<PAGE>
S E L I G M A N
---------------------------
NEW TECHNOLOGIES
FUND, INC.
[PHOTOS OMITTED]
MID-YEAR REPORT
JUNE 30, 2000
SEEKING LONG-TERM
CAPITAL APPRECIATION BY
INVESTING IN COMPANIES
THAT HAVE THE POTENTIAL
TO PRODUCE TOMORROW'S
TECHNOLOGIES
[LOGO OMITTED]
J. & W. SELIGMAN & CO.
INCORPORATED
ESTABLISHED 1864
<PAGE>
SELIGMAN -- TIMES CHANGE...VALUES ENDURE
J. & W. SELIGMAN & CO. INCORPORATED IS A FIRM WITH A LONG TRADITION OF
INVESTMENT EXPERTISE, OFFERING A BROAD ARRAY OF INVESTMENT CHOICES TO HELP
TODAY'S INVESTORS SEEK THEIR LONG-TERM FINANCIAL GOALS.
TIMES CHANGE...
Established in 1864, Seligman has a history of providing financial services
marked not by fanfare, but rather by a quiet and firm adherence to financial
prudence. While the world has changed dramatically in the 136 years since
Seligman first opened its doors, the firm has continued to offer its clients
high-quality investment solutions through changing times.
In the late 19th century, as the country grew, Seligman helped finance the
westward expansion of the railroads, the construction of the Panama Canal, and
the launching of urban transit systems. In the first part of the 20th century,
as America became an industrial power, the firm helped fund the growing capital
needs of the nascent automobile and steel industries.
[PHOTO OMITTED]
JAMES, JESSE, AND JOSEPH SELIGMAN, 1870
With the formation of Tri-Continental Corporation in 1929 -- today, the nation's
largest diversified publicly-traded closed-end investment company -- Seligman
began shifting its emphasis from investment banking to investment management.
Despite the stock market crash and ensuing depression, Seligman was convinced of
the importance that investment companies could have in building wealth for
individual investors and began managing its first mutual fund in 1930.
In the decades that followed, Seligman has continued to offer forward-looking
investment solutions, including equity funds that specialize in small companies,
technology, or international securities, and bond funds that focus on high-yield
issuers, US government bonds, or municipal securities.
...VALUES ENDURE
Seligman is proud of its distinctive past and of the traditional values that
continue to shape the firm's business decisions and investment judgment. While
much has changed over the years, the firm's commitment to providing prudent
investment management that seeks to build wealth for clients over time is an
enduring value that will guide Seligman in the new millennium.
------------------------------------------------------------
TABLE OF CONTENTS
To the Shareholders .................................. 1
Interview With Your Portfolio Managers ............... 2
Performance Overview ................................. 4
Portfolio Overview ................................... 5
Portfolio of Investments ............................. 7
Statement of Assets and Liabilities .................. 10
Statement of Operations .............................. 11
Statements of Changes in Net Assets .................. 12
Notes to Financial Statements ........................ 13
Financial Highlights ................................. 18
Report of Independent Auditors AND
For More Information ............................... 19
Board of Directors AND Executive Officers ............ 20
Glossary of Financial Terms .......................... 21
------------------------------------------------------------
<PAGE>
TO THE SHAREHOLDERS
For the six months ended June 30, 2000, Seligman New Technologies Fund delivered
a total return of 17.03%. During the same time period, the Goldman Sachs
Technology Index returned 5.64% and the Lipper Sector Equity Funds Average
returned 11.72%. These returns assume reinvestment of dividends and capital
gains, if any.
While the Fund delivered strong returns, the six-month period was a challenging
one for the stock market in general, and for technology stocks in particular. In
June 1999, in an effort to slow the economy, the Federal Reserve Board began
raising interest rates. Over the course of this one-year period, the federal
funds rate was increased by 175 basis points, from 4.75% before the June 1999
Fed meeting, to 6.50% following the most recent 50 basis point increase in May
2000.
Investor fear induced a significant correction in the Nasdaq Composite Index (a
technology-heavy index) in March. From March 10 through May 23, 2000, this index
lost 37% of its market value. Meanwhile, stocks in other industries with solid
earnings and strong underlying fundamentals made a significant comeback, while
"concept stocks," those of companies with interesting business models but
without earnings, fell out of favor.
As the six months came to a close, the economy finally showed signs of a
slowdown. Growth and concept stocks then temporarily regained some momentum,
recovering some of the ground that had been lost earlier in the period. By the
end of the six months, in which investors wavered between growth and value
stocks, the broad market averages delivered generally flat results.
At period-end, 58.7% of the portfolio was invested in publicly traded companies,
36.8% was invested in venture capital companies, and 4.5% was invested in cash
and short-term securities. The Fund's venture capital investments made a
significant contribution to overall performance during this time. We are
optimistic that these holdings will continue to be rewarding for the Fund and
its shareholders over the long term.
In May, the Fund's Board of Directors increased the Fund's 35% restriction on
venture capital investments but only on a very limited basis. Henceforth,
additional venture capital investments will be allowed for follow-on investments
at all times where the Manager believes that the Fund could be adversely
affected by not participating in such follow-on investments. This added
flexibility should help protect the interests of the Fund and its shareholders
with respect to existing venture capital investments.
Thank you for your support of Seligman New Technologies Fund. A discussion with
your portfolio managers, as well as the Fund's investments results, portfolio of
investments and financial statements, follows this letter. We look forward to
serving your investment needs for many years to come.
By order of the Board of Directors,
/s/ William C. Morris
---------------------
William C. Morris
Chairman
/s/ Brian T. Zino
-----------------
Brian T. Zino
President
August 11, 2000
1
<PAGE>
INTERVIEW WITH YOUR PORTFOLIO MANAGERS,
PAUL H. WICK AND STORM BOSWICK
Q: HOW DID SELIGMAN NEW TECHNOLOGIES FUND PERFORM DURING THE FIRST SIX MONTHS
OF 2000?
A: Seligman New Technologies Fund posted a total return of 17.03%. This return
outpaced the 5.64% total return delivered by the Goldman Sachs Technology
Index, an index designed to measure the performance of the technology
sector, the 11.72% delivered by the Lipper Sector Equity Funds Average, an
average of closed-end funds with various investment objectives, and the
-0.49% return delivered by the Standard & Poor's 500 Composite Stock Index
(S&P 500), a broad-based index designed to represent the US stock market.
All returns assume reinvestment of dividends and capital gains, if any.
Q: THE FIRST HALF OF 2000 WAS A PARTICULARLY VOLATILE PERIOD FOR THE TECHNOLOGY
SECTOR. WHAT FACTORS CONTRIBUTED TO THIS VOLATILITY?
A: The technology sector as a whole had a difficult six months. The Nasdaq
Composite Index, which is a technology-heavy index, hit a historical high of
5049 on March 10, and then began to fall rapidly. By May 23, the Index had
fallen to 3165 -- a 37% loss of market value in just ten weeks. The sector
rallied somewhat in June, but most stocks remained substantially down from
their highs.
Throughout 1999, investors had driven the prices of many technology
companies with no earnings to levels that we had believed were
unsustainable. Market confidence began to waver when the economy, after
nearly a year of rate increases by the Federal Reserve Board, showed no
signs of slowing. Investors soon became concerned that the Fed would need to
continue to raise interest rates, possibly aggressively, in order to cool
the economic expansion and ward off inflationary pressures. As investor
confidence faded, the most richly valued stocks began to fall, with
technology taking the lead.
[PHOTO OMITTED]
WEST COAST TECHNOLOGY GROUP: (STANDING, FROM LEFT) MICHAEL GUTHRIE, PAUL WICK
(PORTFOLIO MANAGER), MARIANNE HURLOW (ADMINISTRATIVE ASSISTANT), (SEATED, FROM
LEFT) MATTHEW ALFANO, PATRICK RENDA, (NOT PICTURED) MANFRED KRIKKE, VISHAL
SALUJA
Q: HOW DID THE FUND DELIVER STRONG RETURNS IN SPITE OF THIS SIGNIFICANT
CORRECTION?
A: The Fund uses a bottom-up stock selection process. This means that we pick
stocks based on what we think of the individual companies. We look for
strong growth prospects, high profit margins or return on capital,
attractive valuations relative to earnings and cash flow, strong management
teams, and unique competitive advantages.
We don't buy stocks simply because their prices appear to be on an upward
trend. We feel that investor behavior prior to the March correction -- in
which stocks were driven higher as a result of market momentum --
[PHOTO OMITTED]
EAST COAST TECHNOLOGY GROUP: (STANDING, FROM LEFT) LAWRENCE ROSSO, SHANEAN
AUSTIN (ADMINISTRATIVE ASSISTANT), (SEATED) STORM BOSWICK (CO-PORTFOLIO
MANAGER), (NOT PICTURED) GREGORY COTE, STEVEN WERBER, JAMES (HANK) SWIGGETT.
2
<PAGE>
INTERVIEW WITH YOUR PORTFOLIO MANAGERS,
PAUL H. WICK AND STORM BOSWICK
had to correct itself. The companies in the Fund's portfolio had been chosen
because, based on our research, we believed that their prices were
reasonable relative to their prospects. The prices were not, in our opinion,
inflated as a result of investor enthusiasm. As we had expected, these
stocks -- and thus the portfolio as a whole -- did indeed weather the
correction well.
In addition to the Fund's investment process, the way the Fund is structured
also reduced volatility during this time. Thirty-seven percent of the Fund's
assets were invested in venture capital at period-end. This significant
position lowers the Fund's overall volatility because these investments are
not publicly traded.
Q: HOW DID THE FUND'S VENTURE CAPITAL INVESTMENTS PERFORM DURING THIS TIME?
A: Most of the Fund's return during this time was the result of its investments
in public companies. The Fund's investments in venture capital are illiquid,
long-term investments. The Fund does not realize any benefit from these
investments until these companies complete initial public offerings, or are
sold to another company. However, we believe that these investments
represent outstanding opportunities for capital appreciation potential over
the long term.
A TEAM APPROACH
Seligman New Technologies Fund is managed by the Seligman Global Technology
Group, headed by Paul H. Wick. Mr. Wick and Storm Boswick, the Fund's
Co-Portfolio Manager, are assisted in the management of the Fund by a team of
seasoned research professionals who develop relationships with technology
industry executives, investment banks, and venture capital firms to identify
opportunities that they believe offer the greatest potential for growth.
Q: WHAT SECTORS IMPACTED THE FUND'S PERFORMANCE DURING THIS TIME?
A: Software, Internet infrastructure, and semiconductors were the Fund's
strongest performers. Semiconductors benefited from the explosive growth and
demand for many of the products that utilize them, such as wireless
handsets, personal computers, and consumer electronics. The Internet/Online
sector, which was one of the worst performing sectors in the market overall,
detracted from the Fund's performance.
Q: WHAT IS YOUR OUTLOOK?
A: We remain optimistic regarding technology stocks, and believe that the
Fund's ability to pursue venture capital investments may serve the Fund well
in the months ahead. We remain enthusiastic about semiconductors, which
should benefit from a growing market as a result of the continued demand for
wireless telephones, Internet access, and digital consumer electronics. We
are also positive regarding the prospects for wireless handsets. This market
is expected to grow from 260 million handsets in 1999 to 430 million in the
year 2000, and projections for 2001 are between 580 and 650 million
handsets.
Over the long term, we are optimistic regarding the prospects for the
Internet/online sector and are excited regarding the prospects for many of
the Fund's venture capital investments in this area. The Internet is now
widely used in the United States and Europe, and we believe that its use
will continue to expand around the globe.
The technology sector is likely to be volatile in the months ahead, and we
remain concerned about the continued high valuations of some large-cap
technology companies. However, we believe we will continue to find
attractive opportunities among companies that do not yet sell shares in the
public market, and among public small- and mid-cap companies. For the
long-term investor, we believe the technology sector remains an exciting
segment of the market with solid prospects for continued growth.
3
<PAGE>
PERFORMANCE OVERVIEW
INVESTMENT RESULTS PER SHARE
TOTAL RETURNS*
FOR PERIODS ENDED JUNE 30, 2000
SIX SINCEINCEPTION
MONTHS 7/27/99
------------ ------------------
With Sales Charge** 13.54% 82.37%
Without Sales Charge** 17.03 88.01
Goldman Sachs Technology Index+ 5.64 59.37++
Lipper Sector Equity Funds Average+ 11.72 26.73++
S&P 500+ (0.49) 10.70
NET ASSET VALUE
June 30, 2000 $43.70
December 31, 1999 37.34
July 27, 1999*** 24.25
CAPITAL GAIN INFORMATION
FOR THE SIX MONTHS ENDED JUNE 30, 2000
Realized $ 4.649o
Unrealized 10.811oo
The rates of return will vary and the principal value of an investment will
fluctuate. Shares, if redeemed, may be worth more or less than their original
cost. Past performance is not indicative of future investment results. The
Fund's returns since inception were achieved during a market favorable to
companies in the technology sector and benefited significantly from investments
in IPOs. There can be no assurances that the Fund will continue to achieve, by
investing in IPOs or otherwise, this performance in the future.
Investments in one economic sector, such as technology, may be subject to
greater price fluctuations than owning a portfolio of diversified investments.
In addition, the securities in which Seligman New Technologies Fund invests may
be subject to greater government regulation, greater price fluctuation, and
limited liquidity. The stocks of smaller companies may be subject to
above-average risk. The Fund may invest in foreign technology stocks which may
be subject to additional risks, including currency fluctuations, foreign
taxation, differences in financial reporting practices, and rapid changes in
political and economic conditions. Venture capital companies represent highly
speculative investments by the Fund. There can be no assurances that any of the
venture capital companies in which the Fund invests will complete public
offerings or be sold, or, if such events occur, with respect to the timing or
values of such offerings or sales. Changes in the Fund's net asset value may be
more pronounced and more rapid than with other funds because of the Fund's
emphasis on venture capital companies that are not publicly traded. The Fund's
net asset value per share may change materially from day to day, including
during the time between the date a repurchase offer is mailed and the due date
for tendering shares, and during the period immediately after a repurchase is
completed.
-----------
* Returns for periods of less than one year are not annualized.
** Return figures reflect any change in price per share and assume the
investment of capital gain distributions.
*** Commencement of operations.
+ The Goldman Sachs Technology Index, the Lipper Sector Equity Funds Average,
and the S&P 500 are unmanaged benchmarks that assume investment of
dividends. The Lipper Sector Equity Funds Average excludes the effect of
sales charges. The Goldman Sachs Technology Index and the S&P 500 exclude
the effect of fees and sales charges. Investors cannot invest directly in
an index or an average.
++ From 7/31/99.
o Excludes $4.596 of net gain realized in November and December 1999, paid
July 28, 2000.
oo Represents the per share amount of net unrealized appreciation of portfolio
securities as of June 30, 2000.
4
<PAGE>
PORTFOLIO OVERVIEW
DIVERSIFICATION OF NET ASSETS
JUNE 30, 2000
<TABLE>
<CAPTION>
PERCENT OF NET ASSETS
---------------------
JUNE 30, DEC. 31,
ISSUES COST VALUE 2000 1999
------ -------------- -------------- ------- -------
<S> <C> <C> <C> <C> <C>
COMMON STOCKS:
Communications Infrastructure ............. 7 $ 23,612,963 $ 114,038,738 11.0 4.7
Communications Services ................... 4 19,551,934 32,114,720 3.1 3.7
Computer and Business Services ............ 2 3,421,374 10,591,456 1.0 3.8
Computer Hardware/Peripherals ............. 6 48,322,805 43,329,381 4.2 8.3
Computer Software ......................... 15 101,770,073 137,893,780 13.3 21.7
Electronics Capital Equipment ............. 3 22,382,241 38,041,577 3.7 3.2
Electronic Components ..................... 1 5,470,148 5,804,903 0.6 --
Information Services ...................... 2 18,705,494 18,319,672 1.8 --
Internet/Online ........................... 9 53,531,333 68,631,764 6.7 12.6
Media ..................................... 6 56,254,885 51,792,122 5.0 9.1
Semiconductors ............................ 7 63,448,703 74,247,534 7.2 7.6
Miscellaneous ............................. 2 4,267,667 21,953,703 2.1 --
Other ..................................... 1 48 25 -- --
--- -------------- ---------------- ----- -----
65 420,739,668 616,759,375 59.7 74.7
--- -------------- ---------------- ----- -----
CONVERTIBLE PREFERRED STOCKS:
Communications Infrastructure ............. 4 9,323,689 9,384,744 0.9 0.2
Computer Software ......................... 20 56,248,600 54,381,212 5.3 0.9
Internet/Online ........................... 63 217,559,839 278,752,715 27.0 16.0
Semiconductors ............................ 3 8,731,280 9,130,000 0.9 --
Telecommunications ........................ 2 12,880,000 12,880,000 1.2 1.8
Wireless Telephone ........................ 1 2,400,000 2,400,000 0.2 --
--- -------------- ---------------- ----- -----
93 307,143,408 366,928,671 35.5 18.9
--- -------------- ---------------- ----- -----
LIMITED PARTNERSHIPS:
Miscellaneous ............................. 4 2,568,651 2,542,765 0.2 0.1
--- -------------- ---------------- ----- -----
CONVERTIBLE PROMISSORY NOTE:
Internet/Online ........................... 1 771,976 771,976 0.1 0.1
--- -------------- ---------------- ----- -----
SHORT-TERM HOLDING AND
OTHER ASSETS LESS LIABILITIES ............. 1 46,816,188 46,816,188 4.5 6.2
--- -------------- ---------------- ----- -----
NET ASSETS ................................... 164 $778,039,891 $1,033,818,975 100.0 100.0
=== ============== ================ ===== =====
</TABLE>
LARGEST INDUSTRIES
JUNE 30, 2000
[Figures below represent bar chart in printed piece]
INTERNET/ONLINE $347,384,479
COMPUTER SOFTWARE $192,274,992
COMMUNICATIONS INFRASTRUCTURE $123,423,482
SEMI-CONDUCTORS $ 83,377,534
MEDIA $ 51,792,122
5
<PAGE>
PORTFOLIO OVERVIEW
ALLOCATION OF INVESTMENTS
JUNE 30, 2000
[Figures below represent pie-chart in printed piece]
Net Cash and Short-Term Holdings 4.5%
Publicly Traded Companies 58.7%
Venture Capital 36.8%
LARGEST PORTFOLIO HOLDINGS
JUNE 30, 2000
SECURITY VALUE
--------- --------------
ONI Systems ............................. $46,906,087
New Focus ............................... 35,294,820
Software.com ............................ 24,871,575
Capstone Turbine ........................ 21,433,687
Global Medical Products (Series A) ...... 19,656,000
Novellus Systems ........................ 18,506,156
Integrated Device Technologies .......... 18,000,000
Lattice Semiconductor ................... 17,634,844
Intuit .................................. 16,896,812
Rational Software ....................... 16,723,125
LARGEST PORTFOLIO CHANGES
DURING PAST SIX MONTHS
SHARES
-------------------------
HOLDINGS
ADDITIONS INCREASE 6/30/00
--------- ----------- ------------
America Online ................. 250,000 250,000
Arrow Electronics .............. 300,000 300,000
Ciena .......................... 60,000 60,000
Gartner Group (Class A) ........ 825,000 825,000
Hyperion Solutions ............. 314,000 314,000
Integrated Device
Technology ................... 300,000 300,000
Intuit ......................... 193,800 409,000
OurHouse (Series D) ............ 1,316,666 1,316,666
PSINet ......................... 387,000 387,000
Synopsys ....................... 223,000 223,000
SHARES
--------------------------
HOLDINGS
REDUCTIONS DECREASE 6/30/00
---------- ------------ ------------
Amdocs ......................... 175,700 134,000
Applied Micro Circuits ......... 181,200 --
C-Cube Microsystems ............ 332,000 --
Check Point Software
Technologies (Israel) ........ 84,000* 46,000
Creative Technology
(Singapore) .................. 505,300 --
Digital Microwave .............. 382,500 --
Documentum ..................... 150,400 --
Internet Security Systems** .... 174,500 --
Rational Software .............. 162,800 180,000
Verio .......................... 181,800 --
Largest portfolio changes from the previous period to the current period are
based on cost of purchases and proceeds from sales of securities.
-----------
* Includes 65,000 shares received as a result of a 2-for-1 stock split.
** Formerly, ISSGroup.
6
<PAGE>
PORTFOLIO OF INVESTMENTS
JUNE 30, 2000
SHARES VALUE
-------- -----------
COMMON STOCKS--59.7%
COMMUNICATIONS
INFRASTRUCTURE--11.0%
Aspect Communications* 230,000 $ 9,034,687
Ciena* 60,000 9,999,375
Crown Castle International* 260,000 9,481,875
Exfo Electro-Optical
Engineering* (Canada) 6,100 268,019
Gilat Satellite Networks* (Israel) 44,000 3,053,875
New Focus# 534,770 35,294,820
ONI Systems# 500,198 46,906,087
------------
114,038,738
------------
COMMUNICATIONS
SERVICES 3.1%
Copper Mountain Networks* 34,100 3,003,997
Rogers Communications* 300,000 8,550,000
Rural Cellular (Class A) 148,600 11,381,831
Universal Access# 464,754 9,178,892
------------
32,114,720
------------
COMPUTER AND BUSINESS
SERVICES 1.0%
Amdocs* 134,000 10,284,500
StorageNetworks* 3,400 306,956
------------
10,591,456
------------
COMPUTER HARDWARE/
PERIPHERALS 4.2%
Adaptec* 270,000 6,150,937
Apex* 324,800 14,189,700
Crossroads Systems# 100,800 2,168,775
Electronics for Imaging* 390,900 9,870,225
Lexmark International Group
(Class A)* 161,000 10,827,250
Mobility Electronics* 9,400 122,494
------------
43,329,381
------------
COMPUTER SOFTWARE 13.3%
Autodesk 304,600 10,575,331
Bindview Development* 500,000 5,984,375
Check Point Software
Technologies* (Israel) 46,000 9,767,812
HNC Software* 154,900 9,584,437
Hyperion Solutions* 314,000 10,195,188
Intuit* 409,000 16,896,812
JDA Software Group* 401,400 7,689,319
Macromedia* 105,700 10,216,566
Manugistics Group* 105,900 4,954,134
Mobius Management Systems 280,100 1,242,944
Portal Software 93,500 5,975,234
Rational Software* 180,000 16,723,125
Symantec* 237,300 12,806,784
Synopsys* 223,000 7,700,469
Wind River Systems* 200,000 7,581,250
------------
137,893,780
------------
ELECTRONICS CAPITAL
EQUIPMENT 3.7%
ATMI* 120,500 5,599,484
Novellus Systems* 327,000 18,506,156
Orbotech* (Israel) 150,000 13,935,937
------------
38,041,577
------------
ELECTRONIC COMPONENTS 0.6%
Sawtek 100,900 5,804,903
------------
INFORMATION SERVICES 1.8%
CSG Systems International* 150,100 8,419,672
Gartner Group (Class A) 825,000 9,900,000
------------
18,319,672
------------
INTERNET/ONLINE 6.7%
America Online 250,000 13,187,500
Autobytel.com* 586,700 3,621,039
Blaze Software# 442,577 4,835,154
E-Stamp# 152,765 241,440
LetsBuyIt.com# (Netherlands) 907,332 6,070,913
PSINet 387,000 9,711,281
Shopfast# (Australia) 231,856 3,855,434
Software.com# 234,974 24,871,575
Snowball.com# 513,500 2,237,428
------------
68,631,764
------------
MEDIA 5.0%
Adelphia Communications
(Class A)* 269,600 12,629,075
Cablevision Systems (Class A)* 184,000 12,489,000
IMAX 248,000 5,626,500
TV Guide (Class A)* 367,000 12,581,219
UnitedGlobalCom* 75,300 3,522,628
Ziff-Davis-ZD Net* 549,300 4,943,700
------------
51,792,122
------------
SEMICONDUCTORS 7.2%
Arrow Electronics 300,000 9,300,000
Conexant Systems* 98,000 4,774,437
Dallas Semiconductor 200,000 8,150,000
GlobeSpan# 35,460 3,326,847
Integrated Device Technology
International* 300,000 18,000,000
Lattice Semiconductor* 255,000 17,634,844
Microchip Technology* 223,750 13,061,406
------------
74,247,534
------------
MISCELLANEOUS 2.1%
Capstone Turbine 11,500 520,016
Capstone Turbine# 592,500 21,433,687
------------
21,953,703
------------
OTHER 25
------------
TOTAL COMMON STOCKS
(Cost $420,739,668) 616,759,375
------------
-------------
See footnotes on page 9.
7
<PAGE>
PORTFOLIO OF INVESTMENTS
JUNE 30, 2000
SHARES VALUE
---------- -------------
CONVERTIBLE PREFERRED
STOCKS 35.5%
COMMUNICATIONS
INFRASTRUCTURE 0.9%
Corvis (Series H)# 19,620 $ 1,648,080
Digicom PTE (Series A)# 51,480 231,660
Kestrel Solutions (Series D)# 303,147 3,950,005
USA Digital Radio (Series A)# 383,495 3,554,999
------------
9,384,744
------------
COMPUTER SOFTWARE 5.3%
2Bridge (Series D)# 188,820 1,215,000
Access Data (Series A)#o 3,190,909 5,265,000
Arzoon.com (Series C)# 133,333 999,998
Cielo Communications
(Series C)# 902,857 1,580,000
Entegrity Solutions (Series D)# 496,075 3,159,998
Global Commerce Systems
(Series A)# 1,746 30,005
Global Commerce Systems
(Series C)# 318,300 5,469,986
iEngineer.com (Series AA)# 3,360,000+ 2,286,327
Index Stock Imagery
(Series F)#o 648,000 3,240,000
Lifemasters Supported
SelfCare (Series E)# 510,318 4,082,544
Lineo (Series B)# 266,667 1,600,002
Lineo (Series C)# 333,333 1,999,998
MarketFirst Software (Series D)# 1,534,980 1,634,754
Metro-Optix (Series B)# 80,563 797,574
Microcosm Technologies
(Series D)# 823,944 5,265,002
Moai Technologies (Series D)# 789,014 6,320,002
Network Specialists (Series A)# 231,275 1,760,003
Petroleum Place, (The)# 68,505 4,050,016
Q-Pass (Series E)# 292,398 2,000,002
Sensable Technologies (Series C)# 489,458 1,625,001
------------
54,381,212
------------
INTERNET/ONLINE 27.0%
Advanced Recognition
Technology (Series D)# 1,312,000 3,280,000
AllAdvantage.com (Series C)# 1,338,776 16,199,190
AllAdvantage.com (Series D)# 109,090 659,995
APB Online (Series B)# 307,575 307,575
Bernard Technologies
(Series D)#o 1,436,364 5,745,456
Bill Gross' Idealab! (Series D)# 63,200 6,320,000
Buildnet (Series C)# 1,077,273 4,740,001
Chorum Technologies (Series D)# 694,992 3,240,979
CollegeClub.com (Series C)# 1,503,892+ 1,729,476
Colo.com (Series C)# 644,898 6,320,000
Complient (Series C)# 138,316 654,235
Consumer Financial Network
(Series C)# 1,600,000 6,400,000
Cyberbills (Series C)# 2,553,191 2,400,000
Docent (Series E)# 430,851 3,240,000
DP Applications (Series C)# 269,231 1,750,001
e-Centives (Series C)# 542,157 5,530,001
Enterworks (Series A)# 2,747,826 3,160,000
EoExchange (Series D)#o 2,271,028 4,860,000
ePolicy.com (Series B)# 562,113 1,999,998
etang.com (Series B)# 379,202 3,160,004
EverAd (Series B)# 11,938 3,160,108
EXP.com (Series C)# 359,154 2,054,361
Firetalk Communications
(Series E)#o 2,953,271 6,320,000
FlashPoint Technology
(Series E)# 1,037,037 4,200,000
Gateway Learning (Series D)# 1,441,442 6,400,002
Global Medical Products
(Series A)# 1,092,000 19,656,000
Homegain.com (Series C)# 711,000 7,110,000
HomePage.com (Series C)# 798,530 5,326,195
HomePage.com (Series D)# 120,000 800,400
HomePoint (Series B)# 47,400 2,528,316
Impresse (Series C)# 255,044 3,159,995
Industry Standard
Communications (Series A)# 619,608 3,160,001
Internet Appliance Network
(Series B)#o 2,558,704 6,319,999
Kozmo.com (Series D)# 1,400,000 10,574,200
Kozmo.com (Series E)# 436,007 3,293,161
Kozmo.com (Series F)# 556,070 4,199,997
Mainspring Communications
(Series E)# 210,667 1,580,003
MaMaMedia (Series D)# 622,222 3,359,999
Microcast (Series A) 5,594 13,627,041
More.com (Series D)# 672,200 5,041,500
More.com (Series E)# 95,311 714,833
NeoPlanet (Series B)# 526,228 6,319,998
NeuVis (Series B)#o 2,304,246 10,343,815
NeuVis (Series C)#o 365,567 1,641,039
NextVenue (Series B)# 138,860 1,215,025
Nitorum (Series B)# 150,100 1,579,998
OurHouse (Series D)# 1,316,666 7,899,996
Pointshare (Series C)# 1,221,818 6,109,090
QuinStreet (Series B)# 166,102 490,001
RC Networks (Series C)# 210,667 790,001
RealEstate.com (Series C)# 13,500 4,050,000
RealNames (Series C)# 130,667 588,002
Reciprocal (Series H)# 7,125 3,239,999
Screaming Media.net (Series B)# 291,440 5,945,376
--------------
See footnotes on page 9.
8
<PAGE>
PORTFOLIO OF INVESTMENTS
JUNE 30, 2000
SHARES
OR UNITS VALUE
-------------- ---------------
INTERNET/ONLINE (CONTINUED)
Softcom (Series B)#o 2,334,091 shs. $ 5,135,000
Techies.com (Series C)# 743,529 6,319,997
UGO Networks (Series D)# 554,386 3,160,000
V-Commerce (Series B)# 994,837 3,160,000
V-Span (Series B)# 14,971 523,985
Wine.com (Series F)# 432,000 2,592,000
YOUcentric (Series B)# 269,551 3,240,003
YOUpowered (Series A)#o 769,481 5,386,367
Yupi Internet (Series C)# 412,174 4,740,001
------------
278,752,715
------------
SEMICONDUCTORS 0.9%
Billions of Operations per
Second (Series C)# 464,000 1,160,000
MicroTune (Series D)# 202,500 2,835,000
Silicon Wave (Series C)# 1,283,750 5,135,000
------------
9,130,000
------------
TELECOMMUNICATIONS 1.2%
Geographic Network
Affiliates#o 6,320 units+ 6,320,000
PointOne
Telecommunications
(Series B)#o 1,166,015 shs.+ 6,560,000
------------
12,880,000
------------
WIRELESS TELEPHONY 0.2%
GoSolo Technologies
(Series A)# 2,500,000 2,400,000
------------
TOTAL CONVERTIBLE
PREFERRED STOCKS
(Cost $307,143,408) 366,928,671
------------
PRINCIPAL
AMOUNT VALUE
------------ ------------
LIMITED PARTNERSHIPS 0.2%
MISCELLANEOUS 0.2%
Compass Venture Partners# $ 224,999 $ 224,999
Edison Venture Fund IV# 1,285,465 1,285,465
InnoCal II# 132,301 132,301
Walden VC II# 900,000 900,000
---------------
TOTAL LIMITED
PARTNERSHIPS
(Cost $2,568,651) 2,542,765
---------------
CONVERTIBLE PROMISSORY
NOTE 0.1% (Cost $771,976)
INTERNET/ONLINE 0.1%
Techies.com, 9%,
due 6/7/2001+ 771,976 771,976
---------------
SHORT-TERM
HOLDINGS 3.7%
(Cost $39,000,000) 39,000,000
---------------
TOTAL INVESTMENTS 99.2%
(Cost $770,223,703) 1,026,002,787
OTHER ASSETS
LESS LIABILITIES 0.8% 7,816,188
---------------
NET ASSETS 100.0% $1,033,818,975
===============
--------------
* Non-income producing security.
# Restricted and non-income producing security.
o Affiliated issuer (Fund's holding representing 5% or more of the outstanding
voting securities).
+ Warrants attached.
See Notes to Financial Statements.
9
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2000
<TABLE>
<S> <C> <C>
ASSETS:
Investments, at value:
Common stocks (cost $420,739,668) ..................................... $616,759,375
Convertible preferred stocks and other* (cost $309,712,059) ........... 369,471,436
Short-term holdings (cost $39,000,000) ................................ 39,000,000
Convertible promissory note (cost $771,976) ........................... 771,976 $1,026,002,787
------------
Cash ...................................................................................... 2,160,103
Receivable for securities sold ............................................................ 12,654,434
Expenses prepaid to shareholder service agent ............................................. 79,089
Receivable for dividends and interest ..................................................... 8,679
Other ..................................................................................... 46,640
---------------
TOTAL ASSETS .............................................................................. 1,040,951,732
---------------
LIABILITIES:
Payable for securities purchased .......................................................... 4,020,008
Accrued expenses and other ................................................................ 3,112,749
---------------
TOTAL LIABILITIES ......................................................................... 7,132,757
---------------
NET ASSETS ................................................................................ $1,033,818,975
===============
COMPOSITION OF NET ASSETS:
Common Stock, at par ($0.01 par value; 100,000,000 shares authorized;
23,659,836 shares outstanding): ......................................................... $ 236,598
Additional paid-in capital ................................................................ 572,951,698
Accumulated net investment loss ........................................................... (12,297,949)
Undistributed net realized gain ........................................................... 217,149,544
Net unrealized appreciation of investments ................................................ 256,013,512
Net unrealized depreciation on translation of assets denominated
in foreign currencies ................................................................... (234,428)
---------------
NET ASSETS ................................................................................ $1,033,818,975
===============
NET ASSET VALUE PER SHARE ................................................................. $43.70
======
</TABLE>
----------------
* Includes affiliated issuers (issuers in which the Fund's holdings represent 5%
or more of the outstanding voting securities) with a cost of $56,434,543 and a
value of $67,136,676.
See Notes to Financial Statements.
10
<PAGE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 2000
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Interest .......................................................... $ 672,573
Dividends ......................................................... 64,117
-----------
TOTAL INVESTMENT INCOME .......................................................... $ 736,690
EXPENSES:
Management fee .................................................... 9,721,016
Stockholder servicing fees ........................................ 2,404,461
Stockholder account services ...................................... 532,872
Shareholder reports and communications ............................ 116,860
Custody fee ....................................................... 87,015
Auditing and legal fees ........................................... 76,243
Registration fee .................................................. 38,635
Directors' fees and expenses ...................................... 15,756
Miscellaneous ..................................................... 8,126
-----------
TOTAL EXPENSES ................................................................... 13,000,984
------------
NET INVESTMENT LOSS .............................................................. (12,264,294)
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
AND FOREIGN CURRENCY TRANSACTIONS:
Net realized gain on investments .................................. 109,996,780
Net realized loss from foreign currency transactions .............. (30,000)
Net change in unrealized appreciation of investments .............. 53,076,969
Net change in unrealized appreciation on translation of assets
denominated in foreign currencies ............................... (241,845)
-----------
NET GAIN ON INVESTMENTS .......................................................... 162,801,904
------------
INCREASE IN NET ASSETS FROM OPERATIONS ........................................... $150,537,610
============
</TABLE>
------------
See Notes to Financial Statements.
11
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS ENDED JULY 27, 1999* TO
JUNE 30, 2000 DECEMBER 31, 1999
---------------- -----------------
<S> <C> <C>
OPERATIONS:
Net investment loss ............................................................... $ (12,264,294) $ (3,126,700)
Net realized gain on investments .................................................. 109,996,780 143,533,499
Net realized loss from foreign currency transactions .............................. (30,000) (28,338)
Net change in unrealized appreciation of investments .............................. 53,076,969 202,936,543
Net change in unrealized appreciation on translation
of assets denominated in foreign currencies .................................... (241,845) 7,417
-------------- --------------
INCREASE IN NET ASSETS FROM OPERATIONS ............................................ 150,537,610 343,322,421
-------------- --------------
DISTRIBUTION TO SHAREHOLDERS:
Net realized gain on investments .................................................. -- (33,229,352)
-------------- --------------
DECREASE IN NET ASSETS FROM DISTRIBUTION .......................................... -- (33,229,352)
-------------- --------------
SHARES
-------------------------------------
SIX MONTHS ENDED JULY 27, 1999* TO
JUNE 30, 2000 DECEMBER 31, 1999
---------------- -----------------
CAPITAL SHARE TRANSACTIONS:
Net proceeds from issuance of Common Stock ......... -- 23,269,963 -- 563,059,814
Shares issued in payment of gain distribution ...... -- 972,490 -- 32,034,021
--------- ------------ -------------- --------------
TOTAL .............................................. -- 24,242,453 -- 595,093,835
--------- ------------ -------------- --------------
Cost of shares repurchased ......................... (586,741) -- (22,005,546) --
--------- ------------ -------------- --------------
INCREASE (DECREASE) IN NET ASSETS FROM
CAPITAL SHARE TRANSACTIONS ...................... (586,741) 24,242,453 (22,005,546) 595,093,835
========= ============ -------------- --------------
INCREASE IN NET ASSETS ............................................................ 128,532,064 905,186,904
NET ASSETS:
Beginning of period ............................................................... 905,286,911 100,007
-------------- --------------
END OF PERIOD (including accumulated net investment loss
of $12,297,949 and $3,655, respectively) ....................................... $1,033,818,975 $ 905,286,911
============== =============
</TABLE>
----------------
* Commencement of operations.
See Notes to Financial Statements.
12
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION -- Seligman New Technologies Fund, Inc. (the "Fund") was
incorporated in Maryland on May 19, 1999 and subsequently was organized and
registered under the Investment Company Act of 1940 as a non-diversified,
closed-end management investment company. The Fund had no operations prior to
July 27, 1999 (commencement of operations) other than those relating to
organizational matters and the sale to Seligman Advisors, Inc. of 4,124 shares
of Common Stock.
2. SIGNIFICANT ACCOUNTING POLICIES -- The financial statements have been
prepared in conformity with accounting principles generally accepted in the
United States of America, which require management to make certain estimates and
assumptions at the date of the financial statements. The following summarizes
the significant accounting policies of the Fund:
a. SECURITY VALUATION -- Investments in convertible securities and common stocks
are valued at current market values or, in their absence, at fair values
determined in good faith in accordance with procedures approved by the Board
of Directors. Securities traded on an exchange are valued at last sales
prices or, in their absence and in the case of over-the-counter securities,
at the mean of bid and asked prices. Short-term holdings maturing in 60 days
or less are valued at amortized cost.
The Fund may invest in equity securities of privatelyowned technology
companies that plan to conduct an initial public offering within a period of
several months to three years from the time the Fund makes its investment.
These are referred to as venture capital companies. Such investments will be
valued at fair value, which is expected to be cost unless J. & W. Seligman &
Co. Incorporated (the "Manager") determines, pursuant to the Fund's valuation
procedures, that such a valuation is no longer fair or appropriate. Examples
of cases where cost may no longer be appropriate include sales of similar
securities to third parties at different prices, or if a venture capital
company in which the Fund invests undertakes an initial public offering. In
such situations, the Fund's investment will be revalued in a manner that the
Manager, following procedures approved by the Board of Directors, determines
best reflects its fair value. In addition, the Fund may hold restricted
securities of a class that have been sold to the public. The fair valuation
of these restricted securities will often be the market value of the publicly
traded shares less a discount to reflect contractual or legal restrictions
limiting resale.
At June 30, 2000, market quotations were not readily available for
securities valued at $380,169,758 (36.8% of net assets). Because of the
inherent uncertainty of valuation, the estimated values may differ
significantly from the values that would have been used had a ready market
for the securities existed.
b. FOREIGN CURRENCY TRANSACTIONS -- The books and records of the Fund are
maintained in US dollars. The market value of investment securities, other
assets, and liabilities denominated in foreign currencies are translated into
USdollars at the daily rate of exchange as reported by a pricing service.
Purchases and sales of investment securities, income, and expenses are
translated into US dollars at the rate of exchange prevailing on the
respective dates of such transactions.
The Fund separates that portion of the results of operations resulting from
changes in the foreign exchange rates from the fluctuations arising from
changes in the market prices of securities held in the portfolio. Similarly,
the Fund separates the effect of changes in foreign exchange rates from the
fluctuations arising from changes in the market prices of portfolio
securities sold during the period.
c. FEDERAL TAXES -- There is no provision for federal income tax. The Fund will
elect to be taxed as a regula- ted investment company and intends to
distribute substantially all taxable net income and net gain realized.
d. SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME -- Investment
transactions are recorded on trade dates. Identified cost of investments sold
is used for both financial statement and federal income tax purposes.
Dividends receivable and payable are recorded on ex-dividend dates. Interest
income is recorded on an accrual basis.
e. DISTRIBUTIONS TO STOCKHOLDERS -- The treatment for financial statement
purposes of distributions made to stockholders during the year from net
investment income or net realized gains may differ from their ultimate
treatment for federal income tax purposes. These differences are caused
primarily by differences in the timing of the recognition of certain
components of income, expense, or realized capital gain; and the
recharacterization of foreign exchange gains or losses to either ordinary
income or realized capital gains for federal income tax purposes. Where such
differences are permanent in nature, they are reclassified in the components
of net assets based on their ultimate characterization for federal income tax
purposes. Any such reclassification will have no effect on net investment
assets, results of operations, or net asset value per share of the Fund.
On July 20, 2000, a distribution of $4.596 per share was declared from 1999
net realized short-term gains from investment transactions for the Fund. The
capital gain was paid on July 28, 2000, to stockholders of record on July 20,
2000.
13
<PAGE>
NOTES TO FINANCIAL STATEMENTS
3. PURCHASES AND SALES OF SECURITIES -- Purchases and sales of portfolio
securities, excluding short-term investments, for the six months ended June 30,
2000 amounted to $601,041,009 and $625,931,773, respectively. The cost of
investments for federal income tax purposes was substantially the same as the
cost for financial reporting purposes, and the tax basis gross unrealized
appreciation and depreciation of portfolio securities amounted to $312,451,092
and $56,672,008, respectively.
4. SHORT-TERM INVESTMENTS -- At June 30, 2000, the Fund owned short-term
investments which matured in less than seven days.
5. REPURCHASE OFFERS -- To provide investors with a limited degree of liquidity,
the Fund will make quarterly offers to repurchase its shares. Repurchase offers
will be limited to 5% of the number of the Fund's outstanding shares on the date
the repurchase requests are due. The Fund may repurchase more than 5% (but not
more than 25%) of its shares in any quarter with the approval of the Fund's
Board of Directors. In the event the repurchase offer is oversubscribed, the
Fund may, but is not required to, repurchase additional shares, but only up to a
maximum of 2% of the outstanding shares of the Fund. If the Fund determines not
to repurchase additional shares, it will repurchase shares on a pro rata basis.
The repurchase price will be equal to the share's net asset value on the date
specified in the notice of repurchase. The repurchase pricing date may be as
much as fourteen days after the date that the repurchase requests are due. The
Fund expects that payment of the repurchase price will be made on the third
business day after the repurchase pricing date, but the payment may be made as
much as seven dates after such pricing date.
During the six months ended June 30, 2000, the Fund completed two repurchase
offers, one which commenced in December 1999 and was completed in January 2000
and one which commenced in March 2000 and was completed in April 2000. In each
offer, the Fund offered to repurchase 5% of the number of its outstanding shares
on the date the repurchase requests were due. The results of each repurchase
offer were as follows:
REPURCHASE PERCENTAGE OF REPURCHASE
DATE SHARES TENDERED PROCEEDS
------------- -------------------- --------------
January 14, 2000 1.1% $10,766,041
April 14, 2000 1.3 11,239,505
In addition, on July 14, 2000, the Fund repurchased 1.5% of its shares for
proceeds of $16,098,902.
6. MANAGEMENT FEE, STOCKHOLDER SERVICING FEE, AND OTHER TRANSACTIONS -- The
Manager manages the affairs of the Fund and provides the necessary personnel and
facilities. Compensation of all officers of the Fund, all directors of the Fund
who are employees of the Manager, and all personnel of the Fund and the Manager
is paid by the Manager. The Manager receives a fee, calculated daily and payable
monthly, equal to 2.00% per annum of the Fund's average daily net assets.
Brokers or dealers that sold shares of the Fund or that maintain accounts for
stockholders can enter into agreements with the Fund and receive a continuing
fee of up to 0.50% on an annual basis, payable quarterly, of the average daily
net assets attributable to Fund shares owned by customers of the particular
broker or dealer for providing personal services and/or the maintenance of
stockholder accounts. For the six months ended June 30, 2000, such fees
aggregated $2,404,461 or 0.50% per annum of the Fund's average daily net assets.
Seligman Data Corp., which is owned by certain associated investment
companies, charged the Fund at cost $532,872 for stockholder account services.
Certain officers and directors of the fund are officers or directors of the
Manager, Seligman Advisors, Inc., and/or Seligman Data Corp.
The Fund has a compensation arrangement under which directors who receive
fees may elect to defer receiving such fees. Directors may elect to have their
deferred fees accrue interest or earn a return based on the performance of
certain other funds in the Seligman Group of Investment Companies. The cost of
such fees and earnings accrued thereon is included in directors' fees and
expenses, and the accumulated balance thereof at June 30, 2000, of $5,186 is
included in other liabilities. Deferred fees and related accrued earnings are
not deductible for federal income tax purposes until such amounts are paid.
7. RESTRICTED SECURITIES -- At June 30, 2000, the Fund owned private placement
investments that were purchased through private offerings and cannot be sold
without prior registration under the Securities Act of 1933 or pursuant to an
exemption therefrom. In addition, the Fund has agreed to further restrictions on
the disposition of these holdings as set forth in various agreements entered
into in connection with the purchase of these investments. These investments are
valued at fair value as determined in accordance with procedures approved by the
Board of Directors of the Fund. The acquisition dates of these investments,
along with their costs and values at June 30, 2000, are as follows:
14
<PAGE>
NOTES TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
INVESTMENTS ACQUISITION DATE COST VALUE
----------- ---------------- ---- -----
<S> <C> <C> <C>
CONVERTIBLE PREFERRED STOCKS:
2Bridge (Series D) 3/9/00 $ 1,215,000 $ 1,215,000
Access Data (Series A) 3/29/00 5,265,000 5,265,000
Advanced Recognition Technologies (Series D) 12/6/99 3,285,655 3,280,000
AllAdvantage.com (Series C) 9/22/99 3,287,004 16,199,190
AllAdvantage.com (Series D) 2/3/00 659,995 659,995
APB Online (Series B) 8/4/99 2,676,162 307,575
Arzoon.com (Series C) 4/11/00 1,000,369 999,998
Bernard Technologies (Series D) 11/8/99 3,957,011 5,745,456
Bill Gross' Idealab! (Series D) 12/22/99 6,320,936 6,320,000
Billions of Operations Per Second (Series C) 6/8/00 1,160,000 1,160,000
Buildnet (Series C) 10/29/99 4,749,047 4,740,001
Chorum Technologies (Series D) 11/10/99 3,244,092 3,240,979
Cielo Communications (Series C) 11/17/99 3,164,385 1,580,000
CollegeClub.com (Series C) 10/28/99 5,205,012 1,729,476
Colo.com (Series C) 12/17/99 6,322,469 6,320,000
Complient (Series C1) 6/23/00 654,235 654,235
Consumer Financial Network (Series C) 3/23/00 6,403,998 6,400,000
Corvis (Series H) 12/16/99 1,579,999 1,648,080
Cyberbills (Series C) 3/21/00 2,402,223 2,400,000
Digicom PTE (Series A) 5/2/00 231,660 231,660
Docent (Series E) 4/5/00 3,240,000 3,240,000
DP Applications (Series C) 4/20/00 1,751,104 1,750,001
e-Centives (Series C) 2/18/00 5,535,464 5,530,001
Entegrity Solutions (Series D) 2/16/00 3,163,621 3,159,998
Enterworks (Series A) 12/30/99 3,160,000 3,160,000
EoExchange (formerly Aeneid) (Series D) 10/15/99 4,863,737 4,860,000
ePolicy.com (Series B) 5/2/00 1,999,998 1,999,998
etang.com (Series B) 1/6/00 3,170,522 3,160,004
EverAd (Series B) 2/16/00 3,163,437 3,160,108
EXP.com (Series C) 6/6/00 2,054,361 2,054,361
Firetalk Communications
(formerly Multitude) (Series E) 12/10/99 6,325,498 6,320,000
FlashPoint Technology (Series E) 9/10/99 4,200,000 4,200,000
Gateway Learning (Series D) 3/22/00 6,400,002 6,400,002
Geographic Network Affiliates (Series A) 12/29/99 6,320,000 6,320,000
Global Commerce Systems (Series A) 4/6/00 30,005 30,005
Global Commerce Systems (Series C) 4/6/00 5,469,986 5,469,986
Global Medical Products (Series A) 9/15/99 5,473,005 19,656,000
GoSolo Technologies (Series A) 4/3/00 2,400,000 2,400,000
Homegain.com (Series C) 12/29/99 7,110,000 7,110,000
HomePage.com (Series C) 10/20/99 1,600,001 5,326,195
HomePage.com (Series D) 6/12/00 800,400 800,400
HomePoint (Series B) 1/10/00 3,160,158 2,528,316
iEngineer (Series AA) (formerly Vuent Series D) 8/12/99 3,362,047 2,286,327
Impresse (Series C) 11/15/99 3,165,525 3,159,995
Index Stock Imagery (Series F) 3/20/00 3,241,688 3,240,000
Industry Standard Communications (Series A) 1/13/00 3,165,886 3,160,001
Internet Appliance Network (Series B) 1/21/00 6,324,967 6,319,999
Kestrel Solutions (Series D) 1/25/00 3,952,809 3,950,005
Kozmo.com (Series D) 8/3/99 2,526,860 10,574,200
Kozmo.com (Series E) 1/6/00 1,926,873 3,293,161
Kozmo.com (Series F) 3/16/00 4,199,997 4,199,997
LifeMasters Supported SelfCare (Series E) 1/31/00 4,082,544 4,082,544
Lineo (Series B) 3/20/00 800,001 1,600,002
Lineo (Series C) 4/28/00 1,999,998 1,999,998
Mainspring Communications (Series E) 11/22/99 1,580,003 1,580,003
</TABLE>
15
<PAGE>
NOTES TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
INVESTMENTS ACQUISITION DATE COST VALUE
----------- -------------- ---- -----
<S> <C> <C> <C>
CONVERTIBLE PREFERRED STOCKS (CONTINUED)
MaMaMedia (Series D) 8/6/99 $ 3,365,302 $ 3,359,999
MarketFirst Software (Series D) 9/10/99 1,636,356 1,634,754
Metro-Optix (Series B) 6/23/00 797,574 797,574
Microcast (Series A) 9/15/99 & 12/16/99 4,036,290 13,627,041
Microcosm Technologies (Series D) 3/8/00 5,265,002 5,265,002
MicroTune (Series D) 10/15/99 2,436,280 2,835,000
Moai Technologies (Series D) 1/25/00 6,320,002 6,320,002
More.com (Series D) 10/22/99 3,240,004 5,041,500
More.com (Series E) 2/9/00 714,833 714,833
NeoPlanet (Series B) 2/18/00 6,319,998 6,319,998
Network Specialists (Series A) 4/14/00 1,760,003 1,760,003
NeuVis (Series B) 10/6/99 3,245,361 10,343,815
NeuVis (Series C) 1/24/00 1,641,279 1,641,039
NextVenue (Series B) 3/9/00 1,215,025 1,215,025
Nitorum (Series B) 1/28/00 1,583,725 1,579,998
OurHouse (Series D) 2/11/00 7,899,996 7,899,996
Petroleum Place (The) (Series C) 3/7/00 4,050,016 4,050,016
PointOne Telecommunications (Series B) 9/24/99 6,560,000 6,560,000
Pointshare (Series C) 9/9/99 3,360,000 6,109,090
Q-Pass (Series E) 5/2/00 2,000,002 2,000,002
QuinStreet (Series B) 5/25/00 490,001 490,001
RC Networks (Series C) 12/10/99 790,001 790,001
RealEstate.com (Series C) 10/6/99 4,056,694 4,050,000
RealNames (Series C) 8/5/99 588,002 588,002
Reciprocal (Series H) 11/12/99 3,239,999 3,239,999
Screaming Media.net (Series B) 10/5/99 3,268,876 5,945,376
Sensable Technologies (Series C) 4/5/00 1,625,001 1,625,001
Silicon Wave (Series C) 12/6/99 5,135,000 5,135,000
Softcom (Series B) 12/23/99 5,135,000 5,135,000
Techies.com (Series C) 1/27/00 6,319,997 6,319,997
UGO Networks (Series D) 11/12/99 3,162,334 3,160,000
USA Digital Radio (Series A) 1/19/00 3,559,221 3,554,999
V-Commerce (Series B) 11/2/99 3,166,436 3,160,000
V-Span (Series B) 6/7/00 523,985 523,985
Wine.com (Series F) 11/9/99 2,593,560 2,592,000
YOUcentric (Series B) 3/6/00 3,242,501 3,240,003
YOUpowered (formerly Younology) (Series A) 11/24/99 3,555,002 5,386,367
Yupi Internet (Series C) 11/5/99 4,740,001 4,740,001
----------- -----------
307,143,408 366,928,671
----------- -----------
COMMON STOCKS:
Blaze Software 12/31/99 3,160,000 4,835,154
Capstone Turbine 2/24/00 3,950,000 21,433,687
CrossRoads Systems 8/10/99 1,008,000 2,168,775
E-Stamp 8/4/99 1,259,994 241,440
GlobeSpan 1/14/00 2,372,394 3,326,847
LetsBuyIt.com 12/22/99 3,161,306 6,070,913
New Focus 12/23/99 1,738,002 35,294,820
ONI Systems (formerly Optical Networks) 12/30/99 3,162,471 46,906,087
Shopfast 12/20/99 & 3/24/00 2,911,780 3,855,434
Snowball.com 12/20/99 5,343,731 2,237,428
Software.com 2/22/00 6,320,000 24,871,575
Universal Access 11/11/99 2,834,999 9,178,892
----------- -----------
37,222,677 160,421,052
----------- -----------
</TABLE>
16
<PAGE>
NOTES TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
INVESTMENTS ACQUISITION DATE COST VALUE
----------- ----------------- ---- -----
<S> <C> <C> <C>
LIMITED PARTNERSHIPS:
Compass Venture Partners 11/22/99 - 6/26/00 $ 233,087 $ 224,999
Edison Venture Fund IV 10/18/99 & 4/28/00 1,289,937 1,285,465
InnoCal II 6/9/00 134,292 132,301
Walden VC II 5/17/00 911,335 900,000
------------ ------------
2,568,651 2,542,765
------------ ------------
CONVERTIBLE PROMISSORY NOTE:
Techies.com 9% due 6/7/2001 6/7/00 771,976 771,976
------------ ------------
TOTAL $347,706,712 $530,664,464
============ ============
</TABLE>
8. AFFILIATED ISSUERS -- As defined under the Investment Company Act of 1940, as
amended, affiliated issuers are those issuers in which the Fund's holdings
represent 5% or more of the outstanding voting securities of the issuer. A
summary of the Fund's transactions in the securities of affiliated issuers
during the six months ended June 30, 2000, is as follows:
<TABLE>
<CAPTION>
GROSS DIVIDEND
BEGINNING PURCHASES ENDING INCOME/
SHARES/ AND SHARES/ REALIZED ENDING
AFFILIATE UNITS ADDITIONS UNITS GAIN VALUE
-------- -------- --------- ------ -------- ---------
<S> <C> <C> <C> <C> <C>
Access Data -- 3,190,909 shs. 3,190,909 shs. -- $ 5,265,000
Bernard Technologies 1,436,364 shs. -- 1,436,364 -- 5,745,456
EoExchange 2,271,028 -- 2,271,028 -- 4,860,000
Firetalk Communications 2,953,271 -- 2,953,271 -- 6,320,000
Geographic Network Affiliates 6,320 units -- 6,320 units -- 6,320,000
Index Stock Imagery -- 648,000 648,000 shs. -- 3,240,000
Internet Appliance Network -- 2,558,704 2,558,704 -- 6,319,999
NeuVis 2,304,246 shs. 365,567 2,669,813 -- 11,984,854
PointOne Telecommunications (warrants) 1,166,015 -- 1,166,015 -- 6,560,000
Softcom 2,334,091 -- 2,334,091 -- 5,135,000
YOUpowered 769,481 -- 769,481 -- 5,386,367
------------
TOTAL $67,136,676
============
</TABLE>
17
<PAGE>
FINANCIAL HIGHLIGHTS
The table below is intended to help you understand the Fund's financial
performance from its inception. Certain information reflects financial results
for a single share that was held throughout the periods shown. Per share amounts
are calculated using average shares outstanding. "Total return" shows the rate
that you would have earned (or lost) on an investment in the Fund, assuming you
reinvested your capital gain distributions. Total returns do not reflect any
sales charges and are not annualized.
<TABLE>
<CAPTION>
SIX MONTHS 7/27/99*
ENDED TO
6/30/00 12/31/99
------------ ---------
<S> <C> <C>
PER SHARE DATA:
NET ASSET VALUE, BEGINNING OF PERIOD ........................... $37.34 $24.25
------ ------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss ............................................ (0.51) (0.13)
Net realized and unrealized gain on investments ................ 6.87 14.70
------ ------
INCREASE FROM INVESTMENT OPERATIONS ............................ 6.36 14.57
Distributions from net realized capital gains .................. -- (1.43)
Offering costs ................................................. -- (0.05)
------ ------
NET INCREASE IN NET ASSET VALUE ................................ 6.36 13.09
------ ------
NET ASSET VALUE, END OF PERIOD ................................. $43.70 $37.34
====== ======
TOTAL RETURN: .................................................. 17.03% 60.65%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000s omitted) ....................... $1,033,819 $905,287
Ratio of expenses to average net assets ........................ 2.67%+ 2.78%+
Ratio of net investment loss to average net assets ............. (2.52)%+ (1.06)%+
Portfolio turnover rate ........................................ 63.97% 112.41%
</TABLE>
-----------
* Commencement of operations.
+ Annualized.
See Notes to Financial Statements.
18
<PAGE>
REPORT OF INDEPENDENT AUDITORS
--------------------------------------------------------------------------------
THE BOARD OF DIRECTORS AND SHAREHOLDERS,
SELIGMAN NEW TECHNOLOGIES FUND, INC.
We have audited the accompanying statement of assets and liabilities of Seligman
New Technologies Fund, Inc., including the portfolio of investments, as of June
30, 2000, and the related statements of operations for the six months then
ended, and of changes in net assets for the six months then ended and for the
period from July 27, 1999 to December 31, 1999, and the financial highlights for
each of the periods presented. These financial statements and financial
highlights are the responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audit.
We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation of
securities owned as of June 30, 2000, by correspondence with the
Fund's custodian and brokers; where replies were not received from brokers, we
performed other auditing procedures. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audit provides 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
Seligman New Technologies Fund, Inc. as of June 30, 2000, the results of its
operations for the six months then ended, and the changes in its net assets and
the financial highlights for all the respective stated periods, in conformity
with accounting principles generally accepted in the United States of America.
DELOITTE & TOUCHE LLP
New York, New York
August 11, 2000
--------------------------------------------------------------------------------
FOR MORE INFORMATION
--------------------------------------------------------------------------------
MANAGER
J. & W. Seligman & Co. Incorporated
100 Park Avenue
New York, NY 10017
GENERAL COUNSEL
Sullivan & Cromwell
INDEPENDENT AUDITORS
Deloitte & Touche LLP
GENERAL DISTRIBUTOR
Seligman Advisors, Inc.
100 Park Avenue
New York, NY 10017
SHAREHOLDER SERVICE AGENT
Seligman Data Corp.
100 Park Avenue
New York, NY 10017
(800) 622-4597 24-HOUR AUTOMATED
TELEPHONE ACCESS
SERVICE
--------------------------------------------------------------------------------
19
<PAGE>
BOARD OF DIRECTORS
JOHN R. GALVIN 2, 4
DIRECTOR, Raytheon Company
DEAN EMERITUS, Fletcher School of Law and Diplomacy
at Tufts University
ALICE S. ILCHMAN 3, 4
TRUSTEE, Committee for Economic Development
CHAIRMAN, The Rockefeller Foundation
FRANK A. MCPHERSON 2, 4
DIRECTOR, Kimberly-Clark Corporation
DIRECTOR, Baptist Medical Center
DIRECTOR, Conoco Inc.
JOHN E. MEROW 2, 4
DIRECTOR, Commonwealth Industries, Inc.
TRUSTEE, New York-Presbyterian Hospital
RETIRED CHAIRMAN AND SENIOR PARTNER,
Sullivan & Cromwell, Law Firm
BETSY S. MICHEL 2, 4
TRUSTEE, The Geraldine R. Dodge Foundation
WILLIAM C. MORRIS 1
CHAIRMAN
CHAIRMAN OF THE BOARD,
J. & W. Seligman & Co. Incorporated
CHAIRMAN, Carbo Ceramics Inc.
DIRECTOR, Kerr-McGee Corporation
JAMES C. PITNEY 3, 4
RETIRED PARTNER, Pitney, Hardin, Kipp & Szuch, Law Firm
JAMES Q. RIORDAN 3, 4
DIRECTOR, KeySpan Energy Corporation
TRUSTEE, Committee for Economic Development
RICHARD R. SCHMALTZ 1
MANAGING DIRECTOR, DIRECTOR OF INVESTMENTS,
J. & W. Seligman & Co. Incorporated
TRUSTEE EMERITUS, Colby College
ROBERT L. SHAFER 3, 4
RETIRED VICE PRESIDENT, Pfizer Inc.
JAMES N. WHITSON 2, 4
DIRECTOR AND CONSULTANT, Sammons Enterprises, Inc.
DIRECTOR, C-SPAN
DIRECTOR, CommScope, Inc.
BRIAN T. ZINO 1
PRESIDENT
PRESIDENT, J. & W. Seligman & Co. Incorporated
CHAIRMAN, Seligman Data Corp.
DIRECTOR, ICIMutual Insurance Company
MEMBER OF THE BOARD OF GOVERNORS,
Investment Company Institute
----------------
Member: 1 Executive Committee
2 Audit Committee
3 Director Nominating Committee
4 Board Operations Committee
EXECUTIVE OFFICERS
WILLIAM C. MORRIS
CHAIRMAN
BRIAN T. ZINO
PRESIDENT
STORM BOSWICK
VICE PRESIDENT
LAWRENCE P. VOGEL
VICE PRESIDENT AND TREASURER
PAUL H. WICK
VICE PRESIDENT
FRANK J. NASTA
SECRETARY
20
<PAGE>
GLOSSARY OF FINANCIAL TERMS
CAPITAL GAIN DISTRIBUTION -- A payment to mutual fund shareholders of profits
realized on the sale of securities in a fund's portfolio.
CAPITAL APPRECIATION/DEPRECIATION -- An increase or decrease in the market value
of a mutual fund's portfolio securities, which is reflected in the net asset
value of the fund's shares. Capital appreciation/depreciation of an individual
security is in relation to the original purchase price.
COMPOUNDING -- The change in the value of an investment as shareholders receive
earnings on their investment's earnings. For example, if $1,000 is invested at a
fixed rate of 7% a year, the initial investment is worth $1,070 after one year.
If the return is compounded, second year earnings will not be based on the
original $1,000, but on the $1,070, which includes the first year's earnings.
CONTINGENT DEFERRED SALES CHARGE (CDSC) -- Depending on the class of shares
owned, a fee charged by a mutual fund when shares are sold back to the fund. The
CDSC expires after a fixed time period.
DIVIDEND -- A payment by a mutual fund, usually derived from the fund's net
investment income (dividends and interest less expenses).
DIVIDEND YIELD -- A measurement of a fund's dividend as a percentage of the
maximum offering price or net asset value.
EXPENSE RATIO -- The cost of doing business for a mutual fund, expressed as a
percent of the fund's net assets.
INVESTMENT OBJECTIVE -- The shared investment goal of a fund and its
shareholders.
MANAGEMENT FEE -- The amount paid by a mutual fund to its investment advisor(s).
MULTIPLE CLASSES OF SHARES -- Although an individual mutual fund invests in only
one portfolio of securities, it may offer investors several purchase options
which are "classes" of shares. Multiple classes permit shareholders to choose
the fee structure that best meets their needs and goals. Generally, each class
will differ in terms of how and when sales charges and certain fees are
assessed.
NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC. (NASD) -- A self-regulatory
body with authority over firms that distribute mutual funds.
NET ASSET VALUE (NAV) PER SHARE -- The market worth of one fund share, obtained
by adding a mutual fund's total assets (securities, cash, and any accrued
earnings), subtracting liabilities, and dividing the resulting net assets by the
number of shares outstanding.
OFFERING PRICE -- The price at which a mutual fund's share can be purchased. The
offering price per share is the current net asset value plus any sales charge.
PORTFOLIO TURNOVER -- A measure of the trading activity in a mutual fund's
investment portfolio that reflects how often securities are bought and sold.
PROSPECTUS -- The legal document describing a mutual fund to all prospective
shareholders. It contains information required by the Securities and Exchange
Commission (SEC), such as a fund's investment objective and policies, services,
investment restrictions, how shares are bought and sold, fund fees and other
charges, and the fund's financial highlights.
SEC YIELD -- SEC Yield refers to the net income earned by a fund during a recent
30-day period. This income is annualized and then divided by the maximum
offering price per share on the last day of the 30-day period. The SEC Yield
formula reflects semiannual compounding.
SECURITIES AND EXCHANGE COMMISSION -- The primary US federal agency that
regulates the registration and distribution of mutual fund shares.
STATEMENT OF ADDITIONAL INFORMATION -- A document that contains more detailed
information about an investment company and that supplements the prospectus. It
is available at no charge upon request.
TOTAL RETURN -- A measure of a fund's performance encompassing all elements of
return. Reflects the change in share price over a given period and assumes all
distributions are taken in additional fund shares. The AVERAGE ANNUAL TOTAL
RETURN represents the average annual compounded rate of return for the periods
presented.
YIELD ON SECURITIES -- For bonds, the current yield is the coupon rate of
interest, divided by the purchase price. For stocks, the yield is measured by
dividing dividends paid by the market price of the stock.
----------------
Adapted from the Investment Company Institute's 2000 MUTUAL FUND FACT BOOK.
21
<PAGE>
--------------------------------------------------------------------------------
SELIGMAN ADVISORS, INC.
AN AFFILIATE OF
[LOGO OMITTED]
J. & W. SELIGMAN & CO.
INCORPORATED
ESTABLISHED 1864
100 PARK AVENUE, NEW YORK, NY 10017
www.seligman.com
THIS REPORT IS INTENDED ONLY FOR THE INFORMATION OF SHAREHOLDERS OR THOSE WHO
HAVE RECEIVED THE OFFERING PROSPECTUS COVERING SHARES OF COMMON STOCK OF
SELIGMAN NEW TECHNOLOGIES FUND, INC., WHICH CONTAINS INFORMATION ABOUT THE SALES
CHARGES, MANAGEMENT FEE, AND OTHER COSTS.
CENT3 6/00 [GRAPHIC OMITTED] Printed on Recycled Paper
--------------------------------------------------------------------------------
