized.
See accompanying Notes to Financial Statements.
20
<PAGE>
NOTES TO FINANCIAL STATEMENTS
Centennial Tax Exempt Trust
1. SIGNIFICANT ACCOUNTING POLICIES
Centennial Tax Exempt 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 advisor is Centennial Asset
Management Corporation (the Manager), a subsidiary of Oppenheimer Management
Corporation (OMC). 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.
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, 1995 Year Ended June 30, 1994
---------------------------- ------------------------------
Shares Amount Shares Amount
------------ ------------ ------------ --------------
<S> <C> <C> <C> <C>
Sold 3,745,799,353 $ 3,745,799,210 3,351,917,791 $ 3,351,918,751
Dividends and distributions
reinvested 33,490,524 33,490,524 19,299,307 19,299,307
Issued in connection with
the acquisition of
Oppenheimer Tax-Exempt
Cash Reserves-- Note 4 31,152,605 31,152,738 -- --
Redeemed (3,534,964,703) (3,534,965,589) (3,312,920,844) (3,312,920,844)
-------------- -------------- -------------- ---------------
Net increase 275,477,779 $ 275,476,883 58,296,254 $ 58,297,214
============== ============= ==============
===============
</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 .50% on the
first $250 million of average annual net assets with a reduction of .025% on
each $250 million thereafter to $1.5 billion,
21
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued)
Centennial Tax Exempt Trust
.35% on the next $500 million of net assets and .325% on net assets in excess
of $2 billion. Until Trust net assets reach $1.5 billion, the annual fee
payable to the Manager will be reduced by $100,000. The Manager has agreed to
assume Trust expenses (with specified exceptions) in excess of the most
stringent state regulatory limit on Trust expenses.
Shareholder Services, Inc. (SSI), a subsidiary of OMC, 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 .20% of its net
assets annually to reimburse Centennial Asset Management Corporation, as
distributor, for costs incurred in connection with the personal service and
maintenance of accounts that hold shares of the Trust, including amounts paid
to brokers, dealers, banks and other institutions. During the year ended June
30, 1995, the Trust paid $13,658 to a broker/dealer affiliated with the
Manager as reimbursement for distribution-related expenses.
4. ACQUISITION OF OPPENHEIMER TAX-EXEMPT CASH RESERVES
On July 22, 1994, the Trust acquired all of the net assets of Oppenheimer
Tax-Exempt Cash Reserves (OTECR), pursuant to an Agreement and Plan of
Reorganization approved by the OTECR shareholders on July 12, 1994. The Trust
issued 31,152,605 shares of beneficial interest, valued at $31,152,738, in
exchange for the net assets, resulting in combined net assets of
$1,086,765,782 on July 22, 1994. The exchange qualifies as a tax-free
reorganization for federal income tax purposes.
<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-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.
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 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.
<PAGE>
Exhibit B
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.
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.
<PAGE>
Exhibit C
TAX EXEMPT/TAX EQUIVALENT YIELDS
The equivalent yield table below compares tax-free income with
taxable income under Federal income tax rates effective in 1995. The
tables assume that an investor's highest tax bracket applies to the
change in taxable income resulting from a switch between taxable and
non-taxable investments, that the investor is not subject to the
Alternative Minimum Tax, and that state income tax payments are fully
deductible for Federal income tax purposes. The income tax brackets
are subject to indexing in future years to reflect changes in the
Consumer Price Index.
Example: Assuming a 4.0% tax-free yield, the equivalent taxable yield
would be 6.25% for a person in the 36% tax bracket.
<TABLE>
<CAPTION>
Centennial Tax Exempt Trust Yield of:
Federal Effective 1.5% 2.0% 2.5%
Taxable Tax Is Approximately Equivalent To a
Income Bracket Taxable Yield of:
JOINT RETURN
- ------------
Over Not over
- ---- --------
<S> <C> <C> <C> <C> <C>
$ 0 $ 39,000 15.0% 1.76% 2.35% 2.94%
$ 39,000 $ 94,250 28.0% 2.08% 2.78% 3.47%
$ 94,250 $143,600 31.0% 2.17% 2.90% 3.62%
$143,600 $256,500 36.0% 2.34% 3.13% 3.91%
$256,500 and above 39.6% 2.48% 3.31% 4.14%
SINGLE RETURN
- -------------
Over Not over
- ---- --------
<S> <C> <C> <C> <C> <C>
$ 0 $ 23,350 15.0% 1.76% 2.35% 2.94%
$ 23,350 $ 56,550 28.0% 2.08% 2.78% 3.47%
$ 56,550 $117,950 31.0% 2.17% 2.90% 3.62%
$117,950 $256,500 36.0% 2.34% 3.13% 3.91%
$256,500 and above 39.6% 2.48% 3.31% 4.14%
</TABLE>
<TABLE>
<CAPTION>
Centennial Tax Exempt Trust Yield of:
Federal Effective 3.0% 3.5% 4.0% 4.5%
Taxable Tax Is Approximately Equivalent To a
Income Bracket Taxable Yield of:
JOINT RETURN
- ------------
Over Not over
- ---- --------
<S> <C> <C> <C> <C> <C> <C>
$ 0 $ 39,000 15.0% 3.53% 4.12% 4.71% 5.29%
$ 39,000 $ 94,250 28.0% 4.17% 4.86% 5.56% 6.25%
$ 94,250 $143,600 31.0% 4.35% 5.07% 5.80% 6.52%
$143,600 $256,500 36.0% 4.69% 5.47% 6.25% 7.03%
$256,500 39.6% 4.97% 5.79% 6.62% 7.45%
SINGLE RETURN
- -------------
Over Not over
- ---- --------
$ 0 $ 23,350 15.0% 3.53% 4.12% 4.71% 5.29%
$ 23,350 $ 56,550 28.0% 4.17% 4.86% 5.56% 6.25%
$ 56,550 $117,950 31.0% 4.35% 5.07% 5.80% 6.52%
$117,950 $256,500 36.0% 4.69% 5.47% 6.25% 7.03%
$256,500 39.6% 4.97% 5.79% 6.62% 7.45%
</TABLE>
<PAGE>
Investment Adviser and Distributor
Centennial Asset Management Corporation
3410 South Galena Street
Denver, Colorado 80231
Transfer Agent
Shareholder Services, Inc.
P.O. Box 5143
Denver, Colorado 80217
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 1850
Denver, Colorado 80202
<PAGE>
CENTENNIAL TAX EXEMPT TRUST
FORM N-1A
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits
---------------------------------
(a) Financial Statements
--------------------
(1) Condensed Financial Information (See Part A): Filed herewith.
(2) Independent Auditors' Report (See Part B): Filed herewith.
(3) Statement of Investments, June 30, 1995 (See Part B): Filed
herewith.
(4) Statement of Assets and Liabilities, June 30, 1995 (See Part B):
Filed herewith.
(5) Statement of Operations for the year ended June 30, 1995 (See Part
B): Filed herewith.
(6) Statement of Changes in Net Assets for the years ended June 30,
1994 and 1995 (See Part B): Filed herewith.
(7) Notes to Financial Statements (See Part B): Filed herewith.
(8) Independent Auditors' Consent: Filed herewith.
(b) Exhibits
--------
(1) Restated Declaration of Trust dated September 27, 1985: Filed
with Registrant's Post-Effective Amendment No. 11, 9/27/85, and refiled
with Registrant's Post-Effective Amendment No. 28, 10/31/94, pursuant
to Item 102 of Regulation S-T and incorporated herein by reference.
(2) By-Laws, as amended through June 26, 1990: Filed with
Registrant's Post-Effective Amendment No. 23, 10/31/91, and refiled
with Registrant's Post-Effective Amendment No. 28, 10/31/94, pursuant
to Item 102 of Regulation S-T and incorporated herein by reference.
(3) Not applicable.
(4) Specimen Share Certificate: Filed with Registrant's Post-
Effective Amendment No. 11, 9/27/85, and refiled with Registrant's
Post-Effective Amendment No. 28, 10/31/94, pursuant to Item 102 of
Regulation S-T and incorporated herein by reference.
(5) Investment Advisory Agreement dated February 18, 1992: Filed with
Registrant's Post-Effective Amendment No. 25, 11/1/92, and refiled with
Registrant's Post-Effective Amendment No. 28, 10/31/94, pursuant to
Item 102 of Regulation S-T and incorporated herein by reference.
(6) (i) General Distributor's Agreement between Registrant and
Centennial Asset Management Corporation dated 10/13/92: Filed with
Registrant's Post-Effective Amendment No. 26, 8/30/93, and incorporated
herein by reference.
(ii) Form of Centennial Asset Management Corporation Dealer
Agreement: Filed with Post-Effective Amendment No. 23 to the
Registration Statement of Centennial Government Trust (File No. 2-
75812), 11/1/94, and incorporated herein by reference.
(iii) Sub-Distributor's Agreement dated May 28, 1993 between
Centennial Asset Management Corporation and Oppenheimer Funds
Distributor, Inc.: Filed with Registrant's Post-Effective Amendment No.
26, August 30, 1993, and incorporated herein by reference.
(7) Not applicable.
(8) (i) Custodian Agreement dated March 1, 1981 between
Registrant (formerly Daily Cash Tax Exempt Cash Fund, Inc.) and
Citibank, N.A.: Filed with Registrant's Post-Effective Amendment No.
13, 1/31/86, and refiled with Registrant's Post-Effective Amendment No.
28, 10/31/94, pursuant to Item 102 of Regulation S-T and incorporated
herein by reference.
(ii) Assignment and Amendment dated September 27, 1985 to
Custodian Agreement dated March 1, 1981, between Registrant and
Citibank, N.A.: Filed with Registrant's Post-Effective Amendment No.
13, 1/31/86, and refiled with Registrant's Post-Effective Amendment No.
28, 10/31/94, pursuant to Item 102 of Regulation S-T and incorporated
herein by reference.
(9) Not applicable.
(10) (i) Opinion and Consent of Counsel dated February 23, 1981:
Filed with Pre-Effective Amendment No. 1 to Registrant's Registration
Statement, 3/2/81, and refiled with Registrant's Post-Effective
Amendment No. 28, 10/31/94, pursuant to Item 102 of Regulation S-T and
incorporated herein by reference.
(ii) Opinion of Neef, Swanson, Myer & Clark dated September 27,
1985, general counsel to Registrant, to Centennial Tax Exempt Trust,
issued in the reorganization of Registrant (formerly Daily Cash Tax
Exempt Fund, Inc.) and Centennial Tax Exempt Trust: Filed with
Registrant's Post-Effective Amendment No. 13, 1/31/86, and refiled
herewith pursuant to Item 102 of Regulation S-T.
(iii) Opinion of Moye, Giles, O'Keefe, Vermeire & Gorrell dated
September 27, 1985, special counsel to Centennial Tax Exempt Trust, to
Registrant (formerly Daily Cash Tax Exempt Fund, Inc.), issued in the
reorganization of Registrant and Centennial Tax Exempt Trust: Filed
with Registrant's Post-Effective Amendment No. 13, 1/31/86, and refiled
with Registrant's Post-Effective Amendment No. 28, 10/31/94, pursuant
to Item 102 of Regulation S-T and incorporated herein by reference.
(iv) Opinion of Deloitte Haskins & Sells dated September 27, 1985
issued to Centennial Tax Exempt Trust in the reorganization of
Registrant (formerly Daily Cash Tax Exempt Fund, Inc.) and Centennial
Tax Exempt Trust: Filed with Registrant's Post-Effective Amendment No.
13, 1/31/86, and refiled with Registrant's Post-Effective Amendment No.
28, 10/31/94, pursuant to Item 102 of Regulation S-T and incorporated
herein by reference.
(v) Opinion of Deloitte Haskins & Sells dated September 27, 1985
issued to Registrant (formerly Daily Cash Tax Exempt Fund, Inc.) in the
reorganization of Registrant and Centennial Tax Exempt Trust: Filed
with Registrant's Post-Effective Amendment No. 13, 1/31/86, and refiled
with Registrant's Post-Effective Amendment No. 28, 10/31/94, pursuant
to Item 102 of Regulation S-T and incorporated herein by reference.
(11) Not applicable.
(12) Not applicable.
(13) Not applicable.
(14) Not applicable.
(15) Service Plan and Agreement under Rule 12b-1 between Registrant and
Centennial Asset Management Corporation, dated as of 8/24/93: Filed
with Registrant's Post-Effective Amendment No. 27, 10/28/93, and
incorporated herein by reference.
(16) Performance Data Computation Schedule: Filed herewith.
(17) Financial Data Schedule: Filed herewith.
- -- Powers of Attorney: Filed with Registrant's Post-Effective
Amendment No. 27, 10/28/93, and incorporated herein by reference.
(18) Not Applicable.
Item 25. Persons Controlled by and Under Common Control
with Registrant
----------------------------------------------
None.
Item 26. Number of Holders of Securities
-------------------------------
Number of Record
Holders as of
Title of Class October 6, 1995
-------------- ----------------
Shares of Beneficial Interest 37,044
Item 27. Indemnification
---------------
Reference is made to Section 12 of Article SEVENTH of
Registrant's Restated Declaration of Trust, dated September 27, 1985,
filed as Exhibit 24(b)(1) to this registration statement.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to trustees, officers and
controlling persons of Registrant pursuant to the foregoing provisions
or otherwise, Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against
public policy as expressed in the Securities Act of 1933 and is,
therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
Registrant of expenses incurred or paid by a Trustee, officer or
controlling person of Registrant in the successful defense of any
action, suit or proceeding) is asserted by such Trustee, officer or
controlling person, Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to
a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication
of such issue.
Item 28. Business and Other Connections of Investment Adviser
(a) Centennial Asset Management Corporation is the investment
adviser of the Registrant; it and certain subsidiaries and affiliates
act in the same capacity to other registered investment companies as
described in Parts A and B hereof and listed in Item 28(b) below.
(b) There is set forth below information as to any other
business, profession, vocation or employment of a substantial nature in
which each officer and director of Centennial Asset Management
Corporation is, or at any time during the past two fiscal years has
been, engaged for his/her own account or in the capacity of director,
officer, employee, partner or trustee.
<TABLE>
<CAPTION>
Name & Current Position
with Centennial Asset Other Business and Connections
Management Corporation During the Past Two Years
- ----------------------- ------------------------------
<S> <C>
George C. Bowen, Director, Treasurer of the New York-based
Senior Vice President, Oppenheimer funds; Vice President,
Secretary
Treasurer and Assistant and Treasurer of the Denver-based
Secretary. Oppenheimer funds. Vice President and
Treasurer of Oppenheimer Funds
Distributor,
Inc. ("OFDI") and HarbourView
Asset Management Corporation
("HarbourView"), an investment adviser
subsidiary of OMC; Vice President,
Treasurer and Secretary of Shareholder
Services, Inc. ("SSI") and Shareholder
Financial Services, Inc. ("SFSI"),
transfer agent subsidiaries of OMC; President,
Treasurer and Director of Centennial
Capital Corporation; Vice President and Treasurer
of Main Street Advisers; Treasurer of
Oppenheimer Partnership Holdings, Inc.;
formerly Senior Vice President/ Comptroller
and Secretary of Oppenheimer Asset
Management Corporation ("OAMC"), an
investment adviser which was a subsidiary
of OMC.
Michael Carbuto, Vice Vice President and Portfolio Manager of
President Centennial California Tax Exempt Trust,
Centennial New York Tax Exempt Trust and
Centennial Tax Exempt Trust.
Andrew J. Donohue, Director Secretary of the New York-based
Oppenheimer funds; Vice President of the
Denver-based Oppenheimer funds; Executive
Vice President, Director and General
Counsel
of the Distributor; Executive Vice
President and General Counsel of OMC; Director of
HarbourView Asset Management, Main Street
Advisers, Oppenheimer Partnership
Holdings, Inc.; formerly Senior Vice
President and Associate General Counsel of
the Manager and the Distributor.
Katherine P. Feld, Secretary Vice President and Secretary of OFDI;
Secretary of HarbourView, Main Street
Advisers, Inc. and Oppenheimer Partnership
Holdings, Inc.; Secretary, Vice President
and Director of Centennial Capital Corp.
James C. Swain, President Chairman, CEO and Trustee, Director or
and Director Managing Partner of the Denver-based
Oppenheimer funds; Director of OMC;
formerly President and Director of OAMC, and
Chairman of the Board of SSI.
Gary P. Tyc, Assistant Assistant Treasurer of the Distributor and
Treasurer and Assistant SFSI.
Secretary
Dorothy Warmack, Vice Vice President and Portfolio Manager of
President Daily Cash Accumulation Fund, Inc.,
Oppenheimer Cash Reserves, Centennial
America Fund, L.P., Centennial Government
Trust and Centennial Money Market Trust;
Vice President of OMC.
Carol Wolf, Vice President Vice President and Portfolio Manager of
Oppenheimer Money Market Fund, Inc.,
Centennial America Fund, L.P., Centennial
Government Trust, Centennial Money Market
Trust and Daily Cash Accumulation Fund,
Inc.; Vice President of Oppenheimer Multi-
Sector Income Trust.
Arthur Zimmer, Vice Vice President and Portfolio Manager of
President Centennial America Fund, L.P., Oppenheimer
Money Fund, Centennial Government Trust,
Centennial Money Market Trust and Daily
Cash
Accumulation Fund, Inc.; Vice President of
Oppenheimer Multi-Sector Income Trust;
Vice President of OMC.
</TABLE>
The Oppenheimer funds include the New York-based Oppenheimer funds
and the Denver-based Oppenheimer funds set forth below:
New York-based Oppenheimer funds
Oppenheimer Asset Allocation Fund
Oppenheimer California Tax-Exempt Fund
Oppenheimer Discovery Fund
Oppenheimer Global Emerging Growth Fund
Oppenheimer Global Fund
Oppenheimer Global Growth & Income Fund
Oppenheimer Gold & Special Minerals Fund
Oppenheimer Growth Fund
Oppenheimer Money Market Fund, Inc.
Oppenheimer Multi-Government Trust
Oppenheimer Multi-Sector Income Trust
Oppenheimer Multi-State Tax-Exempt Trust
Oppenheimer New York Tax-Exempt Trust
Oppenheimer Fund
Oppenheimer Target Fund
Oppenheimer Tax-Free Bond Fund
Oppenheimer U.S. Government Trust
Denver-based Oppenheimer funds
Oppenheimer Cash Reserves
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.
The New York Tax-Exempt Income Fund, Inc.
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 Strategic Funds Trust
Oppenheimer Strategic Income & Growth Fund
Oppenheimer Tax-Exempt Fund
Oppenheimer Total Return Fund, Inc.
Oppenheimer Variable Account Funds
The address of Oppenheimer Management Corporation, the New York-
based Oppenheimer funds, Oppenheimer Funds Distributor, Inc.,
Harbourview Asset Management Corp., Oppenheimer Partnership Holdings,
Inc., and Oppenheimer Acquisition Corp. is Two World Trade Center, New
York, New York 10048-0203.
The address of the Denver-based Oppenheimer funds, Shareholder
Financial Services, Inc., Shareholder Services, Inc., Oppenheimer
Shareholder Services, Centennial Asset Management Corporation,
Centennial Capital Corp., and Main Street Advisers, Inc. is 3410 South
Galena Street, Denver, Colorado 80231.
Item 29. Principal Underwriter
(a) Centennial Asset Management Corporation is the Distributor of
Registrant's shares. It is also the Distributor of each of the other
registered open-end investment companies for which Centennial Asset
Management Corporation is the investment adviser, as described in Part
A and B of this Registration Statement and listed in Item 28(b) above.
(b) The directors and officers of the Registrant's principal
underwriter are:
<TABLE>
<CAPTION>
Positions
and
Name & Principal Positions & Offices Offices
with
Business Address with Underwriter Registrant
- ---------------- ------------------- -----------
<S> <C> <C>
Robert J. Bishop+ None Assistant
Secretary
George C.Bowen+ Director, Senior Vice Vice
President, Treasurer and President,
Assistant Secretary Treasurer
and
Secretary
Michael Carbuto* Vice President None
Andrew J. Donohue* Director Vice
President
Scott Farrar= None Assistant
Secretary
Katherine P. Feld* Secretary None
James C. Swain+ President and Director None
Gary Paul Tyc+ Assistant Treasurer and None
Assistant Secretary
Dorothy Warmack+ Vice President None
Carol Wolf+ Vice President None
Arthur Zimmer+ Vice President None
* Two World Trade Center, New York, NY 10048-0203
+ 3410 South Galena St., Denver, CO 80231
</TABLE>
(c) Not applicable.
Item 30. Location of Accounts and Records
--------------------------------
The accounts, books and other documents required to be
maintained by Registrant pursuant to Section 31(a) of the Investment
Company Act of 1940 and rules promulgated thereunder are in the
possession of Centennial Asset Management Corporation, 3410 South
Galena Street, Denver, Colorado 80231.
Item 31. Management Services
-------------------
Not applicable.
Item 32. Undertakings
------------
(a) Not applicable.
(b) Not applicable.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and/or the
Investment Company Act of 1940, the Registrant certifies that it meets
all of the requirements for effectiveness of this Registration
Statement pursuant to Rule 485(b) under the Securities Act of 1933 and
has duly caused this Registration Statement to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of Denver
and State of Colorado on the 27th day of October, 1995.
CENTENNIAL TAX EXEMPT TRUST
By: /s/ James C. Swain*
-----------------------------
James C. Swain, Chairman
Attest:
/s/ George C. Bowen*
- --------------------------
George C. Bowen, Secretary
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons
in the capacities on the dates indicated:
<TABLE>
<CAPTION>
Signatures Title Date
- ---------- ----- ----
<S> <C> <C>
/s/ James C. Swain* Chairman, Trustee October 27, 1995
- ------------------ and Principal
James C. Swain Executive Officer
/s/ Jon S. Fossel* President and October 27, 1995
- ----------------- Trustee
Jon S. Fossel
/s/ George C. Bowen* Treasurer and October 27, 1995
- ------------------- Principal Financial
George C. Bowen and Accounting
Officer
/s/ Robert G. Avis* Trustee October 27, 1995
- ------------------
Robert G. Avis
/s/ William A. Baker* Trustee October 27, 1995
- --------------------
William A. Baker
/s/ Charles Conrad, Jr.* Trustee October 27, 1995
- -----------------------
Charles Conrad, Jr.
/s/ Raymond J. Kalinowski* Trustee October 27, 1995
- -------------------------
Raymond J. Kalinowski
/s/ C. Howard Kast* Trustee October 27, 1995
- ------------------
C. Howard Kast
/s/ Robert M. Kirchner* Trustee October 27, 1995
- ----------------------
Robert M. Kirchner
/s/ Ned M. Steel* Trustee October 27, 1995
- ----------------
Ned M. Steel
*By: /s/ Robert G. Zack
- --------------------------------
Robert G. Zack, Attorney-in-Fact
</TABLE>
<PAGE>
CENTENNIAL TAX EXEMPT TRUST
EXHIBIT INDEX
Form N-1A
Item No. Description
- --------- -----------
24 (a) (8) Independent Auditor's Consent
24 (b) (16) Performance Data Computation Schedule
24 (b) (17) Financial Data Schedule
INDEPENDENT AUDITORS' CONSENT
- -----------------------------
Centennial Tax-Exempt Trust
We consent to the use in Post-Effective Amendment No. 29 to
Registration Statement No. 2-69653 of our report dated July 24,
1995 on the financial statements of Centennial Tax Exempt Trust
appearing in the Statement of Additional Information, which is a
part of such Registration Statement, and to the reference to us
under the heading "Financial Highlights" appearing in the
Prospectus, which is also a part of such Registration Statement.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Denver, Colorado
October 27, 1995
Centennial Tax Exempt Trust
Exhibit 24(b)(16) to Form N-1A
Performance Data Computation Schedule
1. YIELD AND EFFECTIVE YIELD FOR 7-DAY PERIOD ENDED 06/30/95:
Calculations of the Fund's "Yield" and "Compounded Effective Yield" set
forth in the section entitled "Yield Information" in the Statement of
Additional Information were made as follows:
Date Daily Accrual Per Share (in $)
06/26/95 .0000995
06/27/95 .0000960
06/28/95 .0000945
06/29/95 .0000972
06/30/95 .0000952
07/01/95 .0000952
07/02/95 .0000952
Seven Day
Total: .0006728
Current Yield: $0.0006728/7 x 365 = 3.51%
365/7
Effective Yield: (.0006728 + 1) - 1 = 3.57%
Centennial Tax Exempt Trust
Page 2
2. TAX EQUIVALENT CURRENT AND EFFECTIVE YIELDS FOR THE 7-DAY PERIOD
ENDED 06/30/95:
The Fund's current tax equivalent yield is calculated using the
following formula:
a
----- + b = Tax Equivalent Yield
1 - c
The symbols above represent the following factors:
a = 7-day current yield of tax-exempt security positions in
the portfolio.
b = 7-day current yield of taxable security positions in the
portfolio.
c = Federal stated tax rate for an individual in the 39.6% federal tax
bracket filing singly).
Example: .0351
---------- + 0 = 5.81%
1 - .3960
The Fund's effective tax equivalent yield is calculated using the
following formula:
a
----- + b = Tax Equivalent Yield
1 - c
The symbols above represent the following factors:
a = 7-day effective yield of tax-exempt security positions in
the portfolio.
b = 7-day effective yield of taxable security positions in the
portfolio.
c = Federal stated tax rate for an individual in the 39.6% federal tax
bracket filing singly).
Example: .0357
---------- + 0 = 5.91%
1 - .3960
Centennial Tax Exempt Trust
Page 3
3. TAX EQUIVALENT CURRENT AND EFFECTIVE YIELDS FOR THE 30-DAY PERIOD
ENDED 06/30/95:
The Fund's current tax equivalent yield is calculated using the
following formula:
a
----- + b = Tax Equivalent Yield
1 - c
The symbols above represent the following factors:
a = 30-day current yield of tax-exempt security positions in
the portfolio.
b = 30-day current yield of taxable security positions in the
portfolio.
c = Federal stated tax rate for an individual in the 39.6% federal tax
bracket filing singly).
Example: .0342
---------- + 0 = 5.66%
1 - .3960
The Fund's effective tax equivalent yield is calculated using the
following formula:
a
----- + b = Tax Equivalent Yield
1 - c
The symbols above represent the following factors:
a = 30-day effective yield of tax-exempt security positions in
the portfolio.
b = 30-day effective yield of taxable security positions in the
portfolio.
c = Federal stated tax rate for an individual in the 39.6% federal tax
bracket filing singly).
Example: .0348
---------- + 0 = 5.76%
1 - .3960
<TABLE> <S> <C>
<ARTICLE> 6
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> JUN-30-1995
<PERIOD-START> JUL-01-1994
<PERIOD-END> JUN-30-1995
<INVESTMENTS-AT-COST> 1357731247
<INVESTMENTS-AT-VALUE> 1357731247
<RECEIVABLES> 46426543
<ASSETS-OTHER> 279760
<OTHER-ITEMS-ASSETS> 2477832
<TOTAL-ASSETS> 1406915382
<PAYABLE-FOR-SECURITIES> 71707195
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 20287210
<TOTAL-LIABILITIES> 91994405
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 1314882597
<SHARES-COMMON-STOCK> 1314898565
<SHARES-COMMON-PRIOR> 1039420786
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 38380
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 1314920977
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 43517674
<OTHER-INCOME> 0
<EXPENSES-NET> 8244889
<NET-INVESTMENT-INCOME> 35272785
<REALIZED-GAINS-CURRENT> 69768
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 35342553
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 35284282
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 3776951958
<NUMBER-OF-SHARES-REDEEMED> 3534964703
<SHARES-REINVESTED> 33490524
<NET-CHANGE-IN-ASSETS> 275535154
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 19892
<GROSS-ADVISORY-FEES> 5050991
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 8244889
<AVERAGE-NET-ASSETS> 1127000000
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .03
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> .03
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> .73
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
