Centennial Government Trust

497 1 revisedsai.htm REVISED SAI WITH FINANCIALS Centennial Government Trust

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Centennial Government Trust
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6803 South Tucson Way, Centennial, Colorado 80112
1.800.525.9310

Statement of Additional Information dated October 24, 2008, revised May 7, 2009

This Statement of Additional Information is not a prospectus. This document contains
additional information about the Trust and supplements information in the Prospectus dated
October 24, 2008. It should be read together with the Prospectus, which may be obtained by
writing to the Trust's Transfer Agent, Shareholder Services, Inc., at P.O. Box 5143,
Denver, Colorado 80217, or by calling the Transfer Agent at the toll-free number shown
above.

Contents
Page
About the Trust
Additional Information about the Trust's Investment Policies and Risks........
The Trust's Investment Policies..........................................
Other Investment Strategies..............................................
Other Investment Restrictions............................................
Disclosure of Portfolio Holdings
How the Trust is Managed......................................................
Organization and History.................................................
Board of Trustees and Oversight Committees...............................
Trustees and Officers of the Trust.......................................
The Manager..............................................................
Service Plan..................................................................
Payments to Trust Intermediaries..............................................
Performance of the Trust......................................................

About Your Account
How To Buy Shares.............................................................
How To Sell Shares............................................................
How To Exchange Shares........................................................
Dividends and Taxes...........................................................
Additional Information About the Trust........................................

Financial Information About the Trust
Report of Independent Registered Public Accounting Firm.......................
Financial Statements..........................................................

Appendix A: Description of Securities Ratings..............................A-1

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ABOUT THE TRUST
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Additional Information About the Trust's Investment Policies and Risks

The investment objective and the principal investment policies of the Trust are described
in the Prospectus. This Statement of Additional Information contains supplemental
information about those policies and the types of securities that the Trust's investment
manager, Centennial Asset Management Corporation, (referred to as, the "Manager") will
select for the Trust. Additional explanations are also provided about the strategies the
Trust may use to try to achieve its objective.

The Trust's Investment Policies. The composition of the Trust's portfolio and the
techniques and strategies that the Trust's Manager uses in selecting portfolio securities
will vary over time. The Trust is not required to use all of the investment techniques and
strategies described below at all times in seeking its goal. It may use some of the
special investment techniques and strategies at some times or not at all.

The Trust's objective is to seek a high level of current income consistent with
preservation of capital and the maintenance of liquidity. The Trust will not make
investments with the objective of seeking capital growth. However, the value of the
securities held by the Trust may be affected by changes in general interest rates. Because
the current value of debt securities varies inversely with changes in prevailing interest
rates, if interest rates increase after a security is purchased, that security would
normally decline in value. Conversely, if interest rates decrease after a security is
purchased, its value would rise. However, those fluctuations in value will not generally
result in realized gains or losses to the Trust since the Trust does not usually intend to
dispose of securities prior to their maturity. A debt security held to maturity is
redeemable by its issuer at full principal value plus accrued interest.

The Trust may sell securities prior to their maturity, to attempt to take advantage
of short-term market variations, or because of a revised credit evaluation of the issuer or
other considerations. The Trust may also do so to generate cash to satisfy redemptions of
Trust shares. In such cases, the Trust may realize a capital gain or loss on the security.

Ratings of Securities - Portfolio Quality, Maturity and Diversification. Under Rule 2a-7
of the Investment Company Act of 1940 ("Investment Company Act"), the Trust uses the
amortized cost method to value its portfolio securities to determine the Trust's net asset
value per share. Rule 2a-7 imposes requirements for the maturity, quality and
diversification of the securities which the Trust buys. The Trust may purchase only those
securities that the Manager, under procedures approved by the Board of Trustees, has
determined have minimal credit risk and, as such, are "eligible securities."

|X| Quality. Eligible securities are securities that have received a rating in one of
the two highest short-term rating categories by a rating organization. Rating
organizations are designated by the Securities and Exchange Commission (the "SEC").
Eligible securities may be "first tier" or "second tier" securities. First tier securities
are those that have received a rating in the highest category for short term debt
obligations by at least two rating organizations. If only one rating organization has
rated the security, it must be rated in the highest category for that rating organization.
U.S. government securities and securities issued by a registered money market mutual fund
are also first tier securities. A second tier security is any eligible security that is
not a first tier security.

The Trust may also buy unrated securities that the Manager determines are comparable
in quality to a first or second tier security by applying certain criteria established by
the Board to determine its creditworthiness. These criteria require a high quality short
term or long-term rating (depending on the security) from a rating organization. Unrated
securities the Trust may buy include asset backed securities and securities subject to
"demand features" or "guarantees."

The Trust may purchase a security subject to a guarantee if the guarantee is an
eligible security or a first tier security. The trust may also purchase a security subject
to a "conditional" demand feature if the demand feature is an eligible security and the
Manager has decided that the conditional demand feature meets the requirements imposed by
Rule 2a-7.

If a security's rating is downgraded, the Manager or the Board of Trustees may have
to reassess the security's credit risk. If a security is downgraded, the Manager or the
Board of Trustees will promptly reassess whether the security continues to present minimal
credit risk, reassess the status of the security as an "eligible security," and take such
actions as is appropriate. If the Trust disposes of the security within five days of the
Manager learning of the downgrade, the Manager will provide the Board of Trustees with
subsequent notice of such downgrade. If a security is in default, or ceases to be an
eligible security, or is determined no longer to present minimal credit risks, the Board of
Trustees must determine whether it would be in the best interests of the Trust to dispose
of the security.

|X| Diversification. The Trust cannot invest more than 5% of its total assets in
securities issued by one issuer other than securities issued or guaranteed by the U.S.
government. The Trust also cannot invest more than 1% of its total assets or $1.0 million,
whichever is greater, in second tier securities of one issuer. For diversification
purposes, the Trust is considered to have purchased the security underlying a repurchase
agreement if the repurchase agreement is fully collateralized. If the Trust buys an asset
backed security, the issuer of the security is deemed to be the "special purpose" entity
which issued the security. A special purpose entity is an entity which is organized solely
for the purpose of issuing asset backed securities. If the asset backed securities issued
by the special purpose entity include the obligations of another person or another special
purpose entity and those obligations amount to 10% or more of the asset backed securities
the Trust buys, that other person or entity is considered to be the issuer of a pro rata
percentage of the asset backed security.

The Trust may buy a security subject to a demand feature or guarantee. In this case,
with respect to 75% of its total assets, the Trust may not invest more than 10% of its
total assets in securities issued by or subject to demand features or guarantees issued by
the same issuer. If the security demand feature or guarantee is a second tier security,
the Trust may not invest more than 5% of its total assets in securities subject to demand
features or guarantees from the same issuer. And, the Trust may not invest more than 10%
of its total assets in securities issued by or subject to demand features or guarantees
from the same issuer. However, if the demand feature or guarantee is issued by a person
who is a non-controlled person, the Trust does not have to limit its investments to no more
than 10% of its total assets in securities issued by or subject to demand features or
guarantees from the same issuer.

|X| Maturity. The Trust must maintain a dollar-weighted average portfolio maturity of
not more than 90 days, and the maturity of any single security must not be in excess of the
maximum permitted maturity under Rule 2a-7 (or any other applicable rule) which is
currently 397 days from the date of purchase. The Trust also may buy adjustable and
floating rate securities, enter into repurchase agreements and lend portfolio securities.
Rule 2a-7 defines how the maturities of these securities are determined.

|X| Demand Features and Guarantees. Demand features and guarantees and some of their
uses are described in the Prospectus. The Trust also uses demand features and guarantees
to satisfy the maturity, quality and diversification requirements described above. The
Trust considers the person which issues the demand feature as the person to which the Trust
will look for payment. An unconditional demand feature is considered a guarantee and the
Trust looks to the person making the guarantee for payment of the obligation of the
underlying security.

When the Trust buys municipal securities, it may obtain a demand feature from the
seller to repurchase the securities that entitles the Trust to achieve same day settlement
from the repurchaser and to receive an exercise price equal to the amortized cost of the
underlying security plus accrued interest, if any, at the time of exercise. Another type
of demand feature purchased in conjunction with a Municipal Security enables the Trust to
sell the underlying security within a specified period of time at a fixed exercise price.
The Trust may pay for demand features either separately in cash or by paying a higher price
for the securities acquired subject to the demand features. The Trust will enter into
these transactions only with banks and dealers which, in the Manager's opinion, present
minimal credit risks. The Trust's purchases of demand features are subject to the
provisions of Rule 2a-7 under the Investment Company Act because the Trust uses the
amortized cost method to value its portfolio securities.

The Trust's ability to exercise a demand feature or guarantee will depend on the
ability of the bank or dealer to pay for the securities if the demand feature or guarantee
is exercised. If the bank or dealer should default on its obligation, the Trust might not
be able to recover all or a portion of any loss sustained from having to sell the security
elsewhere. Demand features and guarantees are not transferable by the Trust, and therefore
terminate if the Trust sells the underlying security to a third party. The Trust intends
to enter into these arrangements to facilitate portfolio liquidity, although such
arrangements may enable the Trust to sell a security at a pre-arranged price which may be
higher than the prevailing market price at the time the demand feature or guarantee is
exercised. Any considerations paid by the Trust for the demand feature (which increases the
cost of the security and reduces the yield otherwise available for the security) will be
reflected on the Trust's books as unrealized depreciation while the demand feature or
guarantee is held, and a realized gain or loss when demand feature is exercised or expires.

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.

U.S. government agencies and instrumentalities that issue or guarantee securities
include, but are not limited to, 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.

Securities issued or guaranteed by U.S. government agencies and instrumentalities are
not always 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. If the
securities are not backed by the full faith and credit of the United States, the purchaser
must look principally to the agency issuing the obligation for repayment and may not be
able to assert a claim against the United States if the issuing agency or instrumentality
does not meet its commitment. The Trust will invest in U.S. government securities of such
agencies and instrumentalities only when the Manager is satisfied that the credit risk with
respect to such instrumentality is minimal and that the security is an Eligible Security.

Repurchase Agreements. In a repurchase transaction, the Trust acquires a 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. An "approved vendor" may be a U.S. commercial bank or the U.S. branch of a
foreign bank having total domestic assets of at least $1 billion, or a broker-dealer with a
net capital of $50 million which has been designated a primary dealer in government
securities. They must meet credit requirements set by the Manager from time to time.

The majority of these transactions run from day to day, and delivery pursuant to the
resale typically will occur within one to five days of the purchase. The Trust will not
enter into a repurchase agreement that will cause more than 10% of its net assets to be
subject to repurchase agreements maturing in more than seven days.

Repurchase agreements are considered "loans" under the Investment Company Act,
collateralized by the underlying security. The Trust's repurchase agreements require that
at all times while the repurchase agreement is in effect, the collateral's value must equal
or exceed the repurchase price to fully collateralize the repayment obligation.
Additionally, the Manager will monitor the vendor's creditworthiness to confirm that the
vendor is financially sound and will continuously monitor the collateral's value. However,
if the vendor fails to pay the resale price on the delivery date, the Trust may incur costs
in disposing of the collateral and may experience losses if there is any delay in its
ability to do so.

Pursuant to an Exemptive Order issued by the SEC, the Trust, along with other
affiliated entities managed by the Manager, may transfer uninvested cash balances into one
or more joint repurchase accounts. These balances are invested in one or more repurchase
agreements, secured by U.S. government securities. Securities that are pledged as
collateral for repurchase agreements are held by a custodian bank until the agreements
mature. Each joint repurchase arrangement requires that the market value of the collateral
be sufficient to cover payments of interest and principal; however, in the event of default
by the other party to the agreement, retention or sale of the collateral may be subject to
legal proceedings.

|X| Floating Rate/Variable Rate Obligations. The Trust may invest in instruments with
floating or variable interest rates. The interest rate on a floating rate obligation is
based on a stated prevailing market rate, such as a bank's prime rate, the 90-day U.S.
Treasury Bill rate, the rate of return on commercial paper or bank certificates of deposit,
or some other standard. The rate on the investment is adjusted automatically each time the
market rate is adjusted. The interest rate on a variable rate obligation is also based on
a stated prevailing market rate but is adjusted automatically at a specified interval.
Some variable rate or floating rate obligations in which the Trust may invest have a demand
feature entitling the holder to demand payment of an amount approximately equal to the
amortized cost of the instrument or the principal amount of the instrument plus accrued
interest at any time, or at specified intervals not exceeding the maximum time permitted
under Rule 2a-7 (which is currently 397 days). These notes may or may not be backed by
bank letters of credit.

Variable rate demand notes may include master demand notes, which are obligations
that permit the Trust to invest fluctuating amounts in a note. The amount may change daily
without penalty, pursuant to direct arrangements between the Trust, as the note purchaser,
and the issuer of the note. The interest rates on these notes fluctuate from time to
time. The issuer of this type of obligation normally has a corresponding right in its
discretion, after a given period, to prepay the outstanding principal amount of the
obligation plus accrued interest. The issuer must give a specified number of days' notice
to the holders of those obligations. Generally, the changes in the interest rate on those
securities reduce the fluctuation in their market value. As interest rates decrease or
increase, the potential for capital appreciation or depreciation is less than that for
fixed-rate obligations having the same maturity.

Because these types of obligations are direct lending arrangements between the note
purchaser and issuer of the note, these instruments generally will not be traded.
Generally, there is no established secondary market for these types of obligations,
although they are redeemable from the issuer at face value. Accordingly, where these
obligations are not secured by letters of credit or other credit support arrangements, the
Trust's right to redeem them is dependent on the ability of the note issuer to pay
principal and interest on demand. These types of obligations usually are not rated by
credit rating agencies. The Trust may invest in obligations that are not rated only if the
Manager determines at the time of investment that they are eligible securities. The
Manager, on behalf of the Trust, will monitor the creditworthiness of the issuers of the
floating and variable rate obligations in the Trust's portfolio on an ongoing basis. There
is no limit on the amount of the Trust's assets that may be invested in floating rate and
variable rate obligations that meet the requirements of Rule 2a-7.

Other Investment Strategies

|X| Illiquid and Restricted Securities. Under the policies and procedures
established by the Trust's Board of Trustees and the Manager, the Manager determines the
liquidity of certain of the Trust's investments. Investments may be illiquid because of the
absence of an active trading market, making it difficult to value them or dispose of them
promptly at an acceptable price. A restricted security is one that has a contractual
restriction on its resale or which cannot be sold publicly until it is registered under the
Securities Act of 1933.

Illiquid securities the Trust can buy include issues that may be redeemed only by the
issuer upon more than seven days notice or at maturity, repurchase agreements maturing in
more than seven days, fixed time deposits subject to withdrawal penalties which mature in
more than seven days, and other securities that cannot be sold freely due to legal or
contractual restrictions on resale. Contractual restrictions on the resale of illiquid
securities might prevent or delay their sale by the Trust at a time when such sale would be
desirable.

There are restricted securities that are not illiquid that the Trust can buy. They
include certain master demand notes redeemable on demand, and short-term corporate debt
instruments that are related to current transactions of the issuer and therefore are exempt
from registration as commercial paper. Illiquid securities include repurchase agreements
maturing in more than seven days, or certain participation interests other than those with
puts exercisable within seven days.

|X| Loans of Portfolio Securities. To attempt to increase its income, the Trust may lend
its portfolio securities to brokers, dealers and other financial institutions. These loans
are limited to not more than 25% of the value of the Trust's total assets and are subject
to other conditions described below. The Trust will not enter into any securities lending
agreements having a maturity of greater than the maximum time permitted under Rule 2a-7.
The Trust presently does not intend to lend its portfolio securities, but if it does the
value of securities loaned will not exceed 5% of the value of the Trust's total assets in
the coming year. There are some risks in lending securities. The Trust could experience a
delay in receiving additional collateral to secure a loan, or a delay in recovering the
loaned securities.

The Trust may receive collateral for a loan. Any securities received as collateral
for a loan must mature in twelve months or less. Under current applicable regulatory
requirements (which are subject to change), on each business day the loan collateral must
be at least equal to the market value of the loaned securities. The collateral must
consist of cash, bank letters of credit, U.S. government securities or other cash
equivalents in which the Trust is permitted to invest. To be acceptable as collateral,
letters of credit must obligate a bank to pay amounts demanded by the Trust if the demand
meets the terms of the letter. Such terms and the issuing bank must be satisfactory to the
Trust.

When it lends securities, the Trust receives from the borrower an amount equal to the
interest paid or the dividends declared on the loaned securities during the term of the
loan. It may also receive negotiated loan fees and the interest on the collateral
securities, less any finders', custodian, administrative or other fees the Trust pays in
connection with the loan. The Trust may share the interest it receives on the collateral
securities with the borrower as long as it realizes at least a minimum amount of interest
required by the lending guidelines established by its Board of Trustees.

The Trust will not lend its portfolio securities to any officer, Trustee, employee or
affiliate of the Trust or its Manager. The terms of the Trust's loans must meet certain
tests under the Internal Revenue Code and permit the Trust to reacquire loaned securities
on five business days notice or in time to vote on any important matter.

Other Investment Restrictions

|X| What Are "Fundamental Policies?" Fundamental policies are those policies that
the Trust has adopted to govern its investments that can be changed only by the vote of a
"majority" of the Trust's outstanding voting securities. Under the Investment Company Act,
a "majority" vote is defined as the vote of the holders of the lesser of:
o 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
o more than 50% of the outstanding shares.

The Trust'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 Trust's Board of Trustees 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 Trust's most significant investment policies are described
in the Prospectus.

|X| Does the Trust Have Additional Fundamental Policies? The following investment
restrictions are fundamental policies of the Trust.

o The Trust cannot enter into repurchase agreements maturing in more than seven days or
purchase securities which are restricted as to resale or for which market
quotations are not readily available, if any such investment would cause more
than 10% of the Trust's assets to be invested in such securities.

o The Trust cannot borrow money in excess of 10% of the value of its total assets, and
then only as a temporary measure for extraordinary or emergency purposes;
provided that the Trust will not make any investment at a time during which
such borrowing exceeds 5% of the value of its assets; no assets of the Trust
may be pledged, mortgaged or assigned to secure a debt.

o The Trust cannot make loans, except through (i) the purchase of debt securities
listed in the Prospectus under "Investment Objective and Policies," (ii) the
purchase of such debt securities subject to repurchase agreements, or (iii)
loans of securities as described under "Other Investment Strategies - Loans of
Portfolio Securities," in this Statement of Additional Information.

o The Trust cannot invest in commodities or commodity contracts or invest in interests
in oil, gas or other mineral exploration or development programs.

o The Trust cannot invest in real estate.

o The Trust cannot purchase securities on margin or make short sales of securities.

o The Trust cannot invest in or hold securities of any issuer if those officers and
Trustees of the Trust or its advisor who beneficially own individually more
than 0.5% of the securities of such issuer together own more than 5% of the
securities of such issuer.

o The Trust cannot underwrite securities of other companies.

o The Trust cannot invest in securities of other investment companies, except as they
may be acquired as part of a merger, consolidation or acquisition of assets.

o The Trust cannot issue "senior securities," but this does not prohibit certain
investment activities for which assets of the Trust are designated as
segregated, or margin, collateral or escrow arrangements are established, to
cover the related obligations.

o The Trust cannot invest in any debt instrument having a remaining maturity in excess
of the maturity limitation in Rule 2a-7 of the Investment Company Act, as it
may be amended from time to time, or any other applicable rule, unless it is a
debt instrument that is (1) subject to a repurchase agreement, (2) called for
redemption, or (3) purchased subject to a demand feature such that the security
is due and payable within the remaining maturity limitation in Rule 2a-7.

o The Trust cannot concentrate investment in any particular industry. Therefore the
Trust will not purchase the securities of issuers in any one industry if as a
result of that purchase 25% or more of the value of the Trust's total assets
would consist of securities of issuers in that industry. The Trust's
investments in U.S. government securities and bank obligations located in the
United States (other than obligations of foreign branches of domestic banks and
obligations issued or guaranteed by foreign banks) are not subject to this
limitation.

For the purpose of the Trust's policy not to concentrate its investments as described
above, the Trust has adopted classifications of industries and groups or related
industries. These classifications are not fundamental.

Disclosure of Portfolio Holdings. The Trust has adopted policies and procedures concerning
the dissemination of information about its portfolio holdings by employees, officers and/or
trustees of the Manager, Distributor, Sub-Distributor and Transfer Agent. These policies
are designed to assure that non-public information about portfolio securities is
distributed only for a legitimate business purpose, and is done in a manner that (a)
conforms to applicable laws and regulations and (b) is designed to prevent that information
from being used in a way that could negatively affect the Trust's investment program or
enable third parties to use that information in a manner that is harmful to the Trust.

o Public Disclosure. The Trust's portfolio holdings are made publicly available no
later than 60 days after the close of each of the Trust's fiscal quarters in its
semi-annual report to shareholders and its annual report to shareholders, or its
Statements of Investments on Form N-Q. Those documents are publicly available at the
SEC.

Until publicly disclosed the Trust's portfolio holdings are proprietary, confidential
business information. While recognizing the importance of providing the Trust's
shareholders with information about their Trust's investments and providing portfolio
information to a variety of third parties to assist with the management, distribution and
administrative process, the need for transparency must be balanced against the risk that
third parties who gain access to the Trust's portfolio holdings information could attempt
to use that information to trade ahead of or against the Trust, which could negatively
affect the prices the Trust is able to obtain in portfolio transactions or the availability
of the securities that portfolio managers are trading on the Trust's behalf.

The Manager and its subsidiaries and affiliates, employees, officers, and directors,
shall neither solicit, nor accept any compensation or other consideration (including any
agreement to maintain assets in the Trust or in other investment companies or accounts
managed by the Manager or any affiliated person of the Manager) in connection with the
disclosure the Trust's non-public portfolio holdings. The receipt of investment advisory
fees or other fees and compensation paid to the Manager and its subsidiaries pursuant to
agreements approved by the Trust's Board shall not be deemed to be "compensation" or
"consideration" for these purposes. It is a violation of the Code of Ethics for any
covered person to release holdings in contravention of portfolio holdings disclosure
policies and procedures adopted by the Trust.

A list of the top 20 securities holdings (based on invested assets), listed by
security or by issuer, as of the end of each month may be disclosed to third parties
(subject to the procedures below) no sooner than 15 days after month-end.

Except under special limited circumstances discussed below, month-end lists of the
Trust's complete portfolio holdings may be disclosed no sooner than 30-days after the
relevant month-end, subject to the procedures below. If the Trust's complete portfolio
holdings have not been disclosed publicly, they may be disclosed pursuant to special
requests for legitimate business reasons, provided that:

o The third-party recipient must first submit a request for release of Trust portfolio
holdings, explaining the business reason for the request;
o Senior officers (a Senior Vice President or above) in the Manager's Portfolio and
Legal departments must approve the completed request for release of Trust
portfolio holdings; and
o The third-party recipient must sign the Manager's portfolio holdings non-disclosure
agreement before receiving the data, agreeing to keep information that is not
publicly available regarding the Trust's holdings confidential and agreeing not
to trade directly or indirectly based on the information.

The Trust's complete portfolio holdings positions may be released to the following
categories of entities or individuals on an ongoing basis, provided that such entity or
individual either (1) has signed an agreement to keep such information confidential and
not trade on the basis of such information or (2) is subject to fiduciary obligations,
as a member of the Trust's Board, or as an employee, officer and/or director of the
Manager, Distributor, Sub-Distributor or Transfer Agent, or their respective legal
counsel, not to disclose such information except in conformity with these policies and
procedures and not to trade for his/her personal account on the basis of such
information:

o Employees of the Trust's Manager, Sub-Distributor, Distributor and Transfer Agent who
need to have access to such information (as determined by senior officers of
such entity),
o The Trust's independent registered public accounting firm,
o Members of the Trust's Board and the Board's legal counsel,
o The Trust's custodian bank,
o A proxy voting service designated by the Trust and its Board,
o Rating/ranking organizations (such as Lipper and Morningstar),
o Portfolio pricing services retained by the Manager to provide portfolio security
prices, and
o Dealers, to obtain bids (price quotations if securities are not priced by the Trust's
regular pricing services).

Portfolio holdings information of the Trust may be provided, under limited
circumstances, to brokers and/or dealers with whom the Trust trades and/or entities
that provide investment coverage and/or analytical information regarding the Trust's
portfolio, provided that there is a legitimate investment reason for providing the
information to the broker, dealer or other entity. Month-end portfolio holdings
information may, under this procedure, be provided to vendors providing research
information and/or analytics to the Trust, with at least a 15-day delay after the month
end, but in certain cases may be provided to a broker or analytical vendor with a 1-2
day lag to facilitate the provision of requested investment information to the Manager
to facilitate a particular trade or the portfolio manager's investment process for the
Trust. Any third party receiving such information must first sign the Manager's
portfolio holdings non-disclosure agreement as a pre-condition to receiving this
information.

Portfolio holdings information (which may include information on individual
securities positions or multiple securities) may be provided to the entities listed
below (1) by portfolio traders employed by the Manager in connection with portfolio
trading, and (2) by the members of the Manager's Security Valuation Group and
Accounting Departments in connection with portfolio pricing or other portfolio
evaluation purposes:
o Brokers and dealers in connection with portfolio transactions (purchases and sales)
o Brokers and dealers to obtain bids or bid and asked prices (if securities held by
the Trust are not priced by the Trust's regular pricing services)
o Dealers to obtain price quotations where the Trust is not identified as the owner

Portfolio holdings information (which may include information on the Trust's entire
portfolio or individual securities therein) may be provided by senior officers of the
Manager or attorneys on the legal staff of the Manager, Distributor, or Transfer Agent,
in the following circumstances:

o Response to legal process in litigation matters, such as responses to subpoenas or in
class action matters where the Trust may be part of the plaintiff class (and
seeks recovery for losses on a security) or a defendant,
o Response to regulatory requests for information (the SEC, Financial Industry
Regulatory Authority ("FINRA"), state securities regulators, and/or foreign
securities authorities, including without limitation requests for information
in inspections or for position reporting purposes),
o To potential sub-advisers of portfolios (pursuant to confidentiality agreements),
o To consultants for retirement plans for plan sponsors/discussions at due diligence
meetings (pursuant to confidentiality agreements),
o Investment bankers in connection with merger discussions (pursuant to confidentiality
agreements)

Portfolio managers and analysts may, subject to the Manager's policies on
communications with the press and other media, discuss portfolio information in interviews
with members of the media, or in due diligence or similar meetings with clients or
prospective purchasers of Trust shares or their financial intermediary representatives.

The Trust's shareholders may, under unusual circumstances (such as a lack of
liquidity in the Trust's portfolio to meet redemptions), receive redemption proceeds of
their Trust shares paid as pro rata shares of securities held in the Trust's portfolio. In
such circumstances, disclosure of the Trust's portfolio holdings may be made to such
shareholders.

Any permitted release of non-public portfolio holdings information must be in
accordance with the Trust's then-current policy on approved methods for communicating
confidential information, including but not limited to the Trust's policy as to use of
secure e-mail technology.

The Chief Compliance Officer of the Trust and the Manager, Sub-Distributor,
Distributor, and Transfer Agent (the "CCO") shall oversee the compliance by the Manager,
Sub-Distributor, Distributor, Transfer Agent, and their personnel with these policies and
procedures. At least annually, the CCO shall report to the Trust's Board on such compliance
oversight and on the categories of entities and individuals to which disclosure of
portfolio holdings of the Trust has been made during the preceding year pursuant to these
policies. The CCO shall report to the Trust's Board any material violation of these
policies and procedures and shall make recommendations to the Boards as to any amendments
that the CCO believes are necessary and desirable to carry out or improve these policies
and procedure.

The Manager and/or the Trust have entered into ongoing arrangements to make available
information about the Trust's portfolio holdings. One or more of the Oppenheimer funds may
currently disclose portfolio holdings information based on ongoing arrangements to the
following parties:

ABG Securities Fixed Income Securities Nomura Securities
ABN AMRO Fortis Securities Oppenheimer & Co.
AG Edwards Fox-Pitt, Kelton Oscar Gruss
Allen & Co Friedman, Billing, OTA
Ramsey
American Technology Research Gabelli Pacific Crest Securities
Auerbach Grayson Garp Research Piper Jaffray Inc.
Avondale Gartner Portales Partners
Banc of America Securities George K Baum & Co. Punk Ziegel & Co
Barra Goldman Sachs Raymond James
BB&T Howard Weil RBC
Bear Stearns HSBC Reuters
Belle Haven ISI Group RiskMetrics/ISS
Bloomberg ITG Robert W. Baird
BMO Capital Markets Janco Roosevelt & Cross
BNP Paribas Janney Montgomery Russell
Brean Murray Jefferies Sandler O'Neil
Brown Brothers JMP Securities Sanford C. Bernstein
Buckingham Research Group JNK Securities Scotia Capital Markets
Canaccord Adams Johnson Rice & Co Sidoti
Caris & Co. JP Morgan Securities Simmons
CIBC World Markets Kaufman Brothers Sander Morris Harris
Citigroup Global Markets Keefe, Bruyette & Woods Societe Generale
CJS Securities Keijser Securities Soleil Securities Group
Cleveland Research Kempen & Co. USA Inc. Standard & Poors
Cogent Kepler Equities/Julius Stanford Group
Baer Sec
Collins Stewart KeyBanc Capital Markets State Street Bank
Cowen & Company Lazard Freres & Co Stephens, Inc.
Craig-Hallum Capital Group Leerink Swan Stifel Nicolaus
LLC
Credit Agricole Cheuvreux Lehman Brothers Stone & Youngberg
N.A. Inc.
Credit Suisse Loop Capital Markets Strategas Research
Data Communique Louise Yamada Tech Sungard
Research
Daiwa Securities MainFirst Bank AG Suntrust Robinson
Humphrey
Davy Makinson Cowell US Ltd SWS Group
Deutsche Bank Securities McAdmas Wright Think Equity Partners
Dougherty Markets Merrill Lynch Thomas Weisel Partners
Dowling Miller Tabak Thomson Financial
Empirical Research Mizuho Securities UBS
Enskilda Securities Moodys Research Virtusa Corporation
Exane BNP Paribas Morgan Stanley Wachovia Securities
Factset Natexis Bleichroeder Wedbush
Fidelity Capital Markets Ned Davis Research Group Weeden
First Albany Needham & Co William Blair

How the Trust is Managed

Organization and History. The Trust is an open-end, diversified management investment
company organized as a Massachusetts business trust in 1982, with an unlimited number of
authorized shares of beneficial interest.

|X| Classes of Shares. The Trust has a single class of shares of stock. While that class
has no designation, it is deemed to be the equivalent of Class A for purposes of the
shareholder account policies that apply to Class A shares of the Oppenheimer funds.

Shares of the Trust are freely transferable. Each share has one vote at shareholder
meetings, with fractional shares voting proportionally on matters submitted to a vote of
shareholders. There are no preemptive or conversion rights and shares participate equally
in the assets of the Trust upon liquidation.

|X| Meetings of Shareholders. As a Massachusetts business trust, the Trust is not
required to hold, and does not plan to hold, regular annual meetings of shareholders, but
may hold meetings from time to time on important matters or when required to do so by the
Investment Company Act or other applicable law. Shareholders have the right, upon a vote
or declaration in writing of two-thirds of the outstanding shares of the Trust to remove a
Trustee or to take other action described in the Trust's Declaration of Trust.

The Trustees will call a meeting of shareholders to vote on the removal of a Trustee
upon the written request of the record holders of 10% of its outstanding shares. If the
Trustees receive a request from at least 10 shareholders stating that they wish to
communicate with other shareholders to request a meeting to remove a Trustee, the Trustees
will then either make the Trust's shareholder list available to the applicants or mail
their communication to all other shareholders at the applicants' expense. The shareholders
making the request must have been shareholders for at least six months and must hold shares
of the Trust valued at $25,000 or more or constituting at least 1% of the Trust's
outstanding shares, whichever is less. The Trustees may also take other action as permitted
by the Investment Company Act.

|X| Shareholder and Trustee Liability. The Trust's Declaration of Trust contains an
express disclaimer of shareholder or Trustee liability for the Trust's obligations. It also
provides for indemnification and reimbursement of expenses out of the Trust's property for
any shareholder held personally liable for its obligations. The Declaration of Trust also
states that upon request, the Trust shall assume the defense of any claim made against a
shareholder for any act or obligation of the Trust and shall satisfy any judgment on that
claim. Massachusetts law permits a shareholder of a business trust (such as the Trust) to
be held personally liable as a "partner" under certain circumstances. However, the risk
that a Trust shareholder will incur financial loss from being held liable as a "partner" of
the Trust is limited to the relatively remote circumstances in which the Trust would be
unable to meet its obligations.

The Trust's contractual arrangements state that any person doing business with the
Trust (and each shareholder of the Trust) agrees under its Declaration of Trust to look
solely to the assets of the Trust for satisfaction of any claim or demand that may arise
out of any dealings with the Trust and that the Trustees shall have no personal liability
to any such person, to the extent permitted by law.

Board of Trustees and Oversight Committees. The Trust is governed by a Board of Trustees,
which is responsible for protecting the interests of shareholders under Massachusetts law.
The Trustees meet periodically throughout the year to oversee the Trust's activities,
review its performance, and review the actions of the Manager.

The Audit Committee held 4 meetings during the Trust's fiscal year ended June 30,
2008. The Review Committee held 4 meetings during the Trust's fiscal year ended June 30,
2008. The Governance Committee held 2 meetings during the Trust's fiscal year ended June
30, 2008.

The Board of Trustees has an Audit Committee, a Review Committee and a Governance
Committee. Each committee is comprised solely of Trustees who are not "interested persons"
under the Investment Company Act (the "Independent Trustees"). The members of the Audit
Committee are George C. Bowen (Chairman), Edward L. Cameron, Robert J. Malone and F.
William Marshall, Jr. The Audit Committee furnishes the Board with recommendations
regarding the selection of the Fund's independent registered public accounting firm (also
referred to as the "independent Auditors"). Other main functions of the Audit Committee,
outlined in the Audit Committee Charter, include, but are not limited to: (i) reviewing the
scope and results of financial statement audits and the audit fees charged; (ii) reviewing
reports from the Trust's independent Auditors regarding the Trust's internal accounting
procedures and controls; (iii) reviewing reports from the Manager's Internal Audit
Department; (iv) reviewing certain reports from and meet periodically with the Trust's
Chief Compliance Officer; (v) maintaining a separate line of communication between the
Trust's independent Auditors and the Independent Trustees; (vi) reviewing the independence
of the Trust's independent Auditors; (vii) pre-approving the provision of any audit or
non-audit services by the Trust's independent Auditors, including tax services, that are
not prohibited by the Sarbanes-Oxley Act, to the Trust, the Manager and certain affiliates
of the Manager.

The Review Committee is comprised solely of Independent Trustees. The members of the
Review Committee are Sam Freedman (Chairman), Jon S. Fossel, Richard F. Grabish, and
Beverly L. Hamilton. Among other duties, as set forth in the Review Committee's Charter,
the Review Committee reports and makes recommendations to the Board concerning the fees
paid to the Trust's transfer agent and the Manager and the services provided to the Trust
by the transfer agent and the Manager. The Review Committee also reviews the Trust's
investment performance as well as the policies and procedures adopted by the Trust to
comply with the Investment Company Act and other applicable law.

The Governance Committee is comprised solely of Independent Trustees. The members of
the Governance Committee are, Robert J. Malone (Chairman), William Armstrong, Edward L.
Cameron, Beverly L. Hamilton and F. William Marshall, Jr. The Governance Committee has
adopted a charter setting forth its duties and responsibilities. Among other duties, the
Governance Committee reviews and oversees the Trust's governance guidelines, the adequacy
of the Trust's Codes of Ethics and the nomination of Trustees, including Independent
Trustees. The Governance Committee has adopted a process for shareholder submission of
nominees for board positions. Shareholders may submit names of individuals, accompanied by
complete and properly supported resumes, for the Governance Committee's consideration by
mailing such information to the Governance Committee in care of the Trust. The Governance
Committee may consider such persons at such time as it meets to consider possible nominees.
The Governance Committee, however, reserves sole discretion to determine which candidates
for Trustees and Independent Trustees it will recommend to the Board and/or shareholders
and it may identify candidates other than those submitted by Shareholders. The Governance
Committee may, but need not, consider the advice and recommendation of the Manager and/or
its affiliates in selecting nominees. The full Board elects new Trustees except for those
instances when a shareholder vote is required.

Shareholders who desire to communicate with the Board should address correspondence
to the Board or an individual Board member and may submit their correspondence
electronically at www.oppenheimerfunds.com under the caption "contact us" or by mail to the
Trust at the address below.

Trustees and Officers of the Trust. Except for Mr. Murphy, each of the Trustees is an
Independent Trustee. All of the Trustees are also trustees or directors of the following
Oppenheimer/Centennial funds (referred to as (Board II Funds"), except for Mr. Grabish who
serves as a Trustee for only the following funds: Centennial California Tax Exempt Trust,
Centennial Government Trust, Centennial Money Market Trust, Centennial New York Tax Exempt
Trust, Centennial Tax Exempt Trust, Oppenheimer Core Bond Fund, Oppenheimer Limited-Term
Government Fund, Panorama Series Fund, Inc., Oppenheimer Principal Protected Trust,
Oppenheimer Principal Protected Trust II, Oppenheimer Principal Protected Trust III,
Oppenheimer Senior Floating Rate Fund, Oppenheimer Portfolio Series Fixed Income Active
Allocation Fund, Oppenheimer Master Event-Linked Bond Fund, LLC and Oppenheimer Master Loan
Fund, LLC:

Oppenheimer Principal Protected
Oppenheimer Cash Reserves Trust
Oppenheimer Principal Protected
Oppenheimer Capital Income Fund Trust II
Oppenheimer Principal Protected
Oppenheimer Champion Income Fund Trust III
Oppenheimer Commodity Strategy Total Oppenheimer Senior Floating Rate
Return Fund Fund
Oppenheimer Equity Fund, Inc. Oppenheimer Strategic Income Fund
Oppenheimer Integrity Funds Oppenheimer Variable Account Funds
Oppenheimer International Bond Fund Panorama Series Fund, Inc.
Oppenheimer Limited-Term Government Fund
Oppenheimer Main Street Funds, Inc.
Oppenheimer Main Street Opportunity Fund
Centennial California Tax Exempt
Oppenheimer Main Street Small Cap Fund Trust
Oppenheimer Master Event-Linked Bond
Fund, LLC Centennial Government Trust
Oppenheimer Master Loan Fund, LLC Centennial Money Market Trust
Centennial New York Tax Exempt
Oppenheimer Municipal Fund Trust
Oppenheimer Portfolio Series Fixed Income
Active Allocation Fund Centennial Tax Exempt Trust

Present or former officers, directors, trustees and employees (and their immediate family
members) of the Trust, the Manager and its affiliates, and retirement plans established by
them for their employees are permitted to purchase Class A shares of the Trust and the
other Oppenheimer funds at net asset value without sales charge. The sales charge on Class
A shares is waived for that group because of the reduced sales efforts realized by the
Distributor. Present or former officers, directors, trustees and employees (and their
eligible family members) of the Trust, the Manager and its affiliates, its parent company
and the subsidiaries of its parent company, and retirement plans established for the
benefit of such individuals, are also permitted to purchase Class Y shares of the
Oppenheimer funds that offer Class Y shares.

Messrs. Murphy, Petersen, Szilagyi, Vandehey, Wixted and Zack and Mss. Wolf,
Bloomberg, and Ives who are officers of the Trust, hold the same offices with one or more
of the other Board II Funds. As of October 6, 2008 the Trustees and officers of the Trust,
as a group, owned of record or beneficially less than 1% of the shares of the Trust. The
foregoing statement does not reflect ownership of shares held of record by an employee
benefit plan for employees of the Manager, other than the shares beneficially owned under
that plan by the officers of the Board II Funds. In addition, none of the Independent
Trustees (nor any of their immediate family members) owns securities of either the Manager,
Distributor or the Sub-Distributor, or of any entity directly or indirectly controlling,
controlled by or under common control with the Manager, Distributor or the Sub-Distributor
of the Board II Funds.

Biographical Information. The Trustees and officers, their positions with the Trust,
length of service in such position(s), and principal occupations and business affiliations
during at least the past five years are listed in the charts below. The charts also include
information about each Trustee's beneficial share ownership in the Trust and in all of the
registered investment companies that the Trustee oversees in the Oppenheimer family of
funds ("Supervised Funds"). The address of each Trustee in the chart below is 6803 S.
Tucson Way, Centennial, Colorado 80112-3924. Each Trustee serves for an indefinite term, or
until his or her resignation, retirement, death or removal.

-------------------------------------------------------------------------------------
Independent Trustees
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Name, Principal Occupation(s) During Past 5 Dollar Aggregate
Dollar
Range of
Shares
Range of Beneficially
Position(s) Held Shares Owned in
with the Trust, Years; Other Trusteeships/Directorships Beneficially all
Length of Service, Held; Number of Portfolios in Fund Owned in Supervised
Age Complex Currently Overseen the Trust Funds
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
As of December 31, 2007
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
William L. President, Colorado Christian University None Over
Armstrong, (since 2006); Chairman, Cherry Creek $100,000
Chairman of the Mortgage Company (since 1991), Chairman,
Board since 2003, Centennial State Mortgage Company (since
Trustee since 2000 1994), Chairman, The El Paso Mortgage
Age: 71 Company (since 1993); Chairman,
Ambassador Media Corporation (since
1984); Chairman, Broadway Ventures
(since 1984); Director of Helmerich &
Payne, Inc. (oil and gas
drilling/production company) (since
1992), Campus Crusade for Christ
(non-profit) (since 1991); Former
Director, The Lynde and Harry Bradley
Foundation, Inc. (non-profit
organization) (2002-2006); former
Chairman of: Transland Financial
Services, Inc. (private mortgage banking
company) (1997-2003), Great Frontier
Insurance (1995-2000), Frontier Real
Estate, Inc. (residential real estate
brokerage) (1994-2000) and Frontier
Title (title insurance agency)
(1995-2000); former Director of the
following: UNUMProvident (insurance
company) (1991-2004), Storage Technology
Corporation (computer equipment company)
(1991-2003) and International Family
Entertainment (television channel)
(1992-1997); U.S. Senator (January
1979-January 1991). Oversees 39
portfolios in the OppenheimerFunds
complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
George C. Bowen, Assistant Secretary and Director of the None Over
Trustee since 1998 Manager (December 1991-April 1999); $100,000
Age: 71 President, Treasurer and Director of
Centennial Capital Corporation (June
1989-April 1999); Chief Executive
Officer and Director of MultiSource
Services, Inc. (March 1996-April 1999);
Mr. Bowen held several positions with
OppenheimerFunds, Inc. and with
subsidiary or affiliated companies of
OppenheimerFunds, Inc. (September
1987-April 1999). Oversees 39 portfolios
in the OppenheimerFunds complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Edward L. Member of The Life Guard of Mount Vernon None Over
Cameron, Trustee (George Washington historical site) $100,000
since 2000 (June 2000 - June 2006); Partner of
Age: 70 PricewaterhouseCoopers LLP (accounting
firm) (July 1974-June 1999); Chairman of
Price Waterhouse LLP Global Investment
Management Industry Services Group
(financial services firm) (July
1994-June 1998). Oversees 39 portfolios
in the OppenheimerFunds complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Jon S. Fossel, Director of UNUMProvident (insurance None Over
Trustee since 1990 $100,000
Age: 66 company) (since June 2002); Director of
Northwestern Energy Corp. (public
utility corporation) (since November
2004); Director of P.R. Pharmaceuticals
(October 1999-October 2003); Director of
Rocky Mountain Elk Foundation
(non-profit organization) (February
1998-February 2003 and February
2005-February 2007); Chairman and
Director (until October 1996) and
President and Chief Executive Officer
(until October 1995) of
OppenheimerFunds, Inc.; President, Chief
Executive Officer and Director of the
following: Oppenheimer Acquisition Corp.
("OAC") (parent holding company of
OppenheimerFunds, Inc.), Shareholders
Services, Inc. and Shareholder Financial
Services, Inc. (until October 1995).
Oversees 39 portfolios in the
OppenheimerFunds complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Sam Freedman, Director of Colorado UpLIFT (charitable None Over
Trustee since 1996 $100,000
Age: 67 organization) (since September 1984).
Mr. Freedman held several positions with
OppenheimerFunds, Inc. and with
subsidiary or affiliated companies of
OppenheimerFunds, Inc. (until October
1994). Oversees 39 portfolios in the
OppenheimerFunds complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Richard F. Formerly Senior Vice President and None Over
Grabish, Assistant Director of Sales and $100,000
Trustee since 2001 Marketing (March 1997-December 2007),
Age: 60 Director (March 1987-December 2007) and
Manager of Private Client Services (June
1985-June 2005) of A.G. Edwards & Sons,
Inc. (broker/dealer and investment
firm); Chairman and Chief Executive
Officer of A.G. Edwards Trust Company,
FSB (March 2001-December 2007);
President and Vice Chairman of A.G.
Edwards Trust Company, FSB (investment
adviser) (April 1987-March 2001);
President of A.G. Edwards Trust Company,
FSB (investment adviser) (June
2005-December 2007). Oversees 17
portfolios in the OppenheimerFunds
complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Beverly L. Trustee of Monterey Institute for None Over
Hamilton, Trustee International Studies (educational $100,000
since 2002 organization) (since February 2000);
Age: 61 Board Member of Middlebury College
(educational organization) (since
December 2005); Director of The
California Endowment (philanthropic
organization) (since April 2002);
Director (February 2002-2005) and
Chairman of Trustees (2006-2007) of the
Community Hospital of Monterey
Peninsula; Director (October 1991-2005)
and Vice Chairman (since 2006) of
American Funds' Emerging Markets Growth
Fund, Inc. (mutual fund); President of
ARCO Investment Management Company
(February 1991-April 2000); Member of
the investment committees of The
Rockefeller Foundation (2001-2006) and
The University of Michigan (since 2000);
Advisor at Credit Suisse First Boston's
Sprout venture capital unit (venture
capital fund) (1994-January 2005);
Trustee of MassMutual Institutional
Funds (investment company) (1996-June
2004); Trustee of MML Series Investment
Fund (investment company) (April
1989-June 2004); Member of the
investment committee of Hartford
Hospital (2000-2003); and Advisor to
Unilever (Holland) pension fund
(2000-2003). Oversees 39 portfolios in
the OppenheimerFunds complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Robert J. Malone, Board of Directors of Opera Colorado None Over
Trustee since 2002 Foundation (non-profit organization) $100,000
Age: 64 (since March 2008); Director of Jones
Knowledge, Inc. (since 2006); Director
of Jones International University
(educational organization) (since August
2005); Chairman, Chief Executive Officer
and Director of Steele Street Bank &
Trust (commercial banking) (since August
2003); Director of Colorado UpLIFT
(charitable organization) (since 1986);
Trustee of the Gallagher Family
Foundation (non-profit organization)
(since 2000); Former Chairman of U.S.
Bank-Colorado (subsidiary of U.S.
Bancorp and formerly Colorado National
Bank) (July 1996-April 1999); Director
of Commercial Assets, Inc. (real estate
investment trust) (1993-2000); Director
of Jones Knowledge, Inc. (2001-July
2004); and Director of U.S. Exploration,
Inc. (oil and gas exploration)
(1997-February 2004). Oversees 39
portfolios in the OppenheimerFunds
complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
F. William Trustee of MassMutual Select Funds None Over
Marshall, Jr., (formerly MassMutual Institutional $100,000
Trustee since 2002 Funds) (investment company) (since 1996)
Age: 66 and MML Series Investment Fund
(investment company) (since 1996);
Trustee of Worcester Polytech Institute
(since 1985); Chairman (since 1994) of
the Investment Committee of the
Worcester Polytech Institute (private
university); President and Treasurer of
the SIS Funds (private charitable fund)
(since January 1999); Chairman of SIS &
Family Bank, F.S.B. (formerly SIS Bank)
(commercial bank) (January 1999-July
1999); and Executive Vice President of
Peoples Heritage Financial Group, Inc.
(commercial bank) (January 1999-July
1999). Oversees 41 portfolios in the
OppenheimerFunds complex.*
-------------------------------------------------------------------------------------

* Includes two open-end investment companies: MassMutual Select Funds and MML Series
Investment Fund. In accordance with the instructions for SEC Form N-1A, for purposes of
this section only, MassMutual Select Funds and MML Series Investment Fund are included
in the "Fund Complex." The Manager does not consider MassMutual Select Funds and MML
Series Investment Fund to be part of the OppenheimerFunds' "Fund Complex" as that term
may be otherwise interpreted.

Mr. Murphy is an "Interested Trustee" because he is affiliated with the Manager and
OppenheimerFunds, Inc. by virtue of his positions as an officer and director of the Manager
and OppenheimerFunds, Inc., and as a shareholder of its parent company. The address of Mr.
Murphy is Two World Financial Center, 225 Liberty Street, 11th Floor, New York, New York
10281-1008. Mr. Murphy serves as a Trustee for an indefinite term, or until his
resignation, retirement, death or removal and as an officer for an indefinite term, until
his resignation, death or removal. Mr. Murphy was elected as a Trustee of the Trust with
the understanding that in the event he ceases to be the Chief Executive Officer of the
OppenheimerFunds, Inc. he will resign as a Trustee of the Trust and the other Board II
Funds (defined above) for which he is a director or trustee.

------------------------------------------------------------------------------------
Interested Trustee and Officer
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
Name, Principal Occupation(s) During Past 5 Dollar Aggregate
Dollar
Range of
y Shares
Position(s) Held Range of Beneficially
with the Trust, Shares Owned in
Length of Years / Other Trusteeships/Directorships Beneficiall All
Service, Held by Trustee / Number of Portfolios in Owned in Supervised
Age Fund Complex Currently Overseen by Trustee the Trust Funds
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
As of December 31,
2007
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
John V. Murphy, Chairman, Chief Executive Officer and None Over
Trustee since Director of OppenheimerFunds, Inc. (since
2003 and June 2001); President of
President and OppenheimerFunds, Inc. (September
Principal 2000-February 2007); President and
Executive director or trustee of other Oppenheimer
Officer since funds; President and Director of
2001 Oppenheimer Acquisition Corp. ("OAC")
Age: 59 (the Manager's parent holding company)
and of Oppenheimer Partnership Holdings,
Inc. (holding company subsidiary of
OppenheimerFunds, Inc.) (since July
2001); Director of OppenheimerFunds
Distributor, Inc. (subsidiary of
OppenheimerFunds, Inc.) November
2001-December 2006); Chairman and
Director of Shareholder Services, Inc.
and of Shareholder Financial Services,
Inc. (transfer agent subsidiaries of
OppenheimerFunds, Inc.) (since July
2001); President and Director of
OppenheimerFunds Legacy Program
(charitable trust program established by
OppenheimerFunds, Inc.) (since July
2001); Director of the following
investment advisory subsidiaries of
OppenheimerFunds, Inc.: the Manager, OFI
Institutional Asset Management, Inc.,
Trinity Investment Management Corporation
and Tremont Capital Management, Inc.
(since November 2001), HarbourView Asset
Management Corporation and OFI Private
Investments, Inc. (since July 2001);
President (since November 2001) and
Director (since July 2001) of Oppenheimer
Real Asset Management, Inc.; Executive $100,000
Vice President of Massachusetts Mutual
Life Insurance Company (OAC's parent
company) (since February 1997); Director
of DLB Acquisition Corporation (holding
company parent of Babson Capital
Management LLC) (since June 1995);
Chairman (since October 2007) and Member
of the Investment Company Institute's
Board of Governors (since October 2003).
Oversees 103 portfolios in the
OppenheimerFunds complex.
------------------------------------------------------------------------------------

The addresses of the officers in the chart below is as follows: Mr. Zack and Ms.
Bloomberg, Two World Financial Center, 225 Liberty Street, New York, New York 10281-1008,
for Messrs. Petersen, Szilagyi, Vandehey and Wixted and Mss. Wolf and Ives, 6803 S. Tucson
Way, Centennial, Colorado 80112-3924. Each officer serves for an indefinite term, which
would end: (a) upon the request of the Board, (b) if he or she is no longer an officer of
the Manager., (c) if a material change in his or her duties occurs that are inconsistent
with a position as officer the Fund, or (d) upon his or her resignation, retirement, or
death.

---------------------------------------------------------------------------------
Other Officers of the Trust
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Name, Position(s) Held Principal Occupation(s) During Past 5 Years
with the Trust, Length
of Service, Age
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Carol E. Wolf, Senior Vice President of OppenheimerFunds, Inc. (since
Senior Vice President June 2000) and Harborview Asset Management
and Portfolio Manager Corporation (since June 2003); Vice President of the
since 1990 Manager (since August 2004), an officer of 9 portfolios
Age: 56 in the OppenheimerFunds complex.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark S. Vandehey, Senior Vice President and Chief Compliance Officer of
Vice President and OppenheimerFunds, Inc. (since March 2004); Chief
Chief Compliance Compliance Officer of OppenheimerFunds Distributor,
Officer since 2004 Inc., and Shareholder Services, Inc. (since March
Age: 58 2004); Vice President of the Manager, OppenheimerFunds
Distributor, Inc., and Shareholder Services, Inc.
(since June 1983); Former Vice President and Director
of Internal Audit of OppenheimerFunds, Inc.
(1997-February 2004). An officer of 103 portfolios in
the Oppenheimer funds complex.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian W. Wixted, Senior Vice President and Treasurer of
Treasurer and OppenheimerFunds, Inc. (since March 1999); Treasurer of
Principal Financial & the following: Shareholder Services, Inc., HarbourView
Accounting Officer Asset Management Corporation, Shareholder Financial
since 1999 Services, Inc., Oppenheimer Real Asset Management, Inc.
Age: 48 and Oppenheimer Partnership Holdings, Inc. (since March
1999), OFI Private Investments, Inc. (since March
2000), OppenheimerFunds International Ltd. and
OppenheimerFunds plc (since May 2000), OFI
Institutional Asset Management, Inc. (since November
2000), and OppenheimerFunds Legacy Program (charitable
trust program established by the Manager) (since June
2003); Treasurer and Chief Financial Officer of OFI
Trust Company (trust company subsidiary of
OppenheimerFunds, Inc.) (since May 2000); Assistant
Treasurer of OAC (since March 1999); and Assistant
Treasurer of the Manager and Distributor (March
1999-October 2003) and OppenheimerFunds Legacy Program
(April 2000-June 2003). An officer of 103 portfolios in
the OppenheimerFunds complex.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian Petersen, Vice President of OppenheimerFunds, Inc. (since
Assistant Treasurer February 2007); Assistant Vice President (August
since 1999 2002-February 2007); Manager/Financial Product
Age: 38 Accounting of OppenheimerFunds, Inc. (November
1998-July 2002). An officer of 103 portfolios in the
OppenheimerFunds complex.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian C. Szilagyi, Assistant Vice President of OppenheimerFunds, Inc.
Assistant Treasurer (since July 2004); Director of Financial Reporting and
since 2004 Compliance of First Data Corporation (April 2003-July
Age: 38 2004); Manager of Compliance of Berger Financial Group
LLC (May 2001-March 2003). An officer of 103 portfolios
in the OppenheimerFunds complex.

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert G. Zack, Executive Vice President (since January 2004) and
Vice President and General Counsel (since March 2002) of OppenheimerFunds,
Secretary since 2001 Inc.; General Counsel of the Manager and Distributor
Age: 60 (since December 2001); General Counsel and Director of
OppenheimerFunds Distributor, Inc. (since December
2001); Senior Vice President, General Counsel and
Director of the Transfer Agent, Shareholder Financial
Services, Inc., OFI Private Investments, Inc. and OFI
Trust Company (since November 2001); Senior Vice
President and General Counsel of HarbourView Asset
Management Corporation (since December 2001); Secretary
and General Counsel of OAC (since November 2001);
Assistant Secretary (since September 1997) and Director
(since November 2001) of OppenheimerFunds International
Ltd. and OppenheimerFunds plc; Vice President and
Director of Oppenheimer Partnership Holdings, Inc.
(since December 2002); Director of Oppenheimer Real
Asset Management, Inc. (since November 2001); Vice
President of OppenheimerFunds Legacy Program (since
June 2003); Senior Vice President and General Counsel
of OFI Institutional Asset Management, Inc. (since
November 2001); Director of OppenheimerFunds (Asia)
Limited (since December 2003); Senior Vice President
(May 1985-December 2003). An officer of 103 portfolios
in the OppenheimerFunds complex.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lisa I. Bloomberg, Vice President (since May 2004) and Deputy General
Assistant Secretary Counsel (since May 2008) of OppenheimerFunds, Inc.;
since 2001 Associate Counsel (May 2004-May 2008) of
Age: 40 OppenheimerFunds Inc.; First Vice President (April
2001-April 2004), Associate General Counsel (December
2000-April 2004) of UBS Financial Services, Inc. An
officer of 103 portfolios in the OppenheimerFunds
complex.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kathleen T. Ives, Vice President (since June 1998), Deputy General
Assistant Secretary Counsel (since May 2008) and Assistant Secretary (since
since 2001 October 2003); Senior Counsel (October 2003-May 2008)
Age: 42 of OppenheimerFunds, Inc.; Vice President (since 1999)
and Assistant Secretary (since October 2003) of the
Distributor; Assistant Secretary of the Manager (since
October 2003); Vice President and Assistant Secretary
of Shareholder Services, Inc. (since 1999); Assistant
Secretary of OppenheimerFunds Legacy Program and
Shareholder Financial Services, Inc. (since December
2001); Senior General Counsel of OppenheimerFunds,
Inc.(October 2003-May 2008).. An officer of 103
portfolios in the OppenheimerFunds complex.
---------------------------------------------------------------------------------

Remuneration of the Officers and Trustees. The officers and the interested Trustee of the
Trust, who are affiliated with the Manager, receive no salary or fee from the Trust. The
Independent Trustees and Mr. Grabish received the compensation shown below from the Trust
for serving as a Trustee and member of a committee (if applicable), with respect to the
Trust's fiscal year ended June 30, 2008. The total compensation, including accrued
retirement benefits, from the Trust and fund complex represents compensation received for
serving as a Trustee and member of a committee (if applicable) of the Boards of the Trust
and other funds in the OppenheimerFunds complex during the calendar year ended December 31,
2007.

------------------------------------------------------------------------------
Trustee Name and Other Aggregate Total Compensation
Compensation From Trust and Fund
From Trust ((1)) Complex(2) Year
Position(s) (as applicable) Fiscal Year Ended ended December 31,
June 30, 2008 2007
------------------------------------------------------------------------------
------------------------------------------------------------------------------
William L. Armstrong $1,729 $228,062
Chairman of the Board of
Trustees and Governance
Committee Member
------------------------------------------------------------------------------
------------------------------------------------------------------------------
George C. Bowen $1,272 $158,000
Audit Committee Chairman
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Edward L. Cameron
Audit Committee Member and $1,264 $189,600
Governance Committee Chairman
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Jon S. Fossel $1,148 $161,423
Review Committee Chairman
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Sam Freedman $1,326 $178,277
Review Committee Member
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Richard Grabish((5)) $1,153 $14,732
Review Committee Member
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Beverly L. Hamilton $1,153((3)) $158,000
Review Committee Member and
Governance Committee Member
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Robert J. Malone $1,326 $181,700
Governance Committee Chairman
and Audit Committee Member
------------------------------------------------------------------------------
------------------------------------------------------------------------------
F. William Marshall, Jr.
Audit Committee Member and $1,153 $239,664((4))
Governance Committee Member
------------------------------------------------------------------------------

1. "Aggregate Compensation from the Trust" includes fees and deferred compensation, if
any.
2. In accordance with SEC regulations, for purposes of this section only, "Fund Complex"
includes the Oppenheimer funds, the Mass Mutual Institutional Funds, the MassMutual
Select Funds and the MML Series Investment Fund, the investment adviser for which is the
indirect parent company of OppenheimerFunds Inc. OppenheimerFunds, Inc. also serves as
the Sub-Advisor to the following: MassMutual Premier International Equity Fund,
MassMutual Premier Main Street Fund, MassMutual Premier Strategic Income Fund,
MassMutual Premier Capital Appreciation Fund, and MassMutual Premier Global Fund.
OppenheimerFunds, Inc. does not consider MassMutual Institutional Funds, MassMutual
Select Funds and MML Series Investment Fund to be part of the OppenheimerFunds' "Fund
Complex" as that term may be otherwise interpreted.
3. Includes $1,153 deferred by Ms. Hamilton under the "Compensation Deferral Plan"
described below.
4. Includes $81,664 compensation paid to Mr. Marshall for serving as a Trustee for
MassMutual Select Funds and MML Series Investment Fund.
5. Mr. Grabish serves as Trustee for only the following funds: Centennial California Tax
Exempt Trust, Centennial Government Trust, Centennial Money Market Trust, Centennial New
York Tax Exempt Trust and Centennial Tax Exempt Trust, Oppenheimer Core Bond Fund,
Oppenheimer Limited Term Government Fund, Panorama Series Fund, Inc., Oppenheimer
Principal Protected Trust, Oppenheimer Principal Protected Trust II, Oppenheimer
Principal Protected Trust III, Oppenheimer Senior Floating Rate Fund, Oppenheimer
Portfolio Series Fixed Income Active Allocation Fund, Oppenheimer Master Event-Linked
Bond Fund, LLC and Oppenheimer Master Loan Fund, LLC.

|X| Compensation Deferral Plan for Trustees. The Board of Trustees has adopted a
Compensation Deferral Plan for Independent Trustees that enables them to elect to defer
receipt of all or a portion of the annual fees they are entitled to receive from the
Trust. Under the plan, the compensation deferred by a Trustee is periodically adjusted as
though an equivalent amount had been invested in shares of one or more Oppenheimer funds
selected by the Trustee. The amount paid to the Trustee under this plan will be determined
based upon the amount of compensation deferred and the performance of the selected funds.

Deferral of the Trustees' fees under this plan will not materially affect the Trust's
assets, liabilities or net income per share. This plan will not obligate the Trust to
retain the services of any Trustee or to pay any particular level of compensation to any
Trustee. Pursuant to an Order issued by the SEC, the Trust may invest in the funds
selected by any Trustee under the plan without shareholder approval for the limited purpose
of determining the value of the Trustees' deferred compensation account.

|X| Major Shareholders. As of October 6, 2008 the only person who
owned of record or was known by the Trust to own beneficially 5% or more of the Trust's
outstanding shares was A.G. Edwards & Sons, Inc.("Edwards"), for the Sole Benefit of its
Customers, Attn. Money Fund Dept., 1 North Jefferson Avenue, St. Louis, Missouri 63103,
which owned 185,358,338.360 shares of the Trust which was 73.94% of the outstanding shares
of the Trust on that date, for accounts of its customers none of whom individually owned
more than 5% of the outstanding shares.

The Manager. The Manager, Centennial Asset Management Corporation, is wholly-owned by
OppenheimerFunds, Inc., which is a wholly-owned subsidiary of Oppenheimer Acquisition
Corp., a holding company controlled by Massachusetts Mutual Life Insurance Company, a
global, diversified insurance and financial services organization.

The portfolio managers of the Trust are principally responsible for the day-to-day
management of the Trust'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
Trust's portfolio managers with research and support in managing the Trust's investments.

|X| Code of Ethics. The Manager and the Distributor have a Code of Ethics. It is
designed to detect and prevent improper personal trading by certain employees, including
portfolio managers, have access to information that could permit them to compete with or
take advantage of the Trust's portfolio transactions. Covered persons include persons with
knowledge of the investments and investment intentions of the Trust and other funds advised
by the Manager. The Code of Ethics does permit personnel subject to the Code to invest in
securities, including securities that may be purchased or held by the Trust, subject to a
number of restrictions and controls. Compliance with the Code of Ethics is carefully
monitored and enforced by the Manager. The Trust does not have a Code of Ethics since it
is a money market fund.

The Code of Ethics is an exhibit to the Trust's registration statement filed with the
SEC and can be reviewed and copied at the SEC's Public Reference Room in Washington, D.C.
You can obtain information about the hours of operation of the Public Reference Room by
calling the SEC at 1.202.551.8090. The Code of Ethics can also be viewed as part of the
Trust's registration statement on the SEC's EDGAR database at the SEC's Internet website at
www.sec.gov. Copies may be obtained, after paying a duplicating fee, by electronic request
at the following E-mail address: publicinfo@sec.gov., or by writing to the SEC's Public
Reference Section, Washington, D.C. 20549-0102.

|X| The Investment Advisory Agreement. The Manager provides investment advisory and
management services to the Trust under an investment advisory agreement between the Manager
and the Trust. The Manager selects securities for the Trust's portfolio and handles its
day-to-day business. The agreement requires the Manager, at its expense, to provide the
Trust 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 Trust. 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 Trust.

The Trust pays expenses not expressly assumed by the Manager under the investment
advisory agreement. The investment advisory agreement lists examples of expenses paid by
the Trust. The major categories relate to interest, taxes, fees to unaffiliated Trustees,
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 Trust to the Manager are calculated at the rates
described in the Prospectus. The management fees paid by the Trust to the Manager during
its last three fiscal years were:

---------------------------------------------------------------------------------
Fiscal Year Management Fee Paid to Centennial Asset Management Corporation
ending 6/30
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
2006 $5,392,083
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
2007 $5,291,003
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
2008 $4,962,261
---------------------------------------------------------------------------------

The investment advisory agreement provides that the Manager shall not be liable for any
loss sustained by reason of the adoption of an investment policy or the purchase, sale or
retention of any security on its recommendation, whether or not such recommendation shall
have been based upon its own investigation and research or upon investigation and research
made by any other individual, firm or corporation, if such recommendation shall have been
made and such other individual, firm or corporation shall have been selected with due care
and in good faith, provided that nothing in the agreement shall be construed to protect the
Manager against any liability to the Trust or its shareholders by reason of willful
misfeasance, bad faith or gross negligence in the performance of its duties, or by reason
of its reckless disregard of its obligations and duties under the agreement.

Pending Litigation. During 2009, a number of complaints have been filed in federal courts
against the Manager, the Distributor, and certain other mutual funds ("Defendant Trusts")
advised by the Manager and distributed by the Distributor. The complaints naming the
Defendant Trusts also name certain officers and directors and former directors of the
respective Defendant Trusts. The plaintiffs are seeking class action status on behalf of
those who purchased shares of the respective Defendant Trust during a particular time
period. The complaints against the Defendant Trusts raise claims under federal securities
laws to the effect that, among other things, the disclosure documents of the respective
Defendant Trust contained misrepresentations and omissions, that such Defendant Trust's
investment policies were not followed, and that such Defendant Trust and the other
defendants violated federal securities laws and regulations. The plaintiffs seek
unspecified damages, equitable relief and an award of attorneys' fees and litigation
expenses.

A complaint brought in state court against the Manager, the Distributor and another
subsidiary of the Manager (but not against the Trust), on behalf of the Oregon College
Savings Plan Trust alleges a variety of claims, including breach of contract, breach of
fiduciary duty, negligence and violation of state securities laws. Plaintiffs seek
compensatory damages, equitable relief and an award of attorneys' fees and litigation
expenses.

Other complaints have been filed in state and federal courts, by investors who made
investments through an affiliate of the Manager, against the Manager and certain of its
affiliates, regarding the alleged investment fraud perpetrated by Bernard Madoff and his
firm ("Madoff"). Those lawsuits, in 2008 and 2009, allege a variety of claims, including
breach of fiduciary duty, fraud, negligent misrepresentation, unjust enrichment, and
violation of federal and state securities laws and regulations, among others. They seek
unspecified damages, equitable relief and an award of attorneys' fees and litigation
expenses. None of the suits have named the Distributor, any of the Oppenheimer mutual
funds or any of their independent Trustees or Directors. None of the Oppenheimer funds
invested in any trusts or accounts managed by Madoff.

The Manager believes that the lawsuits described above are without legal merit and intends
to defend them vigorously. The Defendant Trusts' Boards of Directors have also engaged
counsel to defend the suits vigorously on behalf of those Trusts, their boards and the
individual independent Directors named in those suits. While it is premature to render any
opinion as to the likelihood of an outcome in these lawsuits, or whether any costs that the
Defendant Trusts may bear in defending the suits might not be reimbursed by insurance, the
Manager believes that these suits should not impair the ability of the Manager or the
Distributor to perform their respective duties to the Trust, and that the outcome of all of
the suits together should not have any material effect on the operations of any of the
Oppenheimer Funds.

Portfolio Managers. The Trust's portfolio is managed by Carol E. Wolf (referred to as
"Portfolio Manager"). She is the person who is responsible for the day-to-day management of
the Trust's investments.

Other Accounts Managed. In addition to managing the Trust's investment portfolio,
Ms. Wolf also manages other investment portfolios and other accounts on behalf of the
Manager or its affiliates. The following table provides information regarding the other
portfolios and accounts managed by Ms. Wolf as of June 30, 2008. No account has a
performance-based advisory fee:

Portfolio Total Total Total
Assets in
Assets in Other Other
RegistereRegistered Pooled Pooled Assets
InvestmenInvestment InvestmentInvestment Other in Other
CompaniesCompanies Vehicles Vehicles AccountAccounts
Manager Managed Managed(1) Managed Managed(1) ManagedManaged(2)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
8 1 None
Carol E. Wolf $19,179
$187 None
1. In millions.
2. Does not include personal account of portfolio managers and their families, which
are subject to the Code of Ethics.

As indicated above, the Portfolio Managers also manage other funds and accounts.
Potentially, at times, those responsibilities could conflict with the interests of the
Trust. That may occur whether the investment strategies of the other fund or account
are the same as, or different from, the Trust's investment objectives and strategies.
For example, the Portfolio Managers may need to allocate investment opportunities
between the Trust and another fund or account having similar objectives or strategies,
or he may need to execute transactions for another fund or account that could have a
negative impact on the value of securities held by the Trust. Not all funds and
accounts advised by the Manager have the same management fee. If the management fee
structure of another fund or account is more advantageous to the Manager than the fee
structure of the Trust, the Manager could have an incentive to favor the other fund or
account. However, the Manager's compliance procedures and Code of Ethics recognize
the Manager's fiduciary obligations to treat all of its clients, including the Trust,
fairly and equitably, and are designed to preclude the Portfolio Managers from
favoring one client over another. It is possible, of course, that those compliance
procedures and the Code of Ethics may not always be adequate to do so. At different
times, the Trust's Portfolio Managers may manage other funds or accounts with
investment objectives and strategies that are similar to those of the Trust, or may
manage funds or accounts with investment objectives and strategies that are different
from those of the Fund.

Compensation of the Portfolio Managers. The Trust's Portfolio Managers are employed
and compensated by the Manager, not the Trust. Under the Manager's compensation
program for its portfolio managers and portfolio analysts, their compensation is
based primarily on the investment performance results of the funds and accounts they
manage, rather than on the financial success of the Manager. This is intended to
align the portfolio managers' and analysts' interests with the success of the funds
and accounts and their shareholders. The Manager's compensation structure is designed
to attract and retain highly qualified investment management professionals and to
reward individual and team contributions toward creating shareholder value. As of
June 30, 2008 the Portfolio Managers' compensation consisted of three elements: a
base salary, an annual discretionary bonus and eligibility to participate in
long-term awards of options and stock appreciation rights in regard to the common
stock of the Manager's holding company parent. Senior portfolio managers may also be
eligible to participate in the Manager's deferred compensation plan.

To help the Manager attract and retain talent, the base pay component of each
portfolio manager is reviewed regularly to ensure that it reflects the performance of
the individual, is commensurate with the requirements of the particular portfolio,
reflects any specific competence or specialty of the individual manager, and is
competitive with other comparable positions. The annual discretionary bonus is
determined by senior management of the Manager and is based on a number of factors,
including a fund's pre-tax performance for periods of up to five years, measured
against an appropriate benchmark selected by management. The benchmark with respect
to the Trust is the iMoneyNet Retail Government & Agencies Money Market Funds. Other
factors considered include management quality (such as style consistency, risk
management, sector coverage, team leadership and coaching) and organizational
development. The Portfolio Managers' compensation is not based on the total value of
the Trust's portfolio assets, although the Trust's investment performance may
increase those assets. The compensation structure is also intended to be internally
equitable and serve to reduce potential conflicts of interest between the Trust and
other funds and accounts managed by the Portfolio Managers. The compensation
structure of the other funds and accounts managed by the Portfolio Managers is the
same as the compensation structure of the Trust, described above.

Ownership of Trust Shares. As of June 30, 2008 the Portfolio Manager
did not beneficially own any shares of the Trust.

|X| The Distributor. Under its General Distributor's Agreement with the Trust, Centennial
Asset Management Corporation acts as the Trust's principal underwriter and Distributor in
the continuous public offering of the Trust'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. For other distribution expenses paid by the
Trust, see the section entitled "Service Plan" below. The Trust's Sub-Distributor is
OppenheimerFunds Distributor, Inc.

Portfolio Transactions. Portfolio decisions are based upon recommendations and judgment of
the Manager subject to the overall authority of the Board of Trustees. Most purchases made
by the Trust are principal transactions at net prices, so the Trust incurs little or no
brokerage costs. The Trust 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 Trust seeks to obtain prompt execution of orders at the most favorable net
price. If broker/dealers are used for portfolio transactions, transactions may be directed
to broker/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 Trust 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. It may include information and
analyses on particular companies and industries as well as market or economic trends and
portfolio evaluations, analytical software 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 Trust's portfolio or being considered for purchase. No
portfolio transactions will be handled by any securities dealer affiliated with the
Manager.

The Trust may experience high portfolio turnover that may increase the Trust'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 Trust.

Service Plan

The Trust has adopted a Service Plan for the shares. The plan has been approved by a vote
of the Board of Trustees, including a majority of the Independent Trustees(1), cast in
person at a meeting called for the purpose of voting on that plan.

Under the plan, the Manager and the Distributor may make payments to affiliates. In
their sole discretion, they may also from time to time make substantial payments from their
own resources, which include the profits the Manager derives from the advisory fees it
receives from the Trust, to compensate brokers, dealers, financial institutions and other
intermediaries for providing distribution assistance and/or administrative services or that
otherwise promote sales of the Trust's shares. These payments, some of which may be
referred to as "revenue sharing," may relate to the Fund's inclusion on a financial
intermediary's preferred list of funds offered to its clients.

Unless the plan is terminated as described below, the plan continues in effect from
year to year but only if the Trust's Board of Trustees and its Independent Trustees
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 Trustees or by the
vote of the holders of a "majority" (as defined in the Investment Company Act) of the
outstanding shares of the Trust.

The Board of Trustees and the Independent Trustees must approve all material
amendments to the plan. An amendment to increase materially the amount of payments to be
made under the plan must be approved by shareholders of the class affected by the
amendment. The approval must be by a majority of the shares.

While the plan is in effect, the Treasurer of the Trust shall provide separate
written reports on the plan to the Board of Trustees at least quarterly for its review.
The reports shall detail the amount of all payments made under the plan and the purpose for
which the payments were made. Those reports are subject to the review and approval of the
Independent Trustees.

The plan states that while it is in effect, the selection and nomination of those
Trustees of the Trust who are not "interested persons" of the Trust is committed to the
discretion of the Independent Trustees. This does not prevent the involvement of others in
the selection and nomination process as long as the final decision as to selection or
nomination is approved by a majority of the Independent Trustees.

Under the plan, no payment will be made to any recipient in any period in which the
aggregate net asset value of all Trust 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 Independent Trustees. The Board of Trustees has set no minimum amount of
assets to qualify for payments under the plan.

|X| Service Plan Fees. Under the service plan, the Distributor currently uses the
fees it receives from the Trust to pay brokers, dealers and other financial institutions
(referred to as "recipients") for personal services and account maintenance services they
provide for their customers who hold shares. The services include, among others, answering
customer inquiries about the Trust, assisting in establishing and maintaining accounts in
the Trust, making the Trust's investment plans available and providing other services at
the request of the Trust or the Distributor. The service plan permits reimbursements to the
Distributor at a rate of up to 0.20% of average annual net assets of the shares. The
Distributor makes payments to plan recipients periodically depending on asset size at an
annual rate not to exceed 0.20% of the average annual net assets consisting of shares held
in the accounts of the recipients or their customers.

For the fiscal year ended June 30, 2008 payments under the plan totaled $2,167,796.
The Distributor retained nothing and the remaining balance was paid out by the Distributor
to recipients, which included $83,609 paid to an affiliate of the Distributor's parent
company. Any unreimbursed expenses the Distributor incurs with respect to the shares in any
fiscal quarter cannot be recovered in subsequent quarters. The Distributor may not use
payments received under the plan to pay any of its interest expenses, carrying charges, or
other financial costs, or allocation of overhead.

For the fiscal year ended June 30, 2008, the Manager paid, in the aggregate, $3,121,712
in fees out of its own resources for distribution assistance to A.G. Edwards & Sons, Inc.
Those distribution assistance payments were paid based on annual rates applied to the
average net asset value during the calendar quarter of qualified assets of the Centennial
funds.

Payments to Trust Intermediaries

Financial intermediaries may receive various forms of compensation or reimbursement
from the Trust in the form of 12b-1 plan payments as described in the preceding section of
this Statement of Additional Information. Additionally, the Manager, the Distributor and/or
the Sub-Distributor (including their affiliates) may make payments to financial
intermediaries in connection with their offering and selling shares of the Trust and other
Oppenheimer or Centennial funds, providing marketing or promotional support, transaction
processing and/or administrative services. Among the financial intermediaries that may
receive these payments are brokers and dealers who sell and/or hold shares of the Trust,
banks (including bank trust departments), registered investment advisers, insurance
companies, retirement plan and qualified tuition program administrators, third party
administrators, and other institutions that have selling, servicing or similar arrangements
with the Manager, Distributor or Sub-Distributor. The payments to intermediaries vary by
the types of product sold, the features of the Trust and the role played by the
intermediary.

Possible types of payments to financial intermediaries include, without limitation,
those discussed below.

o Payments made by the Trust, or by an investor buying or selling shares of the Trust
may include:

o ongoing asset-based payments attributable to the share class selected, including fees
payable under the Trust's service plan adopted under Rule 12b-1 under the
Investment Company Act, which are paid from the Trust's assets (see " Service
Plan" above);
o shareholder servicing payments for providing omnibus accounting, recordkeeping,
networking, sub-transfer agency or other administrative or shareholder services,
including retirement plan and 529 plan administrative services fees, which are
paid from the assets of a Trust as reimbursement to the Manager, Distributor or
Sub-Distributor for expenses they incur on behalf of the Trust.

o Payments made by the Manager, Distributor or Sub-Distributor out of their respective
resources and assets, which may include profits the Manager derives from investment
advisory fees paid by the Trust. These payments are made at the discretion of the
Manager, the Distributor and/or the Sub-Distributor. These payments, often referred to
as "revenue sharing" payments, may be in addition to the payments by the Trust listed
above.

o These types of payments may reflect compensation for marketing support, support
provided in offering the Trust or other Oppenheimer or Centennial funds through
certain trading platforms and programs, transaction processing or other services;
o The Manager, Distributor and Sub-Distributor each may also pay other compensation to
the extent the payment is not prohibited by law or by any self-regulatory agency,
such as the FINRA. Payments are made based on the guidelines established by the
Manager, Distributor and Sub-Distributor, subject to applicable law.

These payments may provide an incentive to financial intermediaries to actively
market or promote the sale of shares of the Trust or other Oppenheimer or Centennial funds,
or to support the marketing or promotional efforts of the Distributor or Sub-Distributor in
offering shares of the Trust or other Oppenheimer or Centennial funds. In addition, some
types of payments may provide a financial intermediary with an incentive to recommend the
Trust. Financial intermediaries may earn profits on these payments, since the amount of the
payment may exceed the cost of providing the service. Certain of these payments are subject
to limitations under applicable law. Financial intermediaries may categorize and disclose
these arrangements to their clients and to members of the public in a manner different from
the disclosures in the Trust's prospectus and this Statement of Additional Information. You
should ask your financial intermediary for information about any payments it receives from
the Trust, the Manager, the Distributor or the Sub-Distributor and any services it
provides, as well as the fees and commissions it charges.

Although brokers or dealers that sell Trust shares may also act as a broker or dealer
in connection with the execution of the purchase or sale of portfolio securities by the
Trust or other Oppenheimer or Centennial funds, a financial intermediary's sales of shares
of the Trust or such other Oppenheimer or Centennial funds is not a consideration for the
Manager when choosing brokers or dealers to effect portfolio transactions for the Trust or
such funds.

Revenue sharing payments can pay for distribution-related or asset retention items
including, without limitation,

o transactional support, one-time charges for setting up access for the Trust or other
Oppenheimer and Centennial funds on particular trading systems, and paying the
intermediary's networking fees;
o program support, such as expenses related to including the Oppenheimer and Centennial
funds in retirement plans, college savings plans, fee-based advisory or wrap fee
programs, fund "supermarkets", bank or trust company products or insurance
companies' variable annuity or variable life insurance products;
o placement on the dealer's list of offered funds and providing representatives of the
Distributor with access to a financial intermediary's sales meetings, sales
representatives and management representatives.

Additionally, the Manager, Distributor or Sub-Distributor may make payments for firm
support, such as business planning assistance, advertising, and educating a financial
intermediary's sales personnel about the Oppenheimer and Centennial funds and shareholder
financial planning needs.

For the year ended December 31, 2007, the following financial intermediaries that are
broker-dealers offering shares of the Oppenheimer and Centennial funds, and/or their
respective affiliates, received revenue sharing or similar distribution-related payments
from the Manager, Distributor or Sub-Distributor for marketing or program support:

-------------------------------------------------------------------------------
1st Global Capital Company Legend Equities Corporation
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Advantage Capital Corporation Lincoln Benefit National Life
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Aegon USA Lincoln Financial Advisors Corporation
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Aetna Life Insurance & Annuity Company Lincoln Investment Planning, Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
AG Edwards & Sons, Inc. Linsco Private Ledger Financial
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
AIG Financial Advisors Massachusetts Mutual Life Insurance
Company
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
AIG Life Variable Annuity McDonald Investments, Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Allianz Life Insurance Company Merrill Lynch Pierce Fenner & Smith,
Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Allmerica Financial Life Insurance & Merrill Lynch Insurance Group
Annuity Company
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Allstate Life Insurance Company MetLife Investors Insurance Company
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
American Enterprise Life Insurance MetLife Securities, Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
American General Annuity Insurance Minnesota Life Insurance Company
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
American Portfolios Financial MML Investor Services, Inc.
Services, Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Ameriprise Financial Services, Inc. Mony Life Insurance Company
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Ameritas Life Insurance Company Morgan Stanley & Company, Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Annuity Investors Life Insurance Multi-Financial Securities Corporation
Company
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Associated Securities Corporation Mutual Service Corporation
-------------------------------------------------------------------------------
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AXA Advisors LLC NFP Securities, Inc.
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AXA Equitable Life Insurance Company Nathan & Lewis Securities, Inc.
-------------------------------------------------------------------------------
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Banc One Securities Corporation National Planning Corporation
-------------------------------------------------------------------------------
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Cadaret Grant & Company, Inc. Nationwide Financial Services, Inc.
-------------------------------------------------------------------------------
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CCO Investment Services Corporation New England Securities Corporation
-------------------------------------------------------------------------------
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Charles Schwab & Company, Inc. New York Life Insurance & Annuity
Company
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Chase Investment Services Corporation Oppenheimer & Company
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Citicorp Investment Services, Inc. PFS Investments, Inc.
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Citigroup Global Markets Inc. Park Avenue Securities LLC
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CitiStreet Advisors LLC Phoenix Life Insurance Company
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Citizen's Bank of Rhode Island Plan Member Securities
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Columbus Life Insurance Company Prime Capital Services, Inc.
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Commonwealth Financial Network Primevest Financial Services, Inc.
-------------------------------------------------------------------------------
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Compass Group Investment Advisors Protective Life Insurance Company
-------------------------------------------------------------------------------
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CUNA Brokerage Services, Inc. Prudential Investment Management
Services LLC
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CUSO Financial Services, LLP Raymond James & Associates, Inc.
-------------------------------------------------------------------------------
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E*TRADE Clearing LLC Raymond James Financial Services, Inc.
-------------------------------------------------------------------------------
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Edward Jones RBC Dain Rauscher Inc.
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Essex National Securities, Inc. Royal Alliance Associates, Inc.
-------------------------------------------------------------------------------
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Federal Kemper Life Assurance Company Securities America, Inc.
-------------------------------------------------------------------------------
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Financial Network Security Benefit Life Insurance
Company
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-------------------------------------------------------------------------------
Financial Services Corporation Security First-Metlife Investors
Insurance Company
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GE Financial Assurance SII Investments, Inc.
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GE Life & Annuity Signator Investors, Inc.
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Genworth Financial, Inc. Sorrento Pacific Financial LLC
-------------------------------------------------------------------------------
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GlenBrook Life & Annuity Company Sun Life Assurance Company of Canada
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Great West Life & Annuity Company Sun Life Insurance & Annuity Company
of New York
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GWFS Equities, Inc. Sun Life Annuity Company Ltd.
-------------------------------------------------------------------------------
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Hartford Life Insurance Company SunTrust Bank
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HD Vest Investment Services, Inc. SunTrust Securities, Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Hewitt Associates LLC Thrivent Financial Services, Inc.
-------------------------------------------------------------------------------
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IFMG Securities, Inc. Towers Square Securities, Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
ING Financial Advisers LLC Travelers Life & Annuity Company
-------------------------------------------------------------------------------
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ING Financial Partners, Inc. UBS Financial Services, Inc.
-------------------------------------------------------------------------------
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Invest Financial Corporation Union Central Life Insurance Company
-------------------------------------------------------------------------------
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Investment Centers of America, Inc. United Planners Financial Services of
America
-------------------------------------------------------------------------------
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Jefferson Pilot Life Insurance Company Wachovia Securities, Inc.
-------------------------------------------------------------------------------
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Jefferson Pilot Securities Corporation Walnut Street Securities, Inc.
-------------------------------------------------------------------------------
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John Hancock Life Insurance Company Waterstone Financial Group
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JP Morgan Securities, Inc. Wells Fargo Investments
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Kemper Investors Life Insurance Company Wescom Financial Services
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For the year ended December 31, 2007, the following firms, which in some cases are
broker-dealers, received payments from the Manager, Distributor or Sub-Distributor for
administrative or other services provided (other than revenue sharing arrangements), as
described above:

1st Global Capital Co. Lincoln Investment Planning, Inc.
AG Edwards Lincoln National Life Insurance Co.
ACS HR Solutions Linsco Private Ledger Financial
Massachusetts Mutual Life Insurance
ADP Company
Matrix Settlement & Clearance
AETNA Life Ins & Annuity Co. Services
Alliance Benefit Group McDonald Investments, Inc.
American Enterprise Investments Mercer HR Services
American Express Retirement Service Merrill Lynch
American United Life Insurance Co. Mesirow Financial, Inc.
Ameriprise Financial Services, Inc. MetLife
Ameritrade, Inc. MFS Investment Management
AMG (Administrative Management Group) Mid Atlantic Capital Co.
AST (American Stock & Transfer) Milliman USA
AXA Advisors Morgan Keegan & Co, Inc.
Bear Stearns Securities Co. Morgan Stanley Dean Witter
Benefit Administration Company, LLC Mutual of Omaha Life Insurance Co.
Benefit Administration, Inc. Nathan & Lewis Securities, Inc.
Benefit Consultants Group National City Bank
Benefit Plans Administration National Deferred Comp
Benetech, Inc. National Financial
Bisys National Investor Services Co.
Boston Financial Data Services Nationwide Life Insurance Company
Charles Schwab & Co, Inc. Newport Retirement Services, Inc.
Citigroup Global Markets Inc. Northwest Plan Services, Inc.
CitiStreet NY Life Benefits
City National Bank Oppenheimer & Co, Inc.
Clark Consulting Peoples Securities, Inc.
CPI Qualified Plan Consultants, Inc. Pershing LLC
DA Davidson & Co. PFPC
DailyAccess Corporation Piper Jaffray & Co.
Davenport & Co, LLC Plan Administrators, Inc.
David Lerner Associates, Inc. Plan Member Securities
Digital Retirement Solutions, Inc. Primevest Financial Services, Inc.
DR, Inc. Principal Life Insurance Co.
Prudential Investment Management
Dyatech, LLC Services LLC
E*Trade Clearing LLC PSMI Group, Inc.
Edward D Jones & Co. Quads Trust Company
Equitable Life / AXA Raymond James & Associates, Inc.
ERISA Administrative Svcs, Inc. Reliance Trust Co.
ExpertPlan, Inc. Reliastar Life Insurance Company
FASCore LLC Robert W Baird & Co.
Ferris Baker Watts, Inc. RSM McGladrey
Fidelity Scott & Stringfellow, Inc.
First Clearing LLC Scottrade, Inc.
First Southwest Co. Southwest Securities, Inc.
First Trust - Datalynx Standard Insurance Co
First Trust Corp Stanley, Hunt, Dupree & Rhine
Franklin Templeton Stanton Group, Inc.
Geller Group Sterne Agee & Leach, Inc.
Great West Life Stifel Nicolaus & Co, Inc.
H&R Block Financial Advisors, Inc. Sun Trust Securities, Inc.
Hartford Life Insurance Co. Symetra Financial Corp.
HD Vest Investment Services T. Rowe Price
Hewitt Associates LLC The 401k Company
HSBC Brokerage USA, Inc. The Princeton Retirement Group Inc.
ICMA - RC Services The Retirement Plan Company, LLC
Independent Plan Coordinators TruSource Union Bank of CA
Ingham Group UBS Financial Services, Inc.
Interactive Retirement Systems Unified Fund Services (UFS)
Invesmart (Standard Retirement Services,
Inc.) US Clearing Co.
Janney Montgomery Scott, Inc. USAA Investment Management Co.
JJB Hillard W L Lyons, Inc. USI Consulting Group
John Hancock VALIC Retirement Services
JP Morgan Vanguard Group
July Business Services Wachovia
Kaufman & Goble Web401K.com
Legend Equities Co. Wedbush Morgan Securities
Legg Mason Wood Walker Wells Fargo Bank
Lehman Brothers, Inc. Wilmington Trust
Liberty Funds Distributor, Inc./Columbia
Management

Performance of the Trust

Explanation of Performance Terminology. The Trust 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 Trust's performance as of the Trust's most recent
fiscal year end. You can obtain current performance information by calling the Trust's
Transfer Agent at 1.800.525.9310.

The Trust's illustrations of its performance data in advertisements must comply with
rules of the SEC. Those rules describe the types of performance data that may be used and
how it is to be calculated. If the Trust 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
Trust's performance to the performance of other funds for the same periods. However, a
number of factors should be considered before using the Trust's performance information as
a basis for comparisons with other investments:

o Yields and total returns measure the performance of a hypothetical account in the
Trust 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.
o The Trust's performance returns may not reflect the effect of taxes on dividends and
capital gains distributions.
o An investment in the Trust is not insured by the FDIC or any other government agency.
o The principal value of the Trust's shares, its yields and total returns are not
guaranteed and normally will fluctuate on a daily basis.
o When an investor's shares are redeemed, they may be worth more or less than their
original cost.
o 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.

|X| Yields. The Trust'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 Trust'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.

|X| Total Return Information. There are different types of "total returns" to measure
the Trust's performance. Total return is the change in value of a hypothetical investment
in the Trust 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 Trust 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" of each class 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:

1/n
(ERV)
(---) - 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

---------------------------------------------------------------------------------
Yield Compounded Average Annual Total Returns (at 6/30/08)
(7 days ended Effective Yield
6/30/08) (7 days ended
6/30/08)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

1-Year 5 Years 10 Years
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

1.30% 1.31% 3.18% 2.65% 3.11%
---------------------------------------------------------------------------------

|X| Other Performance Comparisons. Yield information may be useful to
investors in reviewing the Trust's performance. The Trust may make comparisons between its
yield and that of other investments, by citing various indices such as The Bank Rate
Monitor National Index (provided by Bank Rate Monitor(TM)) which measures the average rate
paid on bank money market accounts, NOW accounts and certificates of deposits by the 100
largest banks and thrifts in the top ten metro areas. When comparing the Trust's yield
with that of other investments, investors should understand that certain other investment
alternatives such as certificates of deposit, U.S. government securities, money market
instruments or bank accounts may provide fixed yields and may be insured or guaranteed.

From time to time, the Trust may include in its advertisements and sales literature
performance information about the Trust 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 Trust may include in its advertisements and sales literature
the total return performance of a hypothetical investment account that includes shares of
the Trust and other Oppenheimer funds. The combined account may be part of an illustration
of an asset allocation model or similar presentation. The account performance may combine
total return performance of the Trust and the total return performance of other Oppenheimer
funds included in the account. Additionally, from time to time, the Trust's advertisements
and sales literature may include, for illustrative or comparative purposes, statistical
data or other information about general or specific market and economic conditions. That
may include, for example,
o information about the performance of certain securities or commodities markets or
segments of those markets,
o information about the performance of the economies of particular countries or
regions,
o the earnings of companies included in segments of particular industries, sectors,
securities markets, countries or regions,
o the availability of different types of securities or offerings of securities,
o information relating to the gross national or gross domestic product of the United
States or other countries or regions,
o comparisons of various market sectors or indices to demonstrate performance, risk, or
other characteristics of the Trust.

About YOUR ACCOUNT

How to Buy Shares

Determination of Net Asset Value Per Share. The net asset value per share of the Trust is
determined twice each day that the New York Stock Exchange (the "NYSE") is open, at 12:00
Noon and at 4:00 p.m., on each day that the NYSE is open, by dividing the value of the
Trust's net assets by the total number of shares outstanding. All references to time in
this Statement of Additional Information mean "Eastern time." The NYSE'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 Trust's Board of Trustees has adopted the amortized cost method to value the
Trust'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 Trust would receive if it sold the security.

The Trust's Board of Trustees has established procedures reasonably designed to
stabilize the Trust's net asset value at $1.00 per share. Those procedures include a
review of the valuations of the Trust's portfolio holdings by the Board of Trustees, at
intervals it deems appropriate, to determine whether the Trust's net asset value calculated
by using available market quotations deviates from $1.00 per share based on amortized cost.

The Board of Trustees receives information on the extent of any deviation between the
Trust's net asset value based upon available market quotations and amortized cost. If the
Trust's net asset value were to deviate from $1.00 by more than 0.5%, Rule 2a-7 requires
the Board of Trustees 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 Board of Trustees will take whatever steps it considers 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 Trust
may tend to be lower (and net investment income and dividends higher) than those of a fund
holding the identical investments as the Trust 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 Trust 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. When a check is presented to United Missouri Bank (the "Bank") for
clearance, the Bank will ask the Trust 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 Trust. Checks may not be presented for payment at the offices of the Bank or the
Trust's custodian. This limitation does not affect the use of checks for the payment of
bills or to obtain cash at other banks. The Trust reserves the right to amend, suspend or
discontinue offering checkwriting privileges at any time. The Fund will provide you with
notice whenever it is required to do so by applicable law.

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 Trust 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 Trust, its Transfer Agent and any bank through which the Trust's
drafts (checks) are payable to pay all checks drawn on the Trust 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 Trust and/or the Trust's bank; and
(6) acknowledges and agrees that neither the Trust 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 Trust's custodian bank is not open for business on a day
when the Trust would normally authorize the wire to be made, which is usually the Trust'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 Trust is open for
business. No distributions will be paid on the proceeds of redeemed shares awaiting
transfer by Federal Funds wire.

Distributions From Retirement Plans Requests for distributions from
OppenheimerFunds-sponsored IRAs, SEP-IRAs, SIMPLE IRAs, 403(b)(7) custodial plans, 401(k)
plans or pension or profit-sharing plans should be addressed to "Trustee, OppenheimerFunds
Retirement Plans," c/o the Transfer Agent at its address listed in "How To Sell Shares" in
the Prospectus or on the back cover of this Statement of Additional Information. The
request must

(1) state the reason for the distribution;
(2) state the owner's awareness of tax penalties if the distribution is premature; and
(3) conform to the requirements of the plan and the Trust's other redemption
requirements.

Participants (other than self-employed persons) in OppenheimerFunds-sponsored pension
or profit-sharing plans with shares of the Trust held in the name of the plan or its
fiduciary may not directly request redemption of their accounts. The plan administrator or
fiduciary must sign the request.

Distributions from pension and profit sharing plans are subject to special
requirements under the Internal Revenue Code and certain documents (available from the
Transfer Agent) must be completed and submitted to the Transfer Agent before the
distribution may be made. Distributions from retirement plans are subject to withholding
requirements under the Internal Revenue Code, and IRS Form W-4P (available from the
Transfer Agent) must be submitted to the Transfer Agent with the distribution request, or
the distribution may be delayed. Unless the shareholder has provided the Transfer Agent
with a certified tax identification number, the Internal Revenue Code requires that tax be
withheld from any distribution even if the shareholder elects not to have tax withheld.
The Trust, the Manager, the Distributor the Sub-Distributor, and the Transfer Agent assume
no responsibility to determine whether a distribution satisfies the conditions of
applicable tax laws and will not be responsible for any tax penalties assessed in
connection with a distribution.

How to Exchange Shares

As stated in the Prospectus, direct shareholders can exchange shares of the Trust for Class
A shares of the same class of other eligible Trusts. You can obtain a current list showing
which Trusts offer which classes of shares by calling the Distributor or Sub-Distributor at
the telephone number indicated on the front cover of this Statement of Additional
Information.

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 Oppenheimer funds that have a single class without a class
designation are deemed "Class A" shares for this purpose. The prospectus of each of the
Oppenheimer funds indicates which share class or classes that fund offers and provides
information about limitations on the purchase of particular share classes, as applicable
for the particular fund. You can also obtain a current list showing which funds offer which
classes of shares by calling the Distributor at the telephone number indicated on the front
cover of this Statement of Additional Information.

The Trust may amend, suspend or terminate the exchange privilege at any time.
Although the Trust may impose those changes at any time, it will provide you with notice of
the changes whenever it is required to do so by applicable law. It may be required to
provide 60 days' notice prior to materially amending or terminating the exchange privilege,
except in extraordinary circumstances.

|X| Telephone Exchange Requests. When exchanging shares by telephone, a direct
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. 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.

|X| 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 Trust reserves the right, in its discretion, to refuse any exchange request
that may disadvantage it. For example, if the receipt of multiple exchange requests might
require the disposition of portfolio securities at a time or at a price that might be
disadvantageous to the Trust, the Trust may refuse the request.

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 eligible 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 Trust, the
Distributor, the Sub-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.

The Trust may amend, suspend or terminate the exchange privilege at any time.
Although, the Trust may impose these changes at any time, it will provide you with notice
of those changes whenever it is required to do so by applicable law. It may be required to
provide 60 days notice prior to materially amending or terminating the exchange privilege.
That 60-day notice is not required in extraordinary circumstances.

Dividends and Taxes

Tax Status of the Trust's Dividends, Distributions and Redemptions of Shares. The federal
tax treatment of the Trust's dividends and capital gains distributions is briefly
highlighted in the Prospectus. The following is only a summary of certain additional tax
considerations generally affecting the Trust and its shareholders.

The tax discussion in the Prospectus and this Statement of Additional Information is
based on tax law in effect on the date of the Prospectus and this Statement of Additional
Information. Those laws and regulations may be changed by legislative, judicial, or
administrative action, sometimes with retroactive effect. State and local tax treatment of
ordinary income dividends and capital gain dividends from regulated investment companies
may differ from the treatment under the Internal Revenue Code described below. Potential
purchasers of shares of the Trust are urged to consult their tax advisers with specific
reference to their own tax circumstances as well as the consequences of federal, state and
local tax rules affecting an investment in the Trust.

|X| Qualification as a Regulated Investment Company. The Trust has elected to be taxed
as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986,
as amended. As a regulated investment company, the Trust is not subject to federal income
tax on the portion of its net investment income (that is, taxable interest, dividends, and
other taxable ordinary income, net of expenses) and capital gain net income (that is, the
excess of net long-term capital gains over net short-term capital losses) that it
distributes to shareholders. That qualification enables the Trust to "pass through" its
income and realized capital gains to shareholders without having to pay tax on them. This
avoids a "double tax" on that income and capital gains, since shareholders normally will be
taxed on the dividends and capital gains they receive from the Trust (unless their Trust
shares are held in a retirement account or the shareholder is otherwise exempt from tax).

The Internal Revenue Code contains a number of complex tests relating to
qualification that the Trust might not meet in a particular year. If it did not qualify as
a regulated investment company, the Trust would be treated for tax purposes as an ordinary
corporation and would receive no tax deduction for payments made to shareholders.

To qualify as a regulated investment company, the Trust must distribute at least 90%
of its investment company taxable income (in brief, net investment income and the excess of
net short-term capital gain over net long-term capital loss) for the taxable year. The
Trust must also satisfy certain other requirements of the Internal Revenue Code, some of
which are described below. Distributions by the Trust made during the taxable year or,
under specified circumstances, within 12 months after the close of the taxable year, will
be considered distributions of income and gains for the taxable year and will therefore
count toward satisfaction of the above-mentioned requirement.

To qualify as a regulated investment company, the Trust must derive at least 90% of
its gross income from dividends, interest, certain payments with respect to securities
loans, gains from the sale or other disposition of stock or securities or foreign
currencies (to the extent such currency gains are directly related to the regulated
investment company's principal business of investing in stock or securities) and certain
other income including net income derived from an interest in a qualified publicly traded
partnership.

In addition to satisfying the requirements described above, the Trust must satisfy an
asset diversification test in order to qualify as a regulated investment company. Under
that test, at the close of each quarter of the Trust's taxable year, at least 50% of the
value of the Trust's assets must consist of cash and cash items (including receivables),
U.S. government securities, securities of other regulated investment companies, and
securities of other issuers. As to each of those issuers, the Trust must not have invested
more than 5% of the value of the Trust's total assets in securities of each such issuer and
the Trust must not hold more than 10% of the outstanding voting securities of each such
issuer. No more than 25% of the value of its total assets may be invested in the securities
of any one issuer (other than U.S. government securities and securities of other regulated
investment companies), or in two or more issuers which the Trust controls and which are
engaged in the same or similar trades or businesses or in the securities of one or more
qualified publicly traded partnerships. For purposes of this test, obligations issued or
guaranteed by certain agencies or instrumentalities of the U.S. government are treated as
U.S. government securities. Trust investments in partnerships, including qualified publicly
traded partnerships, may result in the Trust being subject to state, local or foreign
income, franchise or withholding liabilities.

|X| Excise Tax on Regulated Investment Companies. Under the Internal Revenue Code, by
December 31 each year, the Trust must distribute 98% of its taxable investment income
earned from January 1 through December 31 of that year and 98% of its capital gains
realized in the period from November 1 of the prior year through October 31 of the current
year. If it does not, the Trust must pay an excise tax on the amounts not distributed. It
is presently anticipated that the Trust will meet those requirements. To meet this
requirement, in certain circumstances the Trust might be required to liquidate portfolio
investments to make sufficient distributions to avoid excise tax liability. However, the
Board of Trustees and the Manager might determine in a particular year that it would be in
the best interests of shareholders for the Trust not to make such distributions at the
required levels and to pay the excise tax on the undistributed amounts. That would reduce
the amount of income or capital gains available for distribution to shareholders.

|X| Taxation of Trust Distributions. The Trust anticipates distributing substantially
all of its investment company taxable income for each taxable year. Those distributions
will be taxable to shareholders as ordinary income and treated as dividends for federal
income tax purposes.

Special provisions of the Internal Revenue Code govern the eligibility of the Trust's
dividends for the dividends-received deduction for corporate shareholders. Long-term
capital gains distributions are not eligible for the deduction. The amount of dividends
paid by the Trust that may qualify for the deduction is limited to the aggregate amount of
qualifying dividends that the Trust derives from portfolio investments that the Trust has
held for a minimum period, usually 46 days. A corporate shareholder will not be eligible
for the deduction on dividends paid on Trust shares held for 45 days or less. To the
extent the Trust's dividends are derived from gross income from option premiums, interest
income or short-term gains from the sale of securities or dividends from foreign
corporations, those dividends will not qualify for the deduction. Since it is anticipated
that most of the Trust's income will be derived from interest it receives on its
investments, the Trust does not anticipate that its distributions will qualify for this
deduction.

The Trust may either retain or distribute to shareholders its net capital gain for
each taxable year. The Trust currently intends to distribute any such amounts. If net
long term capital gains are distributed and designated as a capital gain distribution, it
will be taxable to shareholders as a long-term capital gain and will be properly identified
in reports sent to shareholders in January of each year. Such treatment will apply no
matter how long the shareholder has held his or her shares or whether that gain was
recognized by the Trust before the shareholder acquired his or her shares.

If the Trust elects to retain its net capital gain, the Trust will be subject to tax
on it at the 35% corporate tax rate. If the Trust elects to retain its net capital gain,
the Trust will provide to shareholders of record on the last day of its taxable year
information regarding their pro rata share of the gain and tax paid. As a result, each
shareholder will be required to report his or her pro rata share of such gain on their tax
return as long-term capital gain, will receive a refundable tax credit for his/her pro rata
share of tax paid by the Trust on the gain, and will increase the tax basis for his/her
shares by an amount equal to the deemed distribution less the tax credit.

Investment income that may be received by the Trust from sources within foreign
countries may be subject to foreign taxes withheld at the source. The United States has
entered into tax treaties with many foreign countries which entitle the Trust to a reduced
rate of, or exemption from, taxes on such income.

Distributions by the Trust that do not constitute ordinary income dividends or
capital gain distributions will be treated as a return of capital to the extent of the
shareholder's tax basis in their shares. Any excess will be treated as gain from the sale
of those shares, as discussed below. Shareholders will be advised annually as to the U.S.
federal income tax consequences of distributions made (or deemed made) during the year. If
prior distributions made by the Trust must be re-characterized as a non-taxable return of
capital at the end of the fiscal year as a result of the effect of the Trust's investment
policies, they will be identified as such in notices sent to shareholders.

Distributions by the Trust will be treated in the manner described above regardless
of whether the distributions are paid in cash or reinvested in additional shares of the
Trust (or of another fund). Shareholders receiving a distribution in the form of
additional shares will be treated as receiving a distribution in an amount equal to the
fair market value of the shares received, determined as of the reinvestment date.

The Trust will be required in certain cases to withhold 28% of ordinary income
dividends, capital gains distributions and the proceeds of the redemption of shares, paid
to any shareholder (1) who has failed to provide a correct taxpayer identification number
or to properly certify that number when required, (2) who is subject to backup withholding
for failure to report the receipt of interest or dividend income properly, or (3) who has
failed to certify to the Trust that the shareholder is not subject to backup withholding or
is an "exempt recipient" (such as a corporation). Any tax withheld by the Trust is remitted
by the Trust to the U.S. Treasury and is identified in reports mailed to shareholders in
January of each year with a copy sent to the IRS.

|X| Tax Effects of Redemptions of Shares. If a shareholder redeems all or a portion of
his/her shares, the shareholder will recognize a gain or loss on the redeemed shares in an
amount equal to the difference between the proceeds of the redeemed shares and the
shareholder's adjusted tax basis in the shares. All or a portion of any loss recognized in
that manner may be disallowed if the shareholder purchases other shares of the Trust within
30 days before or after the redemption.

In general, any gain or loss arising from the redemption of shares of the Trust will
be considered capital gain or loss, if the shares were held as a capital asset. It will be
long-term capital gain or loss if the shares were held for more than one year. However,
any capital loss arising from the redemption of shares held for six months or less will be
treated as a long-term capital loss to the extent of the amount of capital gain dividends
received on those shares. Special holding period rules under the Internal Revenue Code
apply in this case to determine the holding period of shares and there are limits on the
deductibility of capital losses in any year.

|X| Foreign Shareholders. Under U.S. tax law, taxation of a shareholder who is a foreign
person (including, but not limited to, a nonresident alien individual, a foreign trust, a
foreign estate, a foreign corporation, or a foreign partnership) primarily depends on
whether the foreign person's income from the Trust is effectively connected with the
conduct of a U.S. trade or business. Typically, ordinary income dividends paid (not
including exempt-interest dividends paid by the Trust) from a mutual fund are not
considered "effectively connected" income.

Ordinary income dividends that are paid by the Trust (and are deemed not "effectively
connected income") to foreign persons will be subject to a U.S. tax withheld by the Trust
at a rate of 30%, provided the Trust obtains a properly completed and signed Certificate of
Foreign Status. The tax rate may be reduced if the foreign person's country of residence
has a tax treaty with the U.S. allowing for a reduced tax rate on ordinary income dividends
paid by the Trust. Any tax withheld by the Trust is remitted by the Trust to the U.S.
Treasury and all income and any tax withheld is identified in reports mailed to
shareholders in March of each year with a copy sent to the IRS.

If the ordinary income dividends from the Trust are effectively connected with the
conduct of a U.S. trade or business, then the foreign person may claim an exemption from
the U.S. tax described above provided the Trust obtains a properly completed and signed
Certificate of Foreign Status.

If the foreign person fails to provide a certification of his/her foreign status, the
Trust will be required to withhold U.S. tax at a rate of 28% on ordinary income dividends,
capital gains distributions and the proceeds of the redemption of shares, paid to any
foreign person. Any tax withheld (in this situation) by the Trust is remitted by the Trust
to the U.S. Treasury and all income and any tax withheld is identified in reports mailed to
shareholders in January of each year with a copy sent to the IRS.

The tax consequences to foreign persons entitled to claim the benefits of an
applicable tax treaty may be different from those described herein. Foreign shareholders
are urged to consult their own tax advisors or the U.S. Internal Revenue Service with
respect to the particular tax consequences to them of an investment in the Trust, including
the applicability of the U.S. withholding taxes described above.

Dividend Reinvestment in Another Trust. Direct shareholders of the Trust may elect to
reinvest all dividends and/or capital gains distributions in Class A shares of any eligible
fund listed above. To elect this option, the shareholder must notify the Transfer Agent in
writing and must have an existing account in the fund selected for reinvestment.
Otherwise, the shareholder first must obtain a prospectus for that fund and an application
from the Distributor to establish an account. The investment will be made at the close of
business on the payable date of the dividend or distribution.

Additional Information About the Trust

The Distributor. The Trust's shares are sold through dealers, brokers and other financial
intermediaries and institutions that have a sales agreement with the Sub-Distributor. The
Distributor and the Sub-Distributor also distribute shares of the other funds managed by
the Manager or an affiliate.

The Transfer Agent. Shareholder Services, Inc., the Trust's Transfer Agent, is responsible
for maintaining the Trust's shareholder registry and shareholder accounting records, and
for paying dividends and distributions to shareholders of the Trust. It also handles
shareholder servicing and administrative functions. It serves as the Transfer Agent for an
annual per account fee.

The Custodian. Citibank, N.A. is the custodian of the Trust's assets. The custodian's
responsibilities include safeguarding and controlling the Trust's portfolio securities and
handling the delivery of such securities to and from the Trust. It is the practice of the
Trust to deal with the custodian in a manner uninfluenced by any banking relationship the
custodian may have with the Manager and its affiliates. The Trust's cash balances with the
custodian in excess of $100,000 are not protected by federal deposit insurance. Those
uninsured balances at times may be substantial.

Independent Registered Public Accounting Firm. At a meeting held on August 20, 2008, the
Board of Trustees of the Trust appointed KPMG LLP as the independent registered public
accounting firm to the Trust for fiscal year 2009, replacing the firm of Deloitte & Touche
LLP, effective at the conclusion of the fiscal 2008 audit. During the two most recent
fiscal years the audit reports of Deloitte & Touche LLP contained no adverse opinion or
disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope or
accounting principles. Further, there were no disagreements between the Trust and Deloitte
& Touche LLP on accounting principles, financial statement disclosure or audit scope, which
if not resolved to the satisfaction of Deloitte & Touche LLP would have caused it to make
reference to the disagreements in connection with its reports.

KPMG LLP serves as the independent registered public accounting firm for the Fund. KPMG
llp audits the Fund's financial statements and performs other related audit and tax
services. KPMG LLP also acts as the independent registered public accounting firm for the
Manager and certain other funds advised by the Manager and its affiliates. Audit and
non-audit services provided by KPMG LLP to the Fund must be pre-approved by the Audit
Committee.



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF CENTENNIAL GOVERNMENT TRUST:

We have audited the accompanying statement of assets and liabilities of
Centennial Government Trust (the "Trust"), including the statement of
investments, as of June 30, 2008, and the related statement of operations for
the year then ended, the statements of changes in net assets for each of the two
years in the period then ended, and the financial highlights for each of the
five years in the period then ended. These financial statements and financial
highlights are the responsibility of the Trust's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits.

     We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). 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.
The Trust is not required to have, nor were we engaged to perform, an audit of
its internal control over financial reporting. Our audits included consideration
of internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Trust's internal control over
financial reporting. Accordingly, we express no such opinion. An audit also
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. Our procedures included confirmation
of securities owned as of June 30, 2008, by correspondence with the custodian
and brokers. We believe that our audits provide a reasonable basis for our
opinion.

     In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of the
Trust as of June 30, 2008, the results of its operations for the year then
ended, the changes in its net assets for each of the two years in the period
then ended, and the financial highlights for each of the five years in the
period then ended, in conformity with accounting principles generally accepted
in the United States of America.

DELOITTE & TOUCHE LLP

Denver, Colorado
August 8, 2008


STATEMENT OF INVESTMENTS June 30, 2008
-------------------------------------------------------------------------------

                                               PRINCIPAL
                                                  AMOUNT                      VALUE
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
U.S. GOVERNMENT AGENCIES-99.7%
-------------------------------------------------------------------------------------

Federal Home Loan Bank:
2%,7/1/08                                $    25,900,000            $    25,900,000
2.055%,10/2/08 1                             250,000,000                250,000,000
2.09%,7/7/08                                   6,700,000                  6,697,666
2.14%,11/26/08 1                             100,000,000                 99,979,781
2.15%,7/2/08                                  26,000,000                 25,998,456
-------------------------------------------------------------------------------------
Overseas Private
Investment Corp.,
3.953%,7/17/08 1,2                             2,810,117                  2,821,971

-------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE
(COST $ 411,397,874)                                99.7%               411,397,874
-------------------------------------------------------------------------------------
OTHER ASSETS
NET OF LIABILITIES                                   0.3                  1,259,378
                                         --------------------------------------------
NET ASSETS                                         100.0%           $   412,657,252
                                         ============================================

INDUSTRY CLASSIFICATIONS ARE UNAUDITED.

FOOTNOTES TO STATEMENT OF INVESTMENTS

1. Represents the current interest rate for a variable or increasing rate
security.

2. Illiquid security. The aggregate value of illiquid securities as of June 30,
2008 was $2,821,971, which represents 0.68% of the Trust's net assets. See Note
4 of accompanying Notes.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

                        CENTENNIAL GOVERNMENT TRUST


STATEMENT OF ASSETS AND LIABILITIES June 30, 2008
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------------------------------------
ASSETS
-------------------------------------------------------------------------------------------------------------

Investments, at value  (cost $411,397,874)--see accompanying statement of investments        $  411,397,874
-------------------------------------------------------------------------------------------------------------
Cash                                                                                                178,770
-------------------------------------------------------------------------------------------------------------
Receivables and other assets:
Interest                                                                                          1,638,743
Other                                                                                                90,552
                                                                                             ----------------
Total assets                                                                                    413,305,939

-------------------------------------------------------------------------------------------------------------
LIABILITIES
-------------------------------------------------------------------------------------------------------------

Payables and other liabilities:
Transfer and shareholder servicing agent fees                                                       186,122
Shares of beneficial interest redeemed                                                              143,120
Shareholder communications                                                                          131,827
Dividends                                                                                           115,584
Distribution and service plan fees                                                                   34,282
Trustees' compensation                                                                                8,842
Other                                                                                                28,910
                                                                                             ----------------
Total liabilities                                                                                   648,687

-------------------------------------------------------------------------------------------------------------
NET ASSETS                                                                                   $  412,657,252
                                                                                             ================

-------------------------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
-------------------------------------------------------------------------------------------------------------

Paid-in capital                                                                              $  412,655,668
-------------------------------------------------------------------------------------------------------------
Accumulated net realized gain on investments                                                          1,584
                                                                                             ----------------
NET ASSETS-applicable to 412,643,312 shares of beneficial interest outstanding               $  412,657,252
                                                                                             ================

-------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, REDEMPTION PRICE PER SHARE AND OFFERING PRICE PER SHARE                     $         1.00

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

                        CENTENNIAL GOVERNMENT TRUST


STATEMENT OF OPERATIONS For the Year Ended June 30, 2008
--------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
----------------------------------------------------------------------------------------------------------
Interest                                                                                 $    42,433,032

----------------------------------------------------------------------------------------------------------
EXPENSES
----------------------------------------------------------------------------------------------------------

Management fees                                                                                4,962,261
----------------------------------------------------------------------------------------------------------
Service plan fees                                                                              2,167,796
----------------------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees                                                    783,930
----------------------------------------------------------------------------------------------------------
Shareholder communications                                                                       161,595
----------------------------------------------------------------------------------------------------------
Trustees' compensation                                                                            11,496
----------------------------------------------------------------------------------------------------------
Custodian fees and expenses                                                                        6,024
----------------------------------------------------------------------------------------------------------
Administration service fees                                                                        1,500
----------------------------------------------------------------------------------------------------------
Other                                                                                            159,146
                                                                                         -----------------
Total expenses                                                                                 8,253,748
Less reduction to custodian expenses                                                              (2,620)
                                                                                         -----------------
Net expenses                                                                                   8,251,128

----------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME                                                                         34,181,904

----------------------------------------------------------------------------------------------------------
NET REALIZED GAIN ON INVESTMENTS                                                                   6,182

----------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS                                     $    34,188,086
                                                                                         =================

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

                         CENTENNIAL GOVERNMENT TRUST


STATEMENTS OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------

YEAR ENDED JUNE 30,                                                               2008                      2007
------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------
OPERATIONS
------------------------------------------------------------------------------------------------------------------

Net investment income                                                 $     34,181,904          $     53,106,794
------------------------------------------------------------------------------------------------------------------
Net realized gain (loss)                                                         6,182                       (76)
                                                                      --------------------------------------------
Net increase in net assets resulting from operations                        34,188,086                53,106,718

------------------------------------------------------------------------------------------------------------------
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
------------------------------------------------------------------------------------------------------------------

Dividends from net investment income                                       (34,181,904)              (53,106,794)

------------------------------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
------------------------------------------------------------------------------------------------------------------

Net decrease in net assets resulting from beneficial
interest transactions                                                     (550,297,031)             (185,724,763)

------------------------------------------------------------------------------------------------------------------
NET ASSETS
------------------------------------------------------------------------------------------------------------------

Total decrease                                                            (550,290,849)             (185,724,839)
------------------------------------------------------------------------------------------------------------------
Beginning of period                                                        962,948,101             1,148,672,940
                                                                      --------------------------------------------

End of period                                                         $    412,657,252          $    962,948,101
                                                                      ============================================

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

                         CENTENNIAL GOVERNMENT TRUST


FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------

YEAR ENDED JUNE 30,                                   2008           2007         2006          2005          2004
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
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                .03 1          .05 1        .03 1         .01 1          -- 2
----------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                  (.03)          (.05)        (.03)         (.01)           -- 2
----------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $   1.00      $    1.00     $   1.00      $   1.00      $   1.00
                                                  ====================================================================

----------------------------------------------------------------------------------------------------------------------
TOTAL RETURN 3                                        3.18%          4.64%        3.54%         1.45%         0.48%
----------------------------------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
----------------------------------------------------------------------------------------------------------------------

Net assets, end of period (in millions)           $    413      $     963     $  1,149      $  1,226      $  1,428
----------------------------------------------------------------------------------------------------------------------
Average net assets (in millions)                  $  1,085      $   1,166     $  1,192      $  1,360      $  1,628
----------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income                                 3.15%          4.55%        3.44%         1.41%         0.49%
Total expenses                                        0.76%          0.74%        0.74%         0.73%         0.71%
Expenses after payments, waivers
and/or reimbursements and reduction
to custodian expenses                                 0.76%          0.74%        0.74%         0.73%         0.60%

1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Less than $0.005 per share.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Total returns are not annualized for
periods less than one full year. Returns do not reflect the deduction of taxes
that a shareholder would pay on trust distributions or the redemption of trust
shares.

4. Annualized for periods less than one full year.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

                         CENTENNIAL GOVERNMENT TRUST


NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES

Centennial Government Trust (the "Trust") is registered under the Investment
Company Act of 1940, as amended, as an open-end management investment company.
The Trust's investment objective is to seek a high level of current income that
is consistent with the preservation of capital and the maintenance of liquidity.
The Trust's investment adviser is Centennial Asset Management Corporation (the
"Manager"), a subsidiary of OppenheimerFunds, Inc. ("OFI").

     The following is a summary of significant accounting policies consistently
followed by the Trust.

--------------------------------------------------------------------------------
SECURITIES VALUATION. The net asset value of shares of the Trust is normally
determined twice each day, at Noon Eastern time and at 4:00 P.M. Eastern time on
each day the New York Stock Exchange (the "Exchange") is open for trading.
Securities are valued at cost adjusted by the amortization of discount or
premium to maturity (amortized cost), which approximates market value. If
amortized cost is determined not to approximate market value, the fair value of
the portfolio securities will be determined under procedures approved by the
Trust's Board of Trustees.

--------------------------------------------------------------------------------
FEDERAL TAXES. The Trust intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income to shareholders.
Therefore, no federal income or excise tax provision is required. The Trust
files income tax returns in U.S. federal and applicable state jurisdictions. The
statute of limitations on the Trust's tax return filings generally remain open
for the three preceding fiscal reporting period ends.

The tax components of capital shown in the following table represent
distribution requirements the Trust must satisfy under the income tax
regulations, losses the Trust may be able to offset against income and gains
realized in future years for federal income tax purposes.

        UNDISTRIBUTED NET          UNDISTRIBUTED          ACCUMULATED LOSS
        INVESTMENT INCOME        LONG-TERM GAINS          CARRYFORWARD 1,2
        ---------------------------------------------------------------------
        $139,975                             $--                       $--

1. During the fiscal year ended June 30, 2008, the Trust utilized $4,597 of
capital loss carryforward to offset capital gains realized in that fiscal year.

2. During the fiscal year ended June 30, 2007, the Trust did not utilize any
capital loss carryforwards.

     Net investment income (loss) and net realized gain (loss) may differ for
financial statement and tax purposes. The character of dividends and
distributions made during the fiscal year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividends and distributions, the
fiscal year in which amounts are distributed may differ from the fiscal year in
which the income or net realized gain was recorded by the Trust.

                         CENTENNIAL GOVERNMENT TRUST


The tax character of distributions paid during the years ended June 30, 2008 and
June 30, 2007 was as follows:

                                          YEAR ENDED           YEAR ENDED
                                       JUNE 30, 2008        JUNE 30, 2007
        -------------------------------------------------------------------
        Distributions paid from:
        Ordinary income                  $34,181,904          $53,106,794

--------------------------------------------------------------------------------
TRUSTEES' COMPENSATION. The Board of Trustees has adopted a compensation
deferral plan for independent trustees that enables trustees to elect to defer
receipt of all or a portion of the annual compensation they are entitled to
receive from the Trust. For purposes of determining the amount owed to the
Trustee under the plan, deferred amounts are treated as though equal dollar
amounts had been invested in shares of the Trust or in other Oppenheimer funds
selected by the Trustee. The Trust purchases shares of the funds selected for
deferral by the Trustee in amounts equal to his or her deemed investment,
resulting in a Trust asset equal to the deferred compensation liability. Such
assets are included as a component of "Other" within the asset section of the
Statement of Assets and Liabilities. Deferral of trustees' fees under the plan
will not affect the net assets of the Trust, and will not materially affect the
Trust's assets, liabilities or net investment income per share. Amounts will be
deferred until distributed in accordance to the compensation deferral plan.

--------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations and
may differ from U.S. generally accepted accounting principles, are recorded on
the ex-dividend date. Income distributions, if any, are declared daily and paid
monthly. Capital gain distributions, if any, are declared and paid annually but
may be paid at other times to maintain the net asset value per share at $1.00.

--------------------------------------------------------------------------------
INVESTMENT INCOME. Interest income is recognized on an accrual basis. Discount
and premium, which are included in interest income on the Statement of
Operations, are amortized or accreted daily.

--------------------------------------------------------------------------------
CUSTODIAN FEES. "Custodian fees and expenses" in the Statement of Operations may
include interest expense incurred by the Trust on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Trust pays
interest to its custodian on such cash overdrafts, to the extent they are not
offset by positive cash balances maintained by the Trust, at a rate equal to the
Federal Funds Rate plus 0.50%. The "Reduction to custodian expenses" line item,
if applicable, represents earnings on cash balances maintained by the Trust
during the period. Such interest expense and other custodian fees may be paid
with these earnings.

--------------------------------------------------------------------------------
SECURITY TRANSACTIONS. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.

                         CENTENNIAL GOVERNMENT TRUST


NOTES TO FINANCIAL STATEMENTS Continued
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued

INDEMNIFICATIONS. The Trust's organizational documents provide current and
former trustees and officers with a limited indemnification against liabilities
arising in connection with the performance of their duties to the Trust. In the
normal course of business, the Trust may also enter into contracts that provide
general indemnifications. The Trust's maximum exposure under these arrangements
is unknown as this would be dependent on future claims that may be made against
the Trust. The risk of material loss from such claims is considered remote.

--------------------------------------------------------------------------------
OTHER. The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America 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 increases and
decreases in net assets from operations during the reporting period. Actual
results could differ from those estimates.

--------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST

The Trust has authorized an unlimited number of no par value shares of
beneficial interest. Transactions in shares of beneficial interest were as
follows:

                                              YEAR ENDED JUNE 30, 2008                YEAR ENDED JUNE 30, 2007
                                            SHARES              AMOUNT             SHARES               AMOUNT
-----------------------------------------------------------------------------------------------------------------
Sold                                 3,038,183,999    $  3,038,183,999      3,034,292,571    $   3,034,292,571
Dividends and/or
distributions reinvested                33,713,745          33,713,745         52,871,375           52,871,375
Redeemed                            (3,622,194,775)     (3,622,194,775)    (3,272,888,709)      (3,272,888,709)
                                    -----------------------------------------------------------------------------
Net decrease                          (550,297,031)   $   (550,297,031)      (185,724,763)    $   (185,724,763)
                                    =============================================================================

--------------------------------------------------------------------------------
3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES

MANAGEMENT FEES. Under the investment advisory agreement, the Trust pays the
Manager a management fee based on the daily net assets of the Trust at an annual
rate as shown in the following table:

        FEE SCHEDULE
        ---------------------------------------------
        Up to $250 million                   0.500%
        Next $250 million                    0.475
        Next $250 million                    0.450
        Next $250 million                    0.425
        Next $250 million                    0.400
        Next $250 million                    0.375
        Over $1.5 billion                    0.350

--------------------------------------------------------------------------------
ADMINISTRATION SERVICE FEES. The Trust pays the Manager a fee of $1,500 per year
for preparing and filing the Trust's tax returns.

                         CENTENNIAL GOVERNMENT TRUST


--------------------------------------------------------------------------------
TRANSFER AGENT FEES. Shareholder Services, Inc. ("SSI") acts as the transfer and
shareholder servicing agent for the Trust. The Trust pays SSI a per account fee.
For the year ended June 30, 2008, the Trust paid $660,974 to SSI for services to
the Trust.

--------------------------------------------------------------------------------
SERVICE PLAN (12b-1) FEES. The Trust has adopted a Service Plan (the "Plan"). It
reimburses Centennial Asset Management Corporation (the "Distributor"), for a
portion of its costs incurred for services provided to accounts that hold shares
of the Trust. Reimbursement is made periodically depending on asset size, at an
annual rate of up to 0.20% of the average annual net assets of the Trust. The
Distributor currently uses all of those fees (together with significant amounts
from the Manager's own resources) to pay dealers, brokers, banks and other
financial institutions periodically for providing personal service and
maintenance of accounts of their customers that hold shares of the Trust. Fees
incurred by the Trust under the Plan are detailed in the Statement of
Operations.

--------------------------------------------------------------------------------
WAIVERS AND REIMBURSEMENTS OF EXPENSES. SSI has voluntarily agreed to limit
transfer and shareholder servicing agent fees to 0.35% of average annual net
assets of the Trust. This undertaking may be amended or withdrawn at any time.

--------------------------------------------------------------------------------
4. ILLIQUID SECURITIES

As of June 30, 2008, investments in securities included issues that are
illiquid. Investments may be illiquid because they do not have an active trading
market, making it difficult to value them or dispose of them promptly at an
acceptable price. The Trust will not invest more than 10% of its net assets
(determined at the time of purchase and reviewed periodically) in illiquid
securities. Securities that are illiquid are marked with an applicable footnote
on the Statement of Investments.

--------------------------------------------------------------------------------
5. RECENT ACCOUNTING PRONOUNCEMENTS

In September 2006, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 157, FAIR VALUE
MEASUREMENTS. This standard establishes a single authoritative definition of
fair value, sets out a framework for measuring fair value and expands
disclosures about fair value measurements. SFAS No. 157 applies to fair value
measurements already required or permitted by existing standards. SFAS No. 157
is effective for financial statements issued for fiscal years beginning after
November 15, 2007, and interim periods within those fiscal years. As of June 30,
2008, the Manager does not believe the adoption of SFAS No. 157 will materially
impact the financial statement amounts; however, additional disclosures may be
required about the inputs used to develop the measurements and the effect of
certain of the measurements on changes in net assets for the period.

     In March 2008, FASB issued SFAS No. 161, DISCLOSURES ABOUT DERIVATIVE
INSTRUMENTS AND HEDGING ACTIVITIES. This standard requires enhanced disclosures
about derivative and hedging activities, including qualitative disclosures about
how and why the Trust uses

                         CENTENNIAL GOVERNMENT TRUST


NOTES TO FINANCIAL STATEMENTS Continued
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
5. RECENT ACCOUNTING PRONOUNCEMENTS Continued

derivative instruments, how these activities are accounted for, and their effect
on the Trust's financial position, financial performance and cash flows. SFAS
No. 161 is effective for financial statements issued for fiscal years beginning
after November 15, 2008 and interim periods within those fiscal years. At this
time, management is evaluating the implications of SFAS No. 161 and its impact
on the Trust's financial statements and related disclosures.

--------------------------------------------------------------------------------
6. SUBSEQUENT EVENT

As of June 30, 2008, A.G. Edwards, a division of Wachovia Securities, LLC, a
broker-dealer, held approximately 83.30% of the issued and outstanding shares of
the Trust on that date, for the benefit of its clients' accounts. A.G. Edwards
has informed the Manager that on August 15, 2008, it intends to redeem shares of
the Trust representing approximately one-half of the issued and outstanding
shares of the Trust.

                       CENTENNIAL GOVERNMENT TRUST

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 Trust. The ratings descriptions are
based on information supplied by the ratings organizations to subscribers.

SHORT TERM DEBT RATINGS.

Moody's Investors Service, Inc. ("Moody's")

The following rating designations for commercial paper (defined by Moody's as promissory
obligations not having original maturity in excess of nine months), are judged by Moody's
to be investment grade, and indicate the relative repayment capacity of rated issuers:

Prime-1: Superior capacity for repayment. Capacity will normally be evidenced by the
following characteristics: (a) leading market positions in well-established industries; (b)
high rates of return on funds employed; (c) conservative capitalization structure 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:

MIG 1/VMIG 1: Denotes superior credit quality. Excellent protection is afforded by
established cash flows, highly reliable liquidity support or demonstrated broad-based
access to the market for refinancing.

MIG 2/VMIG 2: Denotes strong credit quality. Margins of protection are ample although not
as large as in the preceding group.

Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc.
("Standard and Poor's")

The following ratings by Standard and Poor's for commercial paper (defined by Standard and
Poor's as debt having an original maturity of no more than 365 days) assess the likelihood
of payment:
A-1: Obligation is rated in the highest category. The obligor's capacity to meet its
financial commitment on the obligation is strong. Within this category, a plus (+) sign
designation indicates the obligor's capacity to meet its financial obligation is extremely
strong.

A-2: Obligation is somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than obligations in higher rating categories.
However, the obligor's capacity to meet its financial commitment on the obligation is
satisfactory.

Standard and Poor's ratings for Municipal Notes due in 3 years or less:

SP-1: Strong capacity to pay principal and interest. An issue determined to possess a very
strong capacity to pay debt service is given a (+) designation.

SP-2: Satisfactory capacity to pay principal and interest, with some vulnerability to
adverse financial and economic changes over the term of the notes.

Standard and Poor's 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, Standard and Poor's note rating symbols are
used with the commercial paper symbols (for example, "SP-1+/A-1+").

Fitch, Inc. ("Fitch")

Fitch assigns the following short-term ratings to debt obligations that are payable on
demand or have original maturities of generally up to three years, including commercial
paper, certificates of deposit, medium-term notes, and municipal and investment notes:

F1: Highest credit quality. Strongest capacity for timely payment of financial commitments.
May have an added "+" to denote any exceptionally strong credit feature.

F2: Good credit quality. A satisfactory capacity for timely payment of financial
commitments, but the margin of safety is not as great as in the case of higher ratings.

Dominion Bond Rating Service Limited ("DBRS")
--------------------------------------------------------------------------------------------

R-1: Short term debt rated "R-1 (high)" is of the highest credit quality, and indicates an
entity which possesses unquestioned ability to repay current liabilities as they fall due.
Entities rated in this category normally maintain strong liquidity positions, conservative
debt levels and profitability which is both stable and above average. Companies achieving
an "R-1 (high)" rating are normally leaders in structurally sound industry segments with
proven track records, sustainable positive future results and no substantial qualifying
negative factors. Given the extremely tough definition which DBRS has established for an
"R-1 (high)", few entities are strong enough to achieve this rating. Short term debt rated
"R-1 (middle)" is of superior credit quality and, in most cases, ratings in this category
differ from "R-1 (high)" credits to only a small degree. Given the extremely tough
definition which DBRS has for the "R-1 (high)" category (which few companies are able to
achieve), entities rated "R-1 (middle)" are also considered strong credits which typically
exemplify above average strength in key areas of consideration for debt protection. Short
term debt rated "R-1 (low)" is of satisfactory credit quality. The overall strength and
outlook for key liquidity, debt and profitability ratios is not normally as favorable as
with higher rating categories, but these considerations are still respectable. Any
qualifying negative factors which exist are considered manageable, and the entity is
normally of sufficient size to have some influence in its industry.

R-2: Short term debt rated "R-2" is of adequate credit quality and within the three subset
grades (high, middle, low), debt protection ranges from having reasonable ability for
timely repayment to a level which is considered only just adequate. The liquidity and debt
ratios of entities in the "R-2" classification are not as strong as those in the "R-1"
category, and the past and future trend may suggest some risk of maintaining the strength
of key ratios in these areas. Alternative sources of liquidity support are considered
satisfactory; however, even the strongest liquidity support will not improve the commercial
paper rating of the issuer. The size of the entity may restrict its flexibility, and its
relative position in the industry is not typically as strong as the "R-1 credit".
Profitability trends, past and future, may be less favorable, earnings not as stable, and
there are often negative qualifying factors present which could also make the entity more
vulnerable to adverse changes in financial and economic conditions.

LONG TERM DEBT RATINGS.

These ratings are relevant for securities purchased by the Trust with a remaining maturity
of 397 days or less, or for rating issuers of short-term obligations.

Moody's

Bonds (including municipal bonds) are rated as follows:

Aaa: Judged to be the best quality. They carry the smallest degree of investment risk and
are generally referred to as "gilt edged." 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, the changes that can be expected are most unlikely to impair
the fundamentally strong position 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 with "Aaa" securities or
fluctuation of protective elements may be of greater amplitude or there may be other
elements present which make the long-term risk appear somewhat larger than that of "Aaa"
securities.

Moody's applies numerical modifiers "1", "2" and "3" in its "Aa" rating
classification. The modifier "1" indicates that the obligation ranks in the higher end of
its generic rating category; the modifier "2" indicates a mid-range ranking; and the
modifier "3" indicates a ranking in the lower end of that generic rating category.

Standard and Poor's

Bonds (including municipal bonds maturing beyond 3 years) are rated as follows:

AAA: Bonds rated "AAA" have the highest rating assigned by Standard & Poor's. The obligor's
capacity to meet its financial commitment on the obligation is extremely strong.

AA: Bonds rated "AA" differ from the highest rated obligations only in small degree. A
strong capacity to meet its financial commitment on the obligation is very strong.

Fitch

AAA: Highest Credit Quality. "AAA" ratings denote the lowest expectation of credit risk.
They are assigned only in the case of exceptionally strong capacity for timely payment of
financial commitments. This capacity is highly unlikely to be adversely affected by
foreseeable events.

AA: Very High Credit Quality. "AA" ratings denote a very low expectation of credit risk.
They indicate a very strong capacity for timely payment of financial commitments. This
capacity is not significantly vulnerable to foreseeable events.

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+."

Investment Advisor and Distributor
Centennial Asset Management Corporation
6803 South Tucson Way
Centennial, Colorado 80112

Sub-Distributor
OppenheimerFunds Distributor, Inc.
P.O. Box 5254
Denver, Colorado 80217-5254

Transfer Agent
Shareholder Services, Inc.
P.O. Box 5143
Denver, Colorado 80217-5143
1.800.525.9310

Custodian of Portfolio Securities
Citibank, N.A.
111 Wall Street
New York, New York 10005

Independent Registered Public Accounting Firm
KPMG LLP
707 Seventeenth Street
Denver, Colorado 80202

Legal Counsel
K&L Gates LLP
70 West Madison Street, Suite 3100
Chicago, Illinois 60602

PX0170.001.1008.rev0509

(1). In accordance with Rule 12b-1 of the Investment Company Act, the term "Independent
Trustees" in this Statement of Additional Information refers to those Trustees who are not
"interested persons" of the Trust and who do not have any direct or indirect financial
interest in the operation of the plan or any agreement under the plan.