Registration No. 33-12463
File No. 811-5051
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OF 1933 [X]
Pre-Effective Amendment No. _____ [ ]
Post-Effective Amendment No. 19 [X]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY
ACT OF 1940 [X]
Amendment No. 18 [X]
CENTENNIAL AMERICA FUND, L.P.
- ------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
6803 South Tucson Way, Englewood, Colorado 80112
- ------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
1-800-525-9310
- ------------------------------------------------------------------------------
(Registrant's Telephone Number, including Area Code)
Andrew J. Donohue, Esq.
OppenheimerFunds, Inc.
Two World Trade Center, New York, New York 10048-0203
- ------------------------------------------------------------------------------
(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 April 30, 1999 pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a)(1)
[ ] On _______________ pursuant to paragraph (a)(1)
[ ] 75 days after filing pursuant to paragraph (a)(2)
[ ] On _______________ pursuant to paragraph (a)(2) of Rule 485
If appropriate, check the following box:
[ ] This post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
<PAGE>
Centennial America Fund, L.P.
- ------------------------------------------------------------------------------
Prospectus dated April 30, 1999
- ------------------------------------------------------------------------------
Centennial America Fund, L.P. is a money market mutual fund. It seeks
high current income consistent with preserving capital and maintaining
liquidity. The Fund invests in short-term "money market" instruments that
are U.S. government securities to generate income that is not subject to
payment or withholding of U.S. federal income tax for qualifying foreign
investors.
- ------------------------------------------------------------------------------
Shares of this Fund may be purchased only by foreign investors who are not
U.S. citizens, U.S. residents, or U.S. corporations, partnerships or trusts
under the Internal Revenue Code.
- ------------------------------------------------------------------------------
This Prospectus contains important information about the Fund's objective,
its investment policies, strategies and risks. It also contains important
information about how to buy and sell shares of the Fund and other account
features. Please read this Prospectus carefully before you invest and keep it
for future reference about your account.
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved the Fund's securities nor has it determined that this
Prospectus is accurate or complete. It is a criminal offense to represent
otherwise.
<PAGE>
2
Contents
A B O U T T H E F U N D
- ------------------------------------------------------------------------------
The Fund's Objective and Investment Strategies
Main Risks of Investing in the Fund
The Fund's Past Performance
Fees and Expenses of the Fund
About the Fund's Investments
How the Fund is Managed
A B O U T Y O U R A C C O U N T
- ------------------------------------------------------------------------------
How to Buy Shares
How to Sell Shares
Program Participants
Direct Investors
How to Exchange Shares
Shareholder Account Rules and Policies
Distributions and Tax Information
Financial Highlights
<PAGE>
A B O U T T H E F U N D
The Fund's Objective and Investment Strategies
- ------------------------------------------------------------------------------
What Is the Fund's Investment Objective? The Fund seeks as high a level of
current income as is consistent with the preservation of capital and the
maintenance of liquidity.
- ------------------------------------------------------------------------------
What Does the Fund Invest In? The Fund is a money market fund that seeks to
maintain a $1 price per share. It invests in money market instruments, which are
high-quality short-term debt instruments maturing in 397 days or less.
As a fundamental policy, the Fund can invest only in:
o "U.S. government securities," which are debt obligations issued or
guaranteed by the U.S. government or its agencies or
federally-chartered corporate entities referred to as
"instrumentalities," and
o Repurchase agreements under which U.S. government securities are
purchased.
Under normal market conditions the Fund intends to invest at least 75% of its
total assets in U.S. government securities, with no more than 25% of its total
assets in repurchase agreements.
Who Is the Fund Designed For? Shares of the Fund are offered only to foreign
investors who want to earn income at current money market rates while preserving
the value of their investment, because the Fund is managed to keep its share
price stable at $1.00. The Fund does not invest for the purpose of seeking
capital appreciation or gains.
"Foreign investors" refers to persons or entities that not treated as U.S.
citizens or residents, or U.S. corporations, partnerships, trusts or estates
under the Internal Revenue Code. Income on short-term securities tends to be
lower than income on longer-term debt securities, so the Fund's yield will
likely be lower than the yield on longer-term fixed income funds. The Fund is
designed mainly for investors who buy shares through special investment programs
offered by their broker-dealer.
Main Risks of Investing in the Fund
All investments carry risks to some degree. Funds that invest in debt
obligations for income may be subject to credit risks and interest rate risks.
However, the Fund is a money market fund that seeks income by investing in
short-term debt securities that must meet strict standards set by its Managing
General Partners, following rules for money market funds under federal law.
These include requirements for maintaining high credit quality in the Fund's
portfolio, a short average portfolio maturity to reduce the effects of changes
in interest rates on the value of the Fund's securities and diversifying the
Fund's investments among issuers to reduce the effects of a default by any one
issuer on the value of the Fund's shares.
Even so, there are risks that any of the Fund's holdings could have its
credit rating downgraded, or the issuer could default, or that interest rates
could rise sharply, causing the value of the Fund's securities (and its share
price) to fall. If there is a high redemption demand for the Fund's shares that
was not anticipated, portfolio securities might have to be sold prior to their
maturity at a loss. As a result, there is a risk that the Fund's shares could
fall below $1.00 per share.
The Fund is a limited partnership and has made an election under the
Internal Revenue Code to pay federal income taxes (at a special rate) on its
income to allow it to maintain its status as a partnership. As a result, the
Fund's expenses will likely be higher, and its yield lower, than other money
market funds that are organized as corporations or business trusts and which are
not subject to income taxes. If the Fund does not conduct its business in a
manner that complies with other U.S. tax laws, there is the risk that its
distributions to its foreign shareholders will be subject to U.S. income tax
withholding.
The Fund is not a complete investment program. The rate of the Fund's
income will vary from day to day, generally reflecting changes in overall
short-term interest rates. There is no assurance that the Fund will achieve its
investment objective.
An investment in the Fund is not insured or guaranteed by the Federal Deposit
Insurance Corporation or any other government agency. Although the Fund seeks to
preserve the value of your investment at $1.00 per share, it is possible to lose
money by investing in the Fund.
The Fund's Past Performance
The bar chart and table below show how the Fund's returns may vary over time, by
showing changes in the Fund's performance from year to year for the full
calendar years since the Fund became a money market fund and its average annual
total returns for the 1-, and 5-year periods and the period since the Fund
became a money market fund. Variability of returns is one measure of the risks
of investing in a money market fund. The Fund's past investment performance is
not necessarily an indication of how the Fund will perform in the future.
Annual Total Returns (% as of 12/31 each year)
[See appendix to prospectus for annual total return data for bar chart.]
For the period from 1/1/99 through 3/31/99, the cumulative total return (not
annualized) was 0.86%. During the period shown in the bar chart, the highest
return for a calendar quarter was 1.19% (1st Q '96) and the lowest return for a
calendar quarter was 0.52% (1st Q '94).
- -------------------------------------------------------------------------------
Average Annual Total
Returns for the periods
Ended December 31, 1998 1 Year 5 Years Life of Fund*
- -------------------------------------------------------------------------------
Centennial America 4.40% 4.24% 3.91%
Fund, L.P.
- -------------------------------------------------------------------------------
*The Fund became a money market fund 12/6/91. Prior to that date, the Fund was a
long-term bond fund. The returns in the table measure the performance of a
hypothetical account and assume that all distributions have been reinvested in
additional shares.
The total returns are not the Fund's current yield. The Fund's yield more
closely reflects the Fund's current earnings.
- ------------------------------------------------------------------------------
To obtain the Fund's current 7-day yield, please call the Transfer Agent
toll-free at 1-800-525-9310.
- ------------------------------------------------------------------------------
Fees and Expenses of the Fund
The Fund pays a variety of expenses directly for management of its assets,
administration and other services. Those expenses are subtracted from the Fund's
assets to calculate the Fund's net asset value per share. All shareholders
therefore pay those expenses indirectly. Shareholders pay other expenses
directly, such as account transaction charges. The following tables are provided
to help you understand the fees and expenses you may pay if you buy and hold
shares of the Fund. The numbers below are based upon the Fund's expenses during
its fiscal year ended December 31, 1998.
Shareholder Fees. The Fund does not charge any initial sales charge to buy
shares or to reinvest distributions, nor any exchange or redemption fees.1
Annual Fund Operating Expenses (deducted from Fund assets):
(% of average daily net assets)
- -------------------------------------------------------------------------------
Management Fees 0.45%
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Service (12b-1) Fees 0.19%
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Other Expenses 0.58%
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Total Annual Operating Expenses 1.22%
- -------------------------------------------------------------------------------
"Other expenses" in the table include transfer agent fees, custodial fees, and
accounting and legal expenses the Fund pays.
- --------
1. If your shares are purchased under a special investment program through a
broker-dealer, you may pay program fees to your dealer. Those fees are disclosed
in the information about the program that your dealer supplies to you directly.
While the Fund charges no redemption fees, a contingent deferred sales charge
might apply to redemptions of certain shares purchased by exchanging Class A
shares of other Oppenheimer funds that were purchased subject to a contingent
deferred sales charge.
Example. This example is intended to help you compare the cost of investing in
the Fund with the cost of investing in other mutual funds. The example assumes
that you invest $10,000 in shares of the Fund for the time and reinvest your
dividends and distributions. The example also assumes that your investment has a
5% return each year and that the Fund's expenses remain the same. Your actual
costs may be higher or lower, because expenses will vary over time. Based on
these assumptions your expenses would be as follows:
- -------------------------------------------------------------------------------
1 year 3 years 5 years 10 years
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
$124 $387 $670 $1,477
- -------------------------------------------------------------------------------
About the Fund's Investments
The Fund's Principal Investment Policies. In seeking a high level of current
income consistent with preserving capital and maintaining liquidity, the Fund
invests in short-term money market instruments meeting quality, maturity and
diversification standards established for money market funds under the
Investment Company Act. The Statement of Additional Information contains more
detailed information about the Fund's investment policies and risks.
o What Types of Money Market Instruments Does the Fund Invest In? Money
market instruments are high-quality, short-term debt instruments. As a matter of
fundamental policy, the Fund may invest only in obligations issued or guaranteed
by the U.S. government or its agencies or instrumentalities, or in repurchase
agreements under which such obligations are purchased.
U.S. Government Securities. The Fund can invest in securities issued
or guaranteed by the U.S. Treasury or other U.S. government agencies or
instrumentalities. These are referred to as "U.S. government securities" in
this Prospectus. To produce income that is not subject to U.S. federal
income tax withholding for its shareholders, the Fund invests in U.S.
government securities issued after July 18, 1984, in registered form.
o U.S. Treasury Obligations. These include Treasury bills (having
maturities of one year or less when issued), Treasury notes (having
maturities of from one to ten years when issued), and Treasury bonds
(having maturities of more than ten years when issued). Treasury
securities are backed by the full faith and credit of the United States
as to timely payments of interest and repayments of principal.
Although they are not rated by rating organizations, U.S. Treasury
obligations are considered to be of the highest credit quality with
little risk of default.
o Obligations of U.S. Government Agencies or Instrumentalities. These
include debt obligations that have different levels of credit support
from the U.S. government. They can include obligations of agencies or
instrumentalities such as Government National Mortgage Association,
Federal Home Loan Bank, Federal Home Loan Mortgage Corporation, Student
Loan Marketing Association, for example. Some of these obligations are
supported by the full faith and credit of the U.S. government, others
are supported by the right of the issuer to borrow from the U.S.
Treasury under certain circumstances, while others are supported only
by the credit of the entity that issued them. Obligations of U.S.
government agencies and instrumentalities generally have relatively
little credit risk.
o Repurchase Agreements. The Fund can buy U.S. government securities that
are subject to repurchase agreements. In a repurchase transaction, the Fund buys
a security and simultaneously sells it to the vendor for delivery at a future
date. The Fund's repurchase agreements must be fully collateralized by U.S.
government securities. However, if the vendor fails to pay the resale price on
the delivery date, the Fund may incur costs in disposing of the collateral and
may experience losses if there is any delay in its ability to do so. As
fundamental policies, the Fund will not enter into repurchase transactions that:
o cause more than 25% of the Fund's total assets to be subject to
repurchase agreements; or
o cause more than 5% of the Fund's total assets to be subject to repurchase
agreements having a maturity beyond seven days.
o What Credit Quality and Maturity Standards Apply to the Fund's
Investments? The Fund can buy only those money market instruments that meet
credit quality, maturity and diversification standards set in the Investment
Company Act for money market funds. The Fund's Managing General Partners have
adopted procedures to evaluate securities for the Fund's portfolio under those
standards and the Manager has the responsibility to implement those procedures
when selecting investments for the Fund.
In general, those procedures require that the Fund hold only money market
instruments that are rated in one of the two highest short-term rating
categories of two national rating organizations or unrated securities of
comparable quality. All of the Fund's investments are U.S. government securities
or repurchase agreements fully collateralized by U.S. government securities,
which are deemed to be comparable to rated securities in the highest rating
category of ratings organizations.
Under the procedures the Fund can invest without limit in U.S. government
securities because of their limited investment risks. A security's maturity must
not exceed 397 days. Finally, the Fund must maintain an average portfolio
maturity of not more than 90 days, to reduce interest rate risks.
o Can the Fund's Investment Objective and Policies Change? The Fund's
Managing General Partners can change non-fundamental policies without
shareholder approval, although significant changes will be described in
amendments to this Prospectus. Fundamental policies are those that cannot be
changed without the approval of a majority of the Fund's outstanding voting
shares. The Fund's investment objective is a fundamental policy. An investment
policy is not fundamental unless this Prospectus or the Statement of Additional
Information says that it is.
Other Investment Strategies. To seek its objective, the Fund can also use the
investment techniques and strategies described below. The Fund might not always
use all of the techniques and strategies described below. These techniques
involve certain risks. The Statement of Additional Information contains more
information about some of these practices, including limitations on their use
that are designed to reduce some of the risks.
o "When-Issued" and "Delayed-Delivery" Transactions. The Fund can purchase
securities on a "when-issued" basis and can purchase or sell securities on a
"delayed-delivery" basis. These terms refer to securities that have been created
and for which a market exists, but which are not available for immediate
delivery. The Fund does not intend to make such purchases for speculative
purposes. No income is paid to the Fund on a "when-issued" security until the
Fund receives the security on the settlement of the trade. There is a risk of
loss to the Fund if the value of the security declines prior to the settlement
date.
o Illiquid and Restricted Securities. Investments may be illiquid because
they have no active trading market, making it difficult to value them or dispose
of them promptly at an acceptable price. Restricted securities may have a
contractual limit on resale or may require registration under federal securities
laws before they can be sold publicly. As a fundamental policy, the Fund will
not invest more than 5% of its total assets in illiquid or restricted
securities, including repurchase agreements of more than seven days' duration
and securities that are not readily marketable. That limit may not apply to
certain restricted securities that are eligible for resale to qualified
institutional purchasers. The Manager monitors holdings of illiquid securities
on an ongoing basis to determine whether to sell any holdings to maintain
adequate liquidity. Difficulty in selling a security may result in a loss to the
Fund or additional costs.
Year 2000 Risks. Because many computer software systems in use today cannot
distinguish the year 2000 from the year 1900, the markets for securities in
which the Fund invests could be detrimentally affected by computer failures
beginning January 1, 2000. Failure of computer systems used for securities
trading could result in settlement and liquidity problems for the Fund and other
investors. That failure could have a negative impact on handling securities
trades, pricing and accounting services. Data processing errors by government
issuers of securities could result in economic uncertainties, and those issuers
might incur substantial costs in attempting to prevent or fix such errors, all
of which could have a negative effect on the Fund's investments and returns.
The Manager, the Distributor and the Transfer Agent have been working on
necessary changes to their computer systems to deal with the year 2000 and
expect that their systems will be adapted in time for that event, although there
cannot be assurance of success. Additionally, the services they provide depend
on the interaction of their computer systems with those of brokers, information
services, the Fund's Custodian and other parties. Therefore, any failure of the
computer systems of those parties to deal with the year 2000 might also have a
negative effect on the services they provide to the Fund. The extent of that
risk cannot be ascertained at this time.
How the Fund is Managed
The Manager. The Fund's investment Manager, OppenheimerFunds, Inc., is
responsible for selecting the Fund's investments and handles its day-to-day
business. The Manager carries out its duties, subject to the policies
established by the Managing General Partners, under an Investment Advisory
Agreement that states the Manager's responsibilities. The Agreement sets the
fees paid by the Fund to the Manager and describes the expenses that the Fund is
responsible to pay to conduct its business.
The Manager has operated as an investment advisor since 1959. The Manager
(including subsidiaries) currently manages investment companies, including other
Oppenheimer funds, with assets of more than $100 billion as of March 31, 1999,
and with more than 4 million shareholder accounts. The Manager is located at Two
World Trade Center, 34th Floor, New York, New York 10048-0203.
o Portfolio Managers. Carol E. Wolf and Arthur J. Zimmer are the portfolio
managers of the Fund. They are the persons principally responsible for the
day-to-day management of the Fund's portfolio. Ms. Wolf has had this
responsibility since December 6, 1991, and Mr. Zimmer since January 2, 1992. Ms.
Wolf is a Vice President and Mr. Zimmer a Senior Vice President of the Manager,
and each is an officer and portfolio manager of other funds for which the
Manager or a subsidiary of the Manager serves as investment advisor.
o Advisory Fees. Under the Investment Advisory Agreement, the Fund pays the
Manager an advisory fee at an annual rate that declines on additional assets as
the Fund grows: 0.45% of the first $500 million of average annual net assets of
the Fund and 0.40% of average annual net assets over $500 million. The Fund's
management fee for its fiscal year ended December 31, 1998 was 0.45% of the
Fund's average annual net assets.
- ------------------------------------------------------------------------------
A B O U T Y O U R A C C O U N T
- ------------------------------------------------------------------------------
How to Buy Shares
Who Can Buy Fund Shares? Only "eligible foreign investors" can buy Fund
shares. An eligible foreign investor is an investor who is not treated as a
U.S. citizen or resident or as a U.S. corporation, partnership, trust or
estate for U.S. federal income tax purposes under the Internal Revenue Code.
Eligible foreign purchasers are referred to as "Investors" in this
Prospectus.
At What Price Are Shares Sold? Shares are sold at their offering price, which is
the net asset value per share without any sales charge. The net asset value per
share will normally remain fixed at $1.00 per share. However, there is no
guarantee that the Fund will maintain a stable net asset value of $1.00 per
share.
The offering price that applies to a purchase order is based on the next
calculation of the net asset value per share that is made after the Distributor
receives the purchase order at its offices in Denver, Colorado, or after any
agent appointed by the Distributor receives the order and sends it to the
Distributor as described below.
How Much Must You Invest? You can open a Fund account with a minimum initial
investment described below depending on how you buy and pay for your shares, and
you can make additional investments at any time with as little as $25. The
minimum investment requirements do not apply to reinvesting distributions from
the Fund or other Oppenheimer funds (a list of them appears in the Statement of
Additional Information, or you can ask your dealer or call the Transfer Agent)
or reinvesting distributions from unit investment trusts that have made
arrangements with the Distributor.
How Are Shares Purchased? Investors can buy shares in one of several ways:
o Buying Shares Through a Dealer's Automatic Purchase and Redemption Program:
Investors can buy shares through a broker-dealer that has a sales agreement
with the Fund's Distributor or Sub-Distributor that allows shares to be
purchased through the dealer's Automatic Purchase and Redemption Program.
The Fund's shares are sold mainly to customers of participating dealers
that offer the Fund's shares under these special purchase programs. If you
participate in an Automatic Purchase and Redemption Program established by
your dealer, your dealer buys shares of the Fund for your account with the
dealer. Program participants should also read the description of the
program provided by their dealer.
o Buying Shares Through Your Dealer: Investors who do not participate in an
Automatic Purchase and Redemption Program may buy shares of the Fund
through any broker-dealer that has a sales agreement with the Distributor
or the Sub-Distributor. Your dealer will place your order with the
Distributor on your behalf.
o Buying Shares Directly Through the Distributor: Investors can also
purchase shares directly through the Fund's Distributor. Investors who
make purchases directly and hold shares in their own names are referred
to as "Direct Investors" in this Prospectus.
The Distributor may appoint certain servicing agents to accept purchase
(and redemption) orders, including broker-dealers that have established
Automatic Purchase and Redemption Programs. The Distributor, in its sole
discretion, may reject any purchase order for the Fund's shares.
o All Investors Are Limited Partners of the Fund. The Fund is organized as
a limited partnership, and all purchasers of the Fund's shares are required to
become limited partners of the Fund. In order to be admitted as a limited
partner, an Investor must complete the following forms, whether the Investor
buys shares directly or through a broker-dealer: o a partnership subscription
agreement in the Fund Application included
with this Prospectus,
o a special power of attorney, in the form set forth in the Application,
and
o certification of their foreign status to the Fund on Form W-8BEN.
Admission of an Investor as a limited partner also requires the consent of the
Managing General Partners. The Managing General Partners of the Fund, while
recognizing that they have the right to withhold their consent, have stated that
they intend to give such consent as a matter of course to eligible Investors.
How Are Shares Purchased Through Automatic Purchase and Redemption Programs? If
you buy shares through your broker-dealer's Automatic Purchase and Redemption
Program, your broker-dealer will buy your shares of the Fund for your Program
Account and will hold your shares in your broker-dealer's name. These purchases
will be made under the procedures described in "Guaranteed Payment" below. Your
Automatic Purchase and Redemption Program Account may have minimum investment
requirements established by your broker-dealer. You should direct all questions
about your Automatic Purchase and Redemption Program to your broker-dealer,
because the Fund's transfer agent does not have access to information about your
account under that Program.
on Guaranteed Payment Procedures. Some broker-dealers may have arrangements
with the Distributor to enable them to place purchase orders for Fund shares and
to guarantee that the Fund's custodian bank will receive Federal Funds to pay
for the shares prior to specified times. Broker-dealers whose clients
participate in Automatic Purchase and Redemption Programs may use these
guaranteed payment procedures to pay for purchases of Fund shares.
o If the Distributor receives a purchase order before 12:00 Noon on a
regular business day with the dealer's guarantee that the Fund's
custodian bank will receive payment for those shares in Federal Funds
by 2:00 P.M. on that same day, the order will be effected at the net
asset value determined at 12:00 Noon that day. (All references to time
in this Prospectus mean "New York time.") Distributions will begin to
accrue on the shares on that day if the Federal Funds are received by
the required time.
o If the Distributor receives a purchase order after 12:00 Noon on a regular
business day with the dealer's guarantee that the Fund's custodian bank
will receive payment for those shares in Federal Funds by 2:00 P.M. on
that same day, the order will be effected at the net asset value
determined at 4:00 P.M. that day. Distributions will begin to accrue on
the shares on that day if the Federal Funds are received by the required
time.
o If the Distributor receives a purchase order between 12:00 Noon and
4:00 P.M. on a regular business day with the broker-dealer's guarantee
that the Fund's custodian bank will receive payment for those shares in
Federal Funds by 4:00 P.M. the next regular business day, the order
will be effected at the net asset value determined at 4:00 P.M. on the
day the order is received and distributions will begin to accrue on the
shares purchased on the next regular business day if the Federal Funds
are received by the required time.
How Can Direct Investors Buy Shares Through the Distributor? Direct Investors
may buy shares of the Fund by completing a Centennial Funds New Account
Application (enclosed with this Prospectus), along with the three other
documents listed above, and sending them to Centennial Asset Management
Corporation, P.O. Box 5143, Denver, Colorado 80217. Payment must be made by
check or by Federal Funds wire as described below. If you don't list a dealer on
the application, OppenheimerFunds Distributor, Inc., the Sub-Distributor, will
act as your agent in buying the shares. However, we recommend that you discuss
your investment with a financial advisor before you make a purchase to be sure
that the Fund is appropriate for you.
The Fund intends to be as fully invested as possible to maximize its
yield. Therefore, newly-purchased shares normally will begin to accrue
distributions after the Distributor or its agent accepts your purchase order,
starting on the business day after the Fund receives Federal Funds from the
purchase payment.
|X| Payment by Check. Direct Investors may pay for Fund share purchases by
check. Send your check, payable to "Centennial Asset Management Corporation,"
along with your Application and other documents to the address listed above. For
initial purchases, your check should be payable in U.S. dollars and drawn on a
U.S. bank so that distributions will begin to accrue on the next regular
business day after the Distributor accepts your purchase order. If your check is
not drawn on a U.S. bank and is not payable in U.S. dollars, the shares will not
be purchased until the Distributor is able to convert the purchase payment to
Federal Funds. In that case distributions will begin to accrue on the purchased
shares on the next regular business day after the purchase is made. The minimum
initial investment for Direct Investors by check is $500.
o Payment by Federal Funds Wire. Direct Investors may pay for Fund share
purchases by Federal Funds wire. You must also forward your Application and
other documents to the address listed above. Before sending a wire, call the
Distributor's Wire Department at 1-800-525-9310 (toll-free from within the U.S.)
or 303-768-3200 (from outside the U.S.) to notify the Distributor of the wire,
and to receive further instructions.
Distributions will begin to accrue on the purchased shares on the purchase
date that is a regular business day if the Federal Funds from your wire and the
Application are received by the Distributor and accepted by 12:00 Noon. If the
Distributor receives the Federal Funds from your wire and accepts the purchase
order between 12:00 Noon and 4:00 P.M on the purchase date, distributions will
begin to accrue on the shares on the next regular business day. The minimum
investment by Federal Funds Wire is $2,500.
o Buying Shares Through Automatic Investment Plans. Direct Investors can
purchase shares of the Fund automatically each month by authorizing the Fund's
Transfer Agent to debit your account at a U.S. domestic bank or other financial
institution. Details are in the Automatic Investment Plan Application and the
Statement of Additional Information. The minimum monthly purchase is $25.
How is the Fund's Net Asset Value Determined? The net asset value of the Fund's
shares is determined twice each day, at 12:00 Noon and at 4:00 P.M., on each day
The New York Stock Exchange is open for trading (referred to in this Prospectus
as a "regular business day"). All references to time in this Prospectus mean
"New York time."
The net asset value per share is determined by dividing the value of the
Fund's net assets by the number of shares that are outstanding. Under a policy
adopted by the Fund's Managing General Partners, the Fund uses the amortized
cost method to value its securities to determine net asset value.
What Shares Does the Fund Offer? The Fund offers Investors one class of shares.
Those shares are considered to be Class A shares for the purposes of exchanging
them or reinvesting distributions among other Oppenheimer funds that offer more
than one class of shares.
o Service (12b-1) Plan. The Fund has adopted a service plan. It reimburses
the Distributor for a portion of its costs incurred for services provided to
accounts that hold shares of the Fund. Reimbursement is made quarterly at an
annual rate of up to 0.20% of the average annual net assets of the Fund. The
Distributor currently uses all of those fees to pay dealers, brokers, banks and
other financial institutions quarterly for providing personal services and
maintenance of accounts of their customers that hold shares of the Fund.
How to Sell Shares
Shares can be sold (redeemed) on any regular business day. Orders to sell shares
will receive the next net asset value per share calculated after the order is
received in proper form (which means that it must comply with the procedures
described below) and is accepted by the Fund's Transfer Agent.
How Can Program Participants Sell Shares? If you participate in an Automatic
Purchase and Redemption Program sponsored by your broker-dealer, you must redeem
shares held in your Program Account by contacting your broker-dealer firm, or
you can redeem shares by writing checks as described below. You should not
contact the Fund or its Transfer Agent directly to redeem shares held in your
Program Account. You may also arrange (but only through your broker-dealer) to
have the proceeds of redeemed Fund shares sent by Federal Funds wire, as
described below in "Sending Redemption Proceeds by Wire."
How Can Direct Investors Redeem Shares? Direct Investors can redeem their shares
by writing a letter to the Transfer Agent, by using the Fund's checkwriting
privilege, or by telephone. You can also set up Automatic Withdrawal Plans to
redeem shares on a regular basis. If you have questions about any of these
procedures, and especially if you are redeeming shares in a special situation,
such as due to the death of the owner or from a retirement plan account, please
call the Transfer Agent for assistance first, at 1-800-525-9310 (from within the
U.S.) or 303-768-3200 (from outside the U.S.) .
n Certain Requests Require a Signature Guarantee. To protect Investors and
the Fund from fraud, the following redemption requests for accounts of Direct
Investors must be in writing and must include a signature guarantee (although
there may be other situations that also require a signature guarantee):
o You wish to redeem $50,000 or more and receive a check o The redemption
check is not payable to all Investors listed on the
account statement
o The redemption check is not sent to the address of record on your
account statement
o Shares are being transferred to a Fund account with a different
owner or name
o Shares are being redeemed by someone (such as an Executor) other
than the owners
o Where Can Direct Investors Have Their Signatures Guaranteed? The Transfer
Agent will accept a guarantee of your signature by a number of financial
institutions, including: a U.S. bank, trust company, credit union or savings
association, or by a foreign bank that has a U.S. correspondent bank, or by a
U.S. registered dealer or broker in securities, municipal securities or
government securities, or by a U.S. national securities exchange, a registered
securities association or a clearing agency. If you are signing on behalf of a
corporation, partnership or other business or as a fiduciary, you must also
include your title in the signature.
on How Can Direct Investors Sell Shares by Mail? Write a "letter of
instructions" that includes:
o Your name
o The Fund's name
o Your Fund account number (from your account statement)
o The dollar amount or number of shares to be redeemed
o Any special payment instructions
o Any share certificates for the shares you are selling
o The signatures of all registered owners exactly as the account is
registered, and
Any special documents requested by the Transfer Agent to assure proper
authorization of the person asking to sell the shares.
- ------------------------------------------------------------------------------
Use the following address for requests by mail:
- ------------------------------------------------------------------------------
Shareholder Services, Inc.
P.O. Box 5143
Denver, Colorado 80217-5270
Send courier or express mail requests to:
Shareholder Services, Inc.
10200 E. Girard Avenue, Building D
Denver, Colorado 80231
o How Can Direct Investors Sell Shares by Telephone? Direct Investors and
their dealer representative of record may also sell shares by telephone. To
receive the redemption price on a regular business day, the Transfer Agent must
receive the request by 4:00 P.M. on that day. You may not redeem shares held
under a share certificate by telephone. To redeem shares through a service
representative, call 1-800-525-9310 (from within the U.S.) or 303-768-3200 (from
outside the U.S.). Proceeds of telephone redemptions will be paid by check
payable to the shareholder(s) of record and will be sent to the address of
record for the account. Up to $50,000 may be redeemed by telephone in any 7-day
period. The check must be payable to all owners of record of the shares and must
be sent to the address on the account statement. This service is not available
within 30 days of changing the address on an account.
Sending Redemption Proceeds by Wire. While the Fund normally sends Direct
Investors their money by check, you can arrange to have the proceeds of the
shares you sell sent by Federal Funds wire to a bank account you designate. It
must be a commercial bank that is a member of the Federal Reserve wire system.
The minimum redemption you can have sent by wire is $2,500. There is a $10 fee
for each wire. To find out how to set up this feature on an account or to
arrange a wire, Direct Investors should call the Transfer Agent at
1-800-525-9310 (from within the U.S.) or 303-768-3200 (from outside the U.S.).
If you hold your shares through your dealer's Automatic Purchase and Redemption
Program, you must contact your dealer to arrange a Federal Funds wire.
How Do I Write Checks Against My Account? Program participants may write checks
against the Fund account held under their Program, but must arrange for
checkwriting privileges through their dealers. Direct Investors may write checks
against their Fund account by requesting that privilege on the account
Application or by contacting the Transfer Agent for signature cards. They must
be signed (with a signature guarantee) by all owners of the account and returned
to the Transfer Agent so that checks can be sent to you to use. Investors with
joint accounts can elect in writing to have checks paid over the signature of
one owner.
o Checks can be written to the order of whomever you wish, but may not be
cashed at the bank through which the checks are processed or at the
Fund's custodian bank
o Checkwriting privileges are not available for accounts holding shares
that are subject to a contingent deferred sales charge.
o Checks must be written for at least $250.
o Checks cannot be paid if they are written for more than your account
value.
o You may not write a check that would require the Fund to redeem shares
that were purchased by check or Automatic Investment Plan payments
within the prior 10 days.
o Don't use your checks if you changed your Fund account number, until
you receive new checks.
Will I Pay A Sales Charge When I Sell My Shares? The Fund does not charge a
fee to redeem shares of the Fund that were bought directly or by reinvesting
distributions from this Fund or another Centennial or Oppenheimer fund.
Generally, there is no fee to redeem shares of this Fund bought by exchange
of shares of another Centennial Trust or Oppenheimer fund. However,
if you acquired shares of this Fund by exchanging Class A shares of another
Oppenheimer fund that you bought subject to the Class A contingent
deferred sales charge, and
those shares are still subject to the Class A contingent deferred sales
charge when you exchange them into this Fund, then
youwill pay the contingent deferred sales charge if you redeem those shares
from this Fund within 18 months of the purchase date of the shares of the
Fund you exchanged.
Assigning or Transferring Shares is Prohibited. As limited partners of the Fund,
Investors do not have the right to voluntarily transfer or assign their shares
to any other person other than to secure a loan. If a person who is holding Fund
shares as collateral forecloses on that collateral, that person shall not have
the right to be substituted as a limited partner. However, if that person
presents satisfactory evidence to the Managing General Partners of his or her
right to succeed to the interests of the limited partner, that person can: (1)
redeem the shares and (2) receive distributions with respect to the shares.
Under limited circumstances described in the Partnership Agreement, a successor
in interest of a limited partner shall have the right to be substituted as a
limited partner.
How to Exchange Shares
Shares of the Fund can be exchanged for shares of certain other Centennial or
Oppenheimer funds, depending on whether you own your shares through your
dealer's Automatic Purchase and Redemption Program or as a Direct Investor. The
other Centennial and Oppenheimer funds are not designed solely for foreign
investors and are not subject to the same tax considerations as the Fund. As a
result, their distributions paid to foreign investors may be subject to
withholding of U.S. federal income tax. For U.S. federal income tax purposes, an
exchange is treated as a redemption and purchase of shares.
How Can Program Participants Exchange Shares? If you participate in an Automatic
Purchase and Redemption Program sponsored by your broker-dealer, you may
exchange shares held in your Program Account for shares of Centennial Money
Market Trust, Centennial Government Trust and Centennial Tax Exempt Trust
(referred to in this Prospectus as the "Centennial Trusts") by contacting your
broker or dealer and obtaining a Prospectus of the Centennial Trusts.
How Can Direct Investors Exchange Shares? Direct Investors can exchange
shares of the Fund for Class A shares of certain Oppenheimer funds. To
exchange shares, you must meet several conditions:
o Shares of the fund selected for exchange must be available for sale in
your place of residence.
o The prospectuses of this Fund and the fund whose shares you want to buy
must offer the exchange privilege.
o You must hold the shares you buy when you establish your account for at
least 7 days before you can exchange them. After the account is open 7
days, you can exchange shares every regular business day.
o You must meet the minimum purchase requirements for the fund you
purchase by exchange.
o Before exchanging into a fund, you should obtain and read its
prospectus.
Shares of a particular class of an Oppenheimer fund may be exchanged only
for shares of the same class in other Oppenheimer funds. For example, you can
exchange shares of this Fund only for Class A shares of another fund, and you
can exchange only Class A shares of another Oppenheimer fund for shares of this
Fund.
You may pay a sales charge when you exchange shares of this Fund. Because
shares of this Fund are sold without sales charge, in some cases you may pay a
sales charge when you exchange shares of this Fund for shares of other
Oppenheimer funds that are sold subject to a sales charge. You will not pay a
sales charge when you exchange shares of this Fund purchased by reinvesting
distributions from this Fund or other Oppenheimer funds (except Oppenheimer Cash
Reserves), or shares of this Fund purchased by exchange of shares on which you
paid a sales charge.
For tax purposes, exchanges of shares involve a sale of the shares of the
fund you own and a purchase of the shares of the other fund, which may result in
a capital gain or loss. Since shares of this Fund normally maintain a $1.00 net
asset value, in most cases you should not realize a capital gain or loss when
you sell or exchange your shares.
Direct Investors can find a list of Oppenheimer funds currently available
for exchanges in the Statement of Additional Information or you can obtain one
by calling a service representative at 1-800-525-9310. The list of eligible
funds can change from time to time.
o How Do Direct Investors Submit Exchange Requests? Direct
shareholders may request exchanges in writing or by telephone:
o Written Exchange Requests. Submit an Exchange Authorization Form, signed
by all owners of the account. Send it to the Transfer Agent at the address on
the Back Cover.
o Telephone Exchange Requests. Telephone exchange requests may be made by
calling a service representative at 1-800-525-9310. Telephone exchanges may be
made only between accounts that are registered with the same name(s) and
address. Shares held under certificates may not be exchanged by telephone.
Are There Limitations on Exchanges? There are certain exchange policies you
should be aware of:
Shares are normally redeemed from one fund and purchased from the other
fund in the exchange transaction on the same regular business day on
which the Transfer Agent receives an exchange request that conforms to
the policies described above. Requests for exchanges to any of the
Centennial Trusts must be received by the Transfer Agent by 4:00 P.M.
on a regular business day to be effected that day. The Transfer Agent
must receive requests to exchange Fund shares to funds other than the
Centennial Trusts on a regular business day by the close of The New
York Stock Exchange that day. The close is normally 4:00 P.M. but may
be earlier on some days.
Either fund may delay the purchase of shares of the fund you are
exchanging into up to seven days if it determines it would be
disadvantaged by a same-day exchange. For example, the receipt of the
multiple exchange requests from a "market timer" might require a fund
to sell securities at a disadvantageous time and/or price.
Because excessive trading can hurt fund performance and harm shareholders,
the Fund reserves the right to refuse any exchange request that it
believes will disadvantage it, or to refuse multiple exchange requests
submitted by a shareholder or dealer.
TheFund may amend, suspend or terminate the exchange privilege at any
time. Although the Fund will attempt to provide you notice whenever it
is reasonably able to do so, it may impose these changes at any time.
If the Transfer Agent cannot exchange all the shares you request because
of a restriction cited above, only the shares eligible for exchange
will be exchanged.
Shareholder Account Rules and Policies
More information about the Fund's policies and procedures for buying, selling
and exchanging shares is contained in the Statement of Additional Information.
o The offering of shares may be suspended during any period in which the
determination of net asset value is suspended, and the offering may be suspended
by the Managing General Partners at any time they believe it is in the Fund's
best interest to do so.
o Telephone Transaction Privileges for purchases, redemptions or exchanges
may be modified, suspended or terminated by the Fund at any time. If an account
has more than one owner, the Fund and the Transfer Agent may rely on the
instructions of any one owner. Telephone privileges apply to each owner of the
account and the dealer representative of record for the account unless the
Transfer Agent receives cancellation instructions from an owner of the account.
o The Transfer Agent will record any telephone calls to verify data
concerning transactions and has adopted other procedures to confirm that
telephone instructions are genuine, by requiring callers to provide tax
identification numbers and other account data or by using PINs, and by
confirming such transactions in writing. The Transfer Agent and the Fund will
not be liable for losses or expenses arising out of telephone instructions
reasonably believed to be genuine.
o Redemption or transfer requests will not be honored until the Transfer
Agent receives all required documents in proper form. From time to time, the
Transfer Agent in its discretion may waive certain of the requirements for
redemptions stated in this Prospectus.
o Payment for redeemed shares ordinarily is made in cash. It is forwarded
by check or by Federal Funds wire (as elected by the shareholder) within seven
days after the Transfer Agent receives redemption instructions in proper form.
However, under unusual circumstances determined by the Securities and Exchange
Commission, payment may be delayed or suspended. For accounts registered in the
name of a broker-dealer, payment will normally be forwarded within three
business days after redemption.
o The Transfer Agent may delay forwarding a check or making a payment via
Federal Funds wire for recently purchased shares, but only until the purchase
payment has cleared. That delay may be as much as 10 days from the date the
shares were purchased. That delay may be avoided if you purchase shares by
Federal Funds wire or certified check, or arrange with your bank to provide
telephone or written assurance to the Transfer Agent that your purchase payment
has cleared.
on To avoid sending duplicate copies of materials to households, the Fund
will mail only one copy of each annual and semi-annual report to shareholders
having the same last name and address on the Fund's records. However, each
shareholder may call the Transfer Agent at 1-800-525-9310 to ask that copies of
those materials be sent personally to that shareholder.
Distributions and Tax Information
Distributions. The Fund intends to declare daily distributions of all its net
investment income each regular business day and to pay those distributions to
shareholders monthly on a date selected by the Managing General Partners. To
maintain a net asset value of $1.00 per share, the Fund might withhold income
distributions or make distributions from capital or capital gains. Daily
distributions will not be declared or paid on newly purchased shares until
Federal Funds are available to the Fund from the purchase payment for those
shares.
The Fund normally holds its securities to maturity and therefore does not
expect to pay capital gains. Although the Fund does not seek capital gains, it
could realize capital gains on the sale of portfolio securities. If it does, it
may make distributions out of any net short-term or long-term capital gains in
December of each year. The Fund may make supplemental distributions of income
and capital gains following the end of its fiscal year. The Fund has no fixed
distribution rate and cannot guarantee that it will pay any distributions.
What Choices Are there for Receiving Distributions? Your choices for receiving
distributions depend on whether you own your shares directly or through an
Automatic Purchase and Redemption Program.
o Program Participants. If you participate in a dealer's Automatic
Purchase and Redemption Program, all Fund distributions will be automatically
reinvested in additional shares of the Fund. Under the terms of your dealer's
Automatic Purchase and Redemption Program, your broker-dealer may be able to
redeem shares to satisfy debit balances arising in your Program Account. If that
occurs, you will be entitled to distributions on those redeemed shares only to
the date specified in your Program's terms and conditions.
o Direct Investors. All distributions on shares owned by Direct Investors
will be automatically reinvested in additional shares of the Fund unless you ask
the Transfer Agent in writing to pay distributions in cash or to reinvest them
in another Centennial Trust or Oppenheimer fund.
Taxes. The Fund is designed exclusively for eligible foreign investors who
are not treated as U.S. citizens or residents or as U.S. corporations,
partnerships, trusts or estates under the Internal; Revenue Code for U.S.
federal income tax purposes. An Investor's tax consequences of investing in
the Fund will depend upon the jurisdiction in which the Investor is subject
to tax. The discussion of tax matters in this Prospectus assumes that an
Investor is not subject to U.S. tax or withholding with respect to the
Investor's other income or activities that are unrelated to an investment in
the Fund.
The Fund is a limited partnership and has made an election under the
Internal Revenue Code to pay federal income taxes (at a special rate) on its
income to allow it to maintain its status as a partnership. The characterization
under the Internal Revenue Code of any income realized by the Fund after payment
of that tax flows through to its limited partners.
Investors in the Fund are generally liable for payment of taxes on their
allocated share of net investment income and realized capital gains. However, if
that income is "portfolio interest" income, Investors who are not subject to
payment or withholding of U.S. tax on that type of income will generally not be
subject to U.S. federal income tax or withholding on their allocated share of
income realized by the Fund if certain conditions are met on a continuing basis.
The Fund intends to comply with those conditions, which are described in more
detail in the Statement of Additional Information.
After each calendar year, the Fund is required to send Investors a Form
1065, Schedule K-1, regardless of whether they are U.S. taxpayers. The Fund must
also file the Form with the IRS. The Form identifies the Investor's share of the
Fund's net income, gains and losses for the taxable year.
The Fund will also file an annual information return with the IRS with
respect to each Investor. That return includes the Form W-8BEN furnished by the
Investor. The return will indicate, if applicable, that no amount was withheld
with respect to income allocated to the Investor that qualified for the
"portfolio interest" exemption or any other applicable exemption under the
Internal Revenue Code. The Fund may be required to send shareholders additional
forms under certain circumstances.
This information is only a summary of certain federal tax information
about an investment in the Fund. More detailed information about tax matters and
the partnership agreement can be found in the Statement of Additional
Information. Also, Investors should consult their tax advisors regarding any tax
forms received from the Fund and other tax considerations that may apply to your
particular situation.
<PAGE>
Financial Highlights
The Financial Highlights Table is presented to help you understand the Fund's
financial performance for the past 5 fiscal years. Certain information reflects
financial results for a single Fund share. The total returns in the table
represent the rate that an Investor would have earned (or lost) on an investment
in the Fund (assuming reinvestment of all distributions). This information has
been audited by Deloitte & Touche LLP, the Fund's independent auditors, whose
report, along with the Fund's financial statements, is included in the Statement
of Additional Information, which is available on request.
Financial Highlights
<TABLE>
<CAPTION>
Year Ended December 31,
-------------------------------------------------
1998 1997 1996 1995 1994
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
PER SHARE OPERATING DATA
Net asset value, beginning of period .............. $1.00 $1.00 $1.00 $1.00 $1.00
----- ----- ----- ----- -----
Income from investment operations--net
investment income and net realized gain ......... .04 .05 .05 .04 .03
Dividends and distributions to shareholders ....... (.04) (.05) (.05) (.04) (.03)
----- ----- ----- ----- -----
Net asset value, end of period .................... $1.00 $1.00 $1.00 $1.00 $1.00
===== ===== ===== ===== =====
TOTAL RETURN(1) ................................... 4.40% 4.63% 4.69% 4.56% 2.91%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in thousands) .......... $22,162 $14,580 $18,661 $11,102 $6,201
Average net assets (in thousands) ................. $19,724 $16,320 $16,998 $ 7,862 $5,693
Ratios to average net assets:
Net investment income ........................... 4.23% 4.53% 4.52% 4.48% 2.89%
Expenses ........................................ 1.22% 0.98% 0.86% 1.48% 1.47%
</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 reflect
changes in net investment income only.
<PAGE>
For More Information About Centennial America Fund, L.P.:
The following additional information about the Fund is available without charge
upon request:
Statement of Additional Information
This document includes additional information about the Fund's investment
policies, risks, and operations. It is incorporated by reference into this
Prospectus (which means it is legally part of this Prospectus).
Annual and Semi-Annual Reports
Additional information about the Fund's investments and performance is available
in the Fund's Annual and Semi-Annual Reports to shareholders. The Annual Report
includes a discussion of market conditions and investment strategies that
significantly affected the Fund's performance during its last fiscal year.
How to Get More Information:
You can request the Statement of Additional Information, the Annual and
Semi-Annual Reports, and other information about the Fund or your account:
By Telephone:
Call Shareholder Services, Inc. toll-free:
1-800-525-9310 (from inside the U.S.)
303-768-3200 (from outside the U.S.)
By Mail:
Write to:
Shareholder Services, Inc.
P.O. Box 5143
Denver, Colorado 80217
You can also obtain copies of the Statement of Additional Information and other
Fund documents and reports by visiting the SEC's Public Reference Room in
Washington, D.C. (Phone 1-800-SEC-0330) or the SEC's Internet web site at
http://www.sec.gov. Copies may be obtained upon payment of a duplicating fee by
writing to the SEC's Public Reference Section, Washington, D.C. 20549-6009.
No one has been authorized to provide any information about the Fund or to make
any representations about the Fund other than what is contained in this
Prospectus. This Prospectus is not an offer to sell shares of the Fund, nor a
solicitation of an offer to buy shares of the Fund, to any person in any state
or other jurisdiction where it is unlawful to make such an offer.
The Fund's shares are distributed by:
SEC File No. 811-5051 Centennial Asset Management Corporation
PR0870.001.0499 Printed on recycled paper
<PAGE>
APPENDIX TO PROSPECTUS OF
CENTENNIAL AMERICA FUND, L.P.
Graphic material included in Prospectus of Centennial America Fund,
L.P. (the "Fund") under the heading: "Annual Total Returns (as of 12/31 each
year)."
A bar chart will be included in the Prospectus of the Fund depicting the
annual total returns of a hypothetical investment in shares of the Fund for each
of the full calendar years since the Fund's inception as a money market fund.
Set forth below are the relevant data points that will appear on the bar chart.
- --------------------------------------------------------------------
Calendar Year Ended: Annual Total Returns
- --------------------------------------------------------------------
- --------------------------------------------------------------------
12/31/92 3.92%
- --------------------------------------------------------------------
- --------------------------------------------------------------------
12/31/93 2.23%
- --------------------------------------------------------------------
- --------------------------------------------------------------------
12/31/94 2.91%
- --------------------------------------------------------------------
- --------------------------------------------------------------------
12/31/95 4.56%
- --------------------------------------------------------------------
- --------------------------------------------------------------------
12/31/96 4.69%
- --------------------------------------------------------------------
- --------------------------------------------------------------------
12/31/97 4.63%
- --------------------------------------------------------------------
- --------------------------------------------------------------------
12/31/98 4.40%
- --------------------------------------------------------------------
<PAGE>
- ------------------------------------------------------------------------------
Centennial America Fund, L.P.
- ------------------------------------------------------------------------------
6803 South Tucson Way, Englewood, Colorado 80112 1-800-525-9310 (from within the
U.S.) 303-768-3200 (from outside the U.S.)
Statement of Additional Information dated April 30, 1999
This Statement of Additional Information is not a Prospectus. This
document contains additional information about the Fund and supplements
information in the Prospectus dated April 30, 1999. It should be read together
with the Prospectus, which may be obtained by writing to the Fund's Transfer
Agent, Shareholder Services, Inc., at P.O. Box 5143, Denver, Colorado 80217, or
by calling the Transfer Agent at the toll-free number shown above (from within
the U.S.), or 303-768-3200 (from outside the U.S.).
Contents
Page
About the Fund
Additional Information about the Fund's Investment Policies and Risks........2
The Fund's Investment Policies..........................................2
Investment Restrictions.................................................5
How the Fund is Managed......................................................7
Organization and History................................................7
Summary of the Fund's Partnership Agreement.............................7
Managing General Partners and Officers of the Fund..........................10
The Manager............................................................15
Service Plan................................................................17
Performance of the Fund.....................................................19
About Your Account
How To Buy Shares...........................................................22
How To Sell Shares..........................................................24
How To Exchange Shares......................................................26
Distributions and Taxes.....................................................29
Additional Information About the Fund.......................................32
Financial Information About the Fund
Independent Auditors' Report................................................33
Financial Statements........................................................34
Appendix A: Securities Ratings.............................................A-1
Appendix B: Industry Classifications.......................................B-1
Appendix C: Agreement of Limited Partnership...............................C-1
<PAGE>
- ------------------------------------------------------------------------------
A B O U T T H E F U N D
- ------------------------------------------------------------------------------
Additional Information About the Fund's Investment Policies and Risks
The investment objective and the principal investment policies of the Fund are
described in the Prospectus. This Statement of Additional Information contains
supplemental information about those policies and the types of securities that
the Fund's investment Manager, OppenheimerFunds, Inc. will select for the Fund.
Additional explanations are also provided about the strategies the Fund can use
to try to achieve its objective.
The Fund's Investment Policies. The Fund's objective is to seek as high a level
of current income as is consistent with the preservation of capital and the
maintenance of liquidity. Because it seeks to maintain a stable $1.00 per share
price, the Fund does not make investments with the objective of seeking capital
growth.
n Interest Rate Risks. The value of the investments held by the Fund could
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, if interest rates decrease after a
security is purchased, its value would rise. Those fluctuations in value
normally will not generally result in realized gains or losses to the Fund since
the Fund uses the amortized cost method of valuing its shares, and 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. Short-term debt securities and money market instruments
normally do not fluctuate in price as much when interest rates change compared
to longer-term securities. However, a sharp, sudden rise in interest rates could
affect the values of money market investments the Fund holds, which could cause
the Fund's share price to fall below $1.00 per share.
The Fund can sell securities prior to their maturity for a number of
reasons, for example because of a revised credit evaluation of an issuer of an
instrument the Fund holds, or to raise cash to meet redemptions of Fund shares,
or to take advantage of short-term market variations, or to correct a deviation
between the amortized cost value of its investments and their market value. In
these cases, the Fund could realize a capital gain or loss on the security.
|X| Ratings of Securities -- Portfolio Quality, Maturity and
Diversification. Under Rule 2a-7 of the Investment Company Act, the Fund uses
the amortized cost method to value its portfolio securities to determine the
Fund's net asset value per share. That method is described below in the section
entitled "How to Buy Shares - Determination of Net Asset Value." Rule 2a-7
places restrictions on a money market fund's investments. Under that Rule, the
Fund may purchase only those securities that the Manager, under Board-approved
procedures, has determined have minimal credit risks and are "Eligible
Securities." The rating restrictions described in the Prospectus and this
Statement of Additional Information do not apply to banks in which the Fund's
cash is kept.
An "Eligible Security" is one that has been rated in one of the two
highest short-term rating categories by any two "nationally-recognized
statistical rating organizations." That term is defined in Rule 2a-7 and they
are referred to as "Rating Organizations" in this Statement of Additional
Information. If only one Rating Organization has rated that security, it must
have been rated in one of the two highest rating categories by that Rating
Organization. An unrated security that is judged by the Manager to be of
comparable quality to Eligible Securities rated by Rating Organizations may also
be an "Eligible Security."
Rule 2a-7 permits the Fund to purchase any number of "First Tier
Securities." These are Eligible Securities that have been rated in the highest
rating category for short-term debt obligations by at least two Rating
Organizations. If only one Rating Organization has rated a particular security,
it must have been rated in the highest rating category by that Rating
Organization. Comparable unrated securities may also be First Tier Securities.
Under Rule 2a-7, the Fund may invest only up to 5% of its total assets in
"Second Tier Securities." Those are Eligible Securities that are not "First Tier
Securities." In addition, the Fund may not invest more than:
|_| 5% of its total assets in the securities of any one issuer (other than
the U.S. Government, its agencies or instrumentalities) or
|_| 1% of its total assets or $1 million (whichever is greater) in Second
Tier Securities of any one issuer.
Under Rule 2a-7, the Fund must maintain a dollar-weighted average
portfolio maturity of not more than 90 days, and the maturity of any single
portfolio investment may not exceed 397 days. The Board regularly reviews
reports from the Manager to show the Manager's compliance with the Fund's
procedures and with the Rule.
If a security's rating is downgraded, the Manager and/or the Managing
General Partners may have to reassess the security's credit risk. If a security
has ceased to be a First Tier Security, the Manager will promptly reassess
whether the security continues to present minimal credit risk. 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 Fund's Managing General Partners shall promptly reassess whether
the security presents minimal credit risk and whether it is in the best
interests of the Fund to retain it. If the Fund disposes of the security within
five days of the Manager learning of the downgrade, the Manager will provide the
Managing General Partners 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 Fund must dispose of the security
as soon as is practicable unless the Managing General Partners determine it
would be in the best interests of the Fund to retain the security.
The Rating Organizations currently designated as nationally-recognized
statistical rating organizations by the Securities and Exchange Commission are
Standard & Poor's Ratings Services, Moody's Investors Service, Inc., Fitch IBCA
, Inc., Duff and Phelps, Inc., and Thomson BankWatch, Inc. Appendix A to this
Statement of Additional Information contains descriptions of the rating
definitions of those Rating Organizations. Ratings at the time of purchase will
determine whether the Fund can acquire securities under the restrictions
described above.
|X| U.S. Government Securities. U.S. government securities are
obligations issued or guaranteed by the U.S. Government or its agencies or
instrumentalities. They include Treasury Bills (which mature within one year
of the date they are issued) and Treasury Notes and Bonds (which are issued
with longer maturities). All Treasury securities are backed by the full
faith and credit of the United States as to payment of interest and repayment
of principal in a timely manner. Although they are generally unrated, they
are considered to be of the highest credit quality and to present little risk
of default. "Full faith and credit" means generally that the taxing power of
the U.S. government is pledged to the payment of interest and repayment of
principal on a security.
The Fund can buy securities of various U.S. Government agencies and
instrumentalities that issue or guarantee securities. These include, among
others, the Federal Housing Administration, Farmers Home Administration,
Export-Import Bank of the United States, Small Business Administration,
Government National Mortgage Association, General Services Administration, Bank
for Cooperatives, Federal Home Loan Banks, Federal Home Loan Mortgage
Corporation, Federal Intermediate Credit Banks, Federal Land Banks, Maritime
Administration, the Tennessee Valley Authority and the District of Columbia
Armory Board.
If a security is not backed by the full faith and credit of the U.S.
government, the purchaser of the security must look to the agency or
instrumentality issuing the obligation for repayment. The owner might not be
able to assert a claim against the United States if the issuing agency or
instrumentality does not meet its obligation. Securities issued or guaranteed by
U.S. Government agencies and instrumentalities are not necessarily backed by the
full faith and credit of the United States. Some, such as securities issued by
the Federal National Mortgage Association ("Fannie Mae"), are backed by the
right of the agency or instrumentality to borrow from the Treasury. Others, such
as securities issued by the Federal Home Loan Mortgage Corporation ("Freddie
Mac"), are supported only by the credit of the instrumentality and not by the
Treasury. The Fund will invest in securities of U.S. government agencies and
instrumentalities only when the Manager is satisfied that the credit risk with
respect to the agency or instrumentality is minimal and that the security is an
Eligible Security.
|X| Repurchase Agreements. As a fundamental policy, the Fund can invest in
repurchase agreements only to purchase U.S. government securities. In a
repurchase transaction, the Fund acquires a U.S. government security from, and
simultaneously resells it to, an approved vendor for delivery on an agreed-upon
future date. 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. "Approved vendors" include U.S. commercial
banks, U.S. branches of a foreign bank, or broker-dealers that have been
designated as primary dealers in government securities. These entities must meet
the credit requirements set by the Fund's Managing General Partners from time to
time.
Repurchase agreements, considered "loans" under the Investment Company
Act, are collateralized by the underlying security. The Fund's repurchase
agreements require that at all times while the repurchase agreement is in
effect, the collateral's value must equal or exceed the repurchase price to
fully collateralize the repayment obligation. However, if the vendor fails to
pay the resale price on the delivery date, the Fund may incur costs in disposing
of the collateral and may experience losses if there is any delay in its ability
to do so. The Manager will monitor the vendor's creditworthiness to confirm that
the vendor is financially sound and will continuously monitor the collateral's
value.
Investment Restrictions
|X| What Are "Fundamental Policies?" Fundamental policies are those
policies that the Fund has adopted to govern its investments that can be changed
only by the vote of a "majority" of the Fund's outstanding voting securities.
Under the Investment Company Act, a "majority" vote is defined as the vote of
the holders of the lesser of:
67%or more of the shares present or represented by proxy at a shareholder
meeting, if the holders of more than 50% of the outstanding shares are
present or represented by proxy, or
more than 50% of the outstanding shares.
The Fund's investment objective is a fundamental policy. Other policies
described in the Prospectus or this Statement of Additional Information are
"fundamental" only if they are identified as such. The Fund's Managing General
Partners can change non-fundamental policies without shareholder approval.
However, significant changes to investment policies will be described in
supplements or updates to the Prospectus or this Statement of Additional
Information, as appropriate. The Fund's most significant investment policies are
described in the Prospectus.
|X| Does the Fund Have Additional Fundamental Policies? The
following investment restrictions are fundamental policies of the Fund:
|_| The Fund will invest only in obligations issued or guaranteed by the
U.S. government or by its agencies and instrumentalities, including
mortgage-backed securities, and securities issued by private entities but
only if the mortgage collateral underlying the securities is insured,
guaranteed, or otherwise backed by the U.S. government or one or more of
its agencies or instrumentalities.
|_| The Fund cannot borrow money, except from banks for temporary or
emergency purposes in amounts not in excess of 5% of the value of the
Fund's total assets. No assets of the Fund may be pledged, mortgaged or
hypothecated other than to secure a borrowing, and then in amounts not
exceeding 7.5% of the Fund's total assets. Borrowings may not be made for
investment leverage, but only for liquidity purposes to satisfy redemption
requests when liquidation of portfolio securities is considered
inconvenient or disadvantageous. However, the Fund may enter into
when-issued and delayed-delivery transactions.
o The Fund can enter into repurchase agreements, but it cannot enter into a
repurchase transaction that will cause more than 25% of the Fund's total
assets to be subject to such agreements.
|_| The Fund cannot make loans, except that the Fund may purchase or hold
debt obligations permitted by its other fundamental policies and may enter
into repurchase transactions collateralized by cash or U.S. Government
Securities having a value equal at all times to at least 100% of the value
of the securities loaned, including accrued interest.
|_| The Fund cannot purchase restricted or illiquid securities (including
repurchase agreements of more than seven days' duration and other
securities that are not readily marketable) if more than 5% of the Fund's
total assets would be invested in such securities.
|_| The Fund cannot purchase any securities (other than U.S. government
securities) that would cause more than 5% of the Fund's total assets to be
invested in securities of a single issuer, or purchase more than 10% of
the outstanding voting securities of an issuer.
|_| The Fund cannot purchase or sell real estate, commodities or commodity
contracts, although it may purchase and sell marketable securities that
are secured by real estate and marketable securities of companies that
invest or deal in real estate. The Fund will not invest in U.S. real
property interests within the meaning of Section 897 of the Internal
Revenue Code.
|_| The Fund cannot invest in interests in oil, gas, or other mineral
exploration or development programs.
|_| The Fund cannot purchase securities on margin or make short sales of
securities.
|_| The Fund cannot underwrite securities except to the extent the Fund
may be deemed to be an underwriter in connection with the sale of
securities held in its portfolio. However the Fund may acquire securities
representing interests in a unit investment trust in connection with the
sale of shares of the Fund if, as a result of that acquisition, the Fund
holds not more than 3% of the outstanding voting securities of that unit
investment trust.
|_| The Fund cannot invest in securities of other investment companies,
except as they may be acquired as part of a merger, consolidation or other
acquisition.
|_| The Fund cannot write, purchase or sell puts, calls or combinations
thereof, or purchase or sell interest rate futures contracts or related
options or otherwise enter into hedging transactions with respect to the
Fund's securities.
|_| The Fund cannot make investments for the purpose of exercising control
of management.
|_| The Fund cannot purchase or retain securities of any company if, to
the knowledge of the Fund, its officers and Managing General Partners and
officers and directors of the Manager individually own more than 0.5% of
the securities of such company and together own beneficially more than 5%
of those securities.
|_| The Fund cannot invest in any warrants related to common stock.
|_| The Fund cannot invest more than 25% of its assets in a single
industry (neither the U.S. government nor any of its agencies or
instrumentalities are considered an industry for the purposes of this
restriction).
The Fund cannot issue any class of senior security (as defined in the
Investment Company Act) or sell any senior security of which the Fund is
the issuer, except as provided in its fundamental policy on borrowing
(described above) or as provided in the Investment Company Act.
Unless the Prospectus or this Statement of Additional Information states
that a percentage restriction applies on an ongoing basis, it applies only at
the time the Fund makes an investment. The Fund need not sell securities to meet
the percentage limits if the value of the investment increases in proportion to
the size of the Fund.
For purposes of the Fund's policy not to concentrate its investments in a
single industry, the Fund has adopted the industry classifications set forth in
Appendix B to this Statement of Additional Information. This is not a
fundamental policy.
How the Fund Is Managed
Organization and History. The Fund is a diversified, open-end management
investment company. It was organized as a limited partnership under the laws of
the State of Delaware in 1987. The Fund originally was a long-term U.S.
government securities fund but became a money market fund on December 6, 1991.
Summary of the Fund's Partnership Agreement. The following statements summarize
certain provisions of the Fund's organizational document, its Agreement of
Limited Partnership. These statements are qualified in their entirety by the
terms of Agreement of Limited Partnership. The full text of the Agreement is
reprinted as Exhibit C to this Statement of Additional Information.
n Fund Shares. All interests in the Fund are partnership interests of a
single class and are referred to in the Partnership Agreement, the Prospectus
and this Statement of Additional Information as "shares." While the Fund's
single share class has no designation, it is deemed to be the equivalent of
Class A shares for the purposes of shareholder account policies that apply to
Class A shares of the Oppenheimer funds. Shares of the Fund may be purchased and
redeemed in accordance with the Partnership Agreement and as described in the
Prospectus. Each share of the Fund has one vote. When issued, shares are fully
paid, non-assessable and redeemable. All shares of the Fund have equal voting,
dividend and liquidation rights but have no subscription, preemptive or
conversion rights. There is no cumulative voting. Limited partners of the Fund
do not have the right to voluntarily transfer or assign their shares to any
other person other than to secure a loan.
|X| General Partners. The general partners of the Fund consist of a number
of individuals, referred to as Managing General Partners, and one corporate
general partner, referred to as the Non-Managing General Partner. In this
document the Managing General Partners and Non-Managing General Partner are all
referred to as "General Partners." Shareholders of the Fund elect the General
Partners for an indefinite term.
The Managing General Partners have complete and exclusive control over the
management, conduct and operation of the Fund's business in accordance the
Agreement of Limited Partnership and the laws of Delaware governing the
responsibilities of general partners of limited partnerships.
The Managing General Partners function like a board of directors. They
establish the Fund's policies and review its management and operations pursuant
to an the Limited Partnership Agreement. The Managing General Partners meet
periodically throughout the year to oversee the Fund's activities, review its
performance, and review the actions of the Manager.
Oppenheimer Partnership Holdings, Inc., the Non-Managing General Partner,
is a wholly owned subsidiary of the Manager. The Non-Managing General Partner
does not participate in the management of the Fund, but is obligated (together
with the Managing General Partners) to maintain an investment in the Fund equal
to 1% of its assets.
The Partnership Agreement provides that the General Partners are not
personally liable to any investor in the Fund for the repayment of any amounts
standing in the account of that investor, except by reason of the General
Partner's willful misfeasance, bad faith, gross negligence or reckless disregard
of the duties involved in the conduct of his or her office. The Partnership
Agreement also provides that the General Partners will not be liable to any
investor by reason of any failure to withhold income tax with respect to
distributions of income from the Fund or any change in any Federal or state tax
laws or in the interpretation of such laws as they apply to the Fund or its
investors so long as the General Partners have acted in good faith and in a
manner reasonably believed to be in the best interests of the investors.
The General Partners generally are entitled to indemnification from the
Fund against liabilities and expenses to which they may become subject in their
capacity as General Partners of the Fund, provided they have acted in good faith
and for a purpose which they reasonably believed to be in the best interests of
the Fund or its investors. That indemnification by the Fund is limited to the
assets of the Fund.
|X| Liability of Limited Partners. In general, limited partners are not
personally liable for obligations of a partnership unless they participate in
the control of the partnership's business. Under the terms of the Partnership
Agreement, the Fund's limited partners do not have the right to participate in
the control of the Fund's business, but they may exercise the right to vote on
matters affecting the basic structure of the Fund, including matters requiring
investor approval under the Investment Company Act.
Under Delaware law, the liability of each limited partner (in his or her
capacity as a limited partner) for the losses, debts and obligations of a Fund
is generally limited to that partner's capital contribution (which is the price
of shares purchased by that partner net of all sales charges) and his or her
share of any undistributed income or assets of the Fund. However, under certain
circumstances, limited partners may be required to return amounts previously
distributed to them, for the benefit of the Fund's creditors. The Fund intends
to include in its contracts a provision limiting the claims of creditors to the
Fund's assets and may carry insurance in such amounts as the Managing General
Partners, in their judgment, consider reasonable to cover potential liabilities
of the Fund.
In addition, the Partnership Agreement provides for indemnification out of
the Fund's property for any shareholder held personally liable for any
obligation of the Fund. The Partnership Agreement also provides that the Fund,
upon request, shall assume the defense of any claim made against any shareholder
for any act or obligation of the Fund and satisfy any judgment thereon. As a
result, the risk of a shareholder incurring financial loss on account of his or
her liability as a limited partner is limited to circumstances in which the Fund
itself would be unable to meet its obligations. The Manager believes that the
risk of personal liability to shareholders is extremely remote, in view of the
protections described above and in view of the character of the operations of
the Fund as an investment company. The foregoing indemnification provisions do
not apply to any liability of the Fund arising out of any liability of a limited
partner for withholding tax on his or her shares, whether that liability is due
to the limited partner's improper certification of his or her tax status or for
some other reason.
|X| Meetings of Shareholders. The Fund's Limited Partners and its General
Partners, including the Managing General Partners, are referred to collectively
in this Statement of Additional Information as "shareholders." The Fund is not
required to hold, and does not plan to hold, regular annual meetings of
shareholders. The Fund will hold shareholder meetings:
o when required to do so by the Investment Company Act or other applicable
law, or
o when a shareholder meeting is called by the Managing General Partners,
or
o upon proper request of the shareholders.
Limited partners have the exclusive right to vote on certain matters
affecting the Fund set forth in the Partnership Agreement. Under the Partnership
Agreement, a Managing General Partner may be removed by the vote of two-thirds
of the outstanding shares of the Fund. The Managing General Partners will call a
meeting of shareholders to vote on the removal of a Managing General Partner
upon the written request of the record holders of 10% of its outstanding shares.
If the Managing General Partners receive a request from at least 10
shareholders stating that they wish to communicate with other shareholders to
request a meeting to remove a Managing General Partner, the Managing General
Partners will then either make the Fund's shareholder list available to the
applicants or mail their communication to all other shareholders at the
applicants' expense.
|X| Term of Existence Dissolution of the Fund. The Fund expects to
continue in existence until December 31, 2037, but shall be dissolved before
that date if and when any of the following circumstances occur:
(1) the shareholders of the Fund approve the prior dissolution of the Fund;
or
(2) the Fund disposes of all of its assets; or
(3) a General Partner withdraws and the remaining General Partners do not
elect to continue the operations of the Partnership; or
(4) there are no remaining General Partners (unless the shareholders agree
by unanimous vote to continue the Fund in circumstances where the last
remaining General Partner was not removed by them, and new General
Partners are promptly elected by the shareholders).
Other than being able to require the Fund to redeem outstanding shares as
described in the Prospectus under "How to Sell Shares," limited partners have no
right to the return of any part of their contributions to the Fund unless and
until the Fund is dissolved. Distributions to a shareholder by the Fund, whether
upon redemption, dissolution or otherwise, will be in proportion to the number
of outstanding shares held by the shareholder without regard to the dollar
amount contributed to the Fund or the amount of any profits of the Fund
received.
|X| Other Provisions. The Partnership Agreement also provides for the
pricing, purchase and redemption of shares of the Fund as described below, as
well as procedures relating to the giving of notices, the calling of meetings
and solicitation of shareholder consents. In addition, the Partnership Agreement
contains provisions relating to the maintenance of books and records by the
Fund, the accounting procedures to be followed by the Fund, the allocation for
U.S. Federal income tax purposes of items of income, gain, loss, deduction and
credit, and the procedures by which amendments to the Partnership Agreement may
be made. Limited partners have the right to obtain current copies of the
Partnership Agreement and certain other records of the Fund. The records of the
Fund, although available to limited partners upon request and to certain other
persons in connection with Fund business, are not matters of public record.
Managing General Partners and Officers of the Fund. The Fund's Managing General
Partners and officers and their principal occupations and business affiliations
during the past five years are listed below. Managing General Partners denoted
with an asterisk (*) below are deemed to be "interested persons" of the Fund
under the Investment Company Act. All of the Managing General Partners are also
Managing General Partner, directors or managing general partners of the
following Denver-based Oppenheimer funds1:
Oppenheimer Cash Reserves Oppenheimer Strategic Income Fund
Oppenheimer Champion Income Fund Oppenheimer Total Return Fund, Inc.
Oppenheimer Capital Income Fund Oppenheimer Variable Account Funds
Oppenheimer High Yield Fund Panorama Series Fund, Inc.
Oppenheimer International Bond Fund Centennial America Fund, L. P.
Oppenheimer Integrity Funds Centennial California Tax Exempt Trust
Oppenheimer Limited-Term Government Centennial Government Trust
Fund
Oppenheimer Main Street Funds, Inc. Centennial Money Market Trust
Oppenheimer Municipal Fund Centennial New York Tax Exempt Trust
Oppenheimer Real Asset Fund Centennial Tax Exempt Trust
- --------
1 Ms. Macaskill is not a director of Oppenheimer Integrity Funds,
Oppenheimer Strategic Income Fund, Panorama Series Fund, Inc. or Oppenheimer
Variable Account Funds.
Robert G. Avis*, Managing General Partner; Age: 67
One North Jefferson Ave., St. Louis, Missouri 63103
Executive Vice President of A.G. Edwards & Sons, Inc. (a broker-dealer) and
Chairman of A.G. Edwards Capital, Inc. (general partner of A. G. Edwards
private equity funds).
William A. Baker, Managing General Partner; Age: 84
197 Desert Lakes Drive, Palm Springs, California 92264
Management Consultant.
Charles Conrad, Jr., Managing General Partner; Age: 68
1501 Quail Street, Newport, Beach, CA 92660
Chairman and CEO of Universal Space Lines, Inc. (a space services management
company); formerly Vice President of McDonnell Douglas Space Systems Co., prior
to which he was associated with the National Aeronautics and Space
Administration.
Sam Freedman, Managing General Partner; Age: 58
4975 Lakeshore Drive, Littleton, Colorado 80123
Formerly Chairman and Chief Executive Officer of OppenheimerFunds Services,
Chairman, Chief Executive Officer and a director of Shareholder Services, Inc.,
Chairman, Chief Executive and Officer and director of Shareholder Financial
Services, Inc. (transfer agent subsidiaries of the Manager), a director of the
Manager and Vice President and a director of Oppenheimer Acquisition Corp. (the
holding company parent of the Manager).
Raymond J. Kalinowski, Managing General Partner; Age: 69
44 Portland Drive, St. Louis, Missouri 63131
Director of Wave Technologies International, Inc. (a computer products
training company), self-employed consultant (securities matters).
C. Howard Kast, Managing General Partner; Age: 77
2552 East Alameda, Denver, Colorado 80209
Formerly Managing Partner of Deloitte, Haskins & Sells (an accounting firm).
Robert M. Kirchner, Managing General Partner; Age: 77
7500 E. Arapahoe Road, Englewood, Colorado 80112
President of The Kirchner Company (management consultants).
Bridget A. Macaskill*, President and Managing General Partner; Age: 50 Two World
Trade Center, New York, New York 10048-0203 President (since June 1991), Chief
Executive Officer (since September 1995) and a Director (since December 1994) of
OppenheimerFunds, Inc. (the "Manager"); President and director (since June 1991)
of HarbourView Asset Management Corp., an investment adviser subsidiary of the
Manager; Chairman and a director of Shareholder Services, Inc. (since August
1994) and Shareholder Financial Services, Inc. (since September 1995); President
(since September 1995) and a director (since October 1990) of Oppenheimer
Acquisition Corp.; President (since September 1995) and a director (since
November 1989) of Oppenheimer Partnership Holdings, Inc., a holding company
subsidiary of the Manager; a director of Oppenheimer Real Asset Management, Inc.
(since July 1996), a subsidiary of the Manager; President and a director (since
October 1997) of OppenheimerFunds International Ltd., an offshore fund
management subsidiary of the Manager, and of Oppenheimer Millennium Funds plc,
offshore investment companies; President and a director of other Centennial and
Oppenheimer funds; a director of Hillsdown Holdings plc (a U.K. food company).
Ned M. Steel, Managing General Partner; Age: 83
3416 South Race Street, Englewood, Colorado 80110
Chartered Property and Casualty Underwriter; a director of Visiting Nurse
Corporation of Colorado.
James C. Swain*, Chairman, Chief Executive Officer and Managing General
Partner; Age: 65
6803 South Tucson Way, Englewood, Colorado 80112
Vice Chairman of the Manager (since September 1988); formerly President and a
director of Centennial Asset Management Corporation, an investment adviser and
broker-dealer subsidiary of the Manager, and Chairman of the Board of
Shareholder Services, Inc..
Carol E. Wolf, Vice President and Portfolio Manager; Age: 47
Two World Trade Center, New York, New York 10048-0203
Vice President of the Manager and of Centennial Asset Management Corporation
(since June 1990); an officer of other Oppenheimer funds.
Arthur J. Zimmer, Vice President and Portfolio Manger; Age: 52
Two World Trade Center, New York, New York 10048-0203
Senior Vice President of the Manager (since June 1997); Vice President of
Centennial Asset Management Corporation (since June 1997); an officer of other
Oppenheimer funds; formerly Vice President of the Manager (October 1990-June
1997).
Andrew J. Donohue, Vice President and Secretary, Age 48
Two World Trade Center, New York, New York 10048-0203
Executive Vice President (since January 1993), General Counsel (since October
1991) and a Director (since September 1995) of the Manager; Executive Vice
President and General Counsel (since September 1993) and a director (since
January 1992) of the Distributor; Executive Vice President, General Counsel and
a director of HarbourView Asset Management Corp., Shareholder Services, Inc.,
Shareholder Financial Services, Inc. and (since September 1995) Oppenheimer
Partnership Holdings, Inc.; President and a director of Centennial Asset
Management Corporation (since September 1995); President, General Counsel and a
director of Oppenheimer Real Asset Management, Inc. (since July 1996); General
Counsel (since May 1996) and Secretary (since April 1997) of Oppenheimer
Acquisition Corp.; Vice President and a director of OppenheimerFunds
International Ltd. and Oppenheimer Millennium Funds plc (since October 1997); an
officer of other Oppenheimer funds.
Brian W. Wixted, Vice President, Treasurer and Assistant Secretary; Age: 39
6803 South Tucson Way, Englewood, Colorado 80112
Senior Vice President and Treasurer (since April 1999) of the Manager; formerly
Principal and Chief Operating Officer, Bankers Trust Company-Mutual Fund
Services Division (1995-1999), Vice President and Chief Financial Officer of CS
First Boston Investment Management Corp. (1991-1995), and Vice President and
Accounting Manager, Merrill Lynch Asset Management, Inc. (1987-1991).
Robert J. Bishop, Assistant Treasurer; Age: 40
6803 South Tucson Way, Englewood, Colorado 80112
Vice President of the Manager/Mutual Fund Accounting (since May 1996); an
officer of other Oppenheimer funds; formerly an Assistant Vice President of the
Manager/Mutual Fund Accounting (April 1994-May 1996), and a Fund
Controller for the Manager.
Scott T. Farrar, Assistant Treasurer; Age: 33
6803 South Tucson Way, Englewood, Colorado 80112
Vice President of the Manager/Mutual Fund Accounting (since May 1996); Assistant
Treasurer of Oppenheimer Millennium Funds plc (since October 1997); an officer
of other Oppenheimer funds; formerly an Assistant Vice President of the
Manager/Mutual Fund Accounting (April 1994-May 1996), and a Fund Controller for
the Manager.
Robert G. Zack, Assistant Secretary; Age: 50
Two World Trade Center, New York, New York 10048-0203
Senior Vice President (since May 1985) and Associate General Counsel (since
May 1981) of the Manager, Assistant Secretary of Shareholder Services, Inc.
(since May 1985), and Shareholder Financial Services, Inc. (since November
1989); Assistant Secretary of OppenheimerFunds International Ltd. and
Oppenheimer Millennium Funds plc (since October 1997); an officer of other
Oppenheimer funds.
O Remuneration of Managing General Partners. The officers of the Fund and
certain Managing General Partners of the Fund (Ms. Macaskill and Mr. Swain) who
are affiliated with the Manager receive no salary or fee from the Fund. The
remaining Managing General Partners of the Fund received the compensation shown
below. The compensation from the Fund was paid during its fiscal year ended
December 31, 1998. The compensation from all of the Denver-based Oppenheimer
funds includes the Fund and is compensation received as a Managing General
Partner, director, trustee or member of a committee of the Board during the
calendar year 1998.
<PAGE>
-----------------------------------------------------------------------------
Aggregate Total Compensation
Managing General Partner's Compensation from all Denver-Based
Name from Fund Oppenheimer Funds1
and Other Positions
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
Robert G. Avis $236 $67,998.00
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
William A. Baker $241 $69,998.00
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
Charles Conrad, Jr. $234 $67,998.00
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
Sam Freedman
Audit and Review
Committee Member $255 $73,998.00
------------------------------------------------
-----------------------------------------------------------------------------
Raymond J. Kalinowski
Audit and Review
Committee Member $255 $73,998.00
-----------------------------------------------------------------------------
------------------------------------------------
C. Howard Kast
Audit and Review
Committee Chairman $265 $76,998.00
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
Robert M. Kirchner $234 $67,998.00
------------------------------------------------
-----------------------------------------------------------------------------
Ned M. Steel $234 $67,998.00
-----------------------------------------------------------------------------
1. For the 1998 calendar year.
o Deferred Compensation Plan for Managing General Partners. The
Managing General Partners have adopted a Deferred Compensation Plan for
disinterested Managing General Partners that enables them to elect to defer
receipt of all or a portion of the annual fees they are entitled to receive from
the Fund. Under the plan, the compensation deferred by a Managing General
Partner is periodically adjusted as though an equivalent amount had been
invested in shares of one or more Oppenheimer funds selected by the Managing
General Partner. The amount paid to the Managing General Partner under this plan
will be determined based upon the performance of the selected funds.
Deferral of fees of the Managing General Partners under this plan will not
materially affect the Fund's assets, liabilities or net income per share. This
plan will not obligate the Fund to retain the services of any Managing General
Partner or to pay any particular level of compensation to any Managing General
Partner. Pursuant to an Order issued by the Securities and Exchange Commission,
the Fund may invest in the funds selected by any Managing General Partner under
this plan without shareholder approval for the limited purpose of determining
the value of the Managing General Partners' deferred fee accounts.
Major Shareholders. As of April 23, 1999, the only person who owned of record or
was known by the Fund to own beneficially 5% or more of the Fund's outstanding
shares was A.G. Edwards & Sons, Inc. ("A.G. Edwards"), 1 North Jefferson Avenue,
St. Louis, Missouri 63103, which owned 29,762,387.530 shares of the Fund (96.35%
of the then outstanding shares of the Fund). The Fund has been informed that, as
to shares held of record by A.G. Edwards, the following shareholders owned more
than 5% of the outstanding shares of the Fund as of April 23, 1999:
Team Haas USA Ltd., c/o A.G. Edwards, 1 North Jefferson, St. Louis,
Missouri, which owned 3,192,512.180 shares (approximately 10.73% of the
shares of the Fund then outstanding).
Gold Star Hat and Cap, c/o A.G. Edwards, 1 North Jefferson, St. Louis,
Missouri, which owned 10,219,917.26 shares (approximately 34.33% of the
shares of the Fund then outstanding).
Gold Star Hat and Cap Company, is a corporation located in Taipei,
Taiwan.
The Manager. The Manager is wholly-owned by Oppenheimer Acquisition Corp., a
holding company controlled by Massachusetts Mutual Life Insurance Company. The
Manager has a Code of Ethics. It is designed to detect and prevent improper
personal trading by certain employees, including portfolio managers, that would
compete with or take advantage of the portfolio transactions of funds managed by
the Manager. Compliance with the Code of Ethics is carefully monitored and
enforced by the Manager.
The portfolio managers of the Fund are principally responsible for the
day-to-day management of the Fund's investment portfolio. Other members of the
Manager's fixed-income portfolio department, particularly security analysts,
traders and other portfolio managers, have broad experience with fixed-income
securities. They provide the Fund's portfolio managers with research and support
in managing the Fund's investments.
|X| The Investment Advisory Agreement. The Manager provides investment
advisory and management services to the Fund under an investment advisory
agreement between the Manager and the Fund. The Manager selects securities for
the Fund's portfolio and handles its day-to-day business. The agreement requires
the Manager, at its expense, to provide the Fund with adequate office space,
facilities and equipment. It also requires the Manager to provide and supervise
the activities of all administrative and clerical personnel required to provide
effective administration for the Fund. Those responsibilities include the
compilation and maintenance of records with respect to its operations, the
preparation and filing of specified reports, and composition of proxy materials
and registration statements for continuous public sale of shares of the Fund.
Expenses not expressly assumed by the Manager under the investment
advisory agreement are paid by the Fund. The investment advisory agreement lists
examples of expenses paid by the Fund. The major categories relate to interest,
taxes, fees to certain Managing General Partners, legal and audit expenses,
custodian and transfer agent expenses, share issuance costs, certain printing
and registration costs and non-recurring expenses, including litigation costs.
The management fees paid by the Fund to the Manager are calculated at the rates
described in the Prospectus.
<PAGE>
----------------------------------------------------------
Fiscal Year Management Fee Paid to
ending 12/31 OppenheimerFunds, Inc.
----------------------------------------------------------
----------------------------------------------------------
1996 $76,514
----------------------------------------------------------
----------------------------------------------------------
1997 $73,491
----------------------------------------------------------
----------------------------------------------------------
1998 $88,659
----------------------------------------------------------
The investment advisory agreement states that in the absence of willful
misfeasance, bad faith, gross negligence in the performance of its duties or
reckless disregard of its obligations and duties under the investment advisory
agreement, the Manager is not liable for any loss resulting from a good faith
error or omission on its part with respect to any of its duties under the
agreement. The agreement permits the Manager to act as investment adviser for
any other person, firm or corporation.
|X| The Distributor. Under its General Distributor's Agreement with the
Fund, Centennial Asset Management Corporation, a subsidiary of the Manager, acts
as the Fund's principal underwriter and Distributor in the continuous public
offering of the Fund's shares. The Distributor is not obligated to sell a
specific number of shares. The Distributor bears the expenses normally
attributable to sales, including advertising and the cost of printing and
mailing prospectuses, other than those furnished to existing shareholders.
The Fund's use of the name "Centennial" as part of its name is under a
license from the Distributor. If the Distributor ceases to be the Fund's
distributor, the right of the Fund to use the name "Centennial" as part of its
name may be terminated by the Distributor, and the Fund's Managing General
Partners would be required to take action promptly to change the Fund's name.
n The Sub-Distributor. The Distributor has retained OppenheimerFunds
Distributor, Inc., a wholly-owned subsidiary of the Manager, to act as
Sub-Distributor of the Fund's shares. The Sub-Distributor acts as the
Distributor's agent for accepting orders from dealers, brokers and investors to
purchase shares of the Fund. The Sub-Distributor is not obligated to sell a
specific number of shares.
Portfolio Transactions. Portfolio decisions are based upon recommendations and
judgment of the Manager, subject to the overall authority of the Managing
General Partners. Most purchases made by the Fund are principal transactions at
net prices, so the Fund incurs little or no brokerage costs. The Fund deals
directly with the selling or purchasing principal or market maker without
incurring charges for the services of a broker on its behalf unless the Manager
determines that a better price or execution may be obtained by using the
services of a broker. 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 Fund seeks to obtain prompt execution of orders at the most favorable
net price. If dealers are used for portfolio transactions, transactions may be
directed to dealers for their 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. Investment research
received for the commissions of those other accounts may be useful both to the
Fund and one or more of such other accounts.
Investment research services may be supplied to the Manager by a third
party at the instance of a broker through which trades are placed. Those
services may include 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
in commission dollars.
The research services provided by brokers broaden the scope and supplement
the research activities of the Manager. That research provides additional views
and comparisons for consideration, and helps the Manager obtain market
information for the valuation of securities held in the Fund's portfolio or
being considered for purchase.
Subject to applicable rules covering the Manager's activities in this
area, sales of shares of the Fund and/or the other investment companies managed
by the Manager or distributed by the Distributor or Sub-Distributor may also be
considered as a factor in the direction of transactions to dealers. That must be
done in conformity with the price, execution and other considerations and
practices discussed above. Those other investment companies may also give
similar consideration relating to the sale of the Fund's shares. No portfolio
transactions will be handled by any securities dealer affiliated with the
Manager.
The Fund's policy of investing in short-term debt securities with maturity
of less than one year results in high portfolio turnover and may increase the
Fund's transaction costs. However, since brokerage commissions, if any, are
small, high turnover does not have an appreciable adverse effect upon the income
of the Fund.
Service Plan
The Fund has adopted a Service Plan under Rule 12b-1 of the Investment Company
Act. Under that plan, the Fund reimburses the Distributor for a portion of its
costs incurred in connection with the personal service and maintenance of
accounts that hold Fund shares, as described in the Prospectus.
The plan has been approved by a vote of the Managing General Partners of
the Fund, including a majority of the Independent Managing General Partners2,
cast in person at a meeting called for the purpose of voting on the plan. The
plan has also been approved by the vote of the holders of a "majority" (as
defined under the Investment Company Act) of the Fund's outstanding voting
securities. In approving the Plan, the Managing General Partners determined that
it is likely the Plan will benefit the shareholders of the Fund.
Under the plan, the Distributor currently uses the fees it receives from
the Fund to pay brokers, dealers and other financial institutions (they are all
referred to as "recipients") for personal services and account maintenance
services they provide for their customers who hold shares of the Fund. The
services include, among others, answering customer inquiries about the Fund,
assisting in establishing and maintaining accounts or sub-accounts in the Fund,
making the Fund's investment plans available and providing other services at the
request of the Fund or the Distributor. The Distributor pays plan recipients
quarterly at an annual rate not to exceed 0.20% of the average annual net assets
consisting of Fund shares held for the account of the recipient's customers.
2 In accordance with Rule 12b-1 of the Investment Company Act, the term
"Independent Managing General Partners" in this Statement of Additional
Information refers to those Managing General Partners who are not "interested
persons" of the Fund and who do not have any direct or indirect financial
interest in the operation of the plan or any agreement under the plan.
Under the plan, no payment will be made to any recipient in any quarter in
which the aggregate net asset value of all Fund shares held by the recipient for
itself and its customers does not exceed a minimum amount, if any, that may be
set from time to time by a majority of the Fund's Independent Managing General
Partners. The Managing General Partners have set no minimum amount.
Each recipient who is to receive distribution payments for any quarter
must certify in writing that the aggregate payments to be received from the Fund
and the Distributor during that month or quarter do not exceed the recipient's
costs in rendering services and for the maintenance of accounts during the month
or quarter, and that they will reimburse the Fund for any excess.
Unless the plan is terminated as described below, the plan continues in
effect from year to year, but only if the Fund's Managing General Partners and
its Independent Managing General Partners specifically vote annually to approve
its continuance. Approval must be by a vote cast in person at a meeting called
for the purpose of voting on continuing the plan. The plan may be terminated at
any time by the vote of a majority of the Independent Managing General Partners
or by the vote of the holders of a "majority" (as defined in the Investment
Company Act) of the outstanding voting securities of the Fund.
The Managing General Partners and the Independent Managing General
Partners must approve all material amendments, including a majority of the
Independent Managing General Partners. An amendment to increase materially the
amount of payments to be made under the plan must be approved by shareholders,
in the manner set forth above. For the Fund's fiscal year ended December 31,
1998, payments under the plan totaled $38,060, all of which was paid by the
Distributor to recipients. The Distributor cannot recover in later periods any
unreimbursed expenses it incurs for a particular quarter.
While the plan is in effect, the Treasurer of the Fund must provide a
report to the Managing General Partners in writing at least quarterly for its
review. The report shall detail the amount of all payments made under the plan,
the identity of each recipient of payments and the purposes for which the
payments were made. The plan states that while it is in effect, the selection
and nomination of those Managing General Partners of the Fund who are not
"interested persons" of the Fund is committed to the discretion of the
Independent Managing General Partners. This does not prevent the involvement of
others in the selection and nomination process if the final decision as to the
selection or nomination is approved by a majority of the Independent Managing
General Partners.
Under the plan, from time to time in their sole discretion, the Manager
and the Distributor can use their own resources (at no direct cost to the Fund)
to make payments to brokers, dealers and other financial institutions for
distribution and administrative services they perform. The Manager may use its
profits from the advisory fees it receives from the Fund. In their sole
discretion, the Manager and the Distributor may increase or decrease the amount
of payments they make from their own resources to plan recipients.
The Distributor and Sub-Distributor have entered into Supplemental
Distribution Assistance Agreements under the plan with selected dealers that
distribute shares of Oppenheimer Cash Reserves, Centennial Government Trust,
Centennial New York Tax Exempt Trust, Centennial California Tax Exempt Trust and
the Fund. Under those supplemental agreements, the Distributor makes quarterly
payments for distribution-related services at an annual rate that ranges from
0.10% to 0.30% of the average net asset value of shares of the above-mentioned
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 the above-mentioned funds
owned during that quarter by the dealer or its customers is less than $5
million.
Payments under supplemental agreements are not a Fund expense. They 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 the Fund. The Distributor may not make payments to its affiliates under the
Supplemental Agreements.
Performance of the Fund
Explanation of Performance Terminology. The Fund uses a variety of terms to
illustrate its performance. These terms include "yield," "compounded effective
yield" and "average annual total return." An explanation of how yields and total
returns are calculated is set forth below. The charts below show the Fund's
performance as of the Fund's most recent fiscal year end. You can obtain current
performance information by calling the Fund's Transfer Agent at 1-800-525-9310.
The Fund's illustrations of its performance data in advertisements must
comply with rules of the Securities and Exchange Commission. Those rules
describe the types of performance data that may be used and how it is to be
calculated. If the fund shows total returns in addition to its yields, the
returns must be for the 1-, 5- and 10-year periods ending as of the most recent
calendar quarter prior to the publication of the advertisement (or its
submission for publication).
Use of standardized performance calculations enables an investor to
compare the Fund's performance to the performance of other funds for the same
periods. However, a number of factors should be considered before using the
Fund's performance information as a basis for comparisons with other
investments:
Yields and total returns measure the performance of a hypothetical account in
the Fund over various periods and do not show the performance of each
shareholder's account. Your account's performance will vary from the model
performance data if your dividends are received in cash, or you buy or
sell shares during the period, or you bought your shares at a different
time than the shares used in the model.
An investment in the Fund is not insured by the FDIC or any other government
agency.
The Fund's yield is not fixed or guaranteed and will fluctuate.
Yields and total returns for any given past period represent historical
performance information and are not, and should not be considered, a
prediction of future yields or returns.
n Yields. The Fund's current yield is calculated for a seven-day period of
time 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 (1)
adding 1 to the base period return (obtained as described above), (2)
raising the sum to a power equal to 365 divided by 7, and
(3) subtracting 1 from the result.
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. The calculation of yield under either
procedure described above does not take into consideration any realized or
unrealized gains or losses on the Fund's portfolio securities which may affect
dividends. Therefore, the return on dividends declared during a period may not
be the same on an annualized basis as the yield for that period.
o Total Return Information. There are different types of "total
returns" to measure the Fund's performance. Total return is the change in value
of a hypothetical investment in the Fund over a given period, assuming that all
dividends and capital gains distributions are reinvested in additional shares
and that the investment is redeemed at the end of the period. The cumulative
total return measures the change in value over the entire period (for example,
ten years). An average annual total return shows the average rate of return for
each year in a period that would produce the cumulative total return over the
entire period. However, average annual total returns do not show actual
year-by-year performance. The Fund uses standardized calculations for its total
returns as prescribed by the SEC.
The methodology is discussed below.
o Average Annual Total Return. The "average annual total return" is an
average annual compounded rate of return for each year in a specified number of
years. It is the rate of return based on the change in value of a hypothetical
initial investment of $1,000 ("P" in the formula below) held for a number of
years ("n") to achieve an Ending Redeemable Value ("ERV" in the formula) of that
investment, according to the following formula:
( ERV ) 1/n
(-----) -1 = Average Annual Total Return
( P )
o Cumulative Total Return. The "cumulative total return" calculation
measures the change in value of a hypothetical investment of $1,000 over an
entire period of years. Its calculation uses some of the same factors as average
annual total return, but it does not average the rate of return on an annual
basis. Cumulative total return is determined as follows:
ERV - P
------- = Total Return
P
Compounded Average Annual Total Returns (at 12/31/98)
Yield Effective Yield
(7 days ended (7 days ended
12/31/98) 12/31/98)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
1-Year 5 Years 10 Years
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
3.86% 3.94% 4.40% 4.24% 3.91%
- -------------------------------------------------------------------------------
|X| Other Performance Comparisons. Yield information may be useful to
investors in reviewing the Fund's performance. The Fund 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 MonitorJ) which
measures the average rate paid on bank money market accounts, NOW accounts and
certificates of deposits by the 100 largest banks and thrifts in the top ten
metro areas. When comparing the Fund'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 and may be insured or guaranteed.
From time to time, the Fund may include in its advertisements and sales
literature performance information about the Fund cited in other newspapers and
periodicals, such as The New York Times, which may include performance
quotations from other sources.
From time to time, the Fund's Manager may publish rankings or ratings
of the Manager (or the Transfer Agent) or the investor services provided by
them to shareholders of the Oppenheimer funds, other than performance
rankings of the Oppenheimer funds themselves. Those ratings or rankings of
investor/shareholder services by third parties may compare the services of
the Oppenheimer funds to those of other mutual fund families selected by the
rating or ranking services. They may be based on the opinions of the rating
or ranking service itself, based on its research or judgment, or based on
surveys of investors, brokers, shareholders or others.
- ------------------------------------------------------------------------------
A B O U T Y O U R A C C O U N T
- ------------------------------------------------------------------------------
How to Buy Shares
The availability to investors of the various purchase (and redemption)
programs described in this Statement of Additional Information depending on how
an Investor buys shares. Different features and services are available to Direct
Investors (those Investors who buy through the Distributor or through another
broker-dealer but have shares registered directly in the Investor's name) and
Investors who are Program Participants in the Automatic Purchase and Redemption
Program of a particular broker-dealer.
|X| The Oppenheimer Funds. The Oppenheimer funds are
those mutual funds for which OppenheimerFunds Distributor, Inc. acts as the
distributor or the sub-distributor and include the following:
Oppenheimer Bond Fund Oppenheimer Limited-Term Government Fund
Oppenheimer Capital Appreciation Fund Oppenheimer Main Street California
Municipal Fund
Oppenheimer California Municipal Fund Oppenheimer Main Street Growth & Income
Fund
Oppenheimer Champion Income Fund Oppenheimer MidCap Fund
Oppenheimer Convertible
Securities Fund Oppenheimer Multiple Strategies Fund
Oppenheimer Developing
Markets Fund Oppenheimer Municipal Bond Fund
Oppenheimer Disciplined Allocation
Fund Oppenheimer New York Municipal Fund
Oppenheimer Disciplined Value Fund Oppenheimer New Jersey Municipal Fund
Oppenheimer Discovery Fund Oppenheimer Pennsylvania Municipal
Fund
Oppenheimer Enterprise Fund Oppenheimer Quest Balanced Value Fund
Oppenheimer Capital Income Fund Oppenheimer Quest Capital Value Fund,
Inc.
Oppenheimer Florida Municipal Fund Oppenheimer Quest Global Value Fund,
Inc.
Oppenheimer Global Fund Oppenheimer Quest Opportunity Value
Fund
Oppenheimer Global Growth & Income Fund Oppenheimer Quest Small Cap Value Fund
Oppenheimer Gold & Special Minerals Oppenheimer Quest Value Fund, Inc.
Fund
Oppenheimer Growth Fund Oppenheimer Real Asset Fund
Oppenheimer High Yield Fund Oppenheimer Strategic Income Fund
Oppenheimer Insured Municipal Fund Oppenheimer Total Return Fund, Inc.
Oppenheimer Intermediate Municipal
Fund Oppenheimer U.S. Government Trust
Oppenheimer International Bond Fund Oppenheimer World Bond Fund
Oppenheimer International Growth Fund Limited-Term New York Municipal Fund
Oppenheimer International Small Rochester Fund Municipals
Company Fund
Oppenheimer Large Cap Growth Fund
Oppenheimer Europe Fund
and the following money market funds:
Centennial America Fund, L. P. Centennial New York Tax Exempt Trust
Centennial California Tax Exempt Trust Centennial Tax Exempt Trust
Centennial Government Trust Oppenheimer Cash Reserves
Centennial Money Market Trust Oppenheimer Money Market Fund, Inc.
Determination of Net Asset Value Per Share. The net asset value per share of the
Fund is determined twice each day that the New York Stock Exchange ("Exchange")
is open, at 12:00 Noon and at 4:00 P.M., by dividing the value of the Fund's net
assets by the total number of shares outstanding. All references to time in this
Statement of Additional Information mean New York time. The Exchange's most
recent annual announcement (which is subject to change) states that it will
close on New Year's Day, Martin Luther King Jr. Day, Presidents' Day, Good
Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and
Christmas Day. It may also close on other days.
The Fund's Managing General Partners have adopted the amortized cost
method to value the Fund's portfolio securities. Under the amortized cost
method, a security is valued initially at its cost and its valuation 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 consideration any unrealized capital gains or
losses on securities. While this method provides certainty in valuing
securities, in certain periods the value of a security determined by amortized
cost may be higher or lower than the price the Fund would receive if it sold the
security.
The Fund's Managing General Partners have established
procedures reasonably designed to stabilize the Fund's net asset value at $1.00
per share. Those procedures include a review of the Fund's portfolio
holdings by the Managing General Partners, at intervals it deems
appropriate, to determine whether the Fund's net asset value
calculated by using available market quotations deviates from $1.00 per share
based on amortized cost.
The Managing General Partners will examine the extent of any deviation
between the Fund's net asset value based upon available market quotations and
amortized cost. If the Fund's net asset value were to deviate from $1.00 by more
than 0.5%, Rule 2a-7 requires the Managing General Partners to consider what
action, if any, should be taken. If they find that the extent of the deviation
may cause a material dilution or other unfair effects on shareholders, the
Managing General Partners will take whatever steps they consider appropriate to
eliminate or reduce the dilution, including, among others, withholding or
reducing dividends, paying dividends from capital or capital gains, selling
portfolio instruments prior to maturity to realize capital gains or losses or to
shorten the average maturity of the portfolio, or calculating net asset value
per share by using available market quotations.
During periods of declining interest rates, the daily yield on shares of
the Fund may tend to be lower (and net investment income and dividends higher)
than those of a fund holding the identical investments as the Fund but which
used a method of portfolio valuation based on market prices or estimates of
market prices. During periods of rising interest rates, the daily yield of the
Fund would tend to be higher and its aggregate value lower than that of an
identical portfolio using market price valuation.
How to Sell Shares
The information below supplements the terms and conditions for redeeming shares
set forth in the Prospectus.
Checkwriting. The Fund's checks are drafts against the Fund that are payable
through the Fund's bank (which is referred to as the "Bank" in this section).
When a check is presented to the Bank for clearance, the Bank will ask the Fund
to redeem a sufficient number of full and fractional shares in the shareholder's
account to cover the amount of the check. This enables the shareholder to
continue receiving dividends on those shares until the check is presented to the
Fund. Checks may not be presented for payment at the offices of the Bank or the
Fund's custodian bank. This limitation does not affect the use of checks for the
payment of bills or to obtain cash at other banks. The Fund reserves the right
to amend, suspend or discontinue offering checkwriting privileges at any time
without prior notice.
- ------------------------------------------------------------------------------
For Direct Investors, Checkwriting is arranged though the Fund's Transfer Agent.
Investors who are Program Participants in a broker-dealer's Automatic Purchase
and Redemption Program must arrange for Checkwriting and obtain signature cards
through the Investor's broker-dealer firm.
- ------------------------------------------------------------------------------
In choosing to take advantage of the Checkwriting privilege, by signing
the Account Application or by completing a Checkwriting card, each individual
who signs: (1) for individual accounts, represents that they are the registered
owner(s) of the shares of the Fund in that account;
(2) for accounts for corporations, partnerships, trusts and other entities,
represents that they are an officer, general partner, trustee or other
fiduciary or agent, as applicable, duly authorized to act on behalf of
the registered owner(s);
(3) authorizes the Fund, its Transfer Agent and any bank through which the
Fund=s drafts (checks) are payable to pay all checks drawn on the Fund
account of such person(s) and to redeem a sufficient amount of shares
from that account to cover payment of each check;
(4)specifically acknowledges that if they choose to permit checks to be
honored if there is a single signature on checks drawn against joint
accounts, or accounts for corporations, partnerships, trusts or other
entities, the signature of any one signatory on a check will be
sufficient to authorize payment of that check and redemption from the
account, even if that account is registered in the names of more than
one person or more than one authorized signature appears on the
Checkwriting card or the Application, as applicable;
(5) understands that the Checkwriting privilege may be terminated or
amended at any time by the Fund and/or the Fund's Bank; and
(6) acknowledges and agrees that neither the Fund nor its Bank shall incur
any liability for that amendment or termination of checkwriting
privileges or for redeeming shares to pay checks reasonably believed by
them to be genuine, or for returning or not paying checks that have not
been accepted for any reason.
Sending Redemption Proceeds by Federal Funds Wire. The Federal Funds wire of
redemptions proceeds may be delayed if the Fund's custodian bank is not open for
business on a day when the Fund would normally authorize the wire to be made,
which is usually the Fund's next regular business day following the redemption.
In those circumstances, the wire will not be transmitted until the next bank
business day on which the Fund is open for business. No distributions will be
paid on the proceeds of redeemed shares awaiting transfer by Federal Funds wire
Automatic Withdrawal Plans. Direct Investors owning shares of the Fund valued at
$5,000 or more can authorize the Transfer Agent to redeem shares (having a value
of at least $50) automatically on a monthly, quarterly, semi-annual or annual
basis under an Automatic Withdrawal Plan. Shares will be redeemed three business
days prior to the date requested by the Investor for receipt of the payment.
Automatic withdrawals of up to $1,500 per month may be requested by telephone if
payments are to be made by check payable to all shareholders of record. Payments
must also be sent to the address of record for the account and the address must
not have been changed within the prior 30 days.
Payments are normally made by check. Shares are normally redeemed pursuant
to an Automatic Withdrawal Plan three business days before the payment
transmittal date you select in the Account Application. If a contingent deferred
sales charge applies to the redemption, the amount of the check or payment will
be reduced accordingly. The Fund cannot guarantee receipt of a payment on the
date requested and reserves the right to amend, suspend or discontinue offering
such plans at any time without prior notice.
By requesting an Automatic Withdrawal or Exchange Plan, the shareholder
agrees to the terms and conditions applicable to such plans as stated below.
These provisions may be amended from time to time by the Fund and/or the
Distributor. When adopted, any amendments will automatically apply to existing
Plans.
Fund shares will be redeemed as necessary to meet withdrawal payments.
Shares acquired without a sales charge will be redeemed first. Shares purchased
with reinvested dividends and capital gains distributions will be redeemed next,
followed by shares acquired with a sales charge, to the extent necessary to make
withdrawal payments. Depending upon the amount withdrawn, the investor's
principal may be depleted. Payments made under withdrawal plans should not be
considered as a yield or income on your investment.
The Transfer Agent will administer the investor's Automatic Withdrawal
Plan as agent for the shareholder (the "Planholder") who executed the Plan
authorization and application submitted to the Transfer Agent. Neither the
Transfer Agent nor the Fund shall incur any liability to the Planholder for any
action taken or not taken by the Transfer Agent in good faith to administer the
Plan. Share certificates will not be issued for shares of the Fund 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 Fund. Any share certificates
held by a 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.
For accounts subject to Automatic Withdrawal Plans, distributions of
capital gains must be reinvested in shares of the Fund, which will be done at
net asset value without a sales charge. Distributions of income on shares held
in the account may be paid in cash or reinvested.
Shares will be redeemed to make withdrawal payments at the net asset value
per share determined on the redemption date. Checks or AccountLink payments of
the proceeds of Plan withdrawals will normally be transmitted three business
days prior to the date selected for receipt of the payment according to the
choice specified in writing by the Planholder. Receipt of payment on the date
selected cannot be guaranteed.
The amount and the interval of disbursement payments and the address to
which checks are to be mailed or AccountLink payments are to be sent may be
changed at any time by the Planholder by writing to the Transfer Agent. The
Planholder should allow at least two weeks' time in mailing such notification
for the requested change to be put in effect. 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 Fund) to redeem all, or
any part of, the shares held under the Plan. In that case, the Transfer Agent
will redeem the number of shares requested at the net asset value per share in
effect in accordance with the Fund's usual redemption procedures and will mail a
check for the proceeds to the Planholder.
The Planholder may terminate a Plan at any time by writing to the Transfer
Agent. The Fund may also give directions to the Transfer Agent to terminate a
Plan. The Transfer Agent will also terminate a Plan upon its receipt of evidence
satisfactory to it that the Planholder has died or is legally incapacitated.
Upon termination of a Plan by the Transfer Agent or the Fund, shares that have
not been redeemed from the account will be held in uncertificated form in the
name of the Planholder. The account will continue as a dividend-reinvestment,
uncertificated account unless and until proper instructions are received from
the Planholder, his or her executor or guardian, or another authorized person.
To use shares held under the Plan as collateral for a debt, the Planholder
may request issuance of a portion of the shares in certificated form. Upon
written request from the Planholder, the Transfer Agent will determine the
number of shares for which a certificate may be issued without causing the
withdrawal checks to stop. However, should such uncertificated shares become
exhausted, Plan withdrawals will terminate.
If the Transfer Agent ceases to act as transfer agent for the Fund, the
Planholder will be deemed to have appointed any successor transfer agent to act
as agent in administering the Plan.
How to Exchange Shares
- ------------------------------------------------------------------------------
The special tax provisions that are available to shareholders of this Fund do
not apply to the other Oppenheimer funds or Centennial Trusts, and by
exchanging into those other Funds Investors will become subject to applicable
withholding and tax reporting requirements under the Internal Revenue Code as
to those investments.
- ------------------------------------------------------------------------------
Participants in Automatic Purchase and Redemption Programs. Shares of the Fund
held under Automatic Purchase and Redemption Programs through brokers or dealers
may be exchanged only for shares of Centennial Money Market Trust, Centennial
Tax Exempt Trust and Centennial Government Trust. Exchange requests to the Fund
may be placed only by an Investor's broker or dealer.
Direct Investors. Shares of the Fund may be exchanged, subject to the conditions
described in the Prospectus and in this Statement of Additional Information, by
Direct Investors for shares of other Oppenheimer funds. As stated in the
Prospectus, shares of a particular class of Oppenheimer funds having more than
one class of shares may be exchanged only for shares of the same class of other
Oppenheimer funds. Shares of this Fund are deemed to be "Class A Shares" for
this purpose. You can obtain a current list of funds showing which funds offer
which classes by calling the Distributor at 1-800-525- 9310.
|_| All of the other Oppenheimer funds offer Class A, B and C shares except
Centennial Money Market Trust, Centennial Tax Exempt Trust, Centennial
Government Trust, Centennial New York Tax Exempt Trust, Centennial America Fund,
L.P. and Centennial California Tax Exempt Trust, which only offer Class A
shares.
|_| Oppenheimer Main Street California Tax-Exempt Fund currently offers
only Class A and Class B shares.
|_| Class B and Class C shares of Oppenheimer Cash Reserves are generally
available only by exchange from the same class of shares of other Oppenheimer
funds or available through OppenheimerFunds-sponsored 401(k) plans.
|_| Class Y shares of Oppenheimer Real Asset Fund are not exchangeable for
any shares of any other Fund.
o For accounts established on or before March 8, 1996 holding Class M
shares of Oppenheimer Convertible Securities Fund, Class M shares can be
exchanged only for Class A shares of other Oppenheimer funds. Exchanges to Class
M shares of Oppenheimer Convertible Securities Fund are permitted from shares of
this Fund or Class A shares of Oppenheimer Cash Reserves that were acquired by
exchange of Class M shares. No other exchanges may be made to Class M shares.
o Class X shares of Limited Term New York Municipal Fund can be exchanged
only for Class B shares of other Oppenheimer funds and no exchanges can be made
from shares of any other funds to class X shares of Limited Term New York
Municipal Fund.
Class A shares of Oppenheimer funds may be exchanged at net asset value
for shares of any money market fund. Shares of any money market fund purchased
without a sales charge may be exchanged for shares of Oppenheimer funds offered
with a sales charge upon payment of the sales charge. They may also be used to
purchase shares of Oppenheimer funds subject to a contingent deferred sales
charge.
Shares of this Fund acquired by reinvestment of dividends or distributions
from the Fund or from any other of the Oppenheimer funds (other than Oppenheimer
Cash Reserves) or from any unit investment trust for which reinvestment
arrangements have been made with the Distributor may be exchanged at net asset
value for shares of any of the Oppenheimer funds. Shares of this Fund purchased
with the redemption proceeds of shares of other mutual funds (other than funds
managed by the Manager or its subsidiaries) redeemed within the 30 days prior to
that purchase may subsequently be exchanged for shares of other Oppenheimer
funds without being subject to an initial or contingent deferred sales charge.
To qualify for that privilege, the investor or the investor's dealer must notify
the Distributor of eligibility for this privilege at the time the shares of this
Fund are purchased in that way. If requested, they must supply proof of
entitlement to this privilege.
n How Exchanges Affect Contingent Deferred Sales Charges. No contingent
deferred sales charge is imposed on exchanges of shares of any class purchased
subject to a contingent deferred sales charge. However, when shares of this Fund
acquired by exchange of Class A shares of other Oppenheimer funds purchased
subject to a Class A contingent deferred sales charge are redeemed within 18
months of the end of the calendar month of the initial purchase of the exchanged
Class A shares, the Class A contingent deferred sales charge is imposed on the
redeemed shares.
n Limits on Multiple Exchange Orders. The Fund reserves the right to
reject telephone or written exchange requests submitted in bulk by anyone on
behalf of more than one account. The Fund may accept requests for exchanges of
up to 50 accounts per day from representatives of authorized dealers that
qualify for this privilege.
n Telephone Exchange Requests. When exchanging shares by telephone, a
shareholder must have an existing account in the fund to which the exchange is
to be made. Otherwise, the investor must obtain a prospectus of that fund before
the exchange request may be submitted. For full or partial exchanges of an
account made by telephone, 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 instructed
otherwise. If all telephone lines are busy (which might occur, for example,
during periods of substantial market fluctuations), shareholders might not be
able to request exchanges by telephone and would have to submit written exchange
requests.
Processing Exchange Requests. Shares to be exchanged are redeemed on the regular
business day the Transfer Agent receives an exchange request in proper form (the
"Redemption Date"). 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 Fund reserves the right, in its
discretion, to refuse any exchange request that may disadvantage it (for
example, if the receipt of multiple exchange requests from a dealer might
require the disposition of portfolio securities at a time or at a price that
might be disadvantageous to the Fund).
In connection with any exchange request, the number of shares exchanged
may be less than the number requested if the exchange or the number requested
would include shares subject to a restriction cited in the Prospectus or this
Statement of Additional Information or would include shares covered by a share
certificate that is not tendered with the request. In those cases, only the
shares available for exchange without restriction will be exchanged.
The different Oppenheimer funds available for exchange have different
investment objectives, policies and risks. A shareholder should assure that the
fund selected is appropriate for his or her investment and should be aware of
the tax consequences of an exchange. For Federal income tax purposes, an
exchange transaction is treated as a redemption of shares of one fund and a
purchase of shares of another. The Fund, the Distributor, and the Transfer Agent
are unable to provide investment, tax or legal advice to a shareholder in
connection with an exchange request or any other investment transaction.
Distributions and Taxes
Tax Status of the Fund and the Fund's Distributions
The Federal tax treatment of the Fund's distributions is explained in the
Prospectus under the caption "Distributions and Taxes."
Tax Status of the Fund. The Fund is a limited partnership and has made an
election under the Internal Revenue Code to pay federal income taxes (at a
special rate) on its income to allow it to maintain its status as a partnership.
The characterization under the Internal Revenue Code of any income realized by
the Fund after payment of that tax flows through to its limited partners. The
Fund has obtained a ruling from the IRS that it will be classified as a
partnership and that its general and limited partners will be treated as
partners for Federal income tax purposes.
Shareholders of the Fund generally are liable for payment of taxes on
their allocated share of fund income and realized capital gains. However, to
the extent the Fund earns "portfolio interest" income, eligible foreign
investors who are not subject to payment or withholding of U.S. tax on that
type of income are likewise not subject to payment or withholding of U.S. tax
on their allocated share of "portfolio interest" income from the Fund if
certain conditions are met on a continuing basis. Some of those conditions
are the following:
o The Fund must maintain its treatment as a partnership for U.S. Federal
income tax purposes rather than become taxable as a corporation.
o The Fund must comply with the provisions of the Internal Revenue Code
applicable to limited partnerships.
o The income realized by the Fund must consist of interest income which
qualifies for the "portfolio interest" exemption under the U. S.
Internal Revenue Code.
o Eligible Foreign Investors must provide the Fund with certification of
their status by furnishing a valid Form W-8BEN at the time of investment
and at specified times thereafter.
Although the Fund has obtained a ruling relating to its tax status from
the IRS, foreign investors should note that the IRS or the U.S. courts may
ultimately determine that the Fund should be characterized as an association
taxable as a corporation, rather than as a partnership for U.S. Federal income
tax purposes. If the Fund is characterized as an association taxable a
corporation for U.S. Federal income tax purposes, the Fund will incur U.S.
Federal corporate income tax on its earnings. In addition, shareholders will
incur U.S. Federal income tax and withholding on distributions from the Fund
because those distributions would no longer be eligible for the "portfolio
interest" exemption.
n Federal Tax Legislation Affecting Publicly-Traded Partnerships. Under
provisions of the Revenue Act of 1987, "publicly-traded" partnerships such as
the Fund are generally characterized as corporations rather than partnerships
for Federal income tax purposes. The 1987 legislation does not apply to the Fund
because the Fund was in existence and had obtained the IRS ruling relating to
its tax status prior to enactment of that legislation. The Fund maintained its
status as an "existing partnership" under certain "grandfathering" provisions of
that legislation and, as such, continued to be treated as a partnership for
Federal income tax purposes. When the "grandfathering" provisions of the 1987
legislation were set to expire on December 31, 1997, it was anticipated that
"existing partnerships" like the Fund would be classified as "associations
taxable as corporations" as of January 1, 1998.
However, the Taxpayer Relief Act of 1997 permitted a publicly-traded
limited partnership that was in existence on December 17, 1987, like the Fund,
and that continued to meet certain other criteria, to elect to continue its
status as a partnership for U.S. Federal income tax purposes for tax years after
December 31, 1997. The Fund made that election. As an "electing 1987
partnership," the Fund will seek to maintain its treatment as a partnership
rather than become taxable as corporation by paying a tax equal to 3.5% of its
gross income and meeting certain other criteria. That tax increases the Fund
expenses and reduces its yield.
Tax Considerations for Fund Investors. For purposes of this discussion, the term
"foreign investor" means an investor other than a U.S. citizen, U.S. resident,
or a U.S. corporation, partnership, estate or trust. A foreign investor who is
engaged in a trade or business in the United States normally will be subject to
U.S. Federal income tax on any ordinary income and capital gains at the same
rates applicable to U.S. persons on the investor's allocable share of ordinary
income and capital gains realized by the Fund. The foreign investor will be
subject to tax to the extent that (1) that income and gains are deemed to be
effectively connected with the conduct of the foreign investor's trade or
business and (2) U.S. taxation of such income and gains is not avoided under the
terms of an applicable U.S. income tax treaty.
For this purpose, foreign investors will be deemed to be engaged in a
trade or business in the U.S. and will be subject to U.S. Federal income tax on
their allocable share of the Fund's net income and capital gains if the Fund
were deemed to be engaged in a trade or business in the U.S. If the Fund were
deemed to be engaged in a trade or business in the U.S., it would also be
required to withhold U.S. Federal income tax at the maximum rate applicable to
the investor on income earned.
The Fund has obtained an opinion of counsel to the effect that neither the
Fund nor its investors, solely by virtue of their investment in the Fund, should
be deemed to be engaged in a trade or business in the United States if the Fund
adheres to its stated investment objective, policies and restrictions and to
certain guidelines concerning its investment activities. The Fund intends to
comply with those restrictions and guidelines. Consequently, any foreign
investor in the Fund should not be deemed to be engaged in a trade or business
in the United States solely by virtue of an investment in the Fund.
Although the Fund and its tax counsel rendering such opinion believe that
their position is fully supported by applicable law, there can be no assurance
that the IRS or a court of law would not take a contrary position. If the Fund
is deemed to be engaged in a U.S. trade or business by a court of law, then its
portfolio interest would be subject to U.S. Federal income tax and the Fund
would be obligated to withhold tax on all income allocated to shareholders.
Assuming that a foreign investor purchasing Fund shares is not engaged
in a trade or business in the United States, that investor's share of
ordinary income realized by the Fund will not be subject to U.S. Federal
income tax (including withholding of such taxes), if
o the ordinary income consists of interest income which qualifies for the
"portfolio interest" exemption under Sections 871(h) and 881(c) of the
Internal Revenue Code,
o the foreign investor has furnished a valid and effective IRS Form
W-8BEN (or substitute form) to the Fund,
o the Fund has no actual knowledge that the investor is, in fact, a U.S.
person, and
o the investor properly certifies, if so required, that the beneficial
owner of such investment is not (a) a "10% shareholder" (as defined in
Section 871(h)(3) of the Code) of the issuer of the security held by
the Fund which generates the interest income, (b) a controlled foreign
corporation related to such issuer, or (c) a bank deemed to be
receiving such interest (other than interest on an obligation of the
United States) on an extension of credit made pursuant to a loan
agreement entered into in the ordinary course of its trade or
business.
The Fund has been advised that interest income will qualify for the
"portfolio interest" exemption if it is paid with respect to a publicly-offered,
registered debt obligation issued after July 18, 1984, with respect to which the
Fund, which would otherwise be required to withhold U.S. Federal income tax from
such interest, has received a valid and effective statement that the beneficial
owner of the obligation is not a U.S. person. A statement such as that contained
in the representations in Form W-8BEN is expected to be sufficient for that
purpose. Interest income received by the Fund on certain short-term investments
might not qualify for the "portfolio interest" exemption. Accordingly, the
portion of that interest allocable to foreign shareholders would be subject to
U.S. Federal income tax (including withholding taxes) during the calendar year
such interest is received by the Fund.
A foreign investor who is not "engaged in a trade or business" in the
United States for purposes of the Internal Revenue Code generally will not be
subject to U.S. Federal income tax (or withholding) on that investor's allocated
share of net short-term or long-term capital gains realized by the Fund. To
qualify, in the case of an investor who is a person, the investor must not be
physically present in the U.S. for 183 or more days during the year or for such
other period as would cause the investor to be treated as a U.S. resident under
the Internal Revenue Code. Proceeds of redemption of Fund shares also will not
be subject to U.S. tax if they constitute non-U.S. source income by virtue of
the investor's non-U.S. status. However, even if the proceeds of share
redemptions are not subject to U.S. tax under these rules, nevertheless the Fund
might be required to withhold on the portion of those proceeds that represents
the investor's allocable share of income or gains of the Fund that would
otherwise be subject to withholding.
Foreign investors who do not furnish a valid and effective Form W-8BEN or
otherwise properly certify, if required by U.S. Federal tax laws, that such
investor is not (a) a "10 percent shareholder", (b) a controlled foreign
corporation of the issuer, or (c) a bank deemed to be receiving such interest
(other than interest on an obligation of the United States) on an extension of
credit made pursuant to a loan agreement entered into in the ordinary course of
its trade or business may be subject to U.S. withholding taxes on their
allocated shares of all income realized by the Fund (regardless of its source).
Foreign shareholders are required to furnish a Form W-8BEN every three
calendar years. As previously discussed, regardless of whether a valid and
effective Form W-8BEN is furnished, foreign shareholders may be subject to U.S.
withholding taxes on their allocated shares of income realized by the Fund from
sources other than "portfolio interest" income and net realized capital gains
unless such withholding taxes are reduced or eliminated under the terms of an
applicable U.S. income tax treaty and the investor complies with all procedures
for claiming the benefits of such a treaty. It is the intention of the Fund to
withhold amounts required by the Internal Revenue Code with respect to
non-qualifying income and/or non-qualifying investors.
Additional Information About the Fund
The Distributor. The Fund's shares are sold through dealers, brokers and other
financial institutions that have a sales charge agreement with Centennial Asset
Management Corporation, a subsidiary of the Manager that acts as the Fund's
Distributor or OppenheimerFunds Distributor, Inc., the Sub-Distributor. The
Distributor also distributes shares of the other Centennial Trusts.
The Transfer Agent. Shareholder Services, Inc. the Fund's Transfer Agent, is
responsible for maintaining the Fund's shareholder registry and shareholder
accounting records, and for paying dividends and distributions to
shareholders of the Fund. It also handles shareholder servicing and
administrative functions. It is paid on a "at-cost" basis.
The Custodian Bank. Citibank, N.A. is the custodian bank of the Fund's assets.
The custodian's responsibilities include safeguarding and controlling the Fund's
portfolio securities and handling the delivery of such securities to and from
the Fund. It will be the practice of the Fund to deal with the custodian bank in
a manner uninfluenced by any banking relationship the custodian may have with
the Manager and its affiliates. The Fund's cash balances with the custodian bank
in excess of $100,000 are not protected by Federal deposit insurance. Those
uninsured balances at times may be substantial.
Independent Auditors. Deloitte & Touche LLP are the independent auditors of the
Fund. They audit the Fund's financial statements and perform other related audit
services. They also act as auditors for the Manager and certain other funds
advised by the Manager and its affiliates.
<PAGE>
A-5
Appendix 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 Fund. The ratings descriptions are based on information supplied by
the ratings organizations to subscribers.
Short-Term Debt Ratings.
Moody's Investors Service, Inc.
- ------------------------------------------------------------------------------
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 broad-based access to the
market for refinancing.
MIG2/VMIG2: High quality. Margins of protection are ample although not so
large as in the preceding group.
<PAGE>
Standard & Poor's Ratings Services
- ------------------------------------------------------------------------------
The following ratings by Standard & Poor's 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 IBCA, Inc.
- ------------------------------------------------------------------------------
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.
- ------------------------------------------------------------------------------
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.
Thomson BankWatch, Inc.
- ------------------------------------------------------------------------------
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 Fund with a remaining
maturity of 397 days or less, or for rating issuers of short-term obligations.
Moody's Investors Service, Inc.
- ------------------------------------------------------------------------------
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 Ratings Services
- ------------------------------------------------------------------------------
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 IBCA, Inc.
- ------------------------------------------------------------------------------
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, Inc.
- ------------------------------------------------------------------------------
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.
Thomson BankWatch, Inc.
- ------------------------------------------------------------------------------
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>
Appendix B
- ------------------------------------------------------------------------------
Industry Classifications
- ------------------------------------------------------------------------------
Aerospace/Defense Food
Air Transportation Gas Utilities
Asset-Backed Gold
Auto Parts Distribution Health Care/Drugs
Automotive Health Care/Supplies & Services
Bank Holding Companies Homebuilders/Real Estate
Banks Hotel/Gaming
Beverages Industrial Services
Broadcasting Information Technology
Broker-Dealers Insurance
Building Materials Leasing & Factoring
Cable Television Leisure
Chemicals Limited Purpose Finance
Commercial Finance Manufacturing
Computer Hardware Metals/Mining
Computer Software Non-durable Municipality Household
Conglomerates Goods
Consumer Finance Oil - Integrated
Containers Paper
Convenience Stores Publishing/Printing
Cosmetics Railroads
Department Stores Restaurants
Diversified Financial Savings & Loans
Diversified Media Shipping
Drug Stores Special Purpose Financial
Drug Wholesalers Specialty Retailing
Durable Household Goods Steel
Education Supermarkets
Electric Utilities Telecommunications - Technology
Electrical Equipment Telephone - Utility
Electronics Textile/Apparel
Energy Services & Producers Tobacco
Entertainment/Film Toys
Environmental Trucking
Foreign Government Wireless Services
<PAGE>
Appendix C
FIRST TRUST AMERICA FUND, L.P.
AGREEMENT OF LIMITED PARTNERSHIP
dated April 28, 1987
TABLE OF CONTENTS
1. GENERAL PROVISIONS
1.1 Formation
1.2 Name and Place of Business
1.3 Term
1.4 Agent for Service of Process
1.5 Certificate of Limited Partnership
1.6 Other Acts/Filings
2. DEFINITIONS
2.1 Affiliate
2.2 Capital Account
2.3 General Partner
2.4 Holder of Record or Holder of a Share
2.5 Limited Partner
2.6 Majority Vote
2.7 Managing General Partner
2.8 Net Asset Value (per Share)
2.9 Non-Managing General Partner
2.10 Officers
2.11 Partners
2.12 Partnership
2.13 Partnership Act
2.14 Partnership Group
2.15 Person
2.16 Registration Statement
2.17 Secretary of State
2.18 Share (including fractional Shares)
2.19 Substituted Limited Partner
2.20 Tax Code
2.21 Transfer Agent
2.22 1940 Act
3. ACTIVITIES AND PURPOSE
3.1 Operating Policy
3.2 Investment Objectives
3.3 Investment Policies and Restrictions
3.4 Other Authorized Activities
4. GENERAL PARTNERS
4.1 Identity and Number
4.2 Managing and Non-Managing General Partners
4.3 General Partners' Contributions
4.4 Management and Control
4.5 Action by the Managing General Partners
4.6 Limitations on the Authority of the Managing
General Partners
4.7 Right of General Partners to Become
Limited Partners
4.8 Termination of a General Partner
4.9 Additional or Successor General Partners
4.10 Liability to Limited Partners
4.11 Assignment and Substitution
4.12 No Agency
4.13 Reimbursement and Compensation
4.14 Indemnification
5. LIMITED PARTNERS
5.1 Identity of Limited Partners
5.2 Admission of Limited Partners
5.3 Contributions of the Limited Partners
5.4 Additional Contributions of Limited Partners
5.5 Use of Contributions
5.6 Redemption by Limited Partners
5.7 Minimum Contribution and Mandatory Redemption
5.8 Limited Liability
5.9 No Power to Control Operations
5.10 Tax Responsibility
6. SHARES OF PARTNERSHIP INTEREST
7. PURCHASE AND EXCHANGE OF SHARES
7.1 Purchase of Shares
7.2 Net Asset Value
7.3 Exchange of Shares
8. REDEMPTION OF SHARES
8.1 Redemption of Shares
8.2 Payment for Redeemed Shares
9. MATTERS AFFECTING THE PARTNERSHIP'S BASIC STRUCTURE
9.1 Rights of Limited Partners
9.2 Actions of the Partners
9.3 Meetings
9.4 Notices
9.5 Validity of Vote for Certain Matters
9.6 Adjournment
9.7 Waiver of Notice and Consent to Meeting
9.8 Quorum
9.9 Required Vote
9.10 Action by Consent Without a Meeting
9.11 Record Date
9.12 Proxies
9.13 Number of Votes
9.14 Communication Among Limited Partners
10. DISTRIBUTIONS AND ALLOCATION OF PROFITS AND LOSSES
10.1 Fees of General Partners
10.2 Distributions of Income and Gains
10.3 Allocation of Income, Gains, Losses, Deductions
and Credits
10.4 Returns of Contributions
10.5 Capital Accounts
10.6 Allocations of Capital Gains and Losses and
Additional Rules
11. ASSIGNMENT OF SHARES; SUCCESSOR IN INTEREST; SUBSTITUTION
OF PARTNERS
11.1 Prohibition on Assignment
11.2 Rights of the Holders of Shares as Collateral or
Judgment Creditor
11.3 Death, Incompetency, Bankruptcy or Termination
of the Existence of a Partner
11.4 Substituted Limited Partners
12. DISSOLUTION AND TERMINATION OF THE PARTNERSHIP
12.1 Dissolution
12.2 Liquidation
12.3 Termination
13. BOOKS, RECORDS, ACCOUNTS AND REPORTS
13.1 Books and Records
13.2 Limited Partners' Access to Information
13.3 Accounting Basis and Fiscal Year
13.4 Tax Returns
13.5 Filings with Regulatory Agencies
13.6 Tax Matters and Notice Partner
14. AMENDMENTS OF PARTNERSHIP DOCUMENTS
14.1 Amendments in General
14.2 Amendments Without Consent of Limited Partners
14.3 Amendments Needing Consent of Affected Partners
14.4 Amendments to Certificate of Limited
Partnership
14.5 Amendments After Change of Law
15. MISCELLANEOUS PROVISIONS
15.1 Notices
15.2 Section Headings
15.3 Construction
15.4 Severability
15.5 Governing Law
15.6 Counterparts
15.7 Entire Agreement
15.8 Cross-References
15.9 Power of Attorney to the General Partners
15.10 Further Assurances
15.11 Successors and Assigns
15.12 Waiver of Action for Partition
15.13 Creditors
15.14 Remedies
15.15 Custodian
15.16 Use of Name "First Trust"
15.17 Authority
15.18 Signatures
<PAGE>
FIRST TRUST AMERICA FUND, L.P.
This AGREEMENT OF LIMITED PARTNERSHIP ("Partnership Agreement") is entered
into as of this 28th day of April, 1987 by and among Gerald E. Pelzer, an
individual, Thomas L. Johnson, an individual, Dr. David Johnston, an individual,
and Edward McGrew, an individual, as Managing General Partners; Clayton Brown
Investments, Inc., an Illinois corporation, as Non-Managing General Partner
(collectively, the "General Partners"); and Clayton Brown Investments, Inc., an
Illinois corporation, as Limited Partner.
1. GENERAL PROVISIONS
1.1 Formation. The parties hereby agree to form a limited partnership
(the "Partnership") under the terms and conditions set forth below pursuant to
the Delaware Revised Uniform Limited Partnership Act (the "Partnership Act").
1.2 Name and Place of Business. The name of the Partnership shall be
First Trust America Fund, L.P., or such other name as shall be selected from
time to time by the Managing General Partners. The principal place of business
of the Partnership shall be 300 W. Washington Street, Chicago, Illinois 60606 or
such other place or places as the Managing General Partners may deem necessary
or desirable to the conduct of the Partnership's activities, including places
for the conduct of activities relating to its investments, the location and
holding of its assets, the execution of its portfolio transactions and other
operations. The registered office of the Partnership in Delaware is located at
1209 Orange Street, in the City of Wilmington, County of New Castle.
1.3 Term. The term of the Partnership shall commence upon the filing
of the Certificate of Limited Partnership with the Secretary of State and shall
continue until the 31st day of December, 2037, unless terminated earlier in
accordance with the provisions of this Partnership Agreement.
1.4 Agent for Service of Process. The registered agent for service of
process on the Partnership in Delaware is The Corporation Trust Company, 1209
Orange Street, Wilmington, Delaware or such other eligible Delaware resident
individual or corporation qualified to act as an agent for service of process as
the Managing General Partners shall designate.
1.5 Certificate of Limited Partnership. The Managing General Partners
shall cause a Certificate of Limited Partnership to be filed with the Secretary
of State in accordance with the terms of the Partnership Act.
Other Acts/Filings. The Partners shall from time to time execute or cause to be
executed all such certificates, fictitious business name statements, and other
documents, and do or cause to be done all such filings, recordings, publishings,
and other acts as the Managing General Partners may deem necessary or
appropriate to comply with the requirements of law for the formation and
operation of the Partnership in all jurisdictions in which the Partnership shall
desire to conduct its activities.
2. DEFINITIONS
When used in this Partnership Agreement the following terms shall have
the meanings set forth below:
2.1 Affiliate. "Affiliate" shall mean: (i) any person directly or
indirectly controlling, controlled by or under common control with another
person; (ii) a person owning or controlling 10% or more of the outstanding
securities of that other person; (iii) any officer, director, trustee or partner
of that other person; or (iv) if that other person is an officer, director,
trustee or partner, any company for which that person acts in any such capacity
(person shall include any natural person, partnership, corporation, association
or other legal entity).
2.2 Capital Account. The account maintained for each Partner in
accordance with Section 10.5 hereof.
2.3 General Partner. Each of the initial General Partners designated
in the Preamble and any other person or entity who shall hereafter become a
General Partner.
2.4 Holder of Record or Holder of a Share.
(a) a General Partner;
(b) a Limited Partner if he or it has not redeemed or
transferred all of his (its) Shares of the Partnership pursuant to Sections 8 or
11;
(c) a purchaser of a Share or Shares of the Partnership; or
(d) the successor in interest of a Partner under Section 11.
2.5 Limited Partner. The original Limited Partner and all other
persons who shall hereinafter be admitted to the Partnership as additional
Limited Partners or Substituted Limited Partners, except those persons who:
(a) have redeemed all Shares of the Partnership owned by them
and such redemption has been reflected in the records of the Partnership; or
(b) have been replaced by a Substituted Limited Partner to the
extent of their entire Limited Partnership Interest. Reference to a "Limited
Partner" shall mean any one of the Limited Partners.
2.6 Majority Vote. The affirmative vote of the lesser of (i) 67% or more of the
Shares represented at a meeting and entitled to vote if more than 50% of the
then outstanding Shares are present or represented by proxy, or (ii) more than
50% of the then outstanding Shares entitled to vote.
2.7 Managing General Partner. Each General Partner who is an
individual.
2.8 Net Asset Value (per Share). The value (in U.S. Dollars) of a
Share as determined in accordance with Section 7.2 hereof.
2.9 Non-Managing General Partner. Each General Partner that is not an
individual (i.e., any General Partner that is a corporation, association,
partnership, joint venture or trust).
2.10 Officers. Those persons designated by the Managing General
Partners to perform administrative and operational functions on behalf of the
Managing General Partners.
2.11 Partners. Collectively, the General Partners and the Limited
Partners. "Partner" means any one of the Partners.
2.12 Partnership. The limited partnership created and continued by
this Partnership Agreement.
2.13 Partnership Act. The Delaware Revised Uniform Limited
Partnership Act (Sections 17-101 through 17-1108, Chapter 17, Title 6 of the
Delaware Code).
2.14 Partnership Group. All other investment companies of which
Clayton Brown & Associates, Inc. or any parent, subsidiary or affiliate is
organizer or sponsor and which are registered under the 1940 Act.
2.15 Person. An individual, partnership, joint venture, association,
corporation or trust.
2.16 Registration Statement. The Registration Statement on Form N-1A,
registering the Partnership under the 1940 Act and the Shares of the Partnership
under the Securities Act of 1933, as such Registration Statement may be amended
from time to time.
2.17 Secretary of State. The Secretary of State of the State of
Delaware.
2.18 Share (including fractional Shares). A partnership interest in
the Partnership. Reference to "Shares" shall be to more than one Share.
2.19 Substituted Limited Partner. A successor in interest of a Limited
Partner who has complied with the conditions set forth in Section 11.
2.20 Tax Code. The Internal Revenue Code of 1986, as amended, or corresponding
provisions of subsequent revenue laws, and all regulations, rulings and other
promulgations or judicial decisions thereunder.
2.21 Transfer Agent. The person appointed by the Managing General
Partners to be primarily responsible for maintaining the records pertaining to
Limited Partners and certain other records of the Partnership.
2.22 1940 Act. The Investment Company Act of 1940, as amended, or as
it may hereafter be amended, and the Rules and Regulations thereunder.
3. ACTIVITIES AND PURPOSE
3.1 Operating Policy. The Partnership will be authorized and empowered
to operate and will operate as an open-end, diversified management investment
company under the 1940 Act.
3.2 Investment Objectives. The investment objective of the Partnership
is to seek high current return and safety of principal with income free of U.S.
taxes and U.S. tax withholding requirements for qualifying foreign investors by
investing in obligations issued or guaranteed by the U.S. Government or any of
its agencies or instrumentalities, including mortgage-backed securities and
securities issued by private entities and collateralized by such obligations, or
such other investment objectives as may be adopted from time to time by the
Managing General Partners.
3.3 Investment Policies and Restrictions. The investment policies and
restrictions of the Partnership shall be the investment policies and
restrictions set forth in the Partnership's then current Prospectus or Statement
of Additional Information (hereinafter referred to collectively as the
"Prospectus"). Unless otherwise indicated in the Prospectus, such investment
policies and restrictions may be changed from time to time by the Managing
General Partners.
3.4 Other Authorized Activities. Subject to the limitations set forth
in this Partnership Agreement, the Partnership shall have the power to purchase
and sell securities, issue evidences of indebtedness in connection with
Partnership business, to join or become a partner in limited or general
partnerships and to do any and all other things and acts, and to exercise any
and all of the powers that a natural person could do or exercise and which now
or hereafter may be lawfully done or exercised by a Delaware limited
partnership.
4. GENERAL PARTNERS
4.1 Identity and Number. The names of the General Partners and their
last known business or residence address shall be set forth in the Certificate
of Limited Partnership, as it may be amended from time to time; this same
information, together with the amounts of the contributions of each General
Partner and their current Share ownership, shall be set forth on the records of
the Partnership. The General Partners shall be identified as such on such
records and also shall be identified separately as Managing General Partners or
Non-Managing General Partners. The numbers of Managing and Non-Managing General
Partners shall be fixed by the Managing General Partners, provided, however,
that the number of General Partners shall at no time exceed eighteen.
4.2 Managing and Non-Managing General Partners. Only individuals may
act as Managing General Partners, and all General Partners who are individuals
shall act as Managing General Partners. Any General Partner that is a
corporation, association, partnership, joint venture or trust shall act as a
Non-Managing General Partner. Except as provided in Section 4.4 hereof, a
Non-Managing General Partner as such shall take no part in the management,
conduct or operation of the Partnership's business and shall have no authority
to act on behalf of the Partnership or to bind the Partnership. All General
Partners, including Managing and Non-Managing General Partners, shall be subject
to election and removal by the Partners to the extent hereinafter provided.
4.3 General Partners' Contributions. (a) Each General Partner, as
such, shall make a contribution of cash to the Partnership sufficient to
purchase at least one Share (plus any applicable sales charge) and shall
continue to own unencumbered at least one such Share at all times while serving
as a General Partner. The amount contributed by each General Partner shall be
the amount actually invested in Shares of the Partnership at their Net Asset
Value, which amount shall not include any sales charges and which amount may be
less than the offering price paid by such General Partner for his shares to the
extent the offering price includes any sales charges. The amount of such
contributions and the number of Shares owned by each General Partner shall be
set forth in the records of the Partnership.
(b) The Non-Managing General Partner shall, in its capacity as such Non-Managing
General Partner, be obligated to contribute to the Partnership through the
purchase of Shares from time to time amounts sufficient to enable the General
Partners, in the aggregate, to maintain in their capacities as General Partners
an interest in each material item of Partnership income, gain, loss, deduction
or credit equal to at least 1% of each such item at all times during the
existence of the Partnership. If, upon termination of the Partnership, the
General Partners have a negative balance in their Capital Accounts, they shall
in their capacity as General Partners be obligated to make additional capital
contributions in cash equal to the lesser of (i) the negative balance in their
Capital Accounts or (ii) the amount, if any, by which 1.01% of the total capital
contributions of the Limited Partners exceeds the total capital contributions of
the General Partners prior to such termination. For as long as the Non-Managing
General Partner retains its status as such, it shall not redeem or assign Shares
held by it in its capacity as the Non-Managing General Partner or otherwise
accept distributions in cash or property if such action would result in the
failure of the General Partners to maintain such an interest. In the event that
the Non-Managing General Partner is removed or stands for re-election and is not
re-elected by the Partners pursuant to Section 9 hereof, the Non-Managing
General Partner may, upon not less than thirty (30) days' written notice, redeem
its Shares in the same manner as is provided in Section 8 hereof. In the event
that the Non-Managing General Partner voluntarily withdraws or declines to stand
for reelection, the Non-Managing General Partner may, upon not less than thirty
(30) days' written notice following the occurrence of such event, redeem its
Shares in the same manner as provided in Section 8. In the event that the
Non-Managing General Partner is removed, stands for reelection and is not
re-elected, voluntarily withdraws or declines to stand for reelection, the
Managing General Partners shall cause the Certificate of Limited Partnership to
be amended as provided in Section 14.4 hereof to reflect such withdrawal.
4.4 Management and Control. Subject to the terms of this Partnership
Agreement and the 1940 Act, the Partnership will be managed by the Managing
General Partners, who will have complete and exclusive control over the
management, conduct and operation of the Partnership's business, and, except as
otherwise specifically provided in this Partnership Agreement, the Managing
General Partners shall have the rights, powers and authority, on behalf of the
Partnership and in its name to exercise all of the rights, powers and authority
of partners of a partnership without limited partners. Any Managing General
Partner may, by power of attorney, delegate his power to any other Managing
General Partner, provided that in no case shall less than two General Partners
personally exercise their other powers hereunder except as herein otherwise
expressly provided. The Managing General Partners may contract on behalf of the
Partnership with one or more banks, trust companies, underwriters or investment
advisers for the performance of such functions as the Managing General Partners
may determine, but subject always to their continuing supervision, including,
without limitation, the investment and reinvestment of all or part of the
Partnership's assets and execution of portfolio transactions, the distribution
of Shares, and any or all administrative functions. The Managing General
Partners may appoint officers or agents to perform such duties on behalf of the
Partnership and the Managing General Partners as the Managing General Partners
deem desirable. Such officers or agents need not be General or Limited Partners.
The Managing General Partners may also employ persons to perform various duties
on behalf of the Partnership as employees of the Partnership. The Managing
General Partners shall devote themselves to the Partnership's business to the
extent they may determine necessary for the efficient conduct thereof, which
need not, however, occupy their full time. The General Partners may also engage
in other businesses, whether or not similar In nature to the business of the
Partnership, subject to the limitations of the 1940 Act.
In the event that no Managing General Partner shall remain for
the purpose of managing and conducting the business of the Partnership, the
Non-Managing General Partner shall promptly call a meeting of the Limited
Partners, to be held within sixty (60) days of the date the last Managing
General Partner ceases to act in such capacity, to elect new Managing General
Partners. For the period of time during which no Managing General Partner shall
remain, the Non-Managing General Partner, subject to the terms and provisions of
this Partnership Agreement, shall be permitted to engage in the management,
conduct and operation of the business of the Partnership.
4.5 Action by the Managing General Partners. Unless otherwise required
by the 1940 Act with respect to any particular action, the Managing General
Partners shall act only by vote of a majority of the Managing General Partners
at a meeting duly called at which a quorum of the Managing General Partners is
present or by unanimous written consent of the Managing General Partners without
a meeting. At any meeting of the General Partners, a majority of the Managing
General Partners shall constitute a quorum. Any or all of the Managing General
Partners may participate in a meeting by means of a conference telephone or
similar communications equipment by means of which all persons participating in
the meeting can hear each other at the same time; and participation by such
means shall constitute presence in person at a meeting. in there shall be more
than one Managing General Partner, no single Managing General Partner shall have
authority to act on behalf of the Partnership or to bind the Partnership unless
authorized by the Managing General Partners. The Managing General Partners shall
appoint one of their number to be Chairman. Meetings of the Managing General
Partners may be called orally or in writing by the Chairman or by any two
Managing General Partners. Notice of the time, date and place of all meetings of
the Managing General Partners shall be given by the party or parties calling the
meeting to each Managing General Partner by telephone or telegram sent to his
home or business address at least twenty-four hours in advance of the meeting or
by written notice mailed to his home or business address at least seventy-two
hours in advance of the meeting. Notice need not be given to any Managing
General Partner who attends the meeting without objecting to the lack of notice
or who executes a written waiver of notice with respect to the meeting. The
Chairman, if present, shall preside at all meetings of Partners. Notwithstanding
anything contained in this Partnership Agreement, the Managing General Partners
may designate one (1) or more committees to act on behalf of the Managing
General Partners.
4.6 Limitations on the Authority of the Managing General Partners. The
Managing General Partners shall have no authority without the vote or written
consent or ratification of the Limited Partners to:
(a) do any act in contravention of this Partnership
Agreement, as it may be amended from time to time;
(b) do any act which would make it impossible to carry on the
ordinary activities of the Partnership;
(c) confess a judgment against the Partnership;
(d) possess Partnership property, or assign their rights in
specific property, for other than a Partnership purpose;
(e) admit a person as a General Partner except in accordance
with Section 9 hereof; or
(f) admit a person as a Limited Partner, except in accordance
with Section 5 hereof.
4.7 Right of General Partners to Become Limited Partners. A General
Partner may also own Shares as a Limited Partner without obtaining the consent
of the Limited Partners and thereby become entitled to all the rights of a
Limited Partner to the extent of the Limited Partnership Interest so acquired.
Such event shall not, however, be deemed to reduce or otherwise affect any of
the General Partners' liability hereunder as a General Partner. If a General
Partner shall also become a Limited Partner, the contributions and Share
ownership of such General Partner shall be separately designated in the records
of the Partnership to reflect his interest in each capacity.
4.8 Termination of a General Partner. (a) The interest of a General
Partner shall terminate and such person shall have no further right or power to
act as a General Partner (except to execute any amendment to this Partnership
Agreement to evidence his termination):
(i) upon death of the General Partner;
(ii)upon an adjudication of incompetency of the General
Partner;
(iii) if such General Partner is removed pursuant to Subsection (c) of this
Section 4.8 or stands for reelection and is not reelected by the Partners, as
provided in Section 9 below;
(iv)in the case of the Non-Managing General Partner, upon
the filing of a certificate of dissolution, or its equivalent, or a voluntary or
involuntary petition in bankruptcy for such Non-Managing General Partner; or
(v) If such General Partner voluntarily withdraws or retires
upon not less than ninety (90) days' written notice to the other General
Partners.
(b) Notwithstanding the foregoing, the Non-Managing General
Partner shall not voluntarily withdraw or otherwise voluntarily terminate its
status as the Non-Managing General Partner until the earliest of (i) 180 days
from the date that the Non-Managing General Partner gives the other General
Partners written notice of Its intention to withdraw as a Non-Managing General
Partner, (ii) the date that a successor Non-Managing General Partner, who has
agreed to assume the obligations of a Non-Managing General Partner as set forth
in Section 1.3(b) hereof, is appointed by the Managing General Partners pursuant
to Section 4.9 hereof or elected by the Partners pursuant to Section 9 hereof,
or (iii) the date that another General Partner assumes the obligations imposed
upon the Non-Managing General Partner pursuant to Section 4.3(b) hereof. The
failure of the Non-Managing General Partner to seek reelection at any meeting of
the Partners called for such purpose shall be deemed to constitute a voluntary
withdrawal as of the date of such meeting and shall constitute written notice as
at the date of notice of such meeting of its intention to withdraw as a
Non-Managing General Partner, unless it has delivered written notice at an
earlier date.
(c) Any Managing General Partner may be removed at any time by
vote of, or a written instrument signed by, at least two-thirds of the Managing
General Partners prior to such removal, specifying the date when such removal
shall become effective. A Managing General Partner may also be removed after
Limited Partners holding of record not less than two-thirds of the outstanding
Shares have declared that such Managing General Partner be removed from that
office by a declaration in writing signed by such Limited Partners and filed
with the custodian of the assets of the Partnership or by votes cast by such
Limited Partners in person or by proxy at a meeting called for such purpose.
Solicitation of such a declaration shall be deemed a solicitation of a proxy
within the meaning of Section 20(a) of the 1940 Act.
(d) In the event a General Partner ceases to be a General
Partner, the remaining General Partners shall have the right to continue the
operations of the Partnership.
(e) Termination of a person's status as a General Partner shall
not affect his status, if any, as a Limited Partner. A General Partner may
retain Shares owned in his capacity as a Limited Partner provided such General
Partner has been or is admitted to Partnership as a Limited Partner in
accordance with Section 5.2.
(f) A person who ceases to be a General Partner shall
nevertheless be deemed to be acting as a General Partner with respect to a third
party doing business with the Partnership until an amended Certificate of
Limited Partnership is filed with the Secretary of State.
4.9 Additional or Successor General Partners. In case a vacancy shall,
by reason of the withdrawal or termination of a General Partner, an increase in
the number of General Partners or for any other reason exist, the remaining
Managing General Partners, if any, shall fill such vacancy by appointing such
other person as General Partner as they in their discretion may see fit. Such
appointment shall be evidenced by a written instrument signed by a majority of
the Managing General Partners whereupon the appointment shall take effect.
Within 90 days after such appointment the Managing General Partners shall cause
notice of such appointment to be mailed to each Limited Partner at his address
as recorded on the books of the Partnership and shall cause to be filed with the
Secretary of State an amended Certificate of Limited Partnership reflecting the
appointment of such General Partner. An appointment of a General Partner may be
made by the Managing General Partners and notice thereof mailed to the Limited
Partners as aforesaid in anticipation of a vacancy to occur by reason of
retirement, withdrawal or increase in the number of General Partners effective
at a later date, provided that said appointment shall become effective only at
or after the effective date of said retirement, withdrawal or increase in the
number of General Partners. A person also may be added or substituted as a
General Partner upon his election and admission by the Partners at a meeting of
Partners or by written consent without a meeting as provided in Section 9
hereof. Each General Partner, by becoming a General Partner, consents to the
admission as an added or substituted General Partner of any person appointed by
the Managing General Partners or elected by the Partners in accordance with this
Partnership Agreement. Any person who is appointed or elected to be admitted as
a General Partner and who shall not be serving as a General Partner at the time
of such appointment or election, shall be admitted to the Partnership as a
General Partner effective as of the date of such appointment or election. Any
General Partner who stands for re-election and is not re-elected at any such
meeting in the manner specified in Section 9 shall be deemed to have withdrawn
as of the date of such meeting.
4.10 Liability to Limited Partners. The General Partners shall not be
personally liable for the repayment of any amounts standing in the account of a
Limited Partner or holder of Shares including, but not limited to, contributions
with respect to such Shares, except by reason of their willful misfeasance, bad
faith, gross negligence or reckless disregard of the duties involved in the
conduct of their office. Any payment, other than in the event of willful
misfeasance, bad faith, gross negligence 1 or reckless disregard of the duties
involved in the conduct of his office by a General Partner, which results in a
personal liability to Limited Partners or holders of Shares, shall be solely
from the Partnership's assets.
So long as the General Partners have acted in good faith and in
a manner reasonably believed to be in the best interests of the Limited
Partners, the General Partners shall not have any personal liability to any
holder of Shares or to any Limited Partner by reason of (1) any failure to
withhold income tax under Federal or state tax laws with respect to income
allocated to Limited Partners or (2) any change in the Federal or state tax laws
or in the interpretation thereof as they apply to the Partnership, the holders
of the Shares or the Limited Partners, whether such change occurs through
legislative, judicial or administrative action.
4.11 Assignment and Substitution. Each Share held by a General Partner
in his capacity as a General Partner shall be designated as such, and each such
Share shall be non-assignable, except to another person who already is a General
Partner, and then only with the consent of the Managing General Partners, and
shall be redeemable by the Partnership only in the event that (i) the holder
thereof has ceased to be a General Partner of the Partnership or (ii) in the
opinion of counsel for the Partnership redemption of Shares held by a General
Partner would not jeopardize the status of the Partnership as a partnership for
Federal income tax purposes.
4.12 No Agency. Except as provided In Section 15.9 below, nothing in
this Partnership Agreement shall be construed as establishing any General
Partner as an agent of any Limited Partner.
4.13 Reimbursement and Compensation. Managing General Partners may
receive reasonable compensation for their services as Managing General Partners
and will be reimbursed for all reasonable out-of-pocket expenses incurred in
performing their duties hereunder, as provided in Section 10.1.
4.14 Indemnification. (a) Subject to the exceptions and
limitations contained in Subsection (b) below:
(i) Every person who is, or has been, a General Partner, an
officer and/or Director of a Non-Managing General Partner or an officer of the
Partnership (each hereinafter referred to as a "Covered Person") shall be
indemnified by the Partnership to the fullest extent permitted by law against
liability and against all expenses reasonably incurred or paid by him in
connection with any claim, action, suit or proceeding in which he becomes
involved as a party or otherwise by virtue of his being or having been a General
Partner, an officer and/or Director of a Non-Managing General Partner or an
officer of the Partnership and against amounts paid or incurred by him in the
settlement thereof;
(ii)the words "claim", "action", "suit" or "proceeding"
shall apply to all claims, actions, suits or proceedings (civil, criminal or
other, including appeals), actual or threatened while in office or thereafter,
and the words "liability" and "expenses" shall include, without limitation,
attorneys' fees, costs, judgments, amounts paid in settlement, fines, penalties
and other liabilities.
(b) No indemnification shall be provided hereunder to a Covered
Person:
(i) who shall have been finally adjudicated by a court or
other body before which the proceeding was brought (A) to be liable to the
Partnership or its Partners by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his
office or (B) not to have acted in good faith in the reasonable belief that his
action was in the best interests of the Partnership;
(ii)in the event of a settlement, or other disposition not
involving a final adjudication as provided in Subsection (b)(i) unless there has
been a determination that such Covered Person did not engage in willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of his office,
(A) by the court or other body approving the settlement
or other disposition;
(B) by vote of at least a majority of those Managing
General Partners who are neither interested persons (as
defined in the 1940 Act) of the Partnership nor are parties
to the matter based upon a review of readily available facts
(as opposed to a full trial-type inquiry); or
(C) by written opinion of independent legal counsel,
based upon a review of readily available facts (as opposed
to a full trial-type inquiry); provided, however, that any
Partner may, by appropriate legal proceedings, challenge any
such determination by the Managing General Partners, or by
independent counsel; or
(iii) who shall have acted outside the scope of the Managing
General Partners' authority.
(c) The rights of indemnification herein provided may be insured
against by policies maintained by the Partnership, shall be severable, shall not
be exclusive of or affect any other rights to which any Covered Person may now
or hereafter be entitled, shall continue as to a person who has ceased to be
such General Partner, officer and/or Director of a Non-Managing General Partner
or officer of the Partnership and shall inure to the benefit of the heirs,
executors and administrators of such a person. Nothing contained herein shall
affect any rights to indemnification to which Partnership personnel, other than
Covered Persons, and other persons may be entitled by contract or otherwise
under law.
(d) Expenses incurred in connection with the preparation and
presentation of a defense to any claim, action, suit or proceeding of the
character described in Subsection (a) of this Section 4.14 shall be paid by the
Partnership from time to time in advance prior to final disposition thereof upon
receipt of an undertaking by or on behalf of such Covered Person that such
amount will be paid over by him to the Partnership if it is ultimately
determined that he is not entitled to indemnification under this Section 4.14;
provided, however, that either (i) such Covered Persons shall have provided
appropriate security for such undertaking, (ii) the Partnership is insured
against losses arising out of any such advance payments, or (iii) either a
majority of the Managing General Partners who are neither interested persons (as
defined in the 1940 Act) of the Partnership nor are parties to the matter, or
independent legal counsel in a written opinion, shall have determined, based
upon a review of readily available facts to believe that such Covered Person
will be found entitled to indemnification under this Section 4.14.
5. LIMITED PARTNERS
5.1 Identity of Limited Partners. The names of the Limited Partners
and their last known business or residence addresses, together with the amounts
of their contributions and their current Share ownership, shall be set forth in
the records of the Partnership.
5.2 Admission of Limited Partners. The Managing General Partners may
admit a purchaser of Shares as a Limited Partner, upon (i) the execution by such
purchaser of such subscription documents and other instruments as the Managing
General Partners may deem necessary or desirable to effectuate such admission,
which documents shall be described in the Partnership's Registration Statement,
(ii) the purchaser's written acceptance of all the terms and provisions of this
Partnership Agreement, including the power of attorney set forth in Section 15.9
hereof, as the same may have been amended, and (iii) the listing of such
purchaser as a Limited Partner in the records of the Partnership. In no event
shall the consent or approval of any of the Limited Partners be required to
effectuate such admission. Each purchaser of a Share of the Partnership who
becomes a Limited Partner shall be bound by all the terms and conditions of this
Partnership Agreement including, without limitation, the allocation of income,
gains, losses, deductions and credits as provided in Section 10.3.
Notwithstanding anything in this Partnership Agreement to the contrary, the
Managing General Partners reserve the right to refuse to admit any person as a
Limited Partner if, in their judgment, it would not be in the Partnership's best
interests to admit such person. At the sole discretion of and subject to the
terms and conditions set by the Managing General Partners, certificates
certifying the ownership of Shares may be issued in the form attached hereto in
Appendix 1 or in such form as shall be prescribed from time to time by the
Managing General Partners. In the event that the Managing General Partners
authorize the issuance of Share certificates, each Partner shall be entitled to
a certificate stating the number of Shares owned by him or her. Such certificate
shall be signed by an officer of the Partnership. Such signatures may be
facsimiles. In case any officer who has signed or whose facsimile signature has
been placed on such certificate shall have ceased to be such officer before such
certificate is issued, it may be issued by the Partnership with the same effect
as if he or she were such officer at the time of its issue.
5.3 Contributions of the Limited Partners. The amount contributed by
each Limited Partner to the Partnership shall be the amount actually invested in
Shares of the Partnership at their Net Asset Value, which amount shall not
include any sales charges and which amount may be less than the offering price
paid by such Limited Partner for his Shares to the extent the offering price
includes any sales charges. All contributions shall be made in U.S. dollars,
which shall be invested in Shares of the Partnership at Net Asset Value. The
amount of such contributions and. the number of Shares owned by each Partner
shall be set forth in the records of the Partnership.
5.4 Additional Contributions of Limited Partners. No Limited Partner
shall be required to make any additional contributions to (or investments in) or
lend additional funds to the Partnership, and no Limited Partner shall be liable
for any additional assessment therefor. A Limited Partner may make an additional
contribution (or investment), however, at his option through the purchase of
additional Shares at the then current offering price of such Shares, subject to
the same terms and conditions as his initial contribution.
5.5 Use of Contributions. The aggregate of all capital contributions
shall be, and hereby are agreed to be, available to the Partnership to carry out
the objects and purposes of the Partnership.
5.6 Redemption by Limited Partners. A Limited Partner may redeem his Shares at
any time in accordance with Section 8. The Managing General Partners shall cause
the records of the Partnership to be amended to reflect the withdrawal of any
Limited Partner or the return, in whole or in part, of the contribution of any
Limited Partner.
5.7 Minimum Contribution and Mandatory Redemption. The Managing
General Partners shall determine the minimum amounts required for the initial or
additional contributions of a Limited Partner, which amounts may, from time to
time, be changed by the Managing General Partners. Additionally, the Managing
General Partners may, from time to time, establish a minimum total investment
for Limited Partners, and there is reserved to the Partnership the right to
redeem automatically the interest of any Limited Partner the value of whose
investment is less than such minimum upon the giving of at least 30 days' notice
to such Limited Partner. The amounts which the Managing General Partners shall
fix from time to time for initial or additional contributions and the amount of
the minimum total investment shall be stated in the Partnership's then current
Prospectus.
5.8 Limited Liability. (a) No Limited Partner shall be liable for any
debts or obligations of the Partnership and each Limited Partner shall be
indemnified by the Partnership against any such liability; provided, however,
that contributions of a Limited Partner and his share of any undistributed
assets of the Partnership shall be subject to the risks of the operations of the
Partnership and subject to the claims of the Partnership's creditors, and
provided further, that after any Limited Partner has received the return of any
part of his contribution or any distribution of assets of the partnership, he
will be liable to the Partnership for:
(i) any money or other property wrongfully distributed to
him; and
(ii)any sum, not in excess of the amount of such
distribution, necessary to discharge any liabilities of the Partnership to
creditors who extended credit to the Partnership during the period before such
returns or distributions were made, but only to the extent that the assets of
the Partnership are not sufficient to discharge such liabilities. The obligation
of a Limited Partner to return all or any part of a distribution made to him
shall be the sole obligation of such Limited Partner and not of the General
Partners.
(b) If an action is brought against a Limited Partner to satisfy
an obligation of the Partnership, the Partnership, upon notice from the Limited
Partner about the action, will either pay the claim itself or, if the
Partnership believes the claim to be without merit, will undertake the defense
of the claim itself.
(c) The General Partners shall not have any personal liability
to any Holder of Shares or to any Limited Partner for the repayment of any
amounts standing in the account of a Limited Partner including, but not limited
to, contributions with respect to such Shares. Any such payment shall be solely
from the assets of the Partnership. The General Partners shall not be liable to
any Holder of Shares or to any Limited Partner by reason of any change in the
Federal income tax laws as they apply to the Partnership and the Limited
Partners, whether such change occurs through legislative, judicial or
administrative action, so long as the General Partners have acted in good faith
and in a manner reasonably believed to be in the best interests of the Limited
Partners.
5.9 No Power to Control Operations. A Limited Partner shall have no
right to and shall take no part in the management or control of the
Partnership's operations or activities, but may exercise the rights and powers
of a Limited Partner under this Partnership Agreement including, without
limitation, the voting rights and the giving of consents and approvals provided
for in Section 9 hereof. The exercise of such rights and powers are deemed to be
matters affecting the basic structure of the Partnership and not the management
or control of its operations and activities.
5.10 Tax Responsibility. Each Limited Partner shall (a) provide the
Managing General Partners with any tax information which may be required under
applicable law, (b) pay any penalties imposed on such Limited Partner for any
noncompliance with applicable tax laws, and (c) be subject to withholding of
U.S. Federal income tax by the Partnership to the extent required by U.S. laws
in effect at any time.
6. SHARES OF PARTNERSHIP INTEREST
All interests in the Partnership, including contributions by the
General Partners, pursuant to Section 4.3, and by the Limited Partners, pursuant
to Section 5.3, shall be expressed in units of participation herein referred to
as "Shares" (which term includes fractional Shares). Each Share shall represent
an equal proportionate interest in the income and assets of the Partnership with
each other Share outstanding.
7. PURCHASE AND EXCHANGE OF SHARES
7.1 Purchase of Shares. The Partnership may offer Shares on a
continuing basis to investors. Except for the initial purchase of Shares by the
General Partners and the initial Limited Partner, all Shares issued shall be
issued and sold at the Net Asset Value (plus such sales charge or other charge
as may be applicable to the purchase of the Shares) next computed after receipt
of a purchase order in accordance with the Partnership's Prospectus in effect at
the time the order is received. Only investors who agree to be admitted, and who
are eligible for admission, as Limited Partners pursuant to Section 5.2 shall be
eligible to purchase Shares (unless such investor has already been admitted as a
Partner). Orders for the purchase of Shares shall be accepted on any day that
the Partnership's Transfer Agent is open for business (which shall normally be
limited to those days when the New York Stock Exchange is open for business).
The form in which purchase orders may be presented shall be as set forth in the
Partnership's Prospectus In effect at the time the order is received. The
Managing General Partners on behalf of the Partnership reserve the right to
reject any specific order and to suspend the Partnership's offering of new
Shares at any time. Payment for all Shares must be made in U.S. dollars.
7.2 Net Asset Value. The Net Asset Value per Share of the Partnership
shall be determined as of 3 p.m. Chicago time on each day the New York Stock
Exchange is open for trading or as of such other time or times as the Managing
General Partners may determine in accordance with the provisions of the 1940
Act. The Net Asset Value per share shall be expressed in U.S. dollars and shall
be computed by dividing the value of all the assets of the Partnership, less its
liabilities, by the number of Shares outstanding (including Shares held by
General Partners). Portfolio securities and other assets will be valued at their
fair value using methods determined in good faith by the Managing General
Partners in accordance with the 1940 Act. The Partnership may suspend the
determination of Net Asset Value during any period when the New York Stock
Exchange is closed, other than customary weekend and holiday closing, during
periods when trading on the Exchange is restricted as determined by the
Securities and Exchange Commission (the "Commission") or during any emergency as
determined by the Commission which makes it impracticable for the Partnership to
dispose of its securities or value its assets, or during any other period
permitted by order of the Commission for the protection of investors.
7.3 Exchange of Shares. Shares of the Partnership may be exchanged for
(i.e., redeemed and the proceeds reinvested in) shares of any other partnership
in the Partnership Group in accordance with the Partnership's Prospectus in
effect at the time the exchange order is received.
8. REDEMPTION OF SHARES
8.1 Redemption of Shares. The Partnership will redeem from any Partner
all or any portion of the Shares owned by him provided that the Partner delivers
to the Partnership or its designated agent notice of such redemption, stating
the number of Shares to be redeemed, together with a properly endorsed Share
certificate(s) where certificate(s) have been issued, in good order and in
proper form as determined by the Managing General Partners and the Partnership's
Transfer Agent. The Partner shall be entitled to payment in U.S. dollars of the
Net Asset Value of his Shares (as set forth in Section 7.2 hereof), reduced by
the amount of any deferred sales charge or redemption fee that may be imposed as
described in the Prospectus, provided that the amount distributed is in
accordance with and does not exceed the positive book Capital Account balance of
the Partner. Any such redemption shall be in accordance with Section 4 with
respect to General Partners or Section 5 with respect to Limited Partners. Any
distribution upon redemption pursuant to this Section 8.1 shall, in accordance
with Section 10.4 below, constitute a return in full of the redeeming Partner's
contribution attributable to the Shares which are redeemed regardless of the
amount distributed with respect to such Shares. No consent of any of the
Partners shall be required for the withdrawal or return of a Limited Partner's
contribution. All redemptions shall be recorded on the books of the Partnership.
The Managing General Partners may suspend redemptions and defer
payment of the redemption price at any time, subject to the Rules and
Regulations of the Commission.
8.2 Payment for Redeemed Shares. Payments for Shares redeemed by the
Partnership will be made at the time and in the manner set forth in the
Prospectus. Payment for redeemed Shares may, at the option of the Managing
General Partners or such officer or officers as they may duly authorize for this
purpose, in their complete discretion, be made in cash, or in kind, or partially
in cash and partially in kind. In case of payment in kind, the Managing General
Partners, or their delegate, shall have absolute discretion as to what security
or securities shall be distributed in kind and the amount of the same, and the
securities shall be valued for purposes of distribution at the amount at which
they were appraised in computing the Net Asset Value of the Shares, provided
that any Partner who cannot legally acquire securities so distributed in kind by
reason of the prohibitions of the 1940 Act shall receive cash.
9. MATTERS AFFECTING THE PARTNERSHIP'S BASIC STRUCTURE
9.1 Rights of Limited Partners. (a) The Limited Partners shall have
the right to vote together with the General Partners, in accordance with the
provisions of this Section 9, only upon the following matters affecting the
basic structure of the Partnership, which include the voting, approval, consent
or similar rights required under the 1940 Act for voting security holders:
(i) the right to remove General Partner(s) as set forth
in Section 4.8(c);
(ii) the right to elect or ratify the appointment of new
General Partner(s) (subject to the requirements of Section 9.9), but only to the
extent such ratification or election is required by the 1940 Act or the
Partnership Act;
(iii) the right to approve or terminate investment advisory,
underwriting and distribution and servicing contracts and plans;
(iv) the right to ratify or reject the appointment and to
terminate the employment of the independent public accountants of the
Partnership;
(v) the right to approve or disapprove the merger or
consolidation of the Partnership with or into one or more other limited
partnerships or the sale of all or substantially all of the assets of the
Partnership;
(vi) the right to approve the incurrence of indebtedness by
the Partnership other than in the ordinary course of business;
(vii) the right to approve transactions in which the General
Partners have an actual or potential conflict of interest with the Limited
Partners or the Partnership;
(viii) the right to terminate the Partnership, as
provided in Section 12 hereof;
(ix) the right to elect to continue the operations of the
Partnership (subject to the requirements of Section 9.9); and
(x) the right to amend this Partnership Agreement,
including, without limitation, the right to approve or disapprove proposed
changes in the Partnership's investment policies and restrictions; provided,
however, that no such amendment shall conflict with the 1940 Act so long as the
Partnership intends to remain registered thereunder, nor affect the liability of
the General Partners without their consent nor the limited liability of the
Limited Partners as provided under Section 5.8 above.
Notwithstanding the foregoing, the right of Limited Partners
to vote on matters affecting the basic structure of the Partnership as
designated herein shall not be construed as a requirement that all such matters
be submitted to the Limited Partners for their approval or be so approved to the
extent such approval is not required by the Partnership Act, the 1940 Act or
this Partnership Agreement.
(b) Notwithstanding the foregoing, no vote, approval or other
consent shall be required of the Limited Partners with respect to any matter not
affecting the basic structure of the Partnership, including, without limitation,
the following: (i) any change in the amount or character of the contribution of
any Limited Partner; (ii) any change in the procedures for the purchase or
redemption of Shares; (iii) the substitution or deletion of a Limited Partner;
(iv) the admission of any additional Limited Partner; (v) the retirement,
resignation, death or incompetency of a Managing General Partner; (vi) any
addition to the duties or obligations of the General Partners, or any reduction
in the rights or powers granted to the General Partners herein, for the benefit
of the Limited Partners; (vii) any change in the name or investment objectives
of the Partnership; (viii) the correction of any false or erroneous statement,
or change in any statement in order to make such statement accurately represent
the agreement among the General and Limited Partners, in this Partnership
Agreement; (ix) the addition of any omitted provision or amendment of any
provision to cure, correct or supplement any ambiguous, defective or
inconsistent provision hereof; or (x) such amendments as may be necessary to
conform this Partnership Agreement to the requirements of the Partnership Act,
the 1940 Act, the Tax Code or any other law or regulation applicable to the
Partnership.
(c) The Limited Partners shall have no right or power to cause
the termination and dissolution of the Partnership except as set forth in this
Partnership Agreement. No Limited Partner shall have the right to bring an
action for partition against the Partnership.
9.2 Actions of the Partners. Actions which require the vote of the
Limited Partners under Section 9.1 of this Partnership Agreement shall be taken
at a meeting of both the General and Limited Partners, or by consent without a
meeting as provided in Section 9.10. All Partners' meetings shall be held at
such place as the Managing General Partners shall designate. The Partners may
vote at any such meeting in person or by proxy.
9.3 Meetings. Meetings of the Partnership for the purpose of taking
any action which the Limited Partners are permitted to take under this
Partnership Agreement may be called by a majority vote of the Managing General
Partners or upon written request by Limited Partners representing 10% or more of
the outstanding Shares. Written notice of such meeting shall be given in
accordance with Section 9.4.
9.4 Notices. (a) Whenever Partners are required or permitted to take
any action at a meeting, a written notice of the meeting shall be given not less
than ten (10), nor more than sixty (60), days before the date of the meeting to
each Partner entitled to vote at the meeting. The notice shall state the place,
date and hour of the meeting and the general nature of the business to be
transacted.
(b) Notice of a Partner's meeting or any report shall be given
either personally or by mail or other means of written communication, addressed
to the Partner at the address of the Partner appearing on the books of the
Partnership or given by the Partner to the Partnership for the purpose of
notice. A notice or report shall be deemed to have been given at the time when
delivered personally or deposited in the mail or sent by other means of written
communication. An affidavit of mailing of any notice or report in accordance
with the provisions of this Subsection (b), executed by a General Partner, shall
be prima facie evidence of the giving of the notice or report.
If any notice or report addressed to the Partner at the
address of the Partner appearing on the books of the Partnership is returned to
the Partnership marked to indicate that the notice or report to the Partner
could not be delivered at such address, all future notices or reports shall be
deemed to have been duly given without further mailing if they are available to
the Partner at the principal executive office of the Partnership for a period of
one year from the date of the giving of the notice or report to all other
Partners.
(c) Upon written request to the General Partners by any person
entitled to call a meeting of Partners, the General Partners immediately shall
cause notice to be given to the Partners entitled to vote that a meeting will be
held at a time requested by the person calling the meeting, not less than ten
(10), nor more than sixty (60), days after the receipt of the request. If the
notice is not given within twenty (20) days after receipt of the request, the
person entitled to call the meeting may instead give such notice.
9.5 Validity of Vote for Certain Matters. Any Partner approval at a
meeting, other than unanimous approval by those entitled to vote, with respect
to the matters set forth in Section 9.1(a) shall be valid only if the general
nature of the proposal so approved was stated in the notice of meeting or in any
written waiver of notice.
9.6 Adjournment. When a Partners' meeting is adjourned to another time
or place, notice need not be given of the adjourned meeting if the time and
place thereof are announced at the meeting at which the adjournment is taken. At
the adjourned meeting, the Partnership may transact any business which might
have been transacted at the original meeting. If the adjournment is for more
than forty-five (45) days or if after the adjournment a new record date is fixed
for the adjourned meeting, a notice of the adjourned meeting shall be given to
each Partner of record entitled to vote at the meeting in accordance with
Section 9.4.
9.7 Waiver of Notice and Consent to Meeting. The transactions of any
meeting of Partners, however called and noticed, and wherever held, are as valid
as though conducted at a meeting duly held after regular call and notice, if a
quorum is present either in person or by proxy, and if, either before or after
the meeting, each of the persons entitled to vote and not present in person or
by proxy signs a written waiver of notice or a consent to the holding of the
meeting or an approval of the minutes thereof. All waivers, consents and
approvals shall be filed with the Partnership records or made a part of the
minutes of the meeting. Attendance at a meeting shall constitute a waiver of
notice of the meeting, except when the Partner objects at the beginning of the
meeting on the grounds that the meeting is not lawfully called or convened and
except that attendance at a meeting is not a waiver of any right to object to
the consideration of matters required to be included in the notice of the
meeting but not so included, if the objection is expressly made at the meeting.
Neither the business to be transacted at nor the purpose of any meeting of
Partners need be specified in any written waiver of notice, except as provided
in Section 9.6.
9.8 Quorum. The presence in person or by proxy of more than forty
percent (40%) of the outstanding Shares on the record date for any meeting
constitutes a quorum at such meeting. The Partners present at a duly called or
held meeting at which a quorum is present may continue to transact business
until adjournment notwithstanding the withdrawal of enough Partners to leave
less than a quorum, if any action taken (other than adjournment) is approved by
a majority vote of those Partners present (except as otherwise may be required
by the 1940 Act or the Partnership Act). In the absence of a quorum, any meeting
of Partners may be adjourned from time to time by the vote of a majority in
interest of the Partners represented either in person or by proxy, but no other
business may be transacted except as provided in this Section 9.8. The Managing
General Partners may adjourn such meeting to such time or times as determined by
the Managing General Partners.
9.9 Required Vote. Any action which requires the vote of the Limited
Partners shall be adopted by (i) the Majority Vote of the then outstanding
Shares or (ii) if at a meeting, a majority vote of those Shares present if the
quorum requirements of Section 9.8 hereof have been satisfied (except as
otherwise may be required by the 1940 Act or the Partnership Act); provided,
however, that the admission of a General Partner when there is no remaining or
surviving General Partner or an election to continue the operations of the
Partnership when there is no remaining or surviving General Partner shall
require the affirmative vote of all the Limited Partners.
9.10 Action by Consent Without a Meeting. Any action which may be
taken at any meeting of the Partners may be taken without a meeting if a consent
in writing, setting forth the action so taken, shall be signed by Partners
having not less than the minimum number of votes that would be necessary to
authorize or take that action at a meeting. In the event the Limited Partners
are requested to consent to a matter without a meeting, each Partner shall be
given notice of the matter to be voted upon in the same manner as described In
Section 9.4. In the event any General Partner, or Limited Partners representing
10% or more of the outstanding Shares, request a meeting for the purpose of
discussing or voting on the matter, notice of such meeting shall be given in
accordance with Section 9.4 and no action shall be taken until such meeting is
held. Unless delayed in accordance with the provisions of the preceding
sentence, any action taken without a meeting will be effective ten (10) days
after the required minimum number of Partners have signed the consent; however,
the action will be effective immediately if the General Partners and Limited
Partners representing at least 90% of the shares of the Partners have signed the
consent.
9.11 Record Date. (a) In order that the Partnership may determine the
Partners of record entitled to notice of or to vote at any meeting, or entitled
to receive any distribution or to exercise any rights in respect of any other
lawful action, the Managing General Partners, or Limited Partners representing
more than 10% of the Shares then outstanding, may fix, in advance, a record date
which is not more than sixty (60) nor less than ten (10) days prior to the date
of the meeting and not more than sixty (60) days prior to any other action. If
no record date is fixed:
(i) The record date for determining Partners entitled to
notice of or to vote at a meeting of Partners shall be at the close of business
on the business day next preceding the day on which notice is given or, if
notice is waived, at the close of business on the business day next preceding
the day on which the meeting is held.
(ii)The record date for determining Partners entitled to
give consent to Partnership action in writing without a meeting shall be the
first day on which the first written consent is given.
(iii) The record date for determining Partners for any other
purpose shall be at the close of business on the day on which the Managing
General Partners adopt it, or the sixtieth (60th) day prior to the date of the
other action, whichever is later.
(b) The determination of Partners of record entitled to notice
of or to vote at a meeting of Partners shall apply to any adjournment of the
meeting unless the Managing General Partners, or the Limited Partners who called
the meeting, fix a new record date for the adjourned meeting, but the Managing
General Partners, or the Limited Partners who called the meeting, shall fix a
new record date if the meeting is adjourned for more than forty-five (45) days
from the date set for the original meeting.
(c) Any Holder of a Share prior to the record date for a meeting
shall be entitled to vote at such meeting, provided such person becomes a
Partner prior to the date of the meeting.
9.12 Proxies. A Partner may vote at any meeting of the Partnership by
a proxy executed in writing by the Partner. All such proxies shall be filed with
the Partnership before or at the time of the meeting. The law of Delaware
pertaining to corporate proxies will be deemed to govern all Partnership proxies
as if they were proxies with respect to shares of a Delaware corporation. A
proxy may be revoked by the person executing the proxy in a writing delivered to
the Managing General Partners at any time prior to its exercise. Notwithstanding
that a valid proxy is outstanding, powers of the proxy holder will be suspended
if the person executing the proxy is present at the meeting and elects to vote
in person.
9.13 Number of Votes. All Shares have equal voting rights. Each
Partner shall have the right to vote the number of Shares standing of record in
such Partner's name as of the record date set forth in the notice of meeting.
9.14 Communication Among Limited Partners. Whenever ten (10) or more
Limited Partners of record of the Partnership who have been such for at least
six months preceding the date of application, and who hold in the aggregate
either Shares having a net asset value of at least $25,000 or at least 1 per
centum of the outstanding Shares, whichever is less, shall apply to the Managing
General Partners in writing, stating that they wish to communicate with other
Partners with a view to obtaining signatures to a request for a meeting of
Shareholders pursuant to Section 9.3 and accompanied by a form of communication
and request which they wish to transmit, the Managing General Partners shall
within five business days after receipt of such application either:
(a) afford to such applicants access to a list of the names and
addresses of all Partners as recorded on the books of the Partnership;
(b) inform such applicants as to the approximate number of
Partners of record and the approximate cost of mailing to them the proposed
communication and form of request.
If the Managing General Partners elect to follow the course
specified in Subsection (b) of this Section 91.14, the Managing General
Partners, upon the written request of such applicants, accompanied by a tender
of the material to be mailed and of the reasonable expenses of mailing, shall,
with reasonable promptness, mail such material to all Partners of record at
their addresses as recorded on the books of the Partnership, unless within five
business days after such tender the Managing General Partners shall mail to such
applicants and file with the Commission, together with a copy of the material to
be mailed, a written statement signed by at least a majority of the Managing
General Partners to the effect that in their opinion either such material
contains untrue statements of fact or omits to state facts necessary to make the
statements contained therein not misleading, or would be in violation of
applicable law, and specifying the basis of such opinion.
After the Commission has had an opportunity for hearing upon the
objections specified in the written statement so filed by the Managing General
Partners, the Managing General Partners or such applicants may demand that the
Commission enter an order either sustaining one or more of such objections or
refusing to sustain any of such objections. in the Commission shall enter an
order refusing to sustain one or more of such objections, the Commission shall
find, after notice and opportunity for hearing, that all objections so sustained
have been met, and shall enter an order so declaring, the Managing General
Partners shall mail copies of such material to all Partners with reasonable
promptness after the entry of such order and the renewal of such tender.
The provisions of Section 4.8(c), Section 9.3 and this Section
9.14 may not be amended or repealed without the vote of a majority of the
Managing General Partners and a majority of the outstanding Shares; provided,
however, that such provisions shall be deemed null, void, inoperative and
removed from this Partnership Agreement upon the effectiveness of any amendment
to the 1940 Act which eliminates them from Section 16 of the 1940 Act or the
effectiveness of any successor Federal law governing the operating of the
Partnership which does not contain such provisions.
10. DISTRIBUTIONS AND ALLOCATION OF PROFITS AND LOSSES
10.1 Fees of General Partners. As compensation for services rendered
to the Partnership, each Managing General Partner may be paid a fee during each
year, which fee shall be fixed by the Managing General Partners. All the General
Partners shall be entitled to reimbursement of reasonable expenses incurred by
them in connection with their performance of their duties as General Partners.
Neither payment of compensation or reimbursement of expenses to a General
Partner hereunder nor payment of fees to any Affiliate of a General Partner for
the performance of services to the Partnership shall be deemed a distribution
for purposes of Section 10.2, nor shall any such payment affect such person's
right to receive any distribution to which he would otherwise be entitled as a
Holder of Shares.
10.2 Distributions of Income and Gains. Subject to the provisions of
the Partnership Act and the terms of Section 10.4 hereof, the Managing General
Partners in their sole discretion shall determine the amounts, if any, to be
distributed to Holders of Shares, the record date for purposes of such
distributions and the time or times when such distributions shall be made.
Distributions of income may be in cash (U.S. Dollars) or in additional full and
fractional Shares of the Partnership valued at the Net Asset Value on the record
date. With respect to net capital gains, if any, the Managing General Partners
may determine annually what portion, if any, of the Partnership's capital gains
will be distributed and any such distribution may be in cash or in additional
full and fractional Shares of the Partnership at the Net Asset Value on the
record date. Notwithstanding the foregoing, the Managing General Partners shall
not be required to make any distribution of income or capital gains for any
taxable year.
10.3 Allocation of Income, Gains, Losses, Deductions and Credits. The
net income, gains, losses, deductions and credits of the Partnership shall be
allocated equally among the outstanding Shares of the Partnership on a regular
basis to be determined by the Managing General Partner. The net income earned by
the Partnership shall consist of the interest accrued on portfolio securities,
less expenses, since the most recent determination of income. Amortization of
original issue discount will be treated as an income item. Market discount, if
any, will be treated as income items except as otherwise required for Federal
income tax purposes. Any permissible Federal income tax elections or methods
regarding original issue discount, market discount and amortization of bond
premium shall be made at the discretion of the Managing General Partners.
Expenses of the Partnership will be accrued on a regular basis to be determined
by the Managing General Partners. A Holder of a Share shall be allocated with
the proportionate part of such items actually realized by the Partnership for
each such full accrual period during which such Share was owned by such Holder.
A person shall be deemed to be a Holder of a Share on a specific day if he is
the record holder of such Share on such day (regardless of whether or not such
record holder has yet been admitted as a Partner).
10.4 Returns of Contributions. Except upon dissolution of the
Partnership by expiration of its term or otherwise pursuant to Section 12 hereof
(which shall be the time for return to each Partner of his contributions,
subject to the priorities therein), and except upon redemption of Shares of the
Partnership as provided in Section 8, no Partner has the right to demand the
return of any part of his contribution. The Managing General Partners may,
however, from time to time, elect to permit partial returns of contributions to
Holders of Shares, provided that:
(a) all liabilities of the Partnership to persons other than
General and Limited Partners have been paid or, in the good faith determination
of the Managing General Partners, there remains property of the Partnership
sufficient to pay them; and
(b) the Managing General Partners cause the records of the
Partnership to be amended to reflect a reduction in contributions.
In the event that the Managing General Partners elect to make a
partial return of contributions to Holders of Shares, such distribution shall be
made to all of the Holders of Shares in accordance with their positive book
Capital Account balances. Each General and Limited Partner, by becoming such
Partner, consents to any such pro rata distribution therefore or thereafter duly
authorized and made in accordance with such provisions and to any distribution
through redemption of Shares pursuant to Section 8 above.
10.5 Capital Accounts. Unless additional capital accounts are required
to be maintained for accounting purposes in accordance with generally accepted
accounting principles, the Partnership shall generally maintain one Capital
Account for each Partner. Each Capital Account shall be credited with the
Partner's capital contributions and share of profits, shall be charged with such
partner's share of losses, distributions and withholding taxes (if any) and
shall otherwise appropriately reflect transactions of the Partnership and the
Partners. At the end of each day, the Capital Accounts of all Partners shall be
adjusted to reflect the Partnership's income (or loss) which has accrued for
that day. The Capital Accounts will be subject to further adjustment as provided
by Section 10.6. Additional adjustments shall then be made to reflect any
purchases and redemptions of Shares by the Partners. A Substituted Limited
Partner shall be deemed to succeed to the Capital Account of the Partner whom
such Substituted Limited Partner replaced.
10.6 Allocations of Capital Gains and Losses and Additional Rules.
(a) Short Term Gains and Losses. At the end of every month,
short term capital gains and losses for that month will be allocated and
credited (or charged in the event of losses) to each Partner's Capital Account
for those Partners of record as of the last day of that month, based upon the
number of outstanding Shares of the Partnership as of the last day of the month.
(b) Long Term Gains and Losses. At the end of every year (or
shorter period at the discretion of the Managing General Partners), long term
capital gains and losses for that year will be allocated and credited (or
charged in the event of losses) to each Partner's Capital Account for those
Partners of record as of the last day of that year (or shorter period at the
discretion of the Managing General Partners), based upon the number of
outstanding Shares of the Partnership as of the last day of the year.
(c) Minimum Gain Chargeback. In the event that there is a net
decrease in the Partnership's Minimum Gain during any taxable year and any
Partner has a negative Capital Account (after taking into account reductions for
items described in paragraphs (4), (5) and (6) of Treasury Department
Regulations Section 1.704-1(b)(2)(ii)(d)) and such negative balance exceeds the
sum of mount that such Partner is obligated to restore upon liquidation of the
Partnership and (ii) such Partner's share of the Minimum Gain at the end of such
taxable year, such Partner shall be allocated Partnership profits for such year
(and, if necessary, subsequent years) in an amount necessary to eliminate such
excess negative balance as quickly as possible. Allocations of profits to such
Partners having such excess negative Capital Accounts shall be made in
proportion to the amounts of such excess negative Capital Account balances. The
term "Minimum Gain" means the excess of the outstanding balances of all
nonrecourse indebtedness which is secured by property of the Partnership over
the adjusted basis of such property for Federal income tax purposes, as computed
in accordance with the provisions of Treasury Department Regulations Section
1.704-1(b)(4)(iv)(c). A Partner's share of Minimum Gain shall be computed in
accordance with Treasury Department Regulations Section 1.704-1(b)(4)(iv)(f).
(d) Qualified Income Offset. Notwithstanding anything in
Sections 10.3 and 10.6 to the contrary, in the event any Partner unexpectedly
receives any adjustments, allocations or distributions described in Treasury
Department Regulations Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5)
or 1.704-1(b)(2)(ii)(d)(6), items of Partnership income and gain shall be
specially allocated to such Partner in an amount and manner sufficient to
eliminate the deficit balance in his Capital Account (in excess of (i) the
amount he is obligated to restore liquidation of the Partnership or upon
liquidation of his interest in the Partnership and his share of the Minimum
Gain) created by such adjustments, allocations or distributions as quickly as
possible.
(e) Conformance with Treasury Regulations. Allocations pursuant
to the Partnership Agreement may further be modified by the Managing General
Partners, if necessary, in order to comply with existing or future Treasury
Regulations.
11. ASSIGNMENT OF SHARES; SUCCESSOR IN INTEREST;
SUBSTITUTION OF PARTNERS
11.1 Prohibition on Assignment. Except for redemptions as provided in
Section 8, a Partner shall not have the right to sell, transfer or assign his
Shares to any other person, but may pledge them as collateral.
11.2 Rights of the Holders of Shares as Collateral or Judgment
Creditor. In the event that any person who is holding Shares as collateral or
any judgment creditor becomes the owner of such Shares due to foreclosure or
otherwise, such person shall not have the right to be substituted as a Limited
Partner, but shall only have the rights, upon the presentation of evidence
satisfactory to the Managing General Partners of his right to succeed to the
interests of the Limited Partner, set forth immediately below:
(a) to redeem the Shares in accordance with the provisions
of Section 8 hereof; and
(b) to receive any distributions made with respect to such
Shares.
Upon receipt by the Partnership of evidence satisfactory to the
Managing General Partners of his ownership of Shares, the owner shall become a
Holder of Record of the subject Shares and his name shall be recorded on the
books of record of the Partnership maintained for such purpose either by the
Partnership or its Transfer Agent. Such owner shall be liable to return any
excess distributions pursuant to Section 5.8(a). However, such owner shall have
none of the rights or obligations of a Substituted Limited Partner unless and
until he is admitted as such. In addition, a creditor who makes a non-recourse
loan to the Partnership must not have or acquire, at any time as a result of
making the loan, any direct or indirect interest in the profits, capital or
property of the Partnership other than as secured creditor.
11.3 Death, Incompetency, Bankruptcy or Termination of the Existence
of a Partner. In the event of the death or an adjudication of incompetency or
bankruptcy of an individual Partner (or, in the case of a Partner that is a
corporation, association, partnership, joint venture or trust, an adjudication
of bankruptcy, dissolution or other termination of the existence of such
Partner), the successor in interest of such Partner (including without
limitation the Partner's executor, administrator, guardian, conservator,
receiver or other legal representative), upon the presentation of evidence
satisfactory to the Managing General Partners of his right to succeed to the
interests of the Partner, shall have the rights set forth below:
(a) to redeem the Shares of the Partner in accordance with
the provisions of Section 8 hereof;
(b) to receive any distributions made with respect to such
Shares; and
(c) to be substituted as a Limited Partner upon compliance with
the conditions of the admission of a Limited Partner as provided in Sections 5
and 11 hereof.
Upon receipt by the Partnership of evidence satisfactory to the
Managing General Partners of his right to succeed to the interests of the
Partner, the successor in interest shall become a Holder of Record of the
subject Shares and his name shall be recorded on the books of record of the
Partnership maintained for such purpose either by the Partnership or its
Transfer Agent.
11.4 Substituted Limited Partners. (a) A person shall not become a
Substituted Limited Partner unless the Managing General Partners consent to such
substitution (which consent may be withheld in their absolute discretion) and
receive such instruments and documents (including those specified in Section
5.2), and such reasonable transfer fees as the Managing General Partners may
require.
(b) The original Limited Partner shall cease to be a Limited
Partner, and the person to be substituted shall become a Substituted Limited
Partner, as of the date on which the person to be substituted has satisfied the
requirements set forth above and as of the date the records of the Partnership
are amended to reflect his admission as a Substituted Limited Partner.
Thereafter the original Limited Partner shall have no rights or obligations with
respect to the Partnership insofar as the Shares transferred to the Substituted
Limited Partner are concerned.
(c) Unless and until a person becomes a Substituted Limited
Partner, his status and rights shall be limited to the rights of a Holder of
Shares pursuant to Sections 11.3(a) and 11.3(b). A Holder of Shares who does not
become a Substituted Limited Partner shall have no right to inspect the
Partnership's books or to vote on any of the matters on which a Limited Partner
would be entitled to vote. A Holder of Shares who has become a Substituted
Limited Partner has all the rights and powers, and is subject to the
restrictions and liabilities, of a Limited Partner under this Partnership
Agreement.
(d) Any person admitted to the Partnership as a Substituted
Limited Partner shall be subject to and bound by the provisions of this
Partnership Agreement as if originally a party to this Partnership Agreement.
12. DISSOLUTION AND TERMINATION OF THE PARTNERSHIP
12.1 Dissolution. The Partnership shall be dissolved and its affairs
shall be wound up upon the happening of the first to occur of the following:
(a) the stated term of the Partnership has expired unless the
Partners by a Majority Vote have previously amended the Partnership Agreement to
establish a different term;
(b) the Partnership has disposed of all of its assets;
(c) a General Partner has ceased to be a General Partner and the
remaining General Partners elect not to continue the operations of the
Partnership;
(d) there is only one General Partner remaining and such General
Partner has ceased to be a General Partner as set forth in Section 4.8;
provided, however, that if the last remaining or surviving General Partner
ceases to be a General Partner other than by removal, the Limited Partners may
agree by unanimous vote to continue the operations of the Partnership and to
admit one or more General Partners in accordance with this Partnership
Agreement;
(e) a decree of judicial dissolution has been entered by a
court of competent jurisdiction; or
(f) the Partners by a Majority Vote have voted to dissolve the
Partnership.
12.2 Liquidation. (a) In the event of dissolution as provided in
Section 12.1, the assets of the Partnership shall be distributed as follows:
(i) all of the Partnership's debts and liabilities to
persons (including Partners to the extent permitted by law) shall be paid and
discharged, and any reserve deemed necessary by the Managing General Partners
for the payment of such debts shall be set aside; and
(ii)the balance of the assets of the Partnership (and any
reserves not eventually used to satisfy debts of the Partnership) shall be
distributed pro rata to the Partners in accordance with their positive book
Capital Account balances.
(b) Upon dissolution, each Partner shall look solely to the
assets of the Partnership for the return of his capital contribution and shall
be entitled only to a distribution of Partnership property and assets in return
thereof. If the Partnership property remaining after the payment or discharge of
the debts and liabilities of the Partnership is insufficient to return the
capital contribution of each Limited Partner, such Limited Partner shall have no
recourse against any General Partner, the assets of any other partnership of
which any General Partner is a partner, or any other Limited Partner. The
winding up of the affairs of the Partnership and the distribution of its assets
shall be conducted exclusively by the Managing General Partners, who are
authorized to do any and all acts and things authorized by law for these
purposes. In the event of dissolution where there is no remaining General
Partner, and there is a failure to appoint a new General Partner, the winding up
of the affairs of the Partnership and the distribution of its assets shall be
conducted by such persons as may be selected by Majority Vote, which person is
hereby authorized to do any and all acts and things authorized by law for these
purposes.
12.3 Termination. Upon the completion of the distribution of
Partnership assets as provided in this Section and the termination of the
Partnership, the General Partner(s) or other person acting as liquidator (or the
Limited Partners, if necessary) shall cause the Certificate of Limited
Partnership of the Partnership to be canceled and shall take such other actions
as may be necessary to legally terminate the Partnership.
13. BOOKS, RECORDS, ACCOUNTS AND REPORTS
13.1 Books and Records. The Partnership shall maintain at its
principal office or at the offices of its investment adviser, administrator,
custodian, Transfer Agent or other agent appointed by the Partnership such books
and records as are required by the 1940 Act or necessary for the operation of
the Partnership.
13.2 Limited Partners' Access to Information. (a) Each Limited Partner
shall have the right, subject to such reasonable standards as may be established
by the Managing General Partners, to obtain from the Managing General Partners
from time to time upon reasonable demand for any purpose reasonably related to
the Limited Partner's interest as a Limited Partner:
(1) True and full information regarding the status of the
business and financial condition of the Partnership;
(2) Promptly after becoming available, a copy of the
Partnership's Federal, state and local income tax returns for each year;
(3) A current list of the name and last known business,
residence or mailing address of each Partner;
(4) A copy of the Partnership Agreement and Certificate of
Limited Partnership and all amendments thereto, together with copies of any
powers of attorney pursuant to which the Partnership Agreement and any
Certificate of Limited Partnership and all amendments thereto have been
executed;
(5) True and full information regarding the amount of cash
and a description and statement of the agreed value of any other property or
services contributed by each Partner and which each Partner has agreed to
contribute in the future, and the date on which each became a Partner; and
(6) Such other Information regarding the affairs of the
Partnership as is just and reasonable.
(b) The Managing General Partners shall cause to be transmitted
to each Partner such other reports and information as shall be required by the
1940 Act, the Partnership Act or the Tax Code.
13.3 Accounting Basis and Fiscal Year. The Partnership's books and
records (i) shall be kept on a basis chosen by the Managing General Partners in
accordance with the accounting methods followed by the Partnership for Federal
income tax purposes and otherwise in accordance with generally accepted
accounting principles applied in a consistent manner, (ii) shall reflect all
Partnership transactions, (iii) shall be appropriate and adequate for the
Partnership's business and for the carrying out of all provisions of this
Partnership Agreement, and (iv) shall be closed and balanced at the end of each
Partnership fiscal year. The fiscal year of the Partnership shall be the
calendar year.
13.4 Tax Returns. The Managing General Partners, at the Partnership's
expense, shall cause to be prepared any income tax or information returns
required to be made by the Partnership and shall father cause such returns to be
timely filed with the appropriate authorities.
13.5 Filings with Regulatory Agencies. The Managing General Partners,
at the Partnership's expense, shall cause to be prepared and timely filed with
appropriate Federal and state regulatory and administrative bodies, all reports
required to be filed with such entitles under then current applicable laws,
rules and regulations.
13.6 Tax Matters and Notice Partners. The Managing General Partners
shall designate one or more General Partners as the "Tax Matters Partner" and
the "Notice Partner" of the Partnership in accordance with Sections 6231(a)(7)
and (8) of the Tax Code, and each such Partner shall have no personal liability
arising out of his good faith performance of his duties in such capacity. The
"Tax Matters Partner" is authorized, at the Partnership's sole cost and expense,
to represent the Partnership and each Limited Partner in connection with all
examinations of the Partnership's affairs by tax authorities, including any
resulting administrative and judicial proceedings. Each Limited Partner agrees
to cooperate with the Managing General Partners and to do or refrain from doing
any and all things reasonably required by the Managing General Partners to
conduct such proceedings. The Managing General Partners shall have the right to
settle any audits without the consent of the Limited Partners.
14. AMENDMENTS OF PARTNERSHIP DOCUMENTS
14.1 Amendments in General. Except as otherwise provided in this
Partnership Agreement, the Partnership Agreement may be amended only by the
General Partners.
14.2 Amendments Without Consent of Limited Partners. In addition to
any amendments otherwise authorized herein and except as otherwise provided,
amendments may be made to this Partnership Agreement from time to time by the
General Partners without the consent of the Limited Partners, including, without
limitation, amendments: (i) to reflect the retirement, resignation, death or
incompetency of a Managing General Partner; (ii) to add to the duties or
obligations of the General Partners, or to surrender any right or power granted
to the General Partners herein, for the benefit of the Limited Partners; (iii)
to change the name or investment objective of the Partnership; (iv) to correct
any false or erroneous statement, or to make a change in any statement in order
to make such statement accurately represent the agreement among the General and
Limited Partners; (v) to supply any omission or to cure, correct or supplement
any ambiguous, defective or inconsistent provision hereof; or (vi) to make such
amendments as may be necessary to conform this Partnership Agreement to the
requirements of the Partnership Act, the 1940 Act, the Tax Code or any other law
or regulation applicable to the Partnership, as now or hereafter in effect.
14.3 Amendments Needing Consent of Affected Partners. Notwithstanding
any other provision of this Partnership Agreement, without the consent of the
Partner or Partners to be affected by any amendment to this Agreement, this
Partnership Agreement may not be amended to (i) convert a Limited Partner's
interest into a General Partner's interest, (ii) modify the limited liability of
a Limited Partner, (iii) alter the interest of a Partner in income, gain, loss,
deductions, credits and distributions, or (iv) increase, add or alter any
obligation of any Limited Partner.
14.4 Amendments to Certificate of Limited Partnership. (a) The
Managing General Partners shall cause to be filed with the Secretary of State,
within ninety (90) days after the happening of any of the following events, an
amendment to the Certificate of Limited Partnership reflecting the occurrence of
any of the following events:
(i) The admission of a new General Partner;
(ii)The withdrawal of a General Partner; or
(iii) A change in the name of the Partnership, or, except as
provided in Sections 17-104(b) and (c) of the Partnership Act, a change in the
address of the registered office or a change in the name or address of the
registered agent of the Partnership.
(b) A Managing General Partner shall cause to be filed with the
Secretary of State an amendment to the Certificate of Limited Partnership
correcting any false or erroneous material statement contained in the
Certificate of Limited Partnership promptly after the discovery of such false or
erroneous statement by such Managing General Partner.
(c) Any Certificate of Limited Partnership filed or recorded in
jurisdictions other than Delaware shall be amended as required by applicable
law.
(d) The Certificate of Limited Partnership may also be amended
at any time in any other manner deemed appropriate by the General Partners.
14.5 Amendments After Change of Law. This Partnership Agreement and
any other Partnership documents may be amended and refiled, if necessary, by the
General Partners without the consent of the Limited Partners if there occurs any
change that permits or requires an amendment of this Partnership Agreement under
the Partnership Act or of any other Partnership document under applicable law,
so long as no Partner is adversely affected (or consent is given by such
Partner).
15. MISCELLANEOUS Provisions
15.1 Notices. (a) Any written notice, offer, demand or communication
required or permitted to be given by any provision of this Partnership
Agreement, unless otherwise specified herein, shall be deemed to have been
sufficiently given for all purposes if delivered personally to the person to
whom the same is directed or if sent by first class mail addressed (i) if to a
General Partner, to the principal place of business and office of the
Partnership specified in this Partnership Agreement and (ii) if to a Limited
Partner, to such Limited Partner's address of record; provided, however, that
notice given by any other means shall be deeded sufficient if actually received
by the person to whom it is directed.
(b) Except as otherwise specifically provided herein, any such
notice that is sent by first class mail shall be deemed to be given two (2) days
after the date on which such notice is mailed.
(c) The Managing General Partners may change the Partnership's
address for purposes of this Partnership Agreement by giving written notice of
such change to the Limited Partners, and any Limited Partner may change his
address for purposes of this Partnership Agreement by giving written notice of
such change to the Managing General Partners, in the manner herein provided for
the giving of notices.
15.2 Section Headings. The Section headings in this Partnership
Agreement are inserted for convenience and identification only and are in no way
intended to define or limit the scope, extent or intent of this Partnership
Agreement or any of the provisions hereof.
15.3 Construction. Whenever the singular number is used herein, the
same shall include the plural; and the neuter, masculine and feminine genders
shall include each other, as applicable. If any language is stricken or deleted
from this Partnership Agreement, such language shall be deemed never to have
appeared herein and no other implication shall be drawn therefrom. The language
in all parts of this Partnership Agreement shall be in all cases construed
according to its fair meaning and not strictly for or against the General
Partners or the Limited Partners.
15.4 Severability. If any covenant, condition, term or provision of
this Partnership Agreement is illegal, or if the application thereof to any
person or in any circumstance shall to any extent be judicially determined to be
invalid or unenforceable, the remainder of this Partnership Agreement, or the
application of such covenant, condition, term or provision to persons or in
circumstances other than those to which it is held invalid or unenforceable,
shall not be affected thereby, and each remaining covenant, condition, term and
provision of this Partnership Agreement shall be valid and enforceable to the
fullest extent permitted by law.
15.5 Governing Law. Notwithstanding the place where this Partnership
Agreement may be executed by any of the parties hereto, the parties expressly
agree that all the terms and provisions hereof shall be construed under the laws
of the State of Delaware and that the Partnership Act as now adopted and as may
be hereafter amended from time to time shall govern the partnership aspects of
this Partnership Agreement.
15.6 Counterparts. This Partnership Agreement may be executed in one
or more counterparts, each of which shall, far all purposes, be deemed an
original and all of such counterparts, taken together, shall constitute one and
the same Partnership Agreement.
15.7 Entire Agreement. This Partnership Agreement and the separate
subscription agreements of each Limited Partner and General Partner constitute
the entire agreement of the parties as to the subject matter hereof. All prior
agreements among the parties as to the subject matter hereof, whether written or
oral, are merged herein and shall be of no force or effect. This Partnership
Agreement cannot be changed, modified or discharged orally, but only by an
agreement in writing. There are no representations, warranties or agreements
other than those set forth in this Partnership Agreement and such separate
subscription agreements, if any.
15.8 Cross-References. All cross-references in this Partnership
Agreement, unless specifically directed to another agreement or document, refer
to provisions in this Partnership Agreement.
15.9 Power of Attorney to the General Partners. (a) Each Partner
hereby makes, constitutes and appoints each Managing General Partner and any
person designated by the Managing General Partners, with full substitution, his
agent and attorney-in-fact in his name, place and stead, to take any and all
actions and to make, execute, swear to and acknowledge, amend, file, record and
deliver the following documents and any other documents deemed by the Managing
General Partners necessary for the operations of the Partnership: (i) any
Certificate of Limited Partnership or Certificate of Amendment thereto, required
or permitted to be filed on behalf of the Partnership, and any and all
certificates as necessary to qualify or continue the Partnership as a limited
partnership or partnership wherein the Limited Partners thereof have limited
liability in the states where the Partnership may be conducting activities, and
all instruments which effect a change or modification of the Partnership in
accordance with this Partnership Agreement; (ii) this Partnership Agreement and
any amendments thereto in accordance with this Partnership Agreement; (iii) any
other instrument which is now or which may hereafter be required or advisable to
be filed for or on behalf of the Partnership; (iv) any document which may be
required to effect the continuation of the Partnership, the admission of an
additional Limited Partner or Substituted Limited Partner, or the dissolution
and termination of the Partnership (provided such continuation, admission or
dissolution and termination is in accordance with the terms of this Partnership
Agreement), or to reflect any reductions or additions in the amount of the
contributions of Partners, in each case having the power to execute such
instruments on his behalf, whether the undersigned approved of such action or
not; and (v) any document containing any investment representations and/or
representations relating to the citizenship, residence and tax status required
by any state or Federal law or regulation.
(b) This Power of Attorney is a special Power of Attorney
coupled with an interest, and shall not be revoked and shall survive the
transfer by any Limited Partner of all or part of his interest in the
Partnership and, being coupled with an interest, shall survive the death or
disability or cessation of the existence as a legal entity of any Limited
Partner; except that where the successor in interest has been approved by said
attorney for admission to the Partnership as a Substituted Limited Partner, this
Power of Attorney shall survive the transfer for the sole purpose of enabling
said attorney to execute, acknowledge and file any instrument necessary to
effectuate such substitution.
(c) Each Limited Partner hereby gives and grants to his said
attorney under this Power of Attorney full power and authority to do and perform
each and every act and thing whatsoever requisites necessary or appropriate to
be done in or in connection with this Power of Attorney as fully to all intents
and purposes as he might or could do if personally present, hereby ratifying all
that his said attorney shall lawfully do or cause to be done by virtue of this
Power of Attorney.
(d) The existence of this Power of Attorney shall not preclude
execution of any such instrument by the undersigned individually on any such
matter. A person dealing with the Partnership may conclusively presume and rely
on the fact that any such instrument executed by such agent and attorney-in-fact
is authorized, regular and binding without further inquiry.
(e) The appointment of each Managing General Partner and each
designee of that General Partner as attorney-in-fact pursuant to this Power of
Attorney automatically shall terminate as to such person at such time as he
ceases to be a General Partner and from such time shall be effective only as to
substitute or additional General Partners admitted in accordance with this
Partnership Agreement and his designees.
15.10 Further Assurances. The Limited Partners will execute and
deliver such further instruments and do such further acts and things as may be
required to carry out the intent and purposes of this Partnership Agreement.
15.11 Successors and Assigns. Subject in all respects to the
limitations on transferability contained herein, this Partnership Agreement
shall be binding upon, and shall inure to the benefit of, the heirs,
administrators, personal representatives, successors and assigns of the
respective parties hereto.
15.12 Waiver of Action for Partition. Each of the parties hereto
irrevocably waives during the term of the Partnership and during the period of
its liquidation following any dissolution, any right that he may have to
maintain any action for partition with respect to any of the assets of the
Partnership.
15.13 Creditors. None of the provisions of this Partnership Agreement
shall be for the benefit of or enforceable by any of the creditors of the
Partnership or the Partners.
15.14 Remedies. The rights and remedies of the Partners hereunder
shall not be mutually exclusive, and the exercise by any Partner of any right to
which he is entitled shall not preclude the exercise of any other right he may
have.
15.15 Custodian. All assets of the Partnership shall be held by a
custodian meeting the requirements of the 1940 Act, and may be registered in the
name of the Partnership or such custodian or nominee. The terms of the custodian
agreement shall be determined by the Managing General Partners.
15.16 Use of Name "First Trust". Clayton Brown & Associates, Inc., as
the initial distributor of Shares, hereby consents to the use by the Partnership
of the name "First Trust" as part of the Partnership's name; provided, however,
that such consent shall be conditioned upon the employment of Clayton Brown &
Associates, Inc. or one of its affiliates (collectively "Clayton Brown") as an
investment adviser of the Partnership. The name "First Trust" or any variation
thereof may be used from time to time in other connections and for other
purposes by Clayton Brown and other investment companies that have obtained
consent to use the name "First Trust." Clayton Brown shall have the right to
require the Partnership to cease using the name "First Trust" as part of the
Partnership's name if the Partnership ceases, for any reason, to employ Clayton
Brown as its investment adviser. Future names adopted by the Partnership for
itself, insofar as such names include identifying words requiring the consent of
Clayton Brown, shall be the property of Clayton Brown and shall be subject to
the same terms and conditions.
15.17 Authority. Each individual executing this Partnership Agreement
on behalf of a partnership, corporation, or other entity warrants that he is
authorized to do so and that this Partnership Agreement will constitute the
legal binding obligation of the entity which he represents.
15.18Signatures. The signature of a Managing General Partner or an
officer or agent of the Partnership duly appointed by the Managing General
Partners shall be sufficient to bind the Partnership to any agreement or on any
document, including, but not limited to, documents drawn or agreements made in
connection with the acquisition or disposition of any assets.
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Managing General Partners and Shareholders of
Centennial America Fund, L.P.:
We have audited the accompanying statement of assets and liabilities, including
the statement of investments, of Centennial America Fund, L.P. as of December
31, 1998, the related statement of operations for the year then ended, the
statements of changes in net assets for the years ended December 31, 1998 and
1997 and the financial highlights for the period January 1, 1994 to December 31,
1998. These financial statements and financial highlights are the responsibility
of the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
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 as of
December 31, 1998 by correspondence with the custodian. 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 America
Fund, L.P. as of December 31, 1998, 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
January 25, 1999
10 Centennial America Fund, L.P.
<PAGE>
<TABLE>
<CAPTION>
================================================================================
STATEMENT OF INVESTMENTS DECEMBER 31, 1998
FACE VALUE
AMOUNT SEE NOTE 1
=============================================================================================================================
REPURCHASE AGREEMENTS - 2.2%
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Repurchase agreement with PaineWebber, Inc., 6.25%, dated 12/31/98, to be
repurchased at $500,347 on 1/4/99, collateralized by Federal National Mortgage
Assn. Participation Nts., 6%-6.50%, 12/1/13-7/1/28, with a value of $510,948 $ 500,000 $ 500,000
=============================================================================================================================
U.S. GOVERNMENT AGENCIES - 99.8%
- -----------------------------------------------------------------------------------------------------------------------------
Federal Farm Credit Bank, 4.93%, 1/22/99 740,000 737,872
- -----------------------------------------------------------------------------------------------------------------------------
Federal Home Loan Bank, 4.96%, 1/22/99 2,000,000 1,994,213
- -----------------------------------------------------------------------------------------------------------------------------
Federal Home Loan Bank, 5.10%, 1/15/99 1,000,000 998,017
- -----------------------------------------------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp., 5.02%, 1/22/99 2,000,000 1,994,108
- -----------------------------------------------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp., 5.03%, 1/11/99 5,310,000 5,302,478
- -----------------------------------------------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp., 5.05%, 2/11/99 1,530,000 1,521,200
- -----------------------------------------------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp., 5.10%, 1/25/99 1,000,000 996,600
- -----------------------------------------------------------------------------------------------------------------------------
Federal National Mortgage Assn., 5.11%, 1/8/99 2,000,000 1,998,013
- -----------------------------------------------------------------------------------------------------------------------------
Student Loan Marketing Assn., guaranteeing commercial paper of
Nebraska Higher Education Loan Program, 6.25%, 1/5/99(1) 3,500,000 3,497,569
- -----------------------------------------------------------------------------------------------------------------------------
Tennessee Valley Authority, 5.08%, 1/4/99 854,000 853,638
- -----------------------------------------------------------------------------------------------------------------------------
USA Group Secondary Market Services, Inc., Education Loan Revenue Nts.,
Series A, 5%, 1/14/99 2,220,000 2,215,992
------------
TOTAL U.S. GOVERNMENT AGENCIES 22,109,700
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE 102.0% 22,609,700
- -----------------------------------------------------------------------------------------------------------------------------
LIABILITIES IN EXCESS OF OTHER ASSETS (2.0) (447,367)
----- ------------
NET ASSETS 100.0% $22,162,333
===== ============
</TABLE>
1. Security issued in an exempt transaction without registration under the
Securities Act of 1933. Such securities amount to $3,497,569 or 15.78% of the
Fund's net assets, and have been determined to be liquid pursuant to guidelines
adopted by the Managing General Partners.
See accompanying Notes to Financial Statements.
<PAGE>
================================================================================
STATEMENT OF ASSETS AND LIABILITIES DECEMBER 31, 1998
<TABLE>
====================================================================================================================
ASSETS
<S> <C>
Investments, at value - see accompanying statement $22,609,700
- --------------------------------------------------------------------------------------------------------------------
Cash 77,812
- --------------------------------------------------------------------------------------------------------------------
Receivables and other assets:
Shares of beneficial interest sold 34,442
Other 22,325
------------
Total assets 22,744,279
====================================================================================================================
LIABILITIES Payables and other liabilities:
Shares of beneficial interest redeemed 531,335
Shareholder reports 14,365
Service plan fees 12,024
Tax liability 11,545
Legal, auditing and other professional fees 5,034
Transfer and shareholder servicing agent fees 4,659
Other 2,984
------------
Total liabilities 581,946
====================================================================================================================
NET ASSETS $22,162,333
============
====================================================================================================================
COMPOSITION OF NET ASSETS
Paid-in capital - applicable to 22,162,333 shares of beneficial interest outstanding $22,162,333
============
====================================================================================================================
NET ASSET VALUE, REDEMPTION PRICE AND OFFERING PRICE PER SHARE $1.00
</TABLE>
See accompanying Notes to Financial Statements.
5 Centennial America Fund, L.P.
<PAGE>
<TABLE>
================================================================================
STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 1998
====================================================================================================================
<S> <C>
INVESTMENT INCOME - Interest $1,074,748
====================================================================================================================
EXPENSES
Management fees - Note 3 88,659
- --------------------------------------------------------------------------------------------------------------------
Service plan fees - Note 3 38,060
- --------------------------------------------------------------------------------------------------------------------
Tax provision - Note 1 37,616
- --------------------------------------------------------------------------------------------------------------------
Shareholder reports 24,389
- --------------------------------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees - Note 3 13,468
- --------------------------------------------------------------------------------------------------------------------
Legal, auditing and other professional fees 10,364
- --------------------------------------------------------------------------------------------------------------------
Registration and filing fees 9,767
- --------------------------------------------------------------------------------------------------------------------
Custodian fees and expenses 4,667
- --------------------------------------------------------------------------------------------------------------------
Managing General Partners' fees and expenses 2,172
- --------------------------------------------------------------------------------------------------------------------
Insurance expenses 1,771
- --------------------------------------------------------------------------------------------------------------------
Other 9,129
-----------
Total expenses 240,062
====================================================================================================================
NET INVESTMENT INCOME $834,686
===========
</TABLE>
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS
YEAR ENDED DECEMBER 31,
1998 1997
====================================================================================================================
OPERATIONS
<S> <C> <C>
Net investment income $834,686 $739,196
====================================================================================================================
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS (834,686) (739,196)
====================================================================================================================
BENEFICIAL INTEREST TRANSACTIONS
Net increase (decrease) in net assets resulting from
beneficial interest transactions - Note 2 7,582,218 (4,081,282)
- --------------------------------------------------------------------------------------------------------------------
NET ASSETS
Total increase (decrease) 7,582,218 (4,081,282)
- --------------------------------------------------------------------------------------------------------------------
Beginning of period 14,580,115 18,661,397
------------ ------------
End of period $22,162,333 $14,580,115
============ ============
</TABLE>
See accompanying Notes to Financial Statements.
6 Centennial America Fund, L.P.
<PAGE>
<TABLE>
<CAPTION>
===================================================================================================================================
FINANCIAL HIGHLIGHTS
YEAR ENDED DECEMBER 31,
1998 1997 1996 1995 1994
===================================================================================================================================
PER SHARE OPERATING DATA
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
- -----------------------------------------------------------------------------------------------------------------------------------
Income from investment operations - net
investment income and net realized gain .04 .05 .05 .04 .03
Dividends and distributions to shareholders (.04) (.05) (.05) (.04) (.03)
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00
===== ===== ===== ===== =====
===================================================================================================================================
TOTAL RETURN(1) 4.40% 4.63% 4.69% 4.56% 2.91%
===================================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in thousands) $22,162 $14,580 $18,661 $11,102 $6,201
- -----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $19,724 $16,320 $16,998 $ 7,862 $5,693
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 4.23% 4.53% 4.52% 4.48% 2.89%
Expenses 1.22% 0.98% 0.86% 1.48% 1.47%
</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 reflect
changes in net investment income only.
See accompanying Notes to Financial Statements.
7 Centennial America Fund, L.P.
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES
Centennial America Fund, L.P. (the Fund) is registered under the Investment
Company Act of 1940, as amended, as a diversified, open-end management
investment company. The Fund's investment objective is to seek as high a level
of current income as is consistent with the preservation of capital and the
maintenance of liquidity. The Fund is organized as a limited partnership and
issues one class of shares, in the form of limited partnership interests. The
Fund's investment advisor is OppenheimerFunds, Inc. (the Manager). The following
is a summary of significant accounting policies consistently followed by the
Fund.
INVESTMENT VALUATION. Portfolio securities are valued on the basis of amortize
cost, which approximates market value.
REPURCHASE AGREEMENTS. The Fund requires the custodian to take possession, to
have legally segregated in the Federal Reserve Book Entry System or to have
segregated within the custodian's vault, all securities held as collateral for
repurchase agreements. The market value of the underlying securities is required
to be at least 102% of the resale price at the time of purchase. If the seller
of the agreement defaults and the value of the collateral declines, or if the
seller enters an insolvency proceeding, realization of the value of the
collateral by the Fund may be delayed or limited.
FEDERAL TAXES. The Fund intends to continue to comply with provisions of the
Internal Revenue Code applicable to limited partnerships. As a limited
partnership, the Fund is not subject to U.S. federal income tax, and the
character of the income earned and capital gains or losses realized by the Fund
flows directly through to shareholders. Therefore, no federal income or excise
tax provision is required. Beginning in 1998, according to the provisions of the
1997 Taxpayer Relief Act, the Fund will elect to be treated as an "Electing 1987
Partnership". As such it will record a U.S. Federal income tax provision equal
to 3.50% of gross income.
DISTRIBUTIONS TO SHAREHOLDERS. The Fund 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 Fund may withhold dividends or make distributions
of net realized gains.
OTHER. Investment transactions are accounted for on the date the investments are
purchased or sold (trade date). Realized gains and losses on investments are
determined on an identified cost basis, which is the same basis used for federal
income tax purposes.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of income and expenses during the reporting period. Actual
results could differ from those estimates.
2. SHARES OF BENEFICIAL INTEREST
The Fund 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 DECEMBER 31, 1998 YEAR ENDED DECEMBER 31, 1997
SHARES AMOUNT SHARES AMOUNT
---------------------------- ----------------------------
<S> <C> <C> <C> <C>
Sold 53,991,754 $53,991,754 44,369,483 $44,369,483
Dividends and distributions reinvested 807,080 807,080 706,803 706,803
Redeemed (47,216,616) (47,216,616) (49,157,568) (49,157,568)
------------ ------------ ------------ ------------
Net increase (decrease) 7,582,218 $ 7,582,218 (4,081,282) $(4,081,282)
============ ============ ============ ============
</TABLE>
8 Centennial America Fund, L.P.
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
3. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Fund which provides for an annual fee of 0.45% of
the first $500 million of net assets and 0.40% of net assets over $500 million.
The Fund's management fee for the year ended December 31, 1998 was 0.45% of the
average annual net assets for the Fund.
Shareholder Services, Inc. (SSI), a subsidiary of the Manager, is the transfer
and shareholder servicing agent for the Fund and other Oppenheimer funds. SSI's
total costs of providing such services are allocated ratably to these funds.
Under an approved plan of distribution, the Fund expends 0.20% of its net assets
annually to reimburse Centennial Asset Management Corporation, a subsidiary of
the Manager, for costs incurred in distributing shares of the Fund, including
amounts paid to brokers, dealers, banks and other institutions.
9 Centennial America Fund, L.P.
<PAGE>
- ------------------------------------------------------------------------------
Centennial America Fund, L.P.
- ------------------------------------------------------------------------------
Investment Advisor
OppenheimerFunds, Inc.
Two World Trade Center
New York, New York 10048-0203
Distributor
Centennial Asset Mangement Corporation
Two World Trade Center
New York, New York 10048-0203
Sub-Distributor
OppenheimerFunds Distributor, Inc.
P.O. Box 5254
Denver, Colorado 80217
Transfer Agent
Shareholder Services, Inc.
P.O. Box 5143
Denver, Colorado 80217
1-800-525-9310 (from within the U.S.)
303-768-3200 (from outside the U.S.)
Custodian of Portfolio Securities
Citibank, N.A.
399 Park Avenue
New York, New York 10043
Independent Auditors
Deloitte & Touche LLP
555 Seventeenth Street
Denver, Colorado 80202
Legal Counsel
Myer, Swanson, Adams & Wolf, P.C.
1600 Broadway
Denver, Colorado 80202
PX0870.001.0499
<PAGE>
CENTENNIAL AMERICA FUND, L.P.
FORM N-1A
PART C
OTHER INFORMATION
Item 23. Exhibits
(a) (1) Form of Agreement of Limited Partnership dated April 28, 1987 See Part
B.
(2) (i) Amended and Restated Certificate of Limited Partnership dated June 26,
1990: Previously filed with Registrant's Post-Effective Amendment dated
No. 6, (5/1/91), and refiled with Registrant's Post-Effective Amendment
No. 14, (4/17/95), pursuant to Item 102 of Regulation S-T, and
incorporated herein by reference.
(ii) Certificate of Amendment to Certificate of Limited Partnership dated
November 29, 1991: Previously filed with Registrant's Post-Effective
Amendment No 10, (4/30/92), and refiled with Registrant's Post-Effective
Amendment No. 14, (4/17/95), pursuant to Item 102 of Regulation S-T, and
incorporated herein by reference.
(iii) Certificate of Amendment to Certificate of Limited Partnership dated
December 17, 1991: Previously filed with Registrant's Post-Effective
Amendment No 10, (4/30/92), and refiled with Registrant's Post-Effective
Amendment No. 14, (4/17/95), pursuant to Item 102 of Regulation S-T, and
incorporated herein by reference.
(iv) Amendment to Certificate of Limited Partnership dated August 30,
1993: Filed with Registrant's Post-Effective Amendment No 12, (4/15/94),
pursuant to Item 102 of Regulation S-T, and incorporated herein by
reference.
(v) Amendment to Certificate of Limited Partnership dated October 26,
1993: Filed with Registrant's Post-Effective Amendment No 12, (4/15/94),
pursuant to Item 102 of Regulation S-T, and incorporated herein by
reference.
(v) Amendment to Certificate of Limited Partnership dated July 1, 1996:
Filed with Registrant's Post-Effective Amendment No 16, (4/23/97),
pursuant to Item 102 of Regulation S-T, and incorporated herein by
reference.
(vi)Amendment to Certificate of Limited Partnership dated October 22,
1996: Filed with Registrant's Post-Effective Amendment No 16, (4/23/97),
pursuant to Item 102 of Regulation S-T, and incorporated herein by
reference.
(b) Form of Operating Procedures: Previously filed with Post-Effective
Amendment No. 6, (5/1/91), and refiled with Registrant's Post-Effective
Amendment No. 14, (4/17/95), pursuant to Item 102 of Regulation S-T, and
incorporated herein by reference.
(c) Specimen Share Certificate: Filed herewith.
(d) Investment Advisory Agreement dated November 29, 1990: Previously filed with
Post-Effective Amendment No. 5, (3/4/91), and refiled with Registrant's
Post-Effective Amendment No. 14, (4/17/95), pursuant to Item 102 of Regulation
S-T and incorporated herein by reference.
(e) (i) General Distributor's Agreement Centennial Asset Management
Corporation dated October 13, 1992: Previously filed with Registrant's
Post Effective Amendment No. 12, (4/15/94), and incorporated herein by
reference.
(ii) Sub-Distributor's Agreement between Centennial Asset Management
Corporation and OppenheimerFunds Distributor, Inc. dated May 28, 1993:
Previously filed with Post-Effective Amendment No. 34, (4/21/94), to the
Registration Statement of Daily Cash Accumulation Fund and incorporated
herein by reference.
(iii) Form of Dealer Agreement of Centennial Asset Management
Corporation: Previously filed with Post-Effective Amendment No. 23 of
Centennial Government Trust (Reg. No. 2-75912), (1/1/94), and
incorporated herein by reference.
(iv) Form of Dealer Agreement of OppenheimerFunds Distributor, Inc.:
Filed with Post-Effective Amendment No. 14 of Oppenheimer Main Street
Funds, Inc. (Reg. No. 33-17850), (9/30/94), and incorporated herein by
reference.
(f) Form of Deferred Compensation Plan for Disinterested
Trustees/Directors: Filed with Post-Effective Amendment No. 40 to the
Registration Statement of Oppenheimer High Yield Fund (Reg. No. 2-62076),
(10/27/98), and incorporated herein by reference.
(g) Custodian Agreement with Citibank, N.A. dated June 1, 1990: Previously filed
with Registrant's Post-Effective Amendment No. 5, (3/4/91), refiled with
Registrant's Post-Effective Amendment No. 14, (4/17/95), pursuant to Item 102 of
Regulation S-T and incorporated herein by reference.
(h) Not applicable.
(i) (i) Opinion and Consent of Counsel dated April 28, 1987: Previously filed
with Registrant's Post-Effective Amendment No. 14, (4/17/95), pursuant to
Item 102 of Regulation S-T and incorporated herein by reference.
(ii) Opinion and Consent of Counsel dated May 8, 1987: Previously filed
and refiled with Registrant's Post-Effective Amendment No. 14, (4/17/95),
pursuant to Item 102 of Regulation S-T and incorporated herein by
reference.
(j) Independent Auditors Consent: Filed herewith.
(k) Not applicable.
(l) Subscription Agreement and Investment Letter: Previously filed with
Registrant's Registration Statement and incorporated herein by reference.
(m) Service Plan and Agreement Between Registrant and Centennial Asset
Management Corporation under Rule 12b-1 dated August 24, 1993: Previously filed
with Registrant's Post-Effective Amendment No. 12, (4/15/94), and incorporated
herein by reference.
(n) Financial Data Schedule: Filed herewith.
(o) Not applicable.
- -- Powers of Attorney (including Certified Board resolutions): Previously
filed with Post-Effective Amendment No. 20 to the Registration Statement of
Oppenheimer Total Return Fund, Inc. (Reg. No. 2-11052), (4/30/99), Brian
Wixted and incorporated herein by reference. Filed with Registrant's
Post-Effective Amendment No. 18, (3/1/99) George Bowen; Filed with
Registrant's Post-Effective Amendment No. 16, (4/23/97) Sam Freedman; Filed
with Registrant's Post Effective Amendment No. 15, (4/18/96) Bridget
Macaskill and with Registrant's Post Effective Amendment No. (all others),
and incorporated herein by reference.
Item 24. Persons Controlled by or Under Common Control with the Fund
None.
Item 25. Indemnification
Reference is made to the provisions of Article Seven of Registrant's
Amended and Restated Declaration of Trust filed as Exhibit 23(a) to this
Registration Statement, and incorporated herein by reference.
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 26. Business and Other Connections of the Investment Adviser
(a) OppenheimerFunds, Inc. is the investment adviser of the Registrant; it and
certain subsidiaries and affiliates act in the same capacity to other investment
companies, including without limitation those described in Parts A and B hereof
and listed in Item 26(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 OppenheimerFunds, Inc. 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.
Name and Current Position Other Business and Connections
with OppenheimerFunds, Inc. During the Past Two Years
Charles E. Albers,
Senior Vice President An officer and/or portfolio manager of
certain Oppenheimer funds (since April
1998); a Chartered Financial Analyst;
formerly, a Vice President and portfolio
manager for Guardian Investor Services,
the investment management subsidiary of
The Guardian Life Insurance Company
(since 1972).
Edward Amberger,
Assistant Vice President Formerly Assistant Vice President,
Securities Analyst for Morgan Stanley
Dean Witter (May 1997 - April 1998); and
Research Analyst (July 1996 - May 1997),
Portfolio Manager (February 1992 - July
1996) and Department Manager (June 1988
to February 1992) for The Bank of New
York.
Mark J.P. Anson,
Vice President Vice President of Oppenheimer Real Asset
Management, Inc.; formerly, Vice
President of Equity Derivatives at
Salomon Brothers, Inc.
Peter M. Antos,
Senior Vice President An officer and/or portfolio manager of
certain Oppenheimer funds; a Chartered
Financial Analyst; Senior Vice President
of HarbourView Asset Management
Corporation; prior to March 1996 he was
the senior equity portfolio manager for
the Panorama Series Fund, Inc. (the
"Company") and other mutual funds and
pension funds managed by G.R. Phelps &
Co. Inc. ("G.R. Phelps"), the Company's
former investment adviser, which was a
subsidiary of Connecticut Mutual Life
Insurance Company; he was also
responsible for managing the common stock
department and common stock investments
of Connecticut Mutual Life Insurance Co.
Lawrence Apolito,
Vice President None.
Victor Babin,
Senior Vice President None.
Bruce Bartlett,
Senior Vice President An officer and/or portfolio manager of
certain Oppenheimer funds. Formerly, a
Vice President and Senior Portfolio
Manager at First of America Investment
Corp.
George Batejan,
Executive Vice President,
Chief Information Officer Formerly Senior Vice President, Group
Executive, and Senior Systems Officer for
American International Group (October
1994 - May 1998).
John R. Blomfield,
Vice President Formerly Senior Product Manager
(November 1995 - August 1997) of
International Home Foods and American Home
Products (March 1994 - October 1996).
Connie Bechtolt,
Assistant Vice President None.
Kathleen Beichert,
Vice President None.
Rajeev Bhaman,
Vice President Formerly, Vice President (January
1992 - February, 1996) of Asian Equities for
Barclays de Zoete Wedd, Inc.
Robert J. Bishop,
Vice President Vice President of Mutual Fund Accounting
(since May 1996); an officer of other
Oppenheimer funds; formerly, an Assistant
Vice President of OppenheimerFunds,
Inc./Mutual Fund Accounting (April 1994 -
May 1996), and a Fund Controller for
OppenheimerFunds, Inc.
Chad Boll,
Assistant Vice President None
George C. Bowen
Senior Vice President,
Treasurer and Director Vice President (since June 1983) and
Treasurer (since March 1985) of
OppenheimerFunds Distributor, Inc. (the
"Distributor"); Senior Vice President
(since February 1992), Treasurer (since
July 1991) and a director (since December
1991) of Centennial Asset Management
Corporation; President, Treasurer and a
director of Centennial Capital
Corporation (since June 1989); a director
of other Oppenheimer funds.
Scott Brooks,
Vice President None.
Kevin Brosmith,
Vice President None.
Nancy Bush,
Assistant Vice President None.
Adele Campbell,
Assistant Vice President & Assistant
Treasurer: Rochester Division Formerly, Assistant Vice President of
Rochester Fund Services, Inc.
Michael Carbuto,
Vice President An officer and/or portfolio manager of
certain Oppenheimer funds; Vice President
of Centennial Asset Management
Corporation.
John Cardillo,
Assistant Vice President None.
Mark Curry,
Assistant Vice President None.
H.C. Digby Clements,
Vice President:
Rochester Division None.
O. Leonard Darling,
Executive Vice President Chief Executive Officer and
Senior Manager of HarbourView Asset
Management Corporation; Trustee (1993 -
present) of Awhtolia College - Greece.
William DeJianne, None.
Assistant Vice President
Robert A. Densen,
Senior Vice President None.
Sheri Devereux,
Assistant Vice President None.
Craig P. Dinsell
Executive Vice President Formerly, Senior Vice President of Human
Resources for Fidelity Investments-Retail
Division (January 1995 - January 1996),
Fidelity Investments FMR Co. (January
1996 - June 1997) and Fidelity
Investments FTPG (June 1997 - January
1998).
Robert Doll, Jr.,
Executive Vice President and
Chief Investment Officer and
Director An officer and/or portfolio manager of
certain Oppenheimer funds.
John Doney,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Andrew J. Donohue,
Executive Vice President,
General Counsel and Director Executive Vice President (since September
1993), and a director (since January
1992) of the Distributor; Executive Vice
President, General Counsel and a director
of HarbourView Asset Management
Corporation Shareholder Services, Inc.,
Shareholder Financial Services, Inc. and
Oppenheimer Partnership Holdings, Inc.
since (September 1995); President and a
director of Centennial Asset Management
Corporation (since September 1995);
President and a director of Oppenheimer
Real Asset Management, Inc (since July
1996); General Counsel (since May 1996)
and Secretary (since April 1997) of
Oppenheimer Acquisition Corp.; Vice
President and Director of
OppenheimerFunds International, Ltd. and
Oppenheimer Millennium Funds plc (since
October 1997); an officer of other
Oppenheimer funds.
Patrick Dougherty, None.
Assistant Vice President
Bruce Dunbar, None.
Vice President
Daniel Engstrom,
Assistant Vice President None.
George Evans,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Edward Everett,
Assistant Vice President None.
George Fahey,
Vice President None.
Scott Farrar,
Vice President Assistant Treasurer of Oppenheimer
Millennium Funds plc (since October
1997); an officer of other Oppenheimer
funds; formerly an Assistant Vice
President of OppenheimerFunds,
Inc./Mutual Fund Accounting (April 1994 -
May 1996), and a Fund Controller for
OppenheimerFunds, Inc.
Leslie A. Falconio,
Assistant Vice President None.
Katherine P. Feld,
Vice President and Secretary Vice President and Secretary of the
Distributor; Secretary of HarbourView
Asset Management Corporation, and
Centennial Asset Management Corporation;
Secretary, Vice President and Director of
Centennial Capital Corporation; Vice
President and Secretary of Oppenheimer
Real Asset Management, Inc.
Ronald H. Fielding,
Senior Vice President; Chairman:
Rochester Division An officer, Director and/or portfolio
manager of certain Oppenheimer funds;
Presently he holds the following other
positions: Director (since 1995) of ICI
Mutual Insurance Company; Governor (since
1994) of St. John's College; Director
(since 1994 - present) of International
Museum of Photography at George Eastman
House. Formerly, he held the following
positions: formerly, Chairman of the
Board and Director of Rochester Fund
Distributors, Inc. ("RFD"); President and
Director of Fielding Management Company,
Inc. ("FMC"); President and Director of
Rochester Capital Advisors, Inc.
("RCAI"); Managing Partner of Rochester
Capital Advisors, L.P., President and
Director of Rochester Fund Services, Inc.
("RFS"); President and Director of
Rochester Tax Managed Fund, Inc.;
Director (1993 - 1997) of VehiCare Corp.;
Director (1993 - 1996) of VoiceMode.
Patricia Foster,
Vice President Formerly, she held the following
positions: An officer of certain former
Rochester funds (May, 1993 - January,
1996); Secretary of Rochester Capital
Advisors, Inc. and General Counsel (June,
1993 - January 1996) of Rochester Capital
Advisors, L.P.
David Foxhoven,
Assistant Vice President Formerly Manager, Banking Operations
Department (July 1996 - November 1998).
Jennifer Foxson,
Vice President None.
Erin Gardiner,
Assistant Vice President None.
Linda Gardner,
Vice President None.
Alan Gilston,
Vice President Formerly, Vice President (1987 - 1997)
for Schroder Capital Management
International.
Jill Glazerman,
Vice President None.
Robyn Goldstein-Liebler
Assistant Vice President None.
Mikhail Goldverg
Assistant Vice President None.
Jeremy Griffiths,
Executive Vice President and
Chief Financial Officer Chief Financial Officer and Treasurer
(since March 1998) of Oppenheimer
Acquisition Corp.; a Member and Fellow of
the Institute of Chartered Accountants;
formerly, an accountant for Arthur Young
(London, U.K.).
Robert Grill,
Senior Vice President Formerly, Marketing Vice
President for Bankers Trust Company (1993 -
1996); Steering Committee Member,
Subcommittee Chairman for American Savings
Education Council (1995 - 1996).
Caryn Halbrecht,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Elaine T. Hamann,
Vice President Formerly, Vice President (September 1989
- January 1997) of Bankers Trust Company.
Robert Haley
Assistant Vice President Formerly, Vice President of
Information Services for Bankers Trust
Company (January 1991 - November 1997).
Thomas B. Hayes,
Vice President None.
Barbara Hennigar,
Executive Vice President and
Chief Executive Officer of
OppenheimerFunds Services,
a division of the Manager President and Director of Shareholder
Financial Services, Inc.; President and
Chief Executive Officer of Shareholder
Services, Inc.
Dorothy Hirshman, None.
Assistant Vice President
Merryl Hoffman,
Vice President None.
Nicholas Horsley,
Vice President Formerly, a Senior Vice President and
Portfolio Manager for Warburg, Pincus
Counsellors, Inc. (1993 - 1997),
Co-Manager of Warburg, Pincus Emerging
Markets Fund (December 1994 - October
1997), Co-Manager Warburg, Pincus
Institutional Emerging Markets Fund -
Emerging Markets Portfolio (August 1996 -
October 1997), Warburg Pincus Japan OTC
Fund, Associate Portfolio Manager of
Warburg Pincus International Equity Fund,
Warburg Pincus Institutional Fund -
Intermediate Equity Portfolio, and
Warburg Pincus EAFE Fund.
Scott T. Huebl,
Vice President None.
Richard Hymes,
Vice President None.
Jane Ingalls,
Vice President None.
Kathleen T. Ives,
Vice President None.
Christopher Jacobs,
Assistant Vice President None.
William Jaume,
Vice President None.
Frank Jennings,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Susan Katz,
Vice President None.
Thomas W. Keffer,
Senior Vice President None.
Erica Klein,
Assistant Vice President None.
Avram Kornberg,
Vice President None.
John Kowalik,
Senior Vice President An officer and/or portfolio manager for
certain OppenheimerFunds; formerly,
Managing Director and Senior Portfolio
Manager at Prudential Global Advisors
(1989 - 1998).
Joseph Krist,
Assistant Vice President None.
Michael Levine,
Vice President None.
Shanquan Li,
Vice President None.
Stephen F. Libera,
Vice President An officer and/or portfolio manager for
certain Oppenheimer funds; a Chartered
Financial Analyst; a Vice President of
HarbourView Asset Management Corporation;
prior to March 1996, the senior bond
portfolio manager for Panorama Series
Fund Inc., other mutual funds and pension
accounts managed by G.R. Phelps; also
responsible for managing the public
fixed-income securities department at
Connecticut Mutual Life Insurance Co.
Mitchell J. Lindauer,
Vice President None.
Dan Loughran,
Assistant Vice President:
Rochester Division None.
David Mabry,
Vice President None.
Steve Macchia,
Vice President None.
Bridget Macaskill,
President, Chief Executive Officer
and Director Chief Executive Officer (since September
1995); President and director (since June
1991) of HarbourView Asset Management
Corporation; Chairman and a director of
Shareholder Services, Inc. (since August
1994), and Shareholder Financial
Services, Inc. (September 1995);
President (since September 1995) and a
director (since October 1990) of
Oppenheimer Acquisition Corp.; President
(since September 1995) and a director
(since November 1989) of Oppenheimer
Partnership Holdings, Inc., a holding
company subsidiary of OppenheimerFunds,
Inc.; a director of Oppenheimer Real
Asset Management, Inc. (since July 1996);
President and a director (since October
1997) of OppenheimerFunds International
Ltd., an offshore fund manager subsidiary
of OppenheimerFunds, Inc. and Oppenheimer
Millennium Funds plc (since October
1997); President and a director of other
Oppenheimer funds; a director of
Hillsdown Holdings plc (a U.K. food
company); formerly, an Executive Vice
President of OFI.
Philip T. Masterson,
Vice President Formerly an Associate at Davis,
Graham, & Stubbs (January 1998 - July 1998);
Associate; Myer, Swanson, Adams & Wolf, P.C.
(May 1996 - June 1998).
Loretta McCarthy,
Executive Vice President None.
Kelley A. McCarthy-Kane
Assistant Vice President Formerly, Product Manager,
Assistant Vice President (June 1995 -
October 1997) of Merrill Lynch Pierce Fenner
& Smith.
Beth Michnowski,
Assistant Vice President Formerly Senior Marketing
Manager (May 1996 - June 1997) and Director
of Product Marketing (August 1992 - May
1996) with Fidelity Investments.
Lisa Migan,
Assistant Vice President None.
Denis R. Molleur,
Vice President None.
Nikolaos Monoyios,
Vice President A Vice President and/or portfolio manager
of certain Oppenheimer funds (since April
1998); a Certified Financial Analyst;
formerly, a Vice President and portfolio
manager for Guardian Investor Services,
the management subsidiary of The Guardian
Life Insurance Company (since 1979).
Linda Moore,
Vice President Formerly, Marketing Manager (July 1995
-November 1996) for Chase Investment
Services Corp.
Kenneth Nadler,
Vice President None.
David Negri,
Senior Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Barbara Niederbrach,
Assistant Vice President None.
Robert A. Nowaczyk,
Vice President None.
Ray Olson,
Assistant Vice President None.
Richard M. O'Shaugnessy,
Assistant Vice President:
Rochester Division None.
Gina M. Palmieri,
Assistant Vice President None.
Robert E. Patterson,
Senior Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
James Phillips
Assistant Vice President None.
Stephen Puckett,
Vice President None.
Jane Putnam,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Michael Quinn,
Assistant Vice President Formerly, Assistant Vice President (April
1995 - January 1998) of Van Kampen
American Capital.
Julie Radtke,
Vice President Formerly Assistant Vice President and
Business Analyst for Pershing, Jersey
City (August 1997 -November 1997); Senior
Business Consultant, American
International Group (January 1996 - July
1997).
Russell Read,
Senior Vice President Vice President of Oppenheimer Real Asset
Management, Inc. (since March 1995).
Thomas Reedy,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds;
formerly, a Securities Analyst for the
Manager.
John Reinhardt,
Vice President: Rochester Division None
Ruxandra Risko,
Vice President None.
Michael S. Rosen,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Richard H. Rubinstein,
Senior Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Lawrence Rudnick,
Assistant Vice President None.
James Ruff,
Executive Vice President & Director None.
Valerie Sanders,
Vice President None.
Ellen Schoenfeld,
Assistant Vice President None.
Martha Shapiro,
Assistant Vice President None
Stephanie Seminara,
Vice President None.
Michelle Simone,
Assistant Vice President None.
Richard Soper,
Vice President None.
Cathleen Stahl,
Vice President Assistant Vice President & Manager of
Women & Investing Program
Nancy Sperte,
Executive Vice President Executive Vice President, Corporate
Developement.
Donald W. Spiro,
Chairman Emeritus and Director Vice Chairman and Trustee of the New
York-based Oppenheimer funds; formerly,
Chairman of the Manager and the
Distributor.
Richard A. Stein,
Vice President: Rochester Division Assistant Vice President (since 1995) of
Rochester Capitol Advisors, L.P.
Arthur Steinmetz,
Senior Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Ralph Stellmacher,
Senior Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
John Stoma,
Senior Vice President None.
Michael C. Strathearn,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds; a
Chartered Financial Analyst; a Vice
President of HarbourView Asset Management
Corporation.
Wayne Strauss,
Assistant Vice President: Rochester
Division Formerly Senior Editor, West Publishing
Company (January 1997 - March 1997).
James C. Swain,
Vice Chairman of the Board Chairman, CEO and Trustee, Director or
Managing Partner of the Denver-based
Oppenheimer Funds; formerly, President
and Director of Centennial Asset
Management Corporation and Chairman of
the Board of Shareholder Services, Inc.
Susan Switzer,
Assistant Vice President None.
Anthony A. Tanner,
Vice President: Rochester Division None.
James Tobin,
Vice President None.
Jay Tracey,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
James Turner,
Assistant Vice President None.
Maureen VanNorstrand,
Assistant Vice President None.
Ashwin Vasan,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds.
Annette Von Brandis,
Assistant Vice President None.
Teresa Ward,
Assistant Vice President None.
Jerry Webman,
Senior Vice President Director of New York-based tax-exempt
fixed income Oppenheimer funds.
Christine Wells,
Vice President None.
Joseph Welsh,
Assistant Vice President None.
Brian W. Wixted,
Senior Vice President and
Treasurer Formerly Principal and Chief Operating
Officer, Bankers Trust Company-Mutual
Fund Services Division (March 1995-March
1999); Vice President and Chief Financial
Officer of CS First Boston Investment
Management Corp. (September 1991-March
1995); and Vice President and Accounting
Manager, Merrill Lynch Asset Management
(November 1987-September 1991).
Kenneth B. White,
Vice President An officer and/or portfolio
manager of certain Oppenheimer funds; a
Chartered Financial Analyst; Vice President
of HarbourView Asset Management Corporation.
William L. Wilby,
Senior Vice President An officer and/or portfolio manager of
certain Oppenheimer funds; Vice President
of HarbourView Asset Management
Corporation.
Carol Wolf,
Vice President An officer and/or portfolio manager of
certain Oppenheimer funds; Vice President
of Centennial Asset Management
Corporation; Vice President, Finance and
Accounting; Point of Contact: Finance
Supporters of Children; Member of the
Oncology Advisory Board of the Childrens
Hospital.
Caleb Wong,
Assistant Vice President None.
Robert G. Zack,
Senior Vice President and
Assistant Secretary, Associate
General Counsel Assistant Secretary of Shareholder
Services, Inc. (since May 1985),
Shareholder Financial Services, Inc.
(since November 1989), OppenheimerFunds
International Ltd. (since 1998),
Oppenheimer Millennium Funds plc (since
October 1997); an officer of other
Oppenheimer funds.
Jill Zachman,
Assistant Vice President:
Rochester Division None.
Arthur J. Zimmer,
Senior Vice President An officer and/or portfolio manager of
certain Oppenheimer funds; Vice President
of Centennial Asset Management
Corporation.
The Oppenheimer Funds include the New York-based Oppenheimer Funds, the
Denver-based Oppenheimer Funds and the Oppenheimer Quest/Rochester Funds, as
set forth below:
New York-based Oppenheimer Funds
Oppenheimer California Municipal Fund
Oppenheimer Capital Appreciation Fund
Oppenheimer Developing Markets Fund
Oppenheimer Discovery Fund
Oppenheimer Enterprise Fund
Oppenheimer Europe Fund
Oppenheimer Global Fund
Oppenheimer Global Growth & Income Fund
Oppenheimer Gold & Special Minerals Fund
Oppenheimer Growth Fund
Oppenheimer International Growth Fund
Oppenheimer International Small Company Fund
Oppenheimer Large Cap Growth Fund
Oppenheimer Money Market Fund, Inc.
Oppenheimer Multi-Sector Income Trust
Oppenheimer Multi-State Municipal Trust
Oppenheimer Multiple Strategies Fund
Oppenheimer Municipal Bond Fund
Oppenheimer New York Municipal Fund
Oppenheimer Series Fund, Inc.
Oppenheimer U.S. Government Trust
Oppenheimer World Bond Fund
Quest/Rochester Funds
Limited Term New York Municipal Fund
Oppenheimer Convertible Securities Fund
Oppenheimer MidCap Fund
Oppenheimer Quest Capital Value Fund, Inc.
Oppenheimer Quest For Value Funds
Oppenheimer Quest Global Value Fund, Inc.
Oppenheimer Quest Value Fund, Inc.
Rochester Fund Municipals
Denver-based Oppenheimer Funds
Centennial America Fund, L.P.
Centennial California Tax Exempt Trust
Centennial Government Trust
Centennial Money Market Trust
Centennial New York Tax Exempt Trust
Centennial Tax Exempt Trust
Oppenheimer Cash Reserves
Oppenheimer Champion Income Fund
Oppenheimer Capital Income Fund
Oppenheimer High Yield Fund
Oppenheimer Integrity Funds
Oppenheimer International Bond Fund
Oppenheimer Limited-Term Government Fund
Oppenheimer Main Street Funds, Inc.
Oppenheimer Municipal Fund
Oppenheimer Real Asset Fund
Oppenheimer Strategic Income Fund
Oppenheimer Total Return Fund, Inc.
Oppenheimer Variable Account Funds
Panorama Series Fund, Inc.
The address of OppenheimerFunds, Inc., the New York-based Oppenheimer Funds, the
Quest Funds, OppenheimerFunds Distributor, Inc., HarbourView Asset Management
Corporation, 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., OppenheimerFunds Services,
Centennial Asset Management Corporation, Centennial Capital Corporation, and
Oppenheimer Real Asset Management, Inc. is 6803 South Tucson Way, Englewood,
Colorado 80112.
The address of the Rochester-based funds is 350 Linden Oaks, Rochester, New York
14625-2807.
Item 27. 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:
Positions and
Name & Principal Positions & Offices Offices with
Business Address with Underwriter Registrant
George C. Bowen(2) Director, Senior Vice Vice President and
President, Treasurer and Assistant Secretary
Assistant Secretary
Michael Carbuto(1) Vice President Vice President of
Centennial
California Tax Exempt
Trust,
Centennial New York Tax
Exempt Trust, and
Centennial
Tax Exempt Trust
Andrew J. Donohue(1) President and Director Vice President and
Secretary
Katherine P. Feld(1) Secretary None
Carol Wolf(2) Vice President Vice President of
Centennial
Government Trust,
Centennial
Money Market Trust and
Centennial America Fund,
L.P.
Arthur Zimmer(2) Vice President Vice President of
Centennial
Government Trust,
Centennial
Money Market Trust and
Centennial America Fund,
L.P.
- -----------------------
(1) Two World Trade Center, New York, NY 10048-0203
(2) 6803 South Tucson Way, Englewood, CO 80112
(c) Not applicable.
Item 28. 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 OppenheimerFunds, Inc. at its
offices at 6803 South Tucson Way, Englewood, Colorado 80112.
Item 29. Management Services
Not applicable
Item 30. Undertakings
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 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
County of Arapahoe and State of Colorado on the 30th day of April, 1999.
CENTENNIAL AMERICA FUND, L.P.
By: /s/ James C. Swain *
James C. Swain, Chairman
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:
Signatures Title Date
/s/ James C. Swain* Chairman of the April 30, 1999
- ---------------------- Board of Managing General
James C. Swain Partners and Managing
General Partner
/s/ Bridget A. Macaskill* President, Principal April 30, 1999
- -------------------------- Executive Officer and
Bridget A. Macaskill Managing General Partner
/s/ Robert G. Avis* Managing General Partner April 30, 1999
- -----------------------
Robert G. Avis
/s/ William A. Baker* Managing General Partner April 30, 1999
- -------------------------
William A. Baker
/s/ Charles Conrad, Jr.* Managing General Partner April 30, 1999
- --------------------------
Charles Conrad, Jr.
/s/ Sam Freedman* Managing General Partner April 30, 1999
- ---------------------------
Sam Freedman
/s/ Raymond J. Kalinowski* Managing General Partner April 30, 1999
- ---------------------------
Raymond J. Kalinowski
/s/ C. Howard Kast* Managing General Partner April 30, 1999
- --------------------------
C. Howard Kast
/s/ Robert M. Kirchner* Managing General Partner April 30, 1999
- -------------------------
Robert M. Kirchner
/s/ Ned M. Steel* Managing General Partner April 30, 1999
- -------------------------
Ned M. Steel
/s/ Brian W. Wixted* Treasurer April 30, 1999
- ------------------------
Brian W. Wixted
*By: /s/ Robert G. Zack
- ---------------------------------------------
Robert G. Zack, Attorney-in-Fact
<PAGE>
CENTENNIAL AMERICA FUND, L.P.
EXHIBIT INDEX
Exhibit No. Description
23(c) Speciman Share Certificate
23(j) Independent Auditors' Consent
23(n) Financial Data Schedule
Exhibit 23(n)
CENTENNIAL AMERICA FUND, L.P.
Share Certificate (8-1/2" x 11")
I. FACE OF CERTIFICATE (All text and other matter lies within
8-5/16" x 10-5/8" decorative border, 5/16" wide)
(upper left corner, box with heading: NUMBER [of shares]
(upper right corner) [share certificate no.]
(upper right box with heading: SHARES
below cert. no.)
(centered
below boxes) Centennial America Fund, L.P.
A DELAWARE LIMITED PARTNERSHIP
(at left) THIS IS TO CERTIFY THAT (at right) SEE REVERSE FOR
CERTAIN DEFINITIONS
(box with number)
CUSIP 15133J 106
(at left) is the owner of
(centered) CENTENNIAL AMERICA FUND, L.P.
This certificate and the Shares of Limited Partnership
interest represented hereby are issued and shall be held
subject to the Agreements of Limited Partnership, dated
April 28, 1987, as amended, the terms of which are
incorporated herein by reference, and are subject to the
transfer restrictions set forth on the reverse side
hereof. This certificate is not valid until
countersigned by the Transfer Agent.
WITNESS the facsimile seal of the Trust and the signatures of
its duly authorized officers.
(signature at left of seal) Dated: (signature at right of seal)
/s/ Brian W. Wixted /s/ Bridget Macaskill
-------------------------- -------------------------
TREASURER PRESIDENT
<PAGE>
(centered at bottom)
1-1/2" diameter facsimile seal
with legend
CENTENNIAL AMERICA FUND, L.P.
CORPORATE
SEAL
1987
DELAWARE
(at lower right, printed vertically) Countersigned
SHAREHOLDER SERVICES, INC.
Denver (CO) Transfer Agent
By---------------------------------
Authorized Signature
II. BACK OF CERTIFICATE (text reads from top to bottom of 11" dimension)
ASSIGNMENT OF SHARES; SUCCESSOR INTEREST;
SUBSTITUTION OF PARTNERS
All terms have the meaning set forth in the Agreement of Limited Partnership
(the "Partnership Agreement")
PROHIBITION ON ASSIGNMENT. EXCEPT FOR REDEMPTIONS AS PROVIDED IN THE PARTNERSHIP
AGREEMENT BY DELIVERING A REDEMPTION REQUEST IN PROPER FORM TO THE TRANSFER
AGENT. A PARTNER SHALL NOT HAVE THE RIGHT TO SELL, TRANSFER OR ASSIGN HIS SHARES
IN THE PARTNERSHIP EVIDENCED BY THIS CERTIFICATE TO ANY OTHER PERSON, BUT MAY
PLEDGE THEM AS COLLATERAL.
Rights of the Holders of Shares as Collateral or Judgment Creditor. In the
event that any person who is holding the Share in the Partnership evidenced by
this Certificate as collateral or any judgment creditor becomes the owner of
such Shares due to foreclosure or otherwise, such person shall not have the
right to be substituted as a Limited Partner, but shall only have the rights,
upon the presentation of evidence satisfactory to the Managing General Partners
of his right to succeed to the interests of the Limited Partner, set forth
immediately below:
(a) to redeem the Shares in accordance with the provisions of the
Partnership Agreement by delivering a redemption request in proper form to the
Transfer Agent; and
(b) to receive any distributions made with respect to the Shares evidenced
by this Certificate.
Upon receipt by the Partnership of evidence satisfactory to the Managing
General Partners of his ownership of Shares evidenced by this Certificate, the
owner shall become a Holder of Record of the subject Shares and his name shall
be recorded on the books of record of the Partnership maintained for such
purpose either by the Partnership or its Transfer Agent. Such owner shall be
liable to return any distributions of any money or other property wrongfully
distributed to him or any sum, not in excess of the amount of such distribution,
necessary to discharge any liabilities of the Partnership to creditors who
extended credit to the Partnership during the period before such returns or
distributions were made, but only to the extent that the assets of the
Partnership are not sufficient to discharge such liabilities. However, such
owner shall have none of the rights or obligations of a Limited Partner unless
and until he is admitted as a Limited Partner in accordance with the Partnership
Agreement.
Death, Incompetency, Bankruptcy or Termination of the Existence of a
Partner. In the event of the death or an adjudication of incompetency or
bankruptcy of an individual Partner (or, in the case of a Partner that is a
corporation, association, partnership, joint venture or trust, and adjudication
of bankruptcy, dissolution or other termination of the existence of such
Partner) the successor in interest of such Partner (including without limitation
the Partner's executor, administrator, guardian, conservator, receiver or other
legal representative), upon the presentation of evidence satisfactory to the
Managing General Partners of his right to succeed to the interests of the
Partner, shall have the rights set forth below:
(a) to redeem the Shares of the Partner evidenced by this Certificate in
accordance with the provisions of the Partnership Agreement by delivering a
redemption request in proper form to the Transfer Agent;
(b) to receive any distributions made with respect to such Shares; and
(c) to be substituted as a Limited Partner upon compliance with the
conditions of the admission of a Limited Partner as provided in the Partnership
Agreement.
Upon receipt by the Partnership of evidence satisfactory to the Managing
General Partners of his right to succeed to the interests of the Partner; the
successor in interest shall become a Holder of Record of the subject Shares and
his name shall be recorded on the books of record of the Partnership maintained
for such purpose either by the Partnership or its Transfer Agent.
Substituted Limited Partners.
(a) A person shall not become a Substituted Limited Partner unless the
Managing General Partners consent to such substitution (which consent may be
withheld in their absolute discretion) and receive such instruments and
documents (including those required of any person desiring to become a Limited
partner) and such reasonable transfer fees as the Managing General Partners may
require.
(b) The original Limited Partner shall cease to be a Limited Partner, and
the person to be substituted shall become a Substituted Limited Partner, as of
the date on which the person to be substituted has satisfied the requirements
set forth above and as of the date the records of the Partnership are amended to
reflect his admission as a Substituted Limited Partner. Thereafter the original
Limited Partner shall no rights or obligations with respect to the Partnership
insofar as the Shares transferred to the Substituted Limited Partner are
concerned.
(c) Unless and until a person becomes a Substituted Limited Partner, his
status and rights shall be limited to the rights of a Holder of Shares which
rights are limited to redeeming the Shares evidenced by this Certificate and
receiving any distributions made in respect of such Shares as specified above. A
Holder of Shares who does not become a Substituted Limited Partner shall have no
right to inspect the Partnership's books or to vote on any of the matters on
which a Limited Partner would be entitled to vote. A Holder of Shares, who has
become a Substituted Limited Partner has all the rights and powers, and is
subject to the Restrictions and liabilities of a Limited Partner under the
Partnership Agreement.
(d) Any person admitted to the Partnership as a Substituted Limited
Partner shall be subject to and bound by the provisions of the Partnership
Agreement as if originally a party of the Partnership Agreement.
<PAGE>
PURSUANT TO THE PARTNERSHIP AGREEMENT, ASSIGNMENT OF THIS CERTIFICATE
IS ONLY VALID FOR REDEMPTION REQUESTS AND PLEDGES
REDEMPTION REQUEST
_______________________________________________, hereby requests that the Shares
represented by the Certificate be redeemed in accordance with the Partnership
Agreement and that the proceeds of such redemption be paid over to
_______________________. The undersigned also agrees to hold the Partnership,
Shareholder Services, Inc. and Centennial Asset Management Corporation harmless
to paying for the proceeds of such redemption as directed above.
DATED: ________________ ___________________________________________
Both owners must sign if applicable
--------------------------------------------
The signature(s) to this Redemption
Request must correspond with the name(s) as
written upon the face
of the Certificate, without alteration or
enlargement or any change whatever.
SIGNATURE(S) GUARANTEED BY:
Signatures must be guaranteed
by a U.S. commercial bank or trust
- -------------------------------
company, a Federally-chartered Name of Firm or Bank
savings and loan association, a
foreign bank having a U.S.
- -------------------------------
correspondent bank or member of a Signature of Officer/Title
national securities exchange.
<PAGE>
- --------------------------------------------------------------------------------
ASSIGNMENT FOR PLEDGE
For Value Received
- ----------------------------------------------------------------------
hereby pledges unto
- ---------------------------------------------------------------------
- -------------------------------------------------------------------------------
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
AND PROVIDE CERTIFICATION BY TRANSFEREE
(box for identifying number)
===============================================================================
the within Certificate and does hereby irrevocably constitute and appoint
______________________________, attorney, to transfer the within Certificate
on the books of the Transfer Agent with full power of substitution in the
premises to the extent permitted by the Partnership Agreement.
DATED: ________________ ___________________________________________
Both owners must sign if applicable
--------------------------------------------
The signature(s) to this Redemption
Request must correspond with the name(s) as
written upon the face
of the Certificate, without alteration or
enlargement or any change whatever.
SIGNATURE(S) GUARANTEED BY:
Signatures must be guaranteed
by a U.S. commercial bank or trust
- -------------------------------
company, a Federally-chartered Name of Firm or Bank
savings and loan association, a
foreign bank having a U.S.
- -------------------------------
correspondent bank or member of a Signature of Officer/Title
national securities exchange.
Exhibit 23(j)
INDEPENDENT AUDITORS' CONSENT
We consent to the use in this Post-Effective Amendment No. 19 to Registration
Statement No. 33-12463 of Centennial America Fund, L.P. on form N-1A of
Centennial America Fund, L.P. of our report dated January 25, 1999 appearing in
the Statement of Additional Information, which is a part of such Registration
Statement, and to the references to us under the headings "Financial Highlights"
appearing in the Prospectus, which is also a part of such Registration Statement
and "Independent Auditors" appearing in the Statement of Additional Information.
/s/ Deloitte & Touche LLP
- ------------------------------------
DELOITTE & TOUCHE LLP
Denver, Colorado
April 29, 1999
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 811267
<NAME> Centennial America Fund, L.P.
<S> <C>
<PERIOD-TYPE> 12-Mos
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> DEC-31-1998
<INVESTMENTS-AT-COST> 22,609,700
<INVESTMENTS-AT-VALUE> 22,609,700
<RECEIVABLES> 34,442
<ASSETS-OTHER> 22,325
<OTHER-ITEMS-ASSETS> 77,812
<TOTAL-ASSETS> 22,744,279
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 581,946
<TOTAL-LIABILITIES> 581,946
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 22,162,333
<SHARES-COMMON-STOCK> 22,162,333
<SHARES-COMMON-PRIOR> 14,580,115
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 22,162,333
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 1,074,748
<OTHER-INCOME> 0
<EXPENSES-NET> 240,062
<NET-INVESTMENT-INCOME> 834,686
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 834,686
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 834,686
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 53,991,754
<NUMBER-OF-SHARES-REDEEMED> 47,216,616
<SHARES-REINVESTED> 807,080
<NET-CHANGE-IN-ASSETS> 7,582,218
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 88,659
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 240,062
<AVERAGE-NET-ASSETS> 19,724,000
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> 0.04
<PER-SHARE-GAIN-APPREC> 0.00
<PER-SHARE-DIVIDEND> 0.04
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 1.22
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0.00
</TABLE>
