<TABLE>
<CAPTION>
COLORADO DOUBLE TAX EXEMPT BOND FUND, INC.
STATEMENT OF INVESTMENTS
SHORT INTERMEDIATE PORTFOLIO
June 30, 1998
(Unaudited)
FACE BOND RATING
AMOUNT MOODY'S/S&P MARKET VALUE
------ ----------- ------------
CERTIFICATES OF PARTICIPATION 9.13%
-----------------------------------
<C> <S> <C> <C>
$ 20,000 Aims Junior College District,
6.40%, 12/01/98 A3/NR $ 20,197
10,000 Conejos & Alamosa County School District, RE1J,
7.40%, 12/01/10 NR/AA- 10,647
100,000 El Paso County School District, 38,
6.25%, 12/01/01 A/A2 104,402
---------
TOTAL CERTIFICATES OF
PARTICIPATION
(Cost $135,454) 135,246
---------
ESCROWED IN U.S. GOVERNMENT SECURITIES 4.25%
--------------------------------------------
5,000 Arapahoe County, Single Family Mtg.,
Zero Coupon, 09/01/10 NR/AAA 2,834
50,000 Pueblo County, Hospital Facilities,
7.50%, 09/01/01 NR/NR 51,902
20,000 Thornton, Prerefunded Cap Appreciation,
Zero Coupon, 12/01/10 Aaa/AAA 8,174
---------
TOTAL ESCROWED IN U.S.
GOVERNMENT SECURITIES
(Cost $ 62,727) 62,910
---------
GENERAL OBLIGATION BONDS 23.94%
-------------------------------
COUNTY/CITY/SPECIAL DISTRICT/SCHOOL DISTRICT 23.94%
---------------------------------------------------
85,000 Boulder Valley School District RE-2,
6.25%, 10/15/08 Aa3/AA 90,648
10,000 Castle Pines Met District Ref,
7.625%, 12/01/15 Aaa/AAA 10,786
175,000 Jefferson County School District R-001,
5.00%, 12/15/04 Aaa/AAA 182,191
50,000 Weld County School District 6,
4.20%, 12/15/99 Aa3/AA- 50,315
20,000 Winter Park West Water & Sanitation,
9.25%, 12/01/06 NR/NR 20,490
---------
TOTAL GENERAL OBLIGATION BONDS
(Cost $350,838) 354,430
---------
REVENUE BONDS 60.25%
---------------------
HOSPITAL 28.69%
----------------
25,000 Colorado Health Facilities, Craig Hospital
4.90%, 12/01/03 A2/NR 25,711
100,000 Colorado Health Facilities, Lutheran Medical Center
7.15%, 10/01/00 A1/A+ 105,012
295,000 Colorado Health Facilities, Natl Benevolent Assn.,
4.60%, 02/01/03 Baa1/NR 294,086
---------
424,809
---------
</TABLE>
-1-
<PAGE>
<TABLE>
HOUSING 10.67%
---------------
<C> <S> <C> <C>
100,000 Colorado Housing Finance Authority Ser 91A,
6.20%, 11/01/99 Aa1/AA+ 102,091
20,000 Colorado Housing Finance Authority Ser AA,
5.05%, 11/01/07 Aa1/AA+ 20,356
35,000 Pueblo County Single Family Mtg.,
6.30%, 06/01/03 NR/AA- 35,527
---------
157,974
---------
INDUSTRIAL DEVELOPMENT 5.04%
----------------------------
70,000 Boulder County Indl Dev- May Dept Stores,
6.25%, 09/01/07 NR/A 74,550
---------
SPECIAL TAX 15.85%
------------------
235,000 Denver, City & County Excise Tax,
5.00%, 11/01/08 A1/AAA 234,716
---------
TOTAL REVENUE BONDS
(Cost $891,155) 892,049
---------
23,110 MUTUAL FUNDS 1.56%
-----------------------------
Star Bank Tax Free Fund, 23,110
(Cost $23,110) ---------
TOTAL INVESTMENTS
(Cost $1,463,284) 99.13% $1,467,745
Other assets in excess of liabilities 0.87% 12,922
------------------
NET ASSETS 100.00% $1,480,667
==================
</TABLE>
-2-
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
<PAGE>
COLORADO DOUBLE TAX EXEMPT BOND FUND, INC.
STATEMENT OF INVESTMENTS
INCOME PORTFOLIO
June 30, 1998
(Unaudited)
<TABLE>
<CAPTION>
FACE BOND RATING
AMOUNT MOODY'S/S&P MARKET VALUE
------ ----------- ------------
CERTIFICATES OF PARTICIPATION 0.82%
----------------------------- -----
<C> <S> <C> <C>
$ 15,000 El Paso County, School District 38,
6.90%, 12/01/13 Aaa/AAA $ 15,760
----------
TOTAL CERTIFICATES OF
PARTICIPATION
(Cost $15,760) 15,760
----------
GENERAL OBLIGATION 7.88%
------------------------
50,000 El Paso County, School District 11,
7.10%, 12/01/18 Aaa/AAA 60,985
50,000 Interstate South Metro District,
6.00%, 12/01/20 NR/A+ 52,919
35,000 Thornton, Revenue Ref.
6.00%, 12/01/15 Aaa/AAA 36,916
----------
TOTAL GENERAL OBLIGATION
(Cost $151,113) 150,820
----------
ESCROWED IN U.S. GOVERNMENT SECURITIES 7.38%
--------------------------------------------
5,000 Adams County, Building Auth.,
Zero Coupon, 08/15/12 NR/AAA 2,517
Colorado Health Facilities, Retirement
110,000 Zero Coupon, 07/15/20 NR/AAA 32,912
85,000 Zero Coupon, 07/15/22 AAA/AAA 22,794
180,000 Zero Coupon, 07/15/24 NR/AAA 43,265
35,000 Platte River Power Authority,
6.00%, 06/01/18 NR/AAA 39,871
----------
TOTAL ESCROWED IN U.S.
GOVERNMENT SECURITIES
(Cost $144,185) 141,359
----------
REVENUE BONDS 83.18%
---------------------
EDUCATION 25.10%
---------------------
205,000 Colorado Postsecondary Educational Facilities,
6.00%, 03/01/16 A2/AAA 219,694
250,000 University of Northern Colorado, Aux Facilities,
5.60%, 06/01/24 Aaa/AAA 260,768
----------
480,462
----------
HOSPITALS 12.05%
-----------------
25,000 Colorado Springs Hospital,
5.70%, 12/15/08 Aaa/AAA 27,249
40,000 Colorado Health Facilities, Catholic Health
5.125%, 12/01/17 Aa2/AA 40,067
20,000 Colorado Health Facilities, Cleo Wallace
7.00%, 08/01/15 NR/NR 20,995
</TABLE>
-3-
<PAGE>
<TABLE>
<C> <S> <C> <C>
20,000 Colorado Health Facs Auth, Lutheran Medical,
7.25%, 10/01/14 A1/A+ 21,110
125,000 Colorado Health Facilities, Sisters of Charity
5.00%, 12/01/25 Aaa/AAA 121,275
----------
230,696
----------
HOUSING 6.33%
--------------
75,000 Adams County, Housing Authority Mtg.,
5.80%, 12/01/22 NR/A 78,178
Colorado Housing Finance Authority, SF Housing,
30,000 Zero Coupon, 09/01/10 Aa1/NR 12,053
30,000 5.60%, 11/01/16 Aa1/AA+ 30,846
----------
121,077
----------
TRANSPORTATION 8.17%
---------------------
150,000 Denver City & County Airport,
5.875%, 11/15/16 Aaa/AAA 156,431
----------
UTILITY 31.53%
---------------
Colorado Springs Utilities,
25,000 6.50%, 11/15/15 Aa2/AA 27,192
145,000 5.10%, 11/15/17 Aa2/AA 145,030
25,000 6.00%, 11/15/18 Aa2/AA 26,427
100,000 6.125%, 11/15/20 Aa2/AA 106,117
Colorado Water Resources & Power Dev. Auth,
60,000 6.375%, 11/01/15 Aaa/AAA 65,524
180,000 5.00%, 09/01/19 Aaa/AAA 177,329
50,000 Upper Eagle Regal Water Authority,
6.70%, 12/01/18 NR/NR 55,981
----------
603,600
----------
TOTAL REVENUE BONDS
(Cost $1,583,017) 1,592,266
----------
MUTUAL FUNDS 0.36%
------------------
6,908 Star Bank Tax Free Fund,
(Cost $ 6,908) 6,908
----------
TOTAL INVESTMENTS
(Cost $1,900,983) 99.62% $1,907,113
Other assets in excess of liabilities 0.38% 7,204
------- ----------
NET ASSETS 100.00% $1,914,317
======= ==========
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
-4-
<PAGE>
COLORADO DOUBLE TAX-EXEMPT BOND FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES
June 30, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHORT/
INTERMEDIATE INCOME
PORTFOLIO PORTFOLIO
------------------------
ASSETS:
<S> <C> <C>
Investments in securities, at value (Cost $1,463,284
and $1,900,983, respectively) (Note 6) $1,467,745 $1,907,113
Prepaid insurance 4,990 4,990
Service deposit 3,000 3,000
Interest receivable 18,583 15,022
-----------------------
TOTAL ASSETS 1,494,318 1,930,125
-----------------------
LIABILITIES:
Payable for dividends declared 2,614 3,713
Payable to advisor 8,111 9,156
Accrued expenses 2,926 2,939
-----------------------
TOTAL LIABILITIES 13,651 15,808
-----------------------
NET ASSETS $1,480,667 $1,914,317
=======================
NET ASSETS CONSIST OF:
Capital stock, $.001 par value; limited
shares authorized; 145,992 and 188,311
shares outstanding, respectively (Note 5) $ 146 $ 188
Additional paid in capital 1,473,918 1,905,955
Undistributed net investment income 0 0
Accumulated undistributed net realized
gain from security transactions 2,142 2,044
Net unrealized appreciation
of investments 4,461 6,130
-----------------------
NET ASSETS $1,480,667 $1,914,317
=======================
Net asset value, redemption and offering price
per share ($1,480,667/145,992 and $1,914,317/
188,311 shares of capital stock outstanding,
respectively) (Note 5) $ 10.14 $ 10.17
========================
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
-5-
<PAGE>
COLORADO DOUBLE TAX EXEMPT BOND FUND, INC.
STATEMENT OF OPERATIONS
For the six months ended
June 30, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHORT
INTERMEDIATE INCOME
PORTFOLIO PORTFOLIO
-------------------------
INVESTMENT INCOME:
<S> <C> <C>
Interest $ 17,313 $ 31,736
---------------------
TOTAL INCOME 17,313 31,736
---------------------
EXPENSES:
Investment advisory fee (Note 3) 794 1,342
Distribution fee (Note 4) 863 1,459
Administrative fee (Note 3) 8,563 8,956
Transfer agent fee (Note 3) 4,120 4,159
Audit fee 2,246 2,246
Custody fee 3,775 3,775
Directors fees and expenses 1,500 1,500
Registration 63 63
Legal fee 6,329 6,329
Insurance expense 2,507 2,507
Other ---------------------
TOTAL EXPENSES 30,835 32,411
---------------------
Less: Expense reimbursement from advisor (Note 3) (28,488) (28,443)
---------------------
NET EXPENSES 2,347 3,968
---------------------
NET INVESTMENT INCOME 14,966 27,768
---------------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
(Note 2)
Net realized gain on investments 2,142 2,044
Unrealized appreciation of investments
for the period 4,300 2,141
---------------------
NET GAIN ON INVESTMENTS 6,442 4,185
---------------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 21,408 $ 31,953
=====================
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
-6-
<PAGE>
COLORADO DOUBLE TAX EXEMPT BOND FUNDS INC., STATEMENT OF CHANGES
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR THE PERIOD FOR THE PERIOD
FOR THE SIX APRIL 17,1997 FOR THE SIX APRIL 17,1997
MONTHS ENDED (CAPITALIZATION) MONTHS ENDED (CAPITALIZATION)
JUNE 30, 1998 TO JUNE 30, 1998 TO
(UNAUDITED) DECEMBER 31,1997 (UNAUDITED) DECEMBER 31,1997
- ----------------------------------------------------------------------------------------------------------------
SHORT/INTERMEDIATE PORTFOLIO INCOME PORTFOLIO
INCREASE IN NET ASSETS FROM OPERATIONS:
<S> <C> <C> <C> <C>
Net investment income $ 14,966 $ 335 $ 27,768 $ 1,598
Net realized gain on investments 2,142 0 2,044 298
Unrealized appreciation for the period 4,300 161 2,141 3,989
-------------------------- --------------------------
Net increase in net assets
from operations 21,408 496 31,953 5,885
-------------------------- --------------------------
DISTRIBUTIONS PAID TO SHAREHOLDERS:
From net investment income($.23, $.07 and $.24,
$.08 per share, respectively) (14,966) (335) (27,768) (1,598)
From net realized gains 0 0 (298) 0
CAPITAL SHARE TRANSACTIONS (NOTE 5) 1,423,319 50,745 1,590,180 315,963
-------------------------- --------------------------
TOTAL INCREASE IN NET ASSETS 1,429,761 50,906 1,594,067 320,250
-------------------------- --------------------------
NET ASSETS:
Beginning of period 50,906 0 320,250 0
-------------------------- --------------------------
End of period $ 1,480,667 $ 50,906 $ 1,914,317 $ 320,250
========================== ==========================
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
-7-
<PAGE>
COLORADO DOUBLE TAX EXEMPT BOND FUND, INC.
SHORT INTERMEDIATE PORTFOLIO
FINANCIAL HIGHLIGHTS
(For a fund share outstanding throughout the period)
<TABLE>
<CAPTION>
For the period
For the six October 28, 1997
Months ended (Commencement of operations)
June 30,1998 to
(Unaudited) December 31,1997
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.03 $ 10.00
--------------- -----------------------------
Income from investment operations:
Net investment income 0.23 0.07
Net realized and unrealized gain
on investments 0.11 0.03
--------------- -----------------------------
TOTAL FROM INVESTMENT OPERATIONS 0.34 0.10
--------------- -----------------------------
Less distributions:
Dividends from net investment income (0.23) (0.07)
Dividends from net realized gains 0.00 0.00
--------------- -----------------------------
TOTAL DISTRIBUTIONS (0.23) (0.07)
--------------- -----------------------------
NET ASSET VALUE, END OF PERIOD $ 10.14 $ 10.03
=============== =============================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) ................ 1,481 51
Ratio of expenses to average net assets ............. 8.93% # 84.89% **
Ratio of expenses to average net assets,
after reimbursement ............................ 0.68% # 0.68% **
Ratio of net investment income (loss) to average
net assets ..................................... (3.92)% # (80.44)% **
Ratio of net investment income (loss) to average
net assets, after reimbursement ................ 4.34% # 3.77% **
Portfolio turnover rate ............................. 114.05% 0.00%
Total return * ...................................... 7.08% # 5.64% **
<FN>
* Based on net asset value per share
** The Portfolio was capitalized on April 17, 1997,with $50,000 representing
5,000 shares at a net asset value per share of $10.00. The initial public
offering was made on November 3, 1997, at which time the net asset value per
share was $10.00. Ratios for this initial period of operations are annualized.
# Annualized
</FN>
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
-8-
<PAGE>
COLORADO DOUBLE TAX EXEMPT BOND FUND, INC.
INCOME PORTFOLIO
FINANCIAL HIGHLIGHTS
(For a fund share outstanding throughout the period)
<TABLE>
<CAPTION>
For the period
For the six October 28, 1997
Months ended (Commencement of operations)
June 30, 1998 to
(Unaudited) December 31, 1997
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 10.12 $ 10.00
--------------- -----------------------------
Income from investment operations:
Net investment income 0.24 0.09
Net realized and unrealized gain
on investments 0.05 0.12
--------------- -----------------------------
TOTAL FROM INVESTMENT OPERATIONS 0.29 0.21
--------------- -----------------------------
Less distributions:
Dividends from net investment income (0.24) (0.09)
Dividends from net realized gains 0.00 0.00
--------------- -----------------------------
TOTAL DISTRIBUTIONS (0.24) (0.09)
--------------- -----------------------------
NET ASSET VALUE, END OF PERIOD $ 10.17 $ 10.12
=============== =============================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) ........... 1,914 320
Ratio of expenses to average net assets ........ 5.55% # 24.20% **
Ratio of expenses to average net assets,
after reimbursement ....................... 0.68% # 0.68% **
Ratio of net investment income (loss) to average
net assets ................................ (0.12)% # (18.48)% **
Ratio of net investment income (loss) to average
net assets, after reimbursement ........... 4.76% # 5.03% **
Portfolio turnover rate ........................ 55.09% 25.64%
Total return * ................................. 5.97% # 12.21% **
<FN>
* Based on net asset value per share
**The Portfolio was capitalized on April 17, 1997, with $50,000 representing
5,000 shares at a net asset value per share of $10.00. The initial public
offering was made on November 3, 1997, at which time the net asset value per
share was $10.00.
Ratios for this initial period of operations are annualized.
# Annualized
</FN>
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
-9-
<PAGE>
COLORADO DOUBLE TAX EXEMPT BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1998
(UNAUDITED)
NOTE 1. ORGANIZATION
The Colorado Double Tax Exempt Bond Fund (the "Fund") was organized as a
Maryland Corporation, on August 29, 1996, and commenced operations on October
28, 1997. The Corporation is registered under the Investment Company Act of
1940, as amended, as a non-diversified, open end management investment company.
The Fund is authorized to issue 100,000,000 shares of capital stock, par value
of $.001 per share, of which 40,000,000 shares are initially authorized as Class
A shares which constitute the Short-Intermediate Portfolio and 20,000,000 shares
are initially authorized as Class B Shares which constitute the Income
Portfolio. The Fund was formed to provide Colorado investors with as high a
level of tax exempt income exempt from Federal and Colorado state income taxes
as is consistent with the maturities of the portfolio selected, with a greater
degree of principal stability than is associated with funds or trusts invested
exclusively in long-term municipal bonds.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Fund in the preparation of its financial statements.
SECURITIES VALUATIONS- Portfolio securities are valued at the last
reported sale price on the securities exchange or national securities market on
which such securities primarily are traded. Securities not listed on an exchange
or national securities market, or securities in which there were no
transactions, are valued at the average of the most recent bid and asked prices.
Short-term investments are carried at amortized cost, which approximates value.
Any securities or other assets for which recent market quotations are not
readily available are valued at fair value as determined in good faith by the
Fund's Board of Directors. Expenses and fees, including the management fee and
distribution and service fees, are accrued daily and taken into account for the
purpose of determining the net asset value of the Fund's shares.
FEDERAL INCOME TAXES- The Fund intends to qualify each year as a
"regulated investment company" under the Internal Revenue Code. By so
qualifying, the Fund will not be subject to federal income taxes to the extent
that it distributes substantially all of its net investment income and any
realized capital gains.
DIVIDENDS AND DISTRIBUTIONS- The Fund accrues dividends daily and
distributes monthly all of its net investment income. The Fund intends to
distribute its net long term capital gains and its net short term capital gains
at least once a year.
ORGANIZATION EXPENSES- During its organization and initial
registration with the Securities and Exchange Commission (the "SEC"), the Fund
incurred organization expenses of $38,656. The Adviser has elected to incur
these expenses.
OTHER- The Fund follows industry practice and records security
transactions on the trade date. The specific identification method is used for
determining gains or losses for financial statements and income tax purposes.
Interest income is recorded on an accrual basis.
USE OF ESTIMATES- The preparation of financial statements in
conformity with generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements, and the reported amounts of increases and decreases in
net assets from operations during the reporting period. Actual results could
differ from those estimates.
-10-
<PAGE>
COLORADO DOUBLE TAX EXEMPT BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1998
(UNAUDITED)
NOTE 3. INVESTMENT ADVISORY, ADMINISTRATION AND CUSTODIAL AGREEMENTS
The Board of Directors provides broad supervision over the affairs of the
Fund. Pursuant to a Management Agreement between the Fund and Funds Management
Corporation (the "Manager") and subject to the authority of the Board of
Directors, the Manager manages the investments of the Fund and is responsible
for the overall management of the business affairs of the Fund.
Under the terms of the Management Agreement, the Fund has agreed to pay the
manager a base monthly management fee at the annual rate of .23%, of the Fund's
average daily net assets.
All expenses incurred in the operation of the Fund will be borne by the
Fund, except to the extent specifically assumed by the Manager. The expenses to
be borne by the Fund will include: taxes, interest, brokerage fees and
commissions, fees of board members who are not officers, directors or employees
of the Manager or its affiliates, Securities and Exchange Commission fees, state
Blue Sky qualification fees, advisory, administrative and fund accounting fees,
charges of custodians, transfer and dividend disbursing agents' fees, insurance
premiums, industry association fees, outside auditing and legal expenses, costs
attributable to investor services (including, without limitation, telephone and
personnel expenses), costs of shareholders' reports and meetings, costs of
preparing and printing prospectuses and statements of additional information,
amounts payable under the Fund's Distribution and Shareholder Servicing Plan
(the "Plan") and any extraordinary expenses. The Manager has agreed to reimburse
the Fund for its expenses to the extent that they ever exceed .68% (including
the Advisor's fee) of the average annual net assets of the Fund. The Manager is
a wholly owned subsidiary of Isaak Bond Investments, Inc. ("The Principal
Underwriter"). The Principal Underwriter is owned by certain Officers and
Directors of the Fund.
For the six months ended June 30, 1998, the Manager earned advisory fees of
$2,136. The Manager earned $794 from the Short-Intermediate Portfolio, and
$1,342 from the Income Portfolio, respectively. The Manager reimbursed the Fund
$56,931 in expenses. The Manager reimbursed the Short-Intermediate Portfolio
$28,488, and reimbursed the Income Portfolio $28,443, respectively.
The Fund has agreements with American Data Services, Inc. (the
"Administrator") to provide shareholder servicing, fund accounting and
administrative services to the Fund. The services to be provided under the
agreements include day-to-day administration of matters related to the corporate
existence of the Fund (other than rendering investment advice), maintenance of
its records, preparation of reports, supervision of the Fund's arrangement with
its custodian and assistance in the preparation of the Fund's registration
statement under federal and state laws. Costs incurred totaled $25,798, $12,683
for the Short-Intermediate Portfolio, and $13,115 for the Income Portfolio
respectively, for the six months ended June 30, 1998. The agreements provide for
minimum fees of $3,000 per portfolio plus expenses and transactional charges.
The agreements provide for discounts to the Fund during the first eight months
of the Fund's operations or until average daily net assets exceed specified
levels. The Fund is required to maintain a $3,000 per portfolio deposit with the
Administrator.
-11-
<PAGE>
COLORADO DOUBLE TAX EXEMPT BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1998
(UNAUDITED)
NOTE 3. INVESTMENT ADVISORY, ADMINISTRATION AND CUSTODIAL AGREEMENTS
(CONTINUED)
The Fund's custody agreements with a bank provides for fees on a
transactional basis plus expenses. The minimum monthly fee per portfolio is $400
per month.
NOTE 4. DISTRIBUTION AGREEMENT
Under a plan adopted by the Fund's Board of Directors pursuant to Rule
12b-1 under the 1940 Act (the "Plan"), the Fund pays the Manager for each of the
Fund's portfolios, a shareholder servicing and distribution fee at the annual
rate of .25% of the average daily net assets of the Fund. Such fee will be used
in it's entirety by the Manager to make payments to reimburse distributors or
others for all expenses incurred by distributors or others in the promotion and
distribution of the Fund's shares. Such expenses may include, but are not
limited to, the printing of prospectuses and reports used for sales purposes,
expenses of prepaying and distributing sales literature and related expenses,
including a prorated portion of distributors' overhead expenses attributable to
the distribution of Fund shares, as well as any distribution or service fees
paid to securities broker-dealers or their firms or others who have executed a
servicing agreement with the Fund, distributors or their affiliates. The fees
paid to the Manager under the Plan are in addition to the fees payable under the
Management Agreement and are payable without regard to actual expenses incurred.
For the six months ended June 30, 1998, the amount paid or accrued for such
expenses was $2,322.
NOTE 5. CAPITAL SHARE TRANSACTIONS
As of June 30, 1998 there was an authorized number of $.001 par value
shares of capital stock authorized for the Fund. The Fund is authorized to issue
100,000,000 shares of capital stock, par value of $.001 per share, of which
40,000,000 shares were initially authorized as Class A Shares which constitute
the Short- Intermediate Portfolio and 20,000,000 shares were initially
authorized as Class B Shares which constitute the Income Portfolio. The Board of
Directors is authorized to assign any of the 40,000,000 unassigned shares of the
Fund to a portfolio. Transactions in capital stock were as follows:
-12-
<PAGE>
COLORADO DOUBLE TAX EXEMPT BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1998
(UNAUDITED)
NOTE 5. CAPITAL SHARE TRANSACTIONS (CONTINUED)
SHORT-INTERMEDIATE PORTFOLIO
<TABLE>
<CAPTION>
FOR THE SIX FOR THE PERIOD
MONTHS ENDED APRIL 17, 1997
(CAPITALIZATION)
TO
JUNE 30, 1998 DECEMBER 31, 1997
SHARES AMOUNT SHARES AMOUNT
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 139,690 $1,410,878 5,050 $ 50,500
Shares is sued for reinvestment
of dividends and distribution 1,227 12,441 24 245
Shares redeemed 0 0 0 0
---------- ---------- ---------- ----------
Net increase 140,917 $1,423,319 5,074 $ 50,745
========== ========== ========== ==========
</TABLE>
INCOME PORTFOLIO
<TABLE>
<CAPTION>
FOR THE SIX FOR THE PERIOD
MONTHS ENDED APRIL 17, 1997
(CAPITALIZATION)
TO
JUNE 30, 1998 DECEMBER 31, 1997
SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 155,472 $ 1,578,038 31,558 $ 315,000
Shares is sued for reinvestment
of dividends and distribution 1,688 17,142 95 963
Shares redeemed (502) (5,000) 0 0
------------ ----------- ----------- -----------
Net increase 156,658 $ 1,590,180 31,653 $ 315,963
=========== =========== =========== ===========
</TABLE>
-13-
<PAGE>
COLORADO DOUBLE TAX EXEMPT BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1998
(UNAUDITED)
NOTE 6. INVESTMENTS
For the six months ended June 30, 1998, purchases and sales of investment
securities, other than short-term investments, were as follows. The
Short-Intermediate Portfolio aggregated $2,165,964 and $776,794, respectively.
The gross unrealized appreciation for all securities totaled $5,970 and the
gross unrealized depreciation for all securities totaled $1,509 for a net
unrealized appreciation of $4,461. The aggregate cost of securities for federal
income tax purposes at June 30, 1998 was $1,463,284. Purchases and sales of the
Income Portfolio aggregated $2,243,058 and $648,770, respectively. The gross
unrealized appreciation for all securities totaled $13,812 and the gross
unrealized depreciation for all securities totaled $7,682 for a net unrealized
appreciation of $6,130. The aggregate cost of securities for federal income tax
purposes at June 30, 1998 was $1,900,983.
-14-
