May 31, 1995, Revised September 29,
1995 COLONIAL CALIFORNIA TAX-EXEMPT
FUND COLONIAL CONNECTICUT TAX-EXEMPT
FUND COLONIAL FLORIDA TAX-EXEMPT FUND
COLONIAL MASSACHUSETTS TAX-EXEMPT FUND
COLONIAL MICHIGAN TAX-EXEMPT FUND
COLONIAL MINNESOTA TAX-EXEMPT FUND
COLONIAL NEW YORK TAX-EXEMPT FUND
COLONIAL NORTH CAROLINA TAX-EXEMPT
FUND COLONIAL OHIO TAX-EXEMPT FUND
PROSPECTUS
BEFORE YOU INVEST
Colonial Management Associates, Inc. (Adviser) and your full-
service financial adviser want you to understand both the risks and
benefits of mutual fund investing.
While mutual funds offer significant opportunities and are
professionally managed, they also carry risks including possible
loss of principal. Unlike savings accounts and certificates of
deposit, mutual funds are not insured or guaranteed by any
financial institution or government agency.
Please consult your full-service financial adviser to determine how
investing in one of these mutual funds may suit your unique needs,
time horizon and risk tolerance.
Each of Colonial California, Connecticut, Florida, Massachusetts,
Michigan, Minnesota, New York, North Carolina and Ohio Tax-Exempt
Funds is a portfolio of Colonial Trust V (Trust), an open-end
management investment company. Each Fund seeks as high a level of
after-tax total return, as is consistent with prudent risk, by
pursuing current income exempt from federal and its state personal
income tax (if any) and opportunities for long-term appreciation
from a portfolio primarily invested in investment grade municipal
bonds. The Florida and Michigan Funds' shares are
intended to be exempt from the respective state's intangibles
tax. Each Fund (except the California Fund) is non-diversified. The
Funds are managed by the Adviser, an investment adviser since 1931.
SP-01/259B-0995
This Prospectus explains concisely what you should know before
investing in the Funds. Read it carefully and retain it for future
reference. More detailed information about each Fund is in the May
31, 1995 Statement of Additional Information which has been filed
with the Securities and Exchange Commission and is obtainable free of
charge by calling the Adviser at 1-800-248-2828. The Statement of
Additional Information is incorporated by reference in (which means
it is considered to be a part of) this Prospectus.
Each Fund offers two classes of shares. Class A shares are offered
at net asset value plus a sales charge imposed at the time of
purchase; Class B shares are offered at net asset value plus an
annual distribution fee and a declining contingent deferred sales
charge on
redemptions made within six years after purchase. Class B
shares automatically convert to Class A shares after
approximately eight years. See "How to buy shares."
Contents Page
Summary of expenses. 2
The Funds' financial history 4
The Funds' investment objective 14
How the Funds pursue their
objective 14
How the Funds measure their
performance 18
How the Funds are managed 18
How the Funds value their shares 18
Distributions and taxes 19
How to buy shares 19
How to sell shares 20
How to exchange shares 20
Telephone transactions 21
12b-1 plans 21
Organization and history 21
Appendix 22
FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED,
ENDORSED OR INSURED BY, ANY BANK OR GOVERNMENT AGENCY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
SUMMARY OF EXPENSES
Expenses are one of several factors to consider when investing in a
Fund. The following tables summarize your maximum transaction costs
and annual expenses for an investment in each Class of each Fund's
shares.
Shareholder Transaction Expenses(1)(2)
Class A Class B
Maximum Initial Sales Charge
Imposed on a Purchase (as a % of
offering price)(3) 4.75% 0.00%(5)
Maximum Contingent Deferred Sales
Charge (as a % of offering
price)(3) 1.00%(4)
5.00%
(1) For accounts less than $1,000 an annual fee of
$10 may be deducted. See "How to sell
shares." (2) Redemption
proceeds exceeding $5,000 sent via
federal funds wire will be subject to a $7.50
charge per transaction.
(3) Does not apply to reinvested distributions.
(4) Only with respect to any portion of purchases
of
$1 million to $5 million redeemed within
approximately 18 months after purchase. See
"How to buy shares."
(5) Because of the 0.75% distribution fee
applicable
to Class B shares, long-term Class B
shareholders may pay more in aggregate sales
charges than the maximum initial sales charge
permitted by the National Association of
Securities Dealers, Inc. However, because the
Funds' Class B shares automatically convert to
Class A shares after approximately 8 years,
this is less likely to be true for Class B
shares than for a class without a conversion
feature.
Annual Operating Expenses (as a % of net assets)
California Connecticut Florida
Class A Class B Class A Class B Class A Class
B Management fee
(after
waiver)(6) 0.54% 0.54% 0.17% 0.17% 0.03% 0.03%
12b-1 fee
(6)(7) 0.12 0.87 0.12 0.87 0.12 0.87
Other expenses
(after waiver) 0.18 0.18 0.28 0.28 0.37 0.37
---- ---- ---- ---- ---- ----
Net expenses(8) 0.84% 1.59% 0.57% 1.32% 0.52% 1.27%
==== ==== ==== ==== ==== ====
Massachusetts Michigan Minnesota
Class A Class B Class A Class B Class A Class
B
Management fee
(after
waiver)(6) 0.50% 0.50% 0.40% 0.40% 0.35%
0.35%
12b-1
fee(6)(7) 0.12 0.87 0.12 0.87 0.12 0.87
Other expenses
(after waiver) 0.25 0.25 0.35 0.35 0.40
0.40
---- ---- ---- ---- ---- ---
- -
Net expenses(8) 0.87% 1.62% 0.87% 1.62% 0.87%
1.62%
==== ==== ==== ==== ====
====
New York North Carolina Ohio
Class A Class B Class A Class B Class A Class
B
Management fee
(after
waiver)(6) 0.20% 0.00% 0.00% 0.00% 0.46%
0.46%
12b-1
fees(6)(7) 0.12 0.87 0.12 0.87 0.12 0.87
Other expenses
(after waiver) 0.30 0.30 0.30 0.30 0.29 0.29
---- ---- ---- ---- ---- ----
Net expenses(8) 0.62% 1.37% 0.42% 1.17% 0.87% 1.62%
==== ==== ==== ==== ==== ====
Without voluntary expense limits that the Adviser may discontinue at
anytime, the amounts in Annual Operating Expenses would be:
California Connecticut Florida
Class A Class B Class A Class B Class A Class
B
Management fee (6) 0.54% 0.54% 0.54% 0.54% 0.54% 0.54%
12b-1 fees (6) (7) 0.12 0.87 0.12 0.87 0.12 0.87
Other expenses 0.18 0.18 0.28 0.28 0.37 0.37
---- ---- ---- ---- ---- ----
Total expenses 0.84% 1.59% 0.94% 1.69% 1.03% 1.78%
==== ==== ==== ==== ==== ====
Massachusetts Michigan Minnesota
Class A Class B Class A Class B Class A Class B
Management fee (6) 0.54% 0.54% 0.54% 0.54% 0.54%
0.54%
12b-1 fees(6)(7) 0.12 0.87 0.12 0.87 0.12
0.87
Other expenses 0.25 0.25 0.35 0.35 0.40
0.40
---- ---- ---- ---- ----
- ----
Total expenses 0.91% 1.66% 1.01% 1.76% 1.06%
1.81%
==== ==== ==== ==== ====
====
New York North Carolina
Ohio
Class A Class B Class A Class B Class A Class
B
Management fee (6) 0.54% 0.54% 0.54% 0.54% 0.54% 0.54%
12b-1 fees(6)(7) 0.12 0.87 0.12 0.87 0.12
0.87
Other expenses 0.30 0.30 0.46 0.46 0.29
0.29
---- ---- ---- ---- ---- ----
Total expenses 0.96% 1.71% 1.12% 1.87% 0.95% 1.70%
==== ==== ==== ==== ==== ====
Example
The following Example shows the cumulative expenses attributable to a
hypothetical $1,000 investment in each Class of shares of each Fund
for the periods specified, assuming a 5% annual return, and, unless
otherwise noted, redemption at period end. The 5% return and expenses
used in the Example should not be considered indicative of actual or
expected Fund performance or expenses, both of which will vary.
California Connecticut Florida
Class A Class B Class A Class B Class A
Class B
Period: (9) (9)
(9)
1 year $ 56 $ 66 $ 16 $52 $ 62 $ 12 $51 $ 61 $ 11
3 years 73 81 51 60 67 37 57 64
34
5 years 92 107 87 70 85 65 65 79
59
10 years 147 170(10) 170(10) 98 122(10) 122(10) 86 110(10)
110(10)
Massachusetts Michigan Minnesota
Class A Class B Class A Class B Class A
Class B
Period: (9) (9)
(9)
1 year $ 55 $ 66 $ 16 $ 55 $ 65 $ 15 $ 55 $ 66 $ 16
3 years 72 80 50 69 77 47 72 80
50
5 years 91 106 86 86 101 81 91 106
86
10 years 144 168(10) 168(10) 133 156(10) 156(10) 144 168(10)
168(10)
New York North Carolina Ohio
Class A Class B Class A Class B Class A Class B
Period: (9) (9)
(9)
1 year $ 53 $ 63 $ 13 $50 $60 $10 $ 55 $ 66 $ 16
3 years 63 71 41 54 61 31 72 80
50
5 years 75 90 70 59 74 54 91 106
86
10 years 110 133(10) 133(10) 74 98(10) 98(10) 144 168(10)
168(10)
Without voluntary expense limits that the Adviser may discontinue at
any time, the amounts in the Example would be:
California Connecticut Florida
Class A Class B Class A Class B Class A
Class B
Period: (9) (9)
(9)
1 year $ 56 $ 66 $ 16 $ 57 $ 67 $ 17 $ 58 $ 68 $ 18
3 years 73 81 51 76 84 54 79 87
57
5 years 92 107 87 97 113 93 102 117
97
10 years 147 170(10) 170(10) 158 181(10) 181(10) 168
191(10) 191(10)
Massachusetts Michigan
Minnesota
Class A Class B Class A Class B Class A Class B
Period: (9) (9)
(9)
1 year $ 56 $ 67 $ 17 $ 57 $ 68 $ 18 $ 58 $ 69 $
19
3 years 75 83 53 78 86 56 80 87
57
5 years 96 111 91 101 116 96 103 119
99
10 years 154 178(10) 178(10) 166 189(10) 189(10) 170 194(10)
194(10)
New York North Carolina Ohio
Class A Class B Class A Class B Class A Class B
Period: (9) (9)
(9)
1 year $ 57 $ 68 $ 18 $ 58 $ 69 $ 19 $ 57 $ 67 $
17
3 years 77 84 54 81 89 59 76 84
54
5 years 98 113 93 106 122 102 98 113
93
10 years 160 183(10) 183(10) 177 201(10) 201(10) 159 182(10)
182(10)
(6) The nominal Management and Rule 12b-1 fees were
changed during the fiscal year ended January
1995. The percentages shown are estimates
based on the new fees.
(7) Includes an annualized service fee of 0.12%.
The service fee rate will fluctuate but will
not exceed 0.25%.
(8) Through July 31, 1995, the Adviser voluntarily
agreed to waive its fees and reimburse the Funds for all expenses
(exclusive of 12b-1 fees, brokerage commissions, interest, taxes
and extraordinary expenses, if any) to the extent such expenses
did not exceed an annual percentage
of average net assets as follows:
Massachusetts
Minnesota
California Connecticut Florida Ohio
0.75% 0.30% 0.20% 0.70%
Michigan New York North Carolina
0.60% 0.40% 0.10%
Effective August 1, 1995, the Adviser agreed to waive its fees and
bear expenses only (exclusive of 12b-1 fees, brokerage
commissions, interest, taxes and extraordinary expenses, if any)
to the extent such expenses would otherwise exceed an annual
percentage of average net assets as follows:
Massachusetts
Michigan
Minnesota
California Connecticut Florida Ohio
0.80% 0.45% 0.40% 0.75%
New York North Carolina
0.50% 0.30%
(9) Assumes no redemption.
(10) Class B shares convert to Class A shares after
approximately 8 years; therefore years 9 and 10
reflect Class A shares expenses.
THE FUNDS' FINANCIAL HISTORY
The following schedules of financial highlights for a share
outstanding throughout each period have been audited by Price
Waterhouse LLP, independent accountants. Their unqualified
reports are included in the Funds' 1995 Annual Reports, and are
incorporated by reference into the Statement of Additional
Information.
<TABLE>
<CAPTION>
CALIFORNIA
Two months ended Year ended
Year ended January 31 January 31 November
30
1995 1994 1993(b) 1992
Class A Class B Class A Class B Class A Class B Class A Class B
(c)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value -
Beginning of period $7.660 $7.660 $7.350 $7.350 $7.270 $7.270 $7.150 $7.410
------ ------ ------ ------ ------- ------- ------ -------
Income from investment
operations:
Net investment income(a) 0.413 0.360 0.434 0.378 0.076 0.067 0.467
0.143
Net realized and
unrealized gain (loss)
on investments (0.791) (0.791) 0.315 0.315 0.081 0.081 0.109 (0.151)
------- ------- ----- ----- ----- ----- ----- -------
Total from investment
operations (0.378) (0.431) 0.749 0.693 0.157 0.148 0.576 (0.008)
------- ------- ------- ------- ------- ------- ------- -------
Less distributions
declared to shareholders:
From net investment income (0.412) (0.359) (0.439) (0.383) (0.077) (0.068) (0.456) (0.132)
Total distributions
declared shareholders: (0.412) (0.359) (0.439) (0.383) (0.077) (0.068) (0.456) (0.132)
------- ------- ------- ------- ------- ------- ------- -------
Net asset value -
End of period $6.870 $6.870 $7.660 $7.660 $7.350 $7.350 $7.270 $7.270 (g)
------- ------ ------- ------- ------- ------- ------- -------
------- ------ ------- ------- ------- ------- ------- -------
Total return(d)(e) (4.83)% (5.55)% 10.44% 9.63% 8.70%(f 1.01%(f) 8.27%
1.94% (g)
------- ------ ------- ------- ------- ------- ------- -------
------- ------ ------- ------- ------- ------- ------- -------
Ratios to average net assets:
Expenses 0.77%(h) 1.52%(h) 0.75% 1.50% 0.65%(g) 1.40%(g) 0.71%
1.46%
Net investment income 5.91% 5.16% 5.73% 4.98% 6.29%(g) 5.54%(g) 6.44%
5.69%
Fees and expenses waived
or borne by Adviser 0.06% 0.06% 0.08% 0.08% 0.21%(g) 0.21%(g) 0.13%
0.13%
Portfolio turnover 47% 47% 17% 17% 19%(g) 19%(g) 12%
12%
Net assets at
end of period (000) $301,912 $98,975 $379,987 $104,578 $337,409 $33,819 $324,012 $22,797
- ----------------------------
(a) Net of fees and
expenses waived or
borne by the Adviser
which amounted to...... $0.004 $0.004 $0.006 $0.006 $0.002 $0.002 $0.010 $0.010
(b) The Fund changed its fiscal year end from November 30 to January
31 in 1992.
(c) Class B shares were initially offered on August 4, 1992. Per
share amounts reflect
activity from that date.
(d) Total return at net asset value assuming all distributions
reinvested and no initial
sales charge or contingent deferred sales charge.
(e) Had the Adviser not waived or reimbursed a portion of expenses
total return would have been reduced.
(f) Not annualized.
(g) Annualized.
(h) Includes service fee since inception on December 1, 1994, of
0.02% (not annualized).
</TABLE>
<TABLE>
<CAPTION>
CALIFORNIA (CONTINUED)
Period ended
Year ended November 30 November 30
1991 1990 1989 1988 1987
1986(b)
<S> Class A Class A Class A Class A Class A Class
A
Net asset value - <C> <C> <C> <C> <C> <C>
Beginning of period $6.940 $7.010 $6.850 $6.530 $7.490
$7.140
------ ------ ------ ------- ------- ----
- ---
Income from investment operations:
Net investment income(a) 0.473 0.490 0.480 0.497 0.515
0.237
Net realized and unrealized
gain (loss) on investments 0.211 (0.065) 0.160 0.316 (0.950)
0.351
----- ------ ------ ------ ------- ----
- --
Total from investment operations: 0.684 0.425 0.640 0.813 (0.435)
0.588
------ ------ ------ ------ ------- -----
- -
Less distributions declared
to shareholders
From net investment income (0.473) (0.492) (0.480) (0.493) (0.514)
(0.238)
From net realized gains --- -- ---- -- (0.002)
- ---
From capital paid in (c) (0.001) (0.003) --- --- (0.009)
- ---
------ ------ ------ ------- ------- ----
- ---
Total distributions declared
to shareholders (0.474) (0.495) (0.480) (0.493) (0.525)
(0.238)
------- ------- ------- ------- ------- -----
- --
Net asset value - End of period $7.150 $6.940 $7.010 $6.850 $6.530
$7.490
------ ------ ------- ------- ------- -----
- --
------ ------ ------- ------- ------- -----
- --
Total return (d) (e) 10.18% 6.30% 9.61% 12.74% (6.02)%
8.35% (f)
------ ------ ------- ------- ------- -------
------ ------ ------- ------- ------- -------
Ratios to average net assets:
Expenses 0.80% 0.70% 0.95% 0.66% 0.52% --
- - (g)
Net investment income 6.69% 7.02% 6.87% 7.28% 7.33%
6.99% (g)
Fees and expenses waived
or borne by Adviser 0.05% 0.15% 0.15% 0.49% 0.63%
1.08% (g)
Portfolio turnover 11% 22% 40% 106% 94%
31% (g)
Net assets at end of period (000) $295,459 $221,519 $155,514 $133,317 $113,774 $57,777
(a) Net of fees and
expenses waived or borne
by the Adviser which
amounted to............... $0.003 $0.010 $0.011 $0.033 $0.044 $0.014
(b) The Fund commenced investment operations on June 16, 1986.
(c) Because of differences between book and tax basis
accounting
there was no return of capital for federal income tax purposes.
(d) Total return at net asset value assuming all distributions
reinvested and no initial
sales charge or contingent deferred sales charge.
(e) Had the Adviser not waived or reimbursed a portion of expenses
total return would have been reduced.
(f) Not annualized.
(g) Annualized.
</TABLE>
<TABLE>
<CAPTION>
CONNECTICUT
Year ended January 31
1995
1994
---- --
- --
Class A Class B Class A Class B
------- ------- ------- -------
<S> <C> <C> <C> <C>
Net asset value - Beginning
of period $7.890 $7.890 $7.420 $7.420
------ ------ ------ ------
Income (loss) from investment
operations:
Net investment income(a) 0.418 0.363 0.429 0.372
Net realized and unrealized
gain (loss) on investments (0.809) (0.809) 0.465 0.465
------- ------- ----- -----
Total from investment
operations (0.391) (0.446) 0.894 0.837
------- ------- ----- -----
Less distributions declared
to shareholders:
From net investment income (0.418) (0.363) (0.424)
(0.367)
In excess of net investment income --- --- --- --
- -
From net realized gains (0.001) (0.001) --- --
- -
In excess of net realized gains --- --- --- --
- -
------- ------- ------- ------
- -
Total from distributions declared
to shareholders (0.419) (0.364) (0.424)
(0.367)
------- ------- ------- ------
- -
Net asset value - End of period $7.080 $7.080 $7.890 $7.890
===== ===== ===== =====
Total return(d)(e) (4.85)% (5.57)% 12.30%
11.49%
==== ==== ===== =====
Ratios to average net assets:
Expenses 0.32%(f) 1.07%(f) 0.22%
0.97%
Net investment income 5.81% 5.06% 5.48%
4.73%
Fees and expense waived
or borne by the Adviser 0.55% 0.55% 0.65%
0.65%
Portfolio turnover 22% 22% 5%
5%
Net assets at end of period (000) $74,616 $73,580 $91,436 $71,791
- -------------------------------------
(a) Net of fees and expenses
waived or borne by the
Adviser which amounted
to......................... $0.039 $0.039 $0.051
$0.051
(b) Class B shares were initially offered on June 8, 1992.
Per share amounts reflect activity from that date.
(c) The Fund commenced investment operations on November 1,
1991.
(d) Total return at net asset value assuming all
distributions reinvested and no initial sales
charge or contingent deferred sales charge.
(e) Had the Adviser not waved or reimbursed a portion
of
expenses total return would have been reduced.
(f) Includes service fee since its inception in December
1, 1994, of 0.02% (not annualized).
(g) Not annualized.
(h) Annualized.
</TABLE>
<TABLE>
<CAPTION>
CONNECTICUT
Period
ended
Year ended January 31 January
31 1993
1992
---- ----
Class A Class B(b) Class A
(c)
------- ---------- ----------
- -
<S> <C> <C> <C>
Net asset value - Beginning
of period $7.190 $7.200 $7.140
------ ------ ------
Income (loss) from investment
operations:
Net investment income(a) 0.449 0.256 0.118
Net realized and unrealized
gain (loss) on investments 0.270 0.257 0.046
----- ----- -----
Total from investment
operations 0.719 0.513 0.164
----- ----- -----
Less distributions declared
to shareholders:
From net investment income (0.452) (0.256) (0.114)
In excess of net investment income (0.002) (0.002) ---
From net realized gains (0.021) (0.021) ---
In excess of net realized gains (0.014) (0.014) ---
------- ------- -------
Total from distributions declared
to shareholders (0.489) (0.293) (0.114)
------- ------- -------
Net asset value - End of period $7.420 $7.420 $7.190
===== ===== =====
Total return(d)(e) 10.34% 7.23%(g)
2.31%(g)
===== ==== ====
Ratios to average net assets:
Expenses --- 0.75%(h) ---
Net investment income 6.00% 5.25%(h)
4.68%(h)
Fees and expense waived
or borne by the Adviser 0.90% 0.90%
1.32%(h)
Portfolio turnover 4% 4%
53%(h)
Net assets at end of period (000) $63,126 $27,839 $12,349
- -------------------------------------
(a) Net of fees and expenses
waived or borne by the
Adviser which amounted
to........................... $0.067 $0.042 $0.033
(b) Class B shares were initially offered on June 8, 1992.
Per share amounts reflect activity from that date.
(c) The Fund commenced investment operations on November 1,
1991.
(d) Total return at net asset value assuming all
distributions reinvested and no initial sales
charge or contingent deferred sales charge.
(e) Had the Adviser not waved or reimbursed a portion
of
expenses total return would have been reduced.
(f) Includes service fee since its inception in
December
1, 1994, of 0.02% (not annualized).
(g) Not annualized.
(h) Annualized.
</TABLE>
<TABLE>
<CAPTION>
FLORIDA
Year ended January
31
1995 1994(b)
---- -------
Class A Class B Class A Class
B
------- ------- ------- ------
- -
<S> <C> <C> <C> <C>
Net asset value - Beginning of period $7.930 $7.930 $7.500
$7.500
------ ------ ------ -----
- -
Income (loss) from investment operations:
Net investment income(a) 0.423 0.369 0.434
0.378
Net realized and unrealized gain (loss) on investments (0.839) (0.839) 0.420
0.420
------- ------- ----- ----
- -
Total from investment operations (0.416) (0.470) 0.854
0.798
------- ------- ----- ----
- -
Less distributions declared to shareholders:
From net investment income (0.414) (0.360) (0.424)
(0.368)
Net asset value - End of period $7.100 $7.100 $7.930
$7.930
===== ===== =====
=====
Total return(c)(d) (5.11)% (5.83)% 11.66%
10.85%
==== ==== =====
=====
Ratios to average net assets:
Expenses 0.22%(e) 0.97%(e) 0.05%
0.80%
Net investment income 5.92% 5.17% 5.40%
4.65%
Fees and expenses waived or borne by the Adviser 0.73% 0.73% 0.88%
0.88%
Portfolio turnover 45% 45% 19%
19%
Net assets at end of period (000) $27,498 $31,116 $23,802
$31,513
- -------------------------------------------
(a) Net of fees and expenses
waived or borne by the
Adviser which amounted to................ $0.052 $0.052 $0.071
$0.071
(b) The Fund commenced investment operations on February 1, 1993.
(c) Total return at net asset value assuming all
distributions reinvested and no initial sales
charge or contingent deferred sales charge.
(d) Had the Adviser not waved or reimbursed a portion
of
expenses total return would have been reduced.
(e) Includes service fee since its inception in December
1, 1994, of 0.02% (not annualized).
</TABLE>
<TABLE>
<CAPTION>
MASSACHUSETTS
Year ended January
31
1995 1994 1993
Class A Class B Class A Class B Class A Class B
(b)
<S> <C> <C> <C> <C> <C> <C>
Net asset value - Beginning of period $8.130 $8.130 $7.700 $7.700 $7.420 $7.450
------ ------ ------ ------ ------- ------
Income from investment operations:
Net investment income(a) 0.444 0.388 0.453 0.395 0.481 0.272
Net realized and unrealized
gain (loss) on investments (0.738) (0.738) 0.439 0.439 0.301
0.275
------ ------ ------ ------ ------- ------
Total from investment
operations (0.294) (0.350) 0.892 0.834 0.782
0.547
------ ------ ------ ------ ------- ------
Less distributions declared
to shareholders:
From net investment income (0.446) (0.390) (0.462) (0.404) (0.479) (0.274)
From net realized gains --- --- --- --- (0.002) (0.002)
In excess of net realized gains --- --- --- --- (0.021) (0.021)
------ ------ ------ ------ ------- ------
Total distributions declared
to shareholders (0.446) (0.390) (0.462) (0.404) (0.502) (0.297)
------ ------ ------ ------ ------- ------
Net asset value - End of period $7.390 $7.390 $8.130 $8.130 $7.700 $7.700
------ ------ ------ ------ ------- ------
------ ------ ------ ------ ------- ------
Total return(c)(d) (3.49)% (4.21)% 11.86% 11.05% 10.87%
1.11%(f)
------ ------ ------ ------ ------- ------
------ ------ ------ ------ ------- ------
Ratios to average net assets:
Expenses 0.72%(e) 1.47%(e) 0.64% 1.39% 0.54%
1.29%(g)
Net investment income 5.93% 5.18% 5.68% 4.93% 6.38%
5.63%(g)
Fees and expense waived
or borne by the Adviser 0.12% 0.12% 0.21% 0.21% 0.33%
0.33%
Portfolio turnover 58% 58% 7% 7% 7%
7%
Net assets at end of period (000) $193,303 $53,973 $225,636 $51,819 $186,526 $17,282
_____________________________
(a) Net of fees and
expenses waived or
borne by the Adviser
which amounted to
amounted to.................. $0.009 $0.009 $0.016 $0.016 $0.025 $0.016
(b) Class B shares were initially offered on June 8, 1992. Per share amounts reflect
activity from that date.
(c) Total return at net asset value assuming all distributions
reinvested and no initial sales charge or contingent deferred sales charge.
(d) Had the Adviser not waived or reimbursed a portion of total
expenses total return would have been reduced.
(e) Includes service fee since its inception on December 1, 1994, of
0.02% (not annualized).
(f) Not annualized.
(g) Annualized.
(h) The Fund commenced investment operations on April 10, 1987.
</TABLE>
<TABLE>
<CAPTION>
MASSACHUSETTS
Period ended
Year ended January 31 January 31
1992 1991 1990 1989 1988(h)
Class A Class A Class A Class A Class
A
<S> <C> <C> <C> <C> <C>
Net asset value - Beginning of period $7.120 $7.080 $7.190 $7.060
$7.140
------ ------ ------- ------ -----
- --
Income from investment operations:
Net investment income(a) 0.505 0.523 0.515 0.517
0.407
Net realized and unrealized
gain (loss) on investments 0.295 0.041 (0.107) 0.129
(0.085)
------ ------ ------- ------ -----
- --
Total from investment
operations 0.800 0.564 0.408 0.646
0.322
------ ------ ------- ------ -----
- --
Less distributions declared
to shareholders:
From net investment income (0.500) (0.524) (0.518) (0.516)
(0.402)
From net realized gains --- --- --- --- ---
In excess of net realized gain --- --- --- --- ---
------ ------ ------- ------ ------
- -
Total distributions declared
to shareholders (0.500) (0.524) (0.518) (0.516)
(0.402)
------- ------- ------- ------- ------
- -
Net asset value - End of period $7.420 $7.120 $7.080 $7.190 $7.060
------ ------ ------- ------ ------
- -
------ ------ ------- ------ ------
- -
Total return(c)(d) 11.61% 8.31% 5.86% 9.55%
4.80%(f)
------ ------ ------- ------ -------
------ ------ ------- ------ -------
Ratios to average net assets:
Expenses 0.46% 0.30% 0.45% 0.22% ---
(g)
Net investment income 6.89% 7.34% 7.17% 7.30%
7.47%(g)
Fees and expense waived
or borne by the Adviser 0.43% 0.65% 0.89% 1.94%
2.90%(g)
Portfolio turnover 14% 30% 25% 44%
104%(g)
Net assets at end of period (000) $145,957 $85,301 $42,167 $21,987 $7,563
_____________________________
(a) Net of fees and
expenses waived or
borne by the Adviser
which amounted to
amounted to.................. $0.032 $0.046 $0.064 $0.137 $0.157
(b) Class B shares were initially offered on June 8, 1992. Per share amounts reflect
activity from that date.
(c) Total return at net asset value assuming all distributions
reinvested and no initial sales charge or contingent deferred sales charge.
(d) Had the Adviser not waived or reimbursed a portion of total
expenses total return would have been reduced.
(e) Includes service fee since its inception on December 1, 1994, of
0.02% (not annualized).
(f) Not annualized.
(g) Annualized.
(h) The Fund commenced investment operations on April 10, 1987.
</TABLE>
<TABLE>
<CAPTION>
MICHIGAN
Year ended January 31
1995 1994
1993
---- ---- --
- --
Class A Class B Class A Class B Class A Class
B(b)
------- ------- ------- ------- ------- --------
- --
<S> <C> <C> <C> <C> <C> <C>
Net asset value - Beginning of period $7.340 $7.340 $6.970 $6.970 $6.730 $6.950
------ ------ ------ ------ ------ ------
Income (loss) from investment operations:
Net investment income (a) 0.410 0.359 0.404 0.351 0.405
0.167
Net realized and unrealized
gain (loss) on investments (0.689) (0.689) 0.356 0.356 0.250
0.029
------- ------- ----- ----- ----- -
- ----
Total from investment
operations (0.279) (0.330) 0.760 0.707 0.655
0.196
------- ------- ----- ----- ----- -
- ----
Less distributions declared
to shareholders:
From net investment income (0.401) (0.350) (0.390) (0.337) (0.407) (0.168)
In excess of net investment income --- --- --- --- (0.008) (0.008)
----- ----- ----- ----- ------- -------
Total distributions declared
to shareholders (0.401) (0.350) (0.390) (0.337) (0.415) (0.176)
------- ------- ------- ------- ------- -------
Net asset value - End of period $6.660 $6.660 $7.340 $7.340 $6.970
$6.970
====== ====== ====== ====== ======
======
Total return (c)(d) (3.66)% (4.39)% 11.16% 10.36% 10.04%
0.98%(f)
====== ====== ===== ===== =====
====
Ratios to average net assets:
Expenses 0.62%(e) 1.37%(e) 0.66% 1.41% 0.88%
1.63%(g)
Net investment income 6.08% 5.33% 5.61% 4.86% 5.86%
5.11%(g)
Fees and expense waived
or borne by the Adviser 0.32% 0.32% 0.33% 0.33% 0.32%
0.32%
Portfolio turnover 40% 40% 7% 7% 14%
14%
Net assets at end of period (000) $41,844 $14,144 $45,570 $15,030 $36,024
$6,670
_____________________________
(a) Net of fees
and expenss waived
or borne by the
Adviser which
amounted to.................... $0.022 $0.022 $0.024 $0.024 $0.022
$0.009
(b) Class B shares were initially offered on August 4, 1992. Per
share amounts reflect activity from that date.
(c) Total return at net asset value assuming all distributions
reinvested and no initial
sales charge or contingent deferred sales charge.
(d) Had the Adviser not waived or reimbursed a portion of expenses
total return would have been reduced.
(e) Includes service fee since its inception on December 1, 1994, of
0.02% (not annualized).
(f) Not annualized.
(g) Annualized.
(h) The Fund commenced investment operations on September 26, 1986.
(i) Because of differences between book and tax basis accounting, there was no
return of capital for federal income tax purposes.
</TABLE>
<TABLE>
<CAPTION>
MICHIGAN
Period
ended Year ended January 31
January 31
1992 1991 1990 1989 1988
1987(h)
---- ---- ---- ---- ---- -
- ---
Class A Class A Class A Class A Class A
Class A
------- ------- ------- ------- ------- -
- ------
<S> <C> <C> <C> <C> <C>
<C>
Net asset value - Beginning of period $6.520 $6.520 $6.690 $6.550 $7.260
$7.140
------ ------ ------ ------ ------ -
- -----
Income (loss) from investment operations:
Net investment income (a) 0.432 0.441 0.422 0.438 0.495
0.170
Net realized and unrealized
gain (loss) on investments 0.208 (0.001) (0.168) 0.133 (0.709)
0.125
----- ------- ------- ----- -------
- -----
Total from investment
operations 0.640 0.440 0.254 0.571 (0.214) 0.295
----- ----- ----- ----- ------- -----
Less distributions declared
to shareholders:
From net investment income (0.430) (0.440) (0.424) (0.431) (0.496)(i)
(0.175)(i)
In excess of net investment income --- --- --- --- --- ---
----- ----- ----- ----- ----- -----
Total distributions declared
to shareholders (0.430) (0.440) (0.424) (0.431) (0.496) (0.175)
------- ------- ------- ------- ------- -------
Net asset value - End of period $6.730 $6.520 $6.520 $6.690 $6.550 $7.260
====== ====== ====== ====== ====== ======
Total return (c)(d) 10.12% 7.01% 3.90% 9.08% (2.68)% 4.18%
(f)
===== ==== ==== ==== ====== ====
Ratios to average net assets:
Expenses 0.95% 1.00% 1.42% 1.29% 0.38% ---
(g)
Net investment income 6.50% 6.79% 6.37% 6.73% 7.38% 6.19%
(g)
Fees and expense waived
or borne by the Adviser 0.35% 0.40% 0.30% 0.51% 1.36% 1.93%
(g)
Portfolio turnover 5% 18% 16% 57% 58% 31%
(g)
Net assets at end of period (000) $28,608 $24,273 $18,870 $20,112 $21,426 $9,679
_____________________________
(a) Net of fees
and expenss waived
or borne by the
Adviser which
amounted to..................... $0.023 $0.026 $0.020 $0.033 $0.089 $0.052
(b) Class B shares were initially offered on August 4, 1992. Per
share amounts reflect activity from that date.
(c) Total return at net asset value assuming all distributions
reinvested and no initial
sales charge or contingent deferred sales charge.
(d) Had the Adviser not waived or reimbursed a portion of expenses
total return would have been reduced.
(e) Includes service fee since its inception on December 1, 1994, of
0.02% (not annualized).
(f) Not annualized.
(g) Annualized.
(h) The Fund commenced investment operations on September 26, 1986.
(i) Because of differences between book and tax basis accounting, there was no
return of capital for federal income tax purposes.
</TABLE>
<TABLE>
<CAPTION>
MINNESOTA
Year ended January 31
1995 1994 1993
Class A Class B Class A Class B Class A Class B
(b)
<S> <C> <C> <C> <C> <C> <C>
Net asset value - Beginning of period $7.480 $7.480 $7.160 $7.160 $7.030 $7.210
------ ------ ------ ------ ------ ------
Income from investment operations:
Net investment income(a) 0.415 0.363 0.419 0.364 0.449 0.191
Net realized and unrealized
gain (loss) on investments (0.642) (0.642) 0.323 0.323 0.125 (0.049)
------- ------- ------ ------ ------ -------
Total from investment
operations (0.227) (0.279) 0.742 0.687 0.574 0.142
-------- ------- ----- ----- ----- -----
Less distributions declared
to shareholders:
From net investment income (0.413) (0.361) (0.422) (0.367) (0.444) (0.192)
From net realized gains --- --- --- --- ---
- ---
From capital paid in (c) --- --- --- --- ---
- ---
------- ------- ------- ------- ------- ------
- -
Total distributions declared
to shareholders (0.413) (0.361) (0.422) (0.367) (0.444)
(0.192)
------- ------- ------- ------- ------- ------
- -
Net asset value - End of period $6.840 $6.840 $7.480 $7.480 $7.160
$7.160
------- ------- ------- ------- ------- ------
- -
------- ------- ------- ------- ------- ------
- -
Total return (d)(e) (2.92)% (3.65)% 10.62% 9.81% 8.41%
2.01%(g)
------- ------- ------- ------ ------ ------
- -
------- ------- ------- ------ ------ ------
- -
Ratios to average net assets:
Expenses 0.72%(f) 1.47%(f) 0.82% 1.57% 0.85%
1.60%(h)
Net investment income 5.98% 5.23% 5.69% 4.94% 6.33%
5.58%(h)
Fees and expense waived
or borne by the Adviser 0.26% 0.26% 0.20% 0.20% 0.35%
0.35%
Portfolio turnover 26% 26% 9% 9% 5%
5%
Net assets at end of period (000) $35,846 $14,731 $41,326 $10,317 $35,017
$2,173
_____________________________
(a) Net of fees
and waived or borne
by the Adviser
which amounted to............ $0.018 $0.018 $0.015 $0.015 $0.025
$0.009
(b) Class B shares were initially offered on August 4, 1992. Per
share amounts reflect activity from that date.
(c) Because of differences between book and tax basis accounting,
there was no return of capital for federal income tax purposes.
(d) Total return at net asset value assuming all distributions
reinvested and no initial sales charge or contingent deferred sales charge.
(e) Had the Adviser not waived or reimbursed a portion of expenses
total return would have been reduced.
(f) Includes service fee since its inception on December 1, 1994, of
0.02% (not annualized).
(g) Not annualized.
(h) Annualized.
(i) The Fund commenced investment operations on September 26, 1986.
</TABLE>
<TABLE>
<CAPTION>
Period
ended Year ended January 31
January 31
1992 1991 1990 1989 1988
1987(i)
Class A Class A Class A Class A Class A Class
A
<S> <C> <C> <C> <C> <C>
<C>
Net asset value - Beginning of period $6.930 $6.820 $6.850 $6.820 $7.310
$7.140
------ ------ ------ ------ ------
- ------
Income from investment operations:
Net investment income(a) 0.461 0.467 0.440 0.434 0.499
0.170
Net realized and unrealized
gain (loss) on investments 0.098 0.108 (0.032) 0.034 (0.490)
0.175
------ ------ ------ ------ ------
- ------
Total from investment
operations 0.559 0.575 0.408 0.468 0.009
0.345
------ ------ ------ ------ ------
- ------
Less distributions declared
to shareholders:
From net investment income (0.458) (0.465) (0.438) (0.438) (0.497)
(0.175)
From net realized gains --- --- --- --- (0.002)
- ---
From capital paid in (c) (0.001) --- --- --- ---
- ---
------- ------- ------- ------- ------- -
- ------
Total distributions declared
to shareholders (0.459) (0.465) (0.438) (0.438) (0.499) (0.175)
------- ------- ------- ------- ------- -------
Net asset value - End of period $7.030 $6.930 $6.820 $6.850 $6.820
$7.310
------ ------ ------ ------ ------ -----
- -
------ ------ ------ ------ ------ -----
- -
Total return (d)(e) 8.33% 8.70% 6.11% 7.15% 0.47%
4.87% (g)
------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------
Ratios to average net assets:
Expenses 0.88% 1.00% 1.41% 1.47% 0.55%
- ---- (h)
Net investment income 6.58% 6.77% 6.40% 6.41% 7.22%
6.16% (h)
Fees and expense waived
or borne by the Adviser 0.42% 0.37% 0.28% 0.39% 1.36%
4.83% (h)
Portfolio turnover 1% 7% 13% 20% 43% 43%
(h)
Net assets at end of period (000) $30,676 $24,188 $19,100 $19,721 $17,533
$5,765
_____________________________
(a) Net of fees
and waived or borne
by the Adviser
which amounted to............ $0.029 $0.026 $0.019 $0.027 $0.094
$0.131
(b) Class B shares were initially offered on August 4, 1992. Per
share amounts reflect activity from that date.
(c) Because of differences between book and tax basis accounting,
there was no return of capital for federal income tax purposes.
(d) Total return at net asset value assuming all distributions
reinvested and no initial sales charge or contingent deferred sales charge.
(e) Had the Adviser not waived or reimbursed a portion of expenses
total return would have been reduced.
(f) Includes service fee since its inception on December 1, 1994, of
0.02% (not annualized).
(g) Not annualized.
(h) Annualized.
(i) The Fund commenced investment operations on September 26, 1986.
</TABLE>
<TABLE>
<CAPTION>
NEW YORK
Year ended January 31
1995 1994
1993
---- ----
- ----
Class A Class B Class A Class B Class A Class
B(b)
------- ------- ------- ------- ------- ---------
- -
<S> <C> <C> <C> <C> <C> <C>
Net asset value - Beginning of period $7.500 $7.500 $7.090 $7.090 $6.840 $7.130
------ ------ ------ ------ ------ ------
Income from investment operations:
Net investment income(a) 0.427 0.376 0.421 0.368 0.438 0.182
Net realized and unrealized
gain (loss) on investments (0.834) (0.834) 0.407 0.407 0.260
(0.029)
------- ------- ----- ----- ----- ------
- -
Total from investment operations (0.407) (0.458) 0.828 0.775 0.698 0.153
------- ------- ----- ----- ----- -----
Less distributions declared
to shareholders:
From net investment income (0.413) (0.362) (0.418) (0.365) (0.445) (0.190)
In excess of net investment income --- --- --- --- (0.003) (0.003)
----- ----- ----- ----- ------- -------
Total distributions declared
to shareholders (0.413) (0.362) (0.418) (0.365) (0.448)
(0.193)
------- ------- ------- ------- -------
- -------
Net asset value - End of period $6.680 $6.680 $7.500 $7.500 $7.090
$7.090
====== ====== ====== ====== ======
======
Total return (c)(d) (5.32)% (6.04)% 11.95% 11.14% 10.50%
1.16%(f)
====== ====== ===== ===== =====
====
Ratios to average net assets:
Expenses 0.42%(e) 1.17%(e) 0.62% 1.37%
0.96% 1.71%(g)
Net investment income 6.25% 5.50% 5.68% 4.93%
6.25% 5.50%(g)
Fees and expense waived
or borne by the Adviser 0.46% 0.46% 0.29% 0.29%
0.06% 0.06%
Portfolio turnover 65% 65% 25% 25%
7% 7%
Net assets at end of period (000) $53,322 $43,166 $63,527 $45,061 $53,779
$14,473
_____________________________
(a) Net of fees
and expenses
waived or borne by
the Adviser which
amounted to.................... $0.032 $0.032 $0.021 $0.021 $0.004
$0.001
</TABLE>
(b) Class B shares were initially offered on August 4, 1992. Per
share amounts reflect activity from that date.
(c) Total return at net asset value assuming all distributions
reinvested and no initial sales charge or contingent deferred sales charge.
(d) Had the Adviser not waived or reimbursed a portion of expenses
total return would have been reduced.
(e) Includes service fee since its inception on December 1, 1994, of
0.02% (not annualized).
(f) Not annualized.
(g) Annualized.
(h) The Fund commenced investment operations on September 26, 1986.
<TABLE>
<CAPTION>
NEW YORK
Period ended Year ended January 31
January 31
1992 1991 1990 1989 1988 1987(h)
---- ---- ---- ---- ---- ----
Class A Class A Class A Class A Class A
Class A
------- ------- ------- ------- ------- --
- -----
<S> <C> <C> <C> <C> <C>
<C>
Net asset value - Beginning of period $6.600 $6.590 $6.690 $6.620 $7.310
$7.140
------ ------ ------ ------ ------ --
- ----
Income from investment operations:
Net investment income(a) 0.453 0.459 0.441 0.427 0.488
0.175
Net realized and unrealized
gain (loss) on investments 0.242 0.013 (0.116) 0.073 (0.687)
0.168
----- ----- ------- ----- ------- -
- ----
Total from investment operations 0.695 0.472 0.325 0.500 (0.199)
0.343
----- ----- ----- ----- ------- -
- ----
Less distributions declared
to shareholders:
From net investment income (0.455) (0.462) (0.425) (0.430) (0.491)
(0.173)
In excess of net investment income --- --- --- --- ---
- ---
----- ----- ----- ----- -----
- -----
Total distributions declared
to shareholders (0.455) (0.462) (0.425) (0.430) (0.491)
(0.173)
------- ------- ------- ------- ------- --
- -----
Net asset value - End of period $6.840 $6.600 $6.590 $6.690 $6.620
$7.310
====== ====== ====== ====== ======
======
Total return (c)(d) 10.86% 7.42% 4.98% 7.89% (2.44)%
4.83% (f)
===== ==== ==== ==== ====== ====
Ratios to average net assets:
Expenses 1.00% 1.04% 1.46% 1.46% 0.49%
- --- (g)
Net investment income 6.71% 6.99% 6.62% 6.52% 7.35% 6.27%
(g)
Fees and expense waived
or borne by the Adviser 0.14% 0.24% 0.05% 0.10% 1.04% 1.70%
(g)
Portfolio turnover 17% 6% 41% 53% 112% 30%
(g)
Net assets at end of period (000) $40,233 $31,691 $23,124 $25,360 $26,588 $15,738
_____________________________
(a) Net of fees
and expenses
waived or borne by
the Adviser which
amounted to................... $0.009 $0.016 $0.003 $0.007 $0.070 $0.047
(b) Class B shares were initially offered on August 4, 1992. Per
share amounts reflect activity from that date.
(c) Total return at net asset value assuming all distributions
reinvested and no initial sales charge or contingent deferred sales charge.
(d) Had the Adviser not waived or reimbursed a portion of expenses
total return would have been reduced.
(e) Includes service fee since its inception on December 1, 1994, of
0.02% (not annualized).
(f) Not annualized.
(g) Annualized.
(h) The Fund commenced investment operations on September 26, 1986.
</TABLE>
<TABLE>
<CAPTION>
NORTH CAROLINA
Year ended January 31
1995 1994(b)
---- -------
Class A Class B Class A Class
B
<S> <C> <C> <C> <C>
Net asset value - Beginning of period $7.500 $7.500 $7.500
$7.500
------ ------ ------ ----
- --
Income (loss) from investment operations:
Net investment income(a) 0.396 0.345 0.164
0.141
Net realized and unrealized loss on investments (0.822) (0.822) --- ---
------- ------- ----- ---
- --
Total from investment operations (0.426) (0.477) 0.164
0.141
------- ------- ----- ---
- --
Less distributions declared to shareholders:
From net investment income (0.394) (0.343) (0.164) (0.141)
------- ------- ------- -------
Net asset value - End of period $6.680 $6.680 $7.500 $7.500
===== ===== ===== =====
Total return(c)(d) (5.55)% (6.27)% 2.22%(f)
1.90%(f)
==== ==== ==== ====
Ratios to average net assets:
Expenses 0.12%(e) 0.87%(e) 0.10%(g)
0.85%(g)
Net investment income 5.83% 5.08% 4.91%(g)
4.16%(g)
Fees and expenses waived or borne by the Adviser 0.93% 0.93% 1.20%(g)
1.20%(g)
Portfolio turnover 37% 37% 1%(g)
1%(g)
Net assets at end of period (000) $14,189 $17,169 $13,710 $9,934
- ----------------------------------------
(a) Net of fees and expenses
waived or borne by the
Adviser which amounted to................... $0.063 $0.063 $0.040
$0.040
(b) The Fund commenced investment operations on February 1, 1993.
(c) Total return at net asset value assuming all
distributions reinvested and no initial sales
charge or contingent deferred sales charge.
(d) Had the Adviser not waved or reimbursed a portion
of
expenses total return would have been reduced.
(e) Includes service fee since its inception in
December
1, 1994, of 0.02% (not annualized).
(f) Not annualized.
(g) Annualized.
</TABLE>
<TABLE>
<CAPTION>
OHIO
Year ended January
31
1995 1994 1993
---- ---- -
- ---
Class A Class B Class A Class B Class A Class B(b)
------- ------- ------- ------- ------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value - Beginning of period $7.670 $7.670 $7.290 $7.290 $7.090 $7.330
------ ------ ------ ------ ------ ------
Income from investment operations:
Net investment income(a) 0.401 0.348 0.406 0.351 0.444
0.185
Net realized and unrealized
gain (loss) on investments (0.745) (0.745) 0.389 0.389 0.204
(0.033)
------- ------- ----- ----- ----- -------
Total from investment
operations (0.344) (0.397) 0.795 0.740 0.648
0.152
------- ------- ----- ----- ----- -----
Less distributions declared
to shareholders:
From net investment income (0.396) (0.343) (0.411) (0.356) (0.448) (0.192)
In excess of net investment income --- --- (0.004) (0.004) ---
- ---
From net realized gains --- --- --- --- --- ---
----- ----- ----- ----- ----- -----
Total distributions declared
to shareholders (0.396) (0.343) (0.415) (0.360) (0.448) (0.192)
------- ------- ------- ------- ------- -------
Net asset value - End of period $6.930 $6.930 $7.670 $7.670 $7.290 $7.290
====== ====== ====== ====== ====== ======
Total return (c)(d) (4.38)% (5.10)% 11.17% 10.36% 9.41%
0.85%(f)
====== ====== ===== ===== ==== ====
Ratios to average net assets:
Expenses 0.72%(e) 1.47%(e) 0.82% 1.57% 1.00%
1.75%(g)
Net investment income 5.71% 4.96% 5.34% 4.59% 6.18%
5.43%(g)
Fees and expense waived
or borne by the Adviser 0.16% 0.16% 0.09% 0.09% 0.03%
0.03%
Portfolio turnover 33% 33% 3% 3% 13% 13%
Net assets at end of period
(000) $72,123 $53,547 $79,394 $51,212 $62,439 $7,293
_____________________________
(a) Net of fees
and expenses
waived or borne by
the Adviser which
amounted to........................ $0.011 $0.011 $0.007 $0.007 $0.002 ---
(b) Class B shares were initially offered on August 4, 1992. Per
share amounts reflect activity from that date.
(c) Total return at net asset value assuming all distributions
reinvested and no initial sales charge or contingent deferred sales charge.
(d) Had the Adviser not waived or reimbursed a portion of expenses
total return would have been reduced.
(e) Includes service fee since its inception on December 1, 1994, of
0.02% (not annualized).
(f) Not annualized.
(g) Annualized.
(h) The Fund commenced investment operations on September 26, 1986.
(i) Approximately $0.004 per share represents a return of capital for book purposes only.
</TABLE>
<TABLE>
<CAPTION>
OHIO
Period ended
Year ended January 31 January 31
1992 1991 1990 1989 1988 1987(h)
---- ---- ---- ---- ---- -------
Class A Class A Class A Class A Class A Class A
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value - Beginning of period $6.880 $6.750 $6.850 $6.640 $7.260
$7.140
------ ------ ------ ------ ------ -----
- -
Income from investment operations:
Net investment income(a) 0.457 0.462 0.463 0.448 0.499
0.175
Net realized and unrealized
gain (loss) on investments 0.208 0.138 (0.114) 0.204 (0.615)
0.120
----- ----- ------- ----- ------- ----
- -
Total from investment
operations 0.665 0.600 0.349 0.652 (0.116)
0.295
----- ----- ----- ----- ------- ----
- -
Less distributions declared
to shareholders:
From net investment income (0.455) (0.470) (0.449) (0.442) (0.503)(i)
(0.175)
In excess of net investment income --- --- --- --- ---
- ---
From net realized gains --- --- --- --- (0.001)
- ---
----- ----- ----- ----- ------- ----
- -
Total distributions declared
to shareholders (0.455) (0.470) (0.449) (0.442) (0.504)
(0.175)
------- ------- ------- ------- ------- -----
- --
Net asset value - End of period $7.090 $6.880 $6.750 $6.850 $6.640
$7.260
====== ====== ====== ====== ======
======
Total return (c)(d) 10.00% 9.21% 5.21% 10.22% (1.25)%
4.18%(f)
===== ==== ==== ===== ====== ====
Ratios to average net assets:
Expenses 1.00% 1.00% 1.27% 1.28% 0.41%
- --- (g)
Net investment income 6.57% 6.83% 6.77% 6.74% 7.49%
6.59%(g)
Fees and expense waived
or borne by the Adviser 0.09% 0.15% 0.06% 0.34% 1.12%
1.72%(g)
Portfolio turnover 13% 11% 45% 89% 69%
158%(g)
Net assets at end of period
(000) $50,281 $41,158 $27,433 $27,676 $27,320
$13,041
_____________________________
(a) Net of fees
and expenses
waived or borne by
the Adviser which
amounted to....................... $0.006 $0.010 $0.004 $0.022 $0.074 $0.045
(b) Class B shares were initially offered on August 4, 1992. Per
share amounts reflect activity from that date.
(c) Total return at net asset value assuming all distributions
reinvested and no initial sales charge or contingent deferred sales charge.
(d) Had the Adviser not waived or reimbursed a portion of expenses
total return would have been reduced.
(e) Includes service fee since its inception on December 1, 1994, of
0.02% (not annualized).
(f) Not annualized.
(g) Annualized.
(h) The Fund commenced investment operations on September 26, 1986.
(i) Approximately $0.004 per share represents a return of capital for book purposes only.
</TABLE>
Further performance information is contained in each Fund's Annual
Report to shareholders, which is obtainable free of charge by
calling 1-800-248-2828.
THE FUNDS' INVESTMENT OBJECTIVES
Each Fund seeks as high a level of after-tax total return, as is
consistent with prudent risk, by pursuing current income exempt from
federal and its state personal income tax (if any)
and opportunities for long-term appreciation from a portfolio
primarily invested in investment grade municipal bonds. The Florida
and Michigan Funds' shares are intended to be exempt
from the respective state's intangibles tax.
HOW THE FUNDS PURSUE THEIR OBJECTIVES
Each Fund normally invests substantially all of its assets in
investment grade debt securities of any maturity, the interest on
which is exempt from federal income tax and that state's personal
income tax (if any), other than any alternative minimum tax (State
Bonds); in the case of the Florida and Michigan Funds, the
State Bonds are exempt from the state intangibles tax. The value of
debt securities (and thus of Fund shares) usually fluctuates
inversely to changes in interest rates. Mutual funds investing in
taxable securities may have higher yields than the Funds. Each Fund
under normal circumstances will invest at least 80% of its assets in
its State's Bonds. The Minnesota Fund intends to invest its assets
so that at least 95% of its exempt-interest dividends each year are
derived from certain Minnesota sources, as specified by Minnesota
law. In periods of unusual market conditions, when the Adviser
considers it appropriate, each Fund may temporarily invest up to 50%
of its total assets in assets that are not State Bonds, subject to
applicable state requirements. The Adviser relies on the opinion of
bond counsel to each issuer as to the tax-exempt status of the
issue. Each Fund normally limits investments in State Bonds subject
to individual alternative minimum tax and securities that are not
State Bonds to a maximum of 20% of the Fund's total assets, subject
to applicable state requirements. Investment grade securities are
those rated at least Baa by Moody's, BBB by S&P, comparably rated by
another national rating service or unrated but considered similar in
quality by the Adviser. Bonds rated BBB or Baa are considered to
have some speculative characteristics and could be more adversely
affected by unfavorable economic developments than higher rated
bonds. Each Fund may invest up to 25% of its net assets in
securities below investment grade (or comparable unrated
securities), but not below the equivalent of CCC by S&P. Each Fund
may invest up to 25% of its assets in unrated State Bonds and other
unrated securities, subject to applicable state requirements.
Certain bonds do not pay interest in cash on a current basis.
However, the Funds will accrue and distribute this interest on a
current basis, and may have to sell securities to generate cash for
distributions. Certain variable rate debt securities (known as
"inverse floaters") pay interest rates that move inversely to
changes in short-term market interest rates, but have values that
move inversely to changes in long-term rates. The values of certain
inverse floaters will change substantially more, given a change in
long-term rates, than would a traditional debt security of similar
maturity. There may not always be a sufficient supply of State
Bonds to enable the Funds to achieve their objectives. Many bonds
have call features and if called the Funds may only be able to
invest the proceeds at lower yields.
Each Fund may invest, under normal conditions, up to 20% of its
total assets in high quality, short-term obligations of banks or
corporations (rated at least Prime-2 by Moody's, A-2 by S&P,
comparably rated by another national rating service or unrated but
considered comparable by the Adviser), the U.S. government, and
repurchase agreements. These investments are subject to federal
and/or state income tax. In addition, gains realized upon the sale
of portfolio securities may be taxable when distributed by the Fund.
Under a repurchase agreement, a Fund buys a security from a bank or
dealer, which is obligated to buy it back at a fixed price and time.
The security is held in a separate account at the Fund's custodian
and constitutes that the Fund's collateral for the bank's repurchase
obligation. However, if the bank or dealer defaults or enters
bankruptcy, the Fund may experience costs and delays in liquidating
the collateral and may experience a loss if it is unable to
demonstrate its right to the collateral in a bankruptcy hearing.
Not more than 15% of each Fund's net assets will be invested in
repurchase agreements maturing in more than 7 days and other
illiquid assets.
To participate in the new issues market, each Fund may without limit
acquire securities on a "when-issued" basis by contracting to
purchase securities for a fixed price on a date beyond the customary
settlement time with no interest accruing until settlement. High
quality securities in an amount equal to the when-issued securities
are maintained in a segregated account at the custodian. If made
through a dealer the contract is dependent on the dealer's
consummation of the sale. The dealer's failure could deprive a Fund
of an advantageous yield or price. These contracts may be
considered securities and involve risk to the extent that the value
of the underlying security changes prior to settlement. A Fund may
realize short-term profits or losses if the contracts are sold.
Lower Rated Bonds (commonly referred to as junk bonds). The Funds
may purchase lower rated bonds. Lower rated bonds are those rated
lower than Baa by Moody's or BBB by S&P, or comparable unrated
securities. (The Funds will not purchase securities rated below CCC
by S&P or equivalent.) Relative to comparable securities of high
quality:
1. The market price is likely to be more volatile because:
a. an economic downturn or increased interest rates may have a
more significant effect on the yield, price and potential for
default;
b. the secondary market may at times become less liquid or respond
to adverse publicity or investor perceptions, increasing the
difficulty in valuing or disposing of the bonds;
c. existing or future legislation limits and may further limit (i)
investment by certain institutions or (ii) tax deductibility of
the interest by the issuer, which may adversely affect value;
and
d. certain lower rated bonds do not pay interest in cash on a
current basis. However, the Funds will accrue and distribute
this interest on a current basis, and may have to sell
securities to generate cash for distributions.
2. The Funds' achievement of their investment objective is more
dependent on the Adviser's credit analysis.
3. Lower rated bonds are less sensitive to interest rate changes,
but are more sensitive to adverse economic developments.
Options And Futures. Each Fund may write covered call and put
options and purchase call and put options on debt securities. A
call option gives the purchaser the right to buy a security from,
and a put option the right to sell a security to, the option writer
at a specified price, on or before a specified date. Each Fund will
pay a premium when purchasing an option, which reduces the Fund's
return on the underlying security if the option is exercised and
results in a loss if the option expires unexercised. Each Fund will
receive a premium from writing an option, which may increase its
return if the option expires or is closed out at a profit. If the
Fund is unable to close out an unexpired option, the Fund must
continue to hold the underlying security until the option expires.
Trading hours for options may differ from the trading hours for the
underlying securities. Thus significant price movements may occur
in the securities markets that
are not reflected in the options market. This may limit the
effectiveness of options as hedging devices.
Each Fund may buy or write options that are not traded on national
securities exchanges and not protected by the Options Clearing
Corporation. These transactions are effected directly with a broker
dealer, and each Fund bears the risk that the broker-dealer will
fail to meet its obligations. The market value of such options and
other illiquid assets will not exceed 15% of each Fund's total
assets.
For hedging purposes each Fund may purchase or sell (1) interest
rate and tax-exempt bond index futures contracts and (2) put and
call options on such contracts and on such indices. A futures
contract creates an obligation by the seller to deliver and the
buyer to take delivery of the type of instrument at the time and in
the amount specified in the contract. Although a futures contract
calls for delivery (or acceptance) of the specified instrument, a
futures contract is usually closed out before the settlement date
through the purchase (sale) of a comparable contract. If the
initial sale price of the future exceeds (or is less than) the price
of the offsetting purchase, the Fund realizes a gain (or loss).
Options on futures contracts operate in a similar manner to options
on securities, except that the position assumed is in the futures
contracts rather than in the security. A Fund may not purchase or
sell futures contracts or purchase related options if immediately
thereafter the sum of the amount of deposits for initial margin or
premiums on the existing futures and related options positions would
exceed 5% of the market value of the Fund's total assets.
Transactions in futures and related options involve the risk of (1)
imperfect correlation between the price movement of the contracts
and the underlying securities, (2) significant price movement in one
but not the other market because of different trading hours, (3) the
possible absence of a liquid secondary market at any point in time,
and (4) if the Adviser's prediction on interest rates is inaccurate,
the Fund may be worse off than if it had not hedged.
Special Considerations. State Bonds include general obligation
bonds (GOs), revenue bonds (RBs) and industrial revenue bonds
(IRBs). GOs are payable from the issuer's unrestricted revenues and
may depend on appropriation by the applicable legislative body. RBs
are payable only from a specified revenue source, not the
unrestricted revenues of the issuer. An IRB generally is payable
only from the revenues of the corporate user of a facility and
consequently its credit rating relates to that of the corporate
user. Each Fund may invest more than 25% of its total assets in
IRBs, but intends to limit investments in IRBs which are based on
the credit of private entities in any one industry to 25% or less.
State Fiscal Conditions. The value of each Fund's shares may be
affected by factors pertaining to its state's economy (which may
affect issuer tax revenues) and the ability of issuers of State
Bonds to meet their obligations and may fluctuate more widely than
the value of shares of a portfolio investing in a number of
different states. The availability of federal, state and local aid
to issuers of State Bonds may also affect their ability to meet
their obligations. Payments of principal and interest on RBs and
IRBs will depend on the economic condition of the specific revenue
source, which could be affected by economic, political and
demographic conditions in the relevant state. There is no assurance
that any issuer of a State Bond will make full and timely payments
of principal and interest or remain solvent. For example, in
December 1994, Orange County, California filed for protection under
the federal bankruptcy laws. A reduction in the actual or perceived
ability of an issuer of State Bonds to meet its obligations
(including a reduction in the rating of its outstanding securities)
could also affect adversely the value and marketability of State
Bonds.
California. From mid-1990 to late 1993, the State of California
suffered a recession with the worst economic, fiscal and budget
conditions since the 1930's. Construction, manufacturing
(especially aerospace), and financial services, among others, were
severely affected. Job losses were the worst of any post-war
recession, and although employment levels stabilized by late 1993
and grew during 1994, pre-recession employment levels are not
expected to be reached until late 1996. Economic indicators show a
steady recovery underway in the State since the start of 1994. The
recession seriously affected State tax revenues and caused an
increase in expenditures for health and welfare programs.
Consequently, the State has experienced recurring budget deficits,
and the ratings of the State's general obligation bonds have been
lowered, most recently in July 1994. It is impossible to predict
the time, location or magnitude of a major earthquake or its effect
on the California economy. In January 1994, a major earthquake
struck Los Angeles, causing significant property damage in a four-
county area. The possibility exists that another earthquake could
create a major dislocation of the California economy.
Certain California State Bonds rely on real property taxes as a
source of revenue. In 1978, California voters approved Proposition
13, which limits ad valorem taxes on real property and restricts the
ability of taxing entities to increase property taxes. California
voters subsequently approved measures that limit spending by the
State and local governments. Decreased State revenues may result in
reductions of funds provided to local governments. The effect of
these changes on the ability of issuers of California State Bonds to
pay interest and principal on their obligations remains unclear, and
may depend upon whether a particular bond is a general obligation or
limited obligation bond.
Connecticut. The State of Connecticut has a mature economy with
primary dependence on durable goods manufacturing, particularly in
defense-related industries. Significant job losses in this sector
coupled with restructurings in the insurance and other service
industries have resulted in the State losing 9% of its job base
between 1988 and 1993. Partially offsetting these factors is the
State's exceptional personal wealth level which, despite the poverty
of certain of its largest cities, continues to rank among the first
in the nation in terms of per capita income. While no signs of a
strong economic recovery are present, personal income growth has
increased and unemployment levels have stabilized. Strong tax
revenue collections through the first half of fiscal year 1994
reinforce the positive actions taken by the State's government in
1992 to implement a personal income tax while cutting certain
business and consumption based taxes with the intent of reducing
economic vulnerability and diversifying the revenue base. These
actions have been coupled with a constitutional cap on the rate of
spending growth and have served to stabilize the State's finances
and restore budgetary balance. The outlook for future economic
growth is modest and a return to the growth rates of the 1980s is
unlikely.
Florida. The State of Florida continues to experience strong
population growth and good economic performance. The State's
economy is becoming more diversified with foreign trade surpassing
tourism as the State's leading industry. Export industries have
benefited from the State's strategic geographic location for
international trade, particularly with Latin America. Creation of
additional long-term opportunities is expected from the passage of
NAFTA. While the State's growth has been impressive, continuing
strong fiscal and economic performance will be based on the State's
ability to maintain a balance that adequately funds the additional
service and infrastructure needs driven by rapid population growth
while continuing to promote further economic development. Without a
personal income tax, the State's operations are largely dependent on
consumption based taxes which are more vulnerable to general
economic conditions.
Massachusetts. The Commonwealth of Massachusetts has a highly
developed economy with a large service sector, particularly in
health care and education. Strong economic growth in the 1980s was
halted late in the decade by weakening in the high technology, real
estate and finance sectors, resulting in steady job losses. At this
time, unemployment in the Commonwealth appears to have peaked and,
along with other indicators, including construction and retail sales
activity, points toward a leveling off of recovery of the local
economy. It is believed, however, that the turnaround in the
Commonwealth's economy will not match the growth rates of the early
1980s as continued restructuring in the defense and computer
manufacturing industries will hold back anticipated strength in the
construction, biotech and computer software industries. The
Commonwealth's economy is also dependent on the healthcare sector
which could be hurt by cuts in medicare and other reforms in
Washington. Of equal importance to the observed economic
improvement is the Commonwealth's progress in stabilizing its fiscal
position since 1990. More realistic revenue expectations and
increased efforts to impose spending discipline have resulted in the
elimination of deficit financing, reduced reliance on short-term
financing and three consecutive years of positive fund balances.
Michigan. The State of Michigan is highly industrialized with a
strong economic concentration in motor vehicle production and other
durable goods manufacturing. A significant degree of industrial
restructuring took place in the early 1980s thus mitigating the
economic impact of the recent recession. A broad-based recovery for
the State rests on national economic development and continuing
improvement in international competitiveness that will in turn boost
demand for the State's primary products. To date, positive economic
indicators for the State include a stabilizing market share and
improving profitability for the domestic auto manufacturers,
increased manufacturing productivity and a minimal exposure to the
downsizing defense industry. In addition, the State has
demonstrated its commitment to addressing budget imbalances and
promoting public service efficiencies, resulting in balanced general
fund operations throughout a difficult economic period and enabling
the State to transfer approximately $464 million to the State's
budget stabilization fund as of September 30, 1994, the end of the
State's 1993-94 fiscal year, bringing the balance in that fund to
over $779 million.
Minnesota. The State of Minnesota's overall economic structure
closely parallels that of the nation as a whole, although
manufacturing is modestly more significant than construction,
finance and real estate. The State's strong natural resource base
is evidenced in its strong positions in food and forestry products,
and the State serves as a major regional commercial center. While
the recession has been less severe in the State than in the nation
overall, the State has not been immune to its impact as evidenced by
slowdowns in income and sales tax revenue growth. Because the State
relies on a progressive personal income tax and retail sales tax for
general fund revenue, the State's fiscal system is particularly
sensitive to economic conditions. As a result, the less than
expected revenue growth, combined with increased spending pressure,
led to budget deficits in fiscal years 1991 and 1992. The State
demonstrated its financial discipline by curing the deficits through
a variety of measures, including a sales tax rate increase and
spending cuts. An improved economy in 1993 and 1994 has led to
stronger revenues and a more favorable expectation for balanced
budget operations. Under recently enacted legislation, if a court
determines that Minnesota's taxation of interest on other state's
obligations, while not taxing interest on its own obligations,
discriminates against interstate
commerce, the interest on certain Minnesota obligations may become
taxable. No federal court has ruled that the taxation by a state of
another state's obligations discriminates against interstate commerce.
New York. The State of New York enjoys a generally diverse and
substantial economic base and a strong socioeconomic profile with
personal income levels among the highest in the nation. The employment
levels in the State have been adversely affected by the
most recent recession as a result of an overweighting in the service
sector, especially in finance, real estate and insurance. While
unemployment appears to have peaked, the State's level continues to be
in excess of the national average. Significant improvement in the labor
market is not expected due to current weakness in the manufacturing,
defense sectors and healthcare. Income levels have suffered as well,
despite the State's strong position relative to the rest of the nation,
as growth rates have been stagnant and have lagged the nation as a
whole. Improvement in this indicator of economic health will be tied to
improvement in the employment level. New York's financial operations
have been historically weak, with chronic budget deficits, untimely
budget passage and overly optimistic revenue assumptions in the face of
a protracted economic recession. The Governor recently proposed a
series of tax cuts designed to stimulate business activity. Both the
State and New York City must overcome substantial budget gaps in fiscal
year 1996 which will be difficult given the local politics and economic
health of the State and New York City. A concurrent focus on structural
debt reform may also improve the State's financial management and fiscal
position.
North Carolina. Although the State of North Carolina is the tenth
largest state in population, it is primarily a rural state, having only
five municipalities with populations in excess of 100,000. The labor
force has undergone significant change during recent years. The State
has moved from an agricultural to a service and goods producing economy.
Those persons displaced by farm mechanization and farm consolidations
have, in large measure, sought and found employment in other pursuits.
During the period 1980 to 1994, the State labor force grew about 25%.
Per capita income during the period 1980 to 1993 increased by 133.8%.
The current economic profile of the State consists of a combination of
industry, agriculture and tourism. As of June 1994, the State was
reported to rank tenth among the states in non-agricultural employment
and eighth in manufacturing employment. Employment indicators have
varied somewhat in the annual periods since June of 1989, but have
demonstrated an upward trend since 1991. As of the date of this
Prospectus, Moody's rated the State's general obligation bonds as Aaa
and Standard & Poor's rated such bonds as AAA. Standard & Poor's also
reaffirmed its stable outlook for the State in January 1994. Standard &
Poor's reports that the State's rating reflects the State's strong
economic characteristics, sound financial performance, and low debt
levels.
Ohio. While diversifying more into the service and other non
manufacturing areas, the State of Ohio's economy continues to rely in
part on durable goods manufacturing largely concentrated in motor
vehicles and equipment, steel, rubber products and household appliances.
As a result, general economic activity, as in many other industrially-
developed states, tends to be more cyclical than in some other states
and in the nation as a whole. Agriculture is an important segment of
the economy. In prior years, the State's overall unemployment rate was
commonly somewhat higher than the national figure. However, for the
last four years the State rates were below the national rates. The
unemployment rate and its effects vary among geographic areas of the
State.
Non-Diversification. Because of the relatively small number of issuers
of investment grade State Bonds, each Fund (except the
California Fund) may concentrate in the securities of a few issuers
which the Adviser considers to be attractive. This may increase the
risk of loss to those Funds. It is also possible that there will not be
a sufficient supply of State Bonds available to enable each Fund to
achieve its objective.
Other. The Funds may not always achieve their investment objective. The
Funds' investment objective and non-fundamental policies may be changed
without shareholder approval. Each Fund will notify investors at least
30 days prior to any material change in its investment objective. If
there is a change in a Fund's investment objective, shareholders should
consider whether the Fund remains an appropriate investment in light of
their current financial position and needs. Shareholders may incur a
contingent deferred sales charge if shares are redeemed in response to a
change in objective. Each Fund's fundamental policies listed in the
Statement of Additional Information cannot be changed without the
approval of a majority of that Fund's outstanding voting securities.
Additional information concerning certain of the securities and
investment techniques described above is contained in the Statement of
Additional Information.
HOW THE FUNDS MEASURE THEIR PERFORMANCE
Performance may be quoted in sales literature and advertisements. Each
Class's average annual total returns are calculated in accordance with
the Securities and Exchange Commission's formula and assume the
reinvestment of all distributions, the maximum initial sales charge of
4.75% on Class A shares and the contingent deferred sales charge
applicable to the time period quoted on Class B shares. Other total
returns differ from the average annual total return only in that they
may relate to different time periods, may represent aggregate as opposed
to average annual total returns, and may not reflect the initial or
contingent deferred sales charges.
Each Class's yield and tax-equivalent yield, which differ from total
return because they do not consider the change in net asset value, are
calculated in accordance with the Securities and Exchange Commission's
formula. Each Class's distribution rate is calculated by dividing the
most recent month's distribution, annualized, by the maximum offering
price of that Class at the end of the month. Each Class's performance
may be compared to various indices. Quotations from various
publications may be included in sales literature and advertisements.
See "Performance Measures" in the Statement of Additional Information
for more information.
All performance information is historical and does not predict future
results.
HOW THE FUNDS ARE MANAGED
The Trustees formulate the Funds' general policies and oversee the
Funds' affairs as conducted by the Adviser.
Colonial Investment Services, Inc. (Distributor) serves as the
Fund's distributor for the Funds' distributor. Colonial Investors
Service Center, Inc. (Transfer Agent) serves as the Fund's shareholder
services and transfer agent. The Adviser, the Distributor and the
Transfer Agent are all direct subsidiaries of Liberty Financial
Companies, Inc.
The Adviser furnishes each Fund with investment management, accounting
and administrative personnel and services, office space and other
equipment and services at the Adviser's expense. For these services,
each Fund paid the Adviser the following percentage of the Fund's net
assets for the year ended 1995: the California Fund paid 0.51%; the
Connecticut Fund paid 0.02%; the Massachusetts Fund paid 0.45%; the
Michigan Fund paid 0.25%; the Minnesota Fund paid 0.30%; the New York
Fund paid 0.10%; and the Ohio Fund paid 0.41%; the Florida Fund and the
North Carolina Fund did not pay any fee.
Jeffrey B. Augustine, Vice President of the Adviser, has managed the
Connecticut Fund since its inception, the Florida Fund since 1993, the
Massachusetts Fund since 1988, the New York Fund since 1987 and the
North Carolina Fund since its inception. Mr. Augustine has managed
various other Colonial tax-exempt funds since 1987.
Brian Hartford, Vice President of the Adviser, has managed the Michigan
Fund, the Minnesota Fund and the Ohio Fund since 1993. Mr. Hartford
was a Senior Municipal Trader of the Adviser from 1991 until 1993, and
Manager of the Analyst Department at Harvard Management Company until
1991.
William C. Loring, Vice President of the Adviser, has managed the
California Fund since its inception and has managed various other
Colonial tax-exempt funds since 1986.
The Adviser also provides pricing and bookkeeping services to each Fund
for a monthly fee of $2,250 per Fund plus a percentage of each Fund's
average net assets over $50 million. The Transfer Agent provides
transfer agency and shareholder services to each Fund for a fee of
0.14% annually of average net assets plus out-of-pocket expenses.
Each of the foregoing fees is subject to any reimbursement or fee
waiver or expense reimbursement to which the Adviser may agree.
The Adviser places all orders for the purchase and sale of portfolio
securities. In selecting broker-dealers, the Adviser may consider
research and brokerage services furnished to it and its affiliates.
Subject to seeking best execution, the Adviser may consider sales of
shares of the Funds (and of certain other Colonial funds) in selecting
broker-dealers for portfolio security transactions.
HOW THE FUNDS VALUE THEIR SHARES
Per share net asset value is calculated by dividing the total value of
each Class's net assets by its number of outstanding shares. Shares
are valued as of the close of the New York Stock Exchange (Exchange)
each day the Exchange is open. Portfolio securities for which market
quotations are readily available are valued at market. Short-term
investments maturing in 60 days or less are valued at amortized cost,
when it is determined,, pursuant to procedures adopted by the Trustees,
that such cost approximates market value. All other securities and
assets are valued at fair value following procedures adopted by the
Trustees.
DISTRIBUTIONS AND TAXES
Each Fund intends to qualify as a "regulated investment company" under
the Internal Revenue Code and to distribute to shareholders virtually
all net income and any net realized gain at least annually.
The Funds generally declare distributions daily and pay them monthly.
Distributions are invested in additional shares of the same Class of
the Fund at net asset value unless the shareholder elects to receive
cash. Regardless of the shareholder's election, distributions of $10
or less will not be issued as checks to shareholders but will be
invested in additional shares of the same class of the Fund at net
asset value. To change your election, call the Transfer Agent for
information.
The Funds'distributions of net income generally will be exempt from
Federal and the relevant State's income taxes. However, as described
above under "How the Funds pursue their objective," certain
investments may produce taxable income, and portfolio transactions
may produce gains
a portion of which may be taxable at ordinary Federal income tax
rates.
If the Funds make taxable distributions, those distributions will
generally be taxable whether you receive them in cash or in
additional Fund shares, unless you are a tax-exempt institution.
Each January, information on the amount and nature of distributions
for the prior year, including the alternative minimum tax portion, is
sent to shareholders.
While each Fund's distributions from income on its State's Bonds are
generally not taxable at the federal level or subject to that Fund's
state's personal income tax, if any, a portion may be included in
computing a shareholder's alternative minimum tax liability. Social
security benefits may be taxed as a result of receiving tax-exempt
income.
HOW TO BUY SHARES
Shares are offered continuously. Orders received in good form prior
to 4:00 p.m. Eastern time (or placed with a financial service firm
before such time and transmitted by the financial service firm before
a Fund processes that day's share transactions) will be processed
based on that day's closing net asset value, plus any applicable
initial sales charge. The minimum initial investment is $1,000;
subsequent investments may be as small as $50. The minimum initial
investment for the Colonial Fundamatic program is $50. Certificates
will not be issued for Class B shares and there are some limitations
on the issuance of Class A certificates. The Funds may refuse any
purchase order for their shares. See the Statement of Additional
Information for more information.
Class A Shares. Class A shares are offered at net asset value plus
an initial or a contingent deferred sales charge as follows:
______Initial Sales Charge_____
Retained
by
Financial
Service
Firm as
as % of %
Amount Offering
Offering Amount Purchased Invested Price Price
Less than $50,000 4.99% 4.75% 4.25%
$50,000 to less than $100,000 4.71% 4.50% 4.00%
$100,000 to less than
$250,000 3.63% 3.50% 3.00%
$250,000 to less than
$500,000 2.56% 2.50% 2.00%
$500,000 to less than
$1,000,000 2.04% 2.00% 1.75%
$1,000,000 or more 0.00% 0.00% 0.00%
On purchases of $1 million or more, the Distributor pays the financial
service firm a cumulative commission as follows:
Amount Purchased Commission
First $3,000,000...........1.00%
Next $2,000,000............0.50%
Over $5,000,000............0.25% (1)
(1) Paid over 12 months but only to the
extent the shares remain outstanding.
Purchases of $1 million to $5 million are subject to a 1.00% contingent
deferred sales charge payable to the Distributor on redemptions within
18 months from the first day of the month following the purchase. The
contingent deferred sales charge does not apply to the excess of any
purchase over $5 million.
Class A shares bear an annual service fee calculated at the rates of
0.10% of average net assets attributed to shares outstanding on
November 30, 1994, and 0.25% of average net assets attributed to shares
issued thereafter.
Class B Shares. Class B shares are offered at net asset value, without
an initial sales charge, subject to a 0.75% annual distribution fee for
approximately 8 years (at which time they convert to Class A shares not
bearing a distribution fee), an annual service fee calculated at the
rates of 0.10% of average net assets attributed to shares outstanding
on November 30, 1994, and 0.25% of average net assets attributed to
shares issued thereafter and a contingent
deferred sales charge if redeemed within 6 years that declines over
time. As shown below, the amount of the contingent deferred sales
charge depends on the number of years after purchase that the
redemption occurs:
Contingent
Years Deferred
After Purchase Sales Charge
0-1 5.00%
1-2 4.00%
2-3 3.00%
3-4 3.00%
4-5 2.00%
5-6 1.00%
More than 6 0.00%
Year one ends one year after the end of the month in which the
purchase was accepted and so on. The Distributor pays financial
service firms a commission of 4.00% on Class B share purchases.
General. All contingent deferred sales charges are deducted from the
redemption, not the amount remaining in the account, and are paid to
the Distributor. Shares issued upon distribution reinvestment and
amounts representing appreciation are not subject to a contingent
deferred sales charge. The contingent deferred sales charge is
imposed on redemptions which result in the account value falling
below
its Base Amount (the total dollar value of purchase payments
(including initial sales charges, if any) in the account reduced by
prior redemptions on which a contingent deferred sales charge was
paid
and any exempt redemptions). See the Statement of Additional
Information for more information.
Which Class is more beneficial to an investor depends on the amount
and intended length of the investment. Large investments,
qualifying for a reduced Class A sales charge, avoid the
distribution fee. Investments in Class B shares have 100% of the
purchase invested immediately. Purchases of $250,000 or more must
be for Class A shares. Consult your financial service firm.
Financial service firms may receive different compensation rates
for selling different classes of shares. The Distributor may pay
additional compensation to financial service firms which have made
or may make significant sales. Initial or contingent deferred
sales charges may be reduced or eliminated for certain groups or
organizations purchasing Fund shares alone or in combination with
certain other Colonial funds. See the Statement of Additional
Information for more information.
Shareholder Services. A variety of shareholder services are
available. For more information about these services or your
account, call 1-800-345-6611. Some services are described in the
attached account application. A shareholder's manual explaining all
available services will be provided upon request.
HOW TO SELL SHARES
Shares of the Funds may be sold on any day the New York Stock
Exchange is open, either directly to a Fund or through your
financial service firm. Sale proceeds generally are sent within
seven days (usually on the next business day after your request
is received in good form). However, for shares recently purchased
by check, the Fund will send proceeds after 15 days from the date of
the purchase.
Selling Shares Directly To A Fund. Send a signed letter of
instruction or stock power form to the Transfer Agent, along with
any certificates for shares to be sold. The sale price is the net
asset value (less any applicable contingent deferred sales charge)
next calculated after the particular Fund receives the request in
proper form. Signatures must be guaranteed by a bank, a member firm
of a national stock exchange or another eligible guarantor
institution. Stock power forms are available from financial service
firms, the Transfer Agent and many banks. Additional documentation
is required for sales by corporations, agents, fiduciaries,
surviving joint owners and individual retirement account holders.
For details contact:
Colonial Investors Service Center, Inc.
P.O. Box 1722
Boston, MA 02105-
1722
1-800-345-6611
Selling Shares Through Financial Service Firms. Financial service
firms must receive requests before 4:00 p.m. Eastern time to receive
that day's price, are responsible for furnishing all necessary
documentation to the Transfer Agent and may charge for this service.
General. The sale of shares is a taxable transaction for federal and
state tax purposes and may be subject to a contingent deferred sales
charge. The contingent deferred sales charge may be waived under
certain circumstances. See the Statement of Additional Information for
more information. Under unusual circumstances, a Fund may suspend
repurchases or postpone payment for up to seven days or longer, as
permitted by federal securities law. In June of any year, a Fund may
deduct $10 (payable to the Transfer Agent) from accounts valued at
less than $1,000 unless the account value has dropped below $1,000
solely as a result of share value depreciation. Shareholders will
receive 60 days' written notice to increase the account before the
fee is deducted.
HOW TO EXCHANGE SHARES
Exchanges at net asset value may be made among shares of the same
class of most Colonial funds. Shares will continue to age without
regard to the exchange for purposes of conversion and determining
the contingent deferred sales charge, if any, upon redemption.
Carefully read the prospectus of the fund into which the exchange
will go before submitting the request. Call 1-800-248-2828 to
receive a prospectus and an exchange authorization form. Call 1-800
422-3737 to exchange shares by telephone. An exchange is a taxable
capital transaction. The exchange service may be changed, suspended
or eliminated on 60 days' written notice.
Class A Shares. An exchange from a money market fund into a non-
money market fund will be at the applicable offering price next
determined (including sales charge), except for amounts on which an
initial sales charge was paid. Non-money market fund shares must be
held for five months before qualifying for exchange to a fund with a
higher sales charge, after which exchanges are made at the net asset
value next determined.
Class B Shares. Exchanges of Class B shares are not subject to the
contingent deferred sales charge. However, if shares are redeemed
within six years after the original purchase, a contingent deferred
sales charge will be assessed using the schedule of the fund into
which the original investment was made.
TELEPHONE TRANSACTIONS
All shareholders and/or their financial advisers may redeem up to
$50,000 of Fund shares by telephone, and may elect telephone
redemption privileges for larger amounts on the account application.
All exchanges may be accomplished by telephone. See the Statement
of Additional Information for more information. The Adviser, the
Transfer Agent and the Fund will not be liable when following
telephone instructions reasonably believed to be genuine and a
shareholder may suffer a loss from unauthorized transactions. The
Transfer Agent will employ reasonable procedures to confirm that
instructions communicated by telephone are genuine. Shareholders
and/or their financial advisers will be required to provide their
name, address and account number. Financial advisers will also be
required to provide their broker number. Proceeds and confirmations
of telephone transactions will be mailed or sent to the address of
record. Telephone redemptions are not available on accounts with an
address change in the preceding 60 days. All telephone transactions
are recorded. Shareholders are not obligated to transact by
telephone.
12B-1 PLANS
Under 12b-1 Plans, each Fund pays the Distributor an annual service
fee calculated at the rates of 0.10% of average net assets
attributed to shares outstanding on November 30, 1994, and 0.25% of
average net assets attributed to shares issued thereafter. Each
Fund also pays the Distributor an annual distribution fee of 0.75%
of the average net assets attributed to its Class B shares. Because
the Class B shares bear the additional fee, their dividends will be
lower than the dividends of Class A shares. Class B shares
automatically convert to Class A shares, approximately eight years
after the Class B shares were purchased. The multiple class
structure could be terminated should certain Internal Revenue
Service rulings be rescinded. See the Statement of Additional
Information for more information. The Distributor uses the fees to
defray the cost of commissions and service fees paid to financial
service firms which have sold Fund shares and to defray other
expenses such as sales literature, prospectus printing and
distribution, shareholder servicing costs, and compensation to
wholesalers. Should the fees exceed the Distributor's expenses in
any year, the Distributor would realize a profit. The Plans also
authorize other payments to the Distributor and its affiliates
(including the Adviser) which may be construed to be indirect
financing of sales of Fund shares.
ORGANIZATION AND HISTORY
The Trust is a Massachusetts business trust organized in 1987. Each
Fund represents the entire interest in a separate portfolio of the
Trust.
The Trust is not required to hold annual shareholder meetings, but
special meetings may be called for certain purposes. You receive
one
vote for each of your Fund shares. Shares of the Trust vote
together except when required by law to vote separately by fund or
by class. Shareholders owning in the aggregate ten percent of Trust
shares may call meetings to consider removal of Trustees. Under
certain circumstances, the Trust will provide information to assist
shareholders in calling such a meeting. See the Statement of
Additional Information for more information.
APPENDIX
DESCRIPTION OF BOND RATINGS
S&P
AAA The highest rating assigned by S&P indicates an extremely strong
capacity to repay principal and interest.
AA bonds also qualify as high quality. Capacity to repay principal
and pay interest is very strong, and in the majority of instances,
they differ from AAA only in a small degree.
A bonds have a strong capacity to repay principal and interest,
although they are somewhat more susceptible to the adverse effects
of changes in circumstances and economic conditions.
BBB bonds are regarded as having an adequate capacity to repay
principal and interest. Whereas they normally exhibit protection
parameters, adverse economic conditions or changing circumstances
are more likely to lead to a weakened capacity to repay principal
and interest than for bonds in the A category.
BB, B, CCC and CC bonds are regarded, on balance, as predominantly
speculative with respect to capacity to pay interest and principal
in accordance with the terms of the obligation. BB indicates the
lowest degree of speculation and CC the highest degree. While
likely to have some quality and protection characteristics, these
are outweighed by large uncertainties or major risk exposures to
adverse conditions.
C ratings are reserved for income bonds on which no interest is
being paid.
D bonds are in default, and payment of interest and/or principal is
in arrears.
Plus(+) or minus (-) are modifiers relative to the standing within
the major rating categories.
MOODY'S
Aaa bonds are judged to be of the best quality. They carry the
smallest degree of investment risk and are generally referred to as
"gilt edge". Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While various
protective elements are likely to change, such changes as can be
visualized are most unlikely to impair the fundamentally strong
position of such issues.
Aa bonds are judged to be of high quality by all standards.
Together with Aaa bonds they comprise what are generally known as
high-grade bonds. They are rated lower than the best bonds because
margins of protective elements may be of greater amplitude or there
may be other elements present which make the long-term risk appear
somewhat larger than in Aaa securities.
Those bonds in the Aa through B groups which Moody's believes
possess the strongest investment attributes are designated by the
symbol Aa1, A1 and Baa1.
A bonds possess many of the favorable investment attributes and are
to be considered as upper-medium-grade obligations. Factors giving
security to principal and interest are considered adequate, but
elements may be present which suggest a susceptibility to impairment
sometime in the future.
Baa bonds are considered as medium grade, neither highly protected
nor poorly secured. Interest payments and principal security appear
adequate for the present but certain protective elements may be
lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment
characteristics and, in fact, have speculative characteristics as
well.
Ba bonds are judged to have speculative elements: their future
cannot be considered as well secured. Often, the protection of
interest and principal payments may be very moderate, and thereby
not well safeguarded during both good and bad times over the
future. Uncertainty of position characterizes these bonds.
B bonds generally lack characteristics of the desirable investment.
Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be
small. Caa bonds are of poor standing. They may be in default or
there may be present elements of danger with respect to principal or
interest. Ca bonds are speculative in a high degree, often in
default or having other marked shortcomings.
C bonds are the lowest rated class of bonds and can be regarded as
having extremely poor prospects of ever attaining any real
investment standing.
Investment Adviser
Colonial Management Associates, Inc.
One Financial Center
Boston, MA 02111-2621
Distributor
Colonial Investment Services, Inc.
One Financial Center
Boston, MA 02111-2621
Custodian
UMB, n.a.
928 Grand Avenue
Kansas City, MO 64106
Shareholder Services and Transfer Agent
Colonial Investors Service Center, Inc.
One Financial Center
Boston, MA 02111-2621
1-800-345-6611
Independent Accountants
Price Waterhouse LLP
160 Federal Street
Boston, MA 02110-2624
Legal Counsel
Ropes & Gray
One International Place
Boston, MA 02110-2624
Your financial service firm is:
Printed in U.S.A.
May 31,1995, Revised September 29, 1995
COLONIAL CALIFORNIA
TAX-EXEMPT FUND
COLONIAL CONNECTICUT
TAX-EXEMPT FUND
COLONIAL FLORIDA
TAX-EXEMPT FUND
COLONIAL MASSACHUSETTS
TAX-EXEMPT FUND
COLONIAL MICHIGAN
TAX-EXEMPT FUND
COLONIAL MINNESOTA
TAX-EXEMPT FUND
COLONIAL NEW YORK
TAX-EXEMPT FUND
COLONIAL NORTH CAROLINA
TAX-EXEMPT FUND
COLONIAL OHIO
TAX-EXEMPT FUND
PROSPECTUS
Each of Colonial California Tax-Exempt Fund, Colonial Connecticut Tax
Exempt Fund, Colonial Florida Tax-Exempt Fund, Colonial Massachusetts
Tax-Exempt Fund, Colonial Michigan Tax-Exempt Fund, Colonial Minnesota
Tax-Exempt Fund, Colonial New York Tax-Exempt Fund, Colonial North
Carolina Tax-Exempt Fund and Colonial Ohio Tax-Exempt Fund seeks as
high a level of after-tax total return, as is consistent with prudent
risk, by pursuing current income exempt from federal and its state
personal income tax (if any) and opportunities for long-term
appreciation from a portfolio primarily invested in investment grade
municipal bonds.
For more detailed information about the Funds, call the Adviser at
1-800-248-2828 for the May 31, 1995 Statement of Additional
Information.
FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED,
ENDORSED OR INSURED BY, ANY BANK OR GOVERNMENT AGENCY.
Colonial Mutual Funds
_________________________________________________________________
Please send your completed application to:
Colonial Mutual Funds
P.O. Box 1722
Boston, Massachusetts 02105-1722
New Account Application/Revision to Existing Account
To open a new account, complete sections 1, 2, 3, & 8.
To apply for special services for a new or existing
account, complete sections 4, 5, 6, 7, or 9 as
appropriate.
___ Please check here if this is a revision.
1-----------Account Ownership--------------
Please choose one of the following.
__Individual: Print your name, Social Security #, U.S.
citizen status.
__Joint Tenant: Print all names, the Social Security #
for the first person, and his/her U.S. citizen status.
__Uniform Gift to Minors: Name of custodian and minor, minor's
Social Security #, minor's U.S. citizen status.
__Corporation, Association, Partnership: Include full name,
Taxpayer I.D. #.
__Trust: Name of trustee, trust title & date, and trust's
Taxpayer I.D. #.
______________________________________
Name of account owner
______________________________________
Name of joint account owner
______________________________________
Street address
______________________________________
Street address
______________________________________
City, State, and Zip
______________________________________
Daytime phone number
______________________________________
Social Security # or Taxpayer I.D. #
Are you a U.S. citizen? Yes___ No___
______________________________________
If no, country of permanent residence
______________________________________
Owner's date of birth
______________________________________
Account number (if existing account)
2 -----Colonial Fund(s) You Are Purchasing--------
Your investment will be made in Class A shares if no class
is indicated. Certificates are not available for Class B
shares. If no distribution option is selected,
distributions will be reinvested in additional Fund shares.
Please consult your financial adviser to determine which
class of shares best suits your needs.
Fund Choice(s)
Fund
___ A Shares ___ B Shares (less than
$250,000)
$____________________________________________
__ Amount
Method of Payment
Choose one for each fund
___Check payable to the Fund, enclosed
___Bank wired on (Date) ____/____/____ Wire confirmation
#
___Dealer purchased on (Date) ____/____/____ Trade
confirmation #
Ways to Receive Your Distributions
Choose one for each fund
___Reinvest dividends and capital gains ___Dividends in
cash; reinvest capital gains ___Dividends and capital
gains in cash
___Automatic Dividend Diversification See section 5A,
inside ___Direct Deposit via Colonial Cash Connection See
section 4B, inside
Fund Choice(s)
Fund
___ A Shares ___ B Shares (less than $250,000)
$______________________________________________
Amount
Method of Payment
Choose one for each fund
___Check payable to the Fund, enclosed
___Bank wired on (Date) ____/____/____ Wire confirmation
#
___Dealer purchased on (Date) ____/____/____ Trade
confirmation #
Ways to Receive Your Distributions
Choose one for each fund
___Reinvest dividends and capital gains ___Dividends in
cash; reinvest capital gains ___Dividends and capital
gains in cash
___Automatic Dividend Diversification See section 5A,
inside ___Direct Deposit via Colonial Cash Connection See
section 4B, inside
Fund Choice(s)
Fund
___ A Shares ___ B Shares (less than $250,000)
$______________________________________________
Amount
Method of Payment
Choose one for each fund
___Check payable to the Fund, enclosed
___Bank wired on (Date) ____/____/____ Wire confirmation
#
___Dealer purchased on (Date) ____/____/____ Trade
confirmation #
Ways to Receive Your Distributions
Choose one for each fund
___Reinvest dividends and capital gains ___Dividends in
cash; reinvest capital gains ___Dividends and capital
gains in cash
___Automatic Dividend Diversification See section 5A,
inside ___Direct Deposit via Colonial Cash Connection See
section 4B, inside
3---Your Signature & Taxpayer I.D. Number Certification---
- -
Each person signing on behalf of an entity represents that
his/her actions are authorized.
I have received and read each appropriate Fund prospectus
and understand that its terms are incorporated by
reference into this application. I understand that this
application is subject to acceptance. I understand that
certain redemptions may be subject to a contingent
deferred sales charge. I certify, under penalties of
perjury, that:
1. The Social Security # or Taxpayer I.D. # provided is
correct.
Cross out 2(a) or 2(b) if either is not true in your case.
2. I am not subject to 31% backup withholding because (a)
I have not been notified that I am subject to backup
withholding or (b) the Internal Revenue Service has
notified me that I am no longer subject to backup
withholding.
It is agreed that the Fund, all Colonial companies and
their officers, directors, agents, and employees will not
be liable for any loss, liability, damage, or expense for
relying upon this application or any instruction believed
genuine.
X______________________________________________
Signature
_______________________________________________
Capacity, if applicable Date
X______________________________________________
Signature
_______________________________________________
Capacity, if applicable Date
4--------Ways to Withdraw from Your Fund-------
It may take up to 30 days to activate the following
features. Complete only the section(s) that apply to the
features you would like.
A. Systematic Withdrawal Plan (SWP)
You can receive monthly, quarterly, or semiannual checks
from your account in any amount you select, with certain
limitations. Your redemption checks can be sent to you at
the address of record for your account, to your bank
account, or to another person you choose. The value of the
shares in your account must be at least $5,000 and you
must reinvest all of your distributions. Checks will be
processed on the 10th calendar day of the month or the
following business day. Withdrawals in excess of 12%
annually of your current account value will not be
accepted. Redemptions made in addition to Plan payments
may be subject to a contingent deferred sales charge for
Class B shares. Please
consult your financial or tax adviser before electing this
option.
Funds for Withdrawal:
______________________________________________
Name of fund
Withdrawal Amount
Redeem shares from account as follows:
Dollar amount of payment $___________
or
Total annual %_________
Frequency (choose one)
__Monthly __Quarterly __Semiannually
I would like payments to begin _________________
(month).
______________________________________________
Name of fund
Withdrawal Amount
Redeem shares from account as follows:
Dollar amount of payment $___________
or
Total annual %_________
Frequency (choose one)
__Monthly __Quarterly __Semiannually
I would like payments to begin _________________
(month). ______________________________________________
Name of fund
Withdrawal Amount
Redeem shares from account as follows:
Dollar amount of payment $___________
or
Total annual %_________
Frequency (choose one)
__Monthly __Quarterly __Semiannually
I would like payments to begin _________________
(month).
Payment Instructions
Send the payment to (choose one):
__My address of record.
__My bank account via Colonial Cash Connection. Please
complete Section 4B and the Bank Information section
below. __The payee listed at right.
______________________________________________
Name of payee
______________________________________________
Address of payee
______________________________________________
City
______________________________________________
State Zip
______________________________________________
Payee's bank account number, if applicable
X_____________________________________________
Signature of account owner(s)
X_____________________________________________
Signature of account owner(s)
Signatures of all owners must be guaranteed. Provide the
name, address, payment amount, and frequency for other
payees (maximum of 5) on a separate sheet.
B. Direct Deposit via Colonial Cash Connection
You can arrange to have distributions from your Colonial
fund account(s) or Systematic Withdrawal Plan checks
automatically deposited directly into your bank checking
account. Distribution deposits will be made 2 days after
the Fund's payable date. Please complete Bank Information
below and attach a blank check marked "VOID."
Please deposit my:
__Dividend distributions only
__Dividend and capital gain distributions
__Systematic Withdrawal Plan payments
I understand that my bank must be a member of the
Automated Clearing House system.
C. Telephone Withdrawal Options
All telephone transaction calls are recorded. These
options are not available for retirement accounts.
1. Fast Cash
You are automatically eligible for this service. You or
your financial adviser can withdraw up to $50,000 from
your account and have it sent to your address on our
records. For your protection, this service is only
available on accounts that have not had an address change
within
60 days of the redemption request.
2. Telephone Redemption
__I would like the Telephone Redemption privilege.
You may withdraw shares from your fund account by
telephone and send your money to your bank account. If you
are adding this service to an existing account, complete
the Bank Information section below and have all
shareholder
signatures guaranteed.
Colonial's and the Fund's liability is limited when
following telephone instructions; a shareholder may suffer
a loss from an unauthorized transaction reasonably
believed by Colonial to have been authorized. Telephone
redemptions exceeding $5,000 will be sent via Federal Fund
Wire, usually on the next business day ($7.50 will be
deducted). Redemptions of $5,000 or less will be sent by
check to your designated bank.
Bank Information (For A, B, or C Above)
I authorize deposits to the following bank account:
__________________________________________________________
__ ____
Bank name City Bank account number
__________________________________________________________
__ ____
Bank street address State Zip Bank routing # (your
bank can provide this)
5-----Ways to Make Additional Investments--------
These services involve continuous investments regardless
of varying share prices. Please consider your ability to
continue purchases through periods of price fluctuations.
Dollar cost averaging does not assure a profit or protect
against loss in declining markets.
A. Automatic Dividend Diversification
Please diversify my portfolio by investing fund
distributions in another Colonial fund. These investments
will be made in the same share class and without sales
charges. I have carefully read the prospectus for the
fund(s) listed below.
____________________________
From fund
____________________________
Account number (if existing)
____________________________
To fund
____________________________
Account number (if existing)
____________________________
From fund
____________________________
Account number (if existing)
____________________________
To fund
____________________________
Account number (if existing)
____________________________
From fund
____________________________
Account number (if existing)
____________________________
To fund
____________________________
Account number (if existing)
B. Automated Dollar Cost Averaging
This program allows you to automatically have money from
any Colonial fund in which you have a balance of at least
$5,000 transferred into the same share class of up to four
other Colonial funds, on a monthly basis. The minimum
amount for each transfer is $100. Please complete the
section below.
____________________________________
Fund from which shares will be sold
$_________________________
Amount to redeem monthly
____________________________________
Fund name
$_________________________
Amount to invest monthly
____________________________________
Fund name
$_________________________
Amount to invest monthly
____________________________________
Fund name
$_________________________
Amount to invest monthly
C. Fundamatic
Fundamatic automatically transfers the specified amount
from your bank checking account to your Colonial fund
account. Your bank needs to be a member of the Automated
Clearing House system. Please attach a blank check marked
"VOID." Also, complete the section below and Fundamatic
Authorization (Section 6).
____________________________________
Fund name
$_____________________ _________________
Amount to transfer Month to start
Frequency
__Monthly or __Quarterly
Date
__5th or __20th of the month
____________________________________
Fund name
$_____________________ _________________
Amount to transfer Month to start
Frequency
__Monthly or __Quarterly
Date
__5th or __20th of the month
____________________________________
Fund name
$_____________________ _________________
Amount to transfer Month to start
Frequency
__Monthly or __Quarterly
Date
__5th or __20th of the month
6 -------------Fundamatic Authorization-------------------
Authorization to honor checks drawn by Colonial Investors
Service Center. Do Not Detach. Make sure all depositors
on the bank account sign to the far right. Please attach
a blank check marked "VOID" here. See reverse for bank
instructions.
I authorize Colonial to draw on my bank account, by check
or electronic funds transfer, for an investment in a
Colonial fund. Colonial and my bank are not liable for any
loss arising from delays or dishonored draws. If a draw is
not honored, I understand that notice may not be given and
Colonial may reverse the purchase and charge my account
$15.
______________________________________
Bank name
______________________________________
Bank street address
______________________________________
Bank street address
______________________________________
City State Zip
______________________________________
Bank account number
______________________________________
Bank routing #
X_____________________________________
Depositor's Signature(s)
Exactly as appears on bank records
X_____________________________________
Depositor's Signature(s)
Exactly as appears on bank records
7--Ways to Reduce Your Sales Charges for Class A Shares-
These services can help you reduce your sales charge while
increasing your share balance over the long term.
A. Right of Accumulation
If you, your spouse or your children own Class A, B or D
shares in other Colonial funds, you may be eligible for a
reduced sales charge. The combined value of your accounts
must be $50,000 or more. Class A shares of money market
funds are not eligible unless purchased by exchange from
another Colonial fund.
The sales charge for your purchase will be based on the
sum of the purchase added to the value of all shares in
other Colonial funds at the previous day's public offering
price.
__Please link the accounts listed below for Right of
Accumulation privileges, so that this and future purchases
will receive any discount for which they are eligible.
_____________________________________
Name on account
_____________________________________
Account number
_____________________________________
Name on account
_____________________________________
Account number
B. Statement of Intent
If you agree in advance to invest at least $50,000 within
13 months, you'll pay a lower sales charge on every dollar
you invest. If you sign a Statement of Intent within 90
days after you establish your account, you can receive a
retroactive discount on prior investments. The amount
required to receive a discount varies by fund; see the
sales charge table in the "How to Buy Shares" section of
your fund prospectus.
__I want to reduce my sales charge.
I agree to invest $ _______________
over a 13-month period starting ______/______/ 19______
(not more than 90 days prior to this application). I
understand an additional sales charge must be paid if I do
not complete this Statement of Intent.
8-------------Financial Service Firm--------------------To
be completed by a Representative of your financial service
firm.
This application is submitted in accordance with our
selling agreement with Colonial Investment Services (CIS),
the Fund's prospectus, and this application. We will
notify CIS of any purchase made under a Statement of
Intent, Right of Accumulation, or Sponsored Arrangement.
We guarantee the signatures on this application and the
legal capacity of the signers.
_____________________________________
Representative's name
_____________________________________
Representative's number
_____________________________________
Representative's phone number
_____________________________________
Account # for client at financial
service firm
_____________________________________
Branch office address
_____________________________________
City
_____________________________________
State Zip
_____________________________________
Branch office number
_____________________________________
Name of financial service firm
_____________________________________
Main office address
_____________________________________
Main office address
_____________________________________
City
_____________________________________
State Zip
X____________________________________
Authorized signature
9--Request for a Combined Quarterly Statement Mailing-
Colonial can mail all of your quarterly statements in one
envelope. This option simplifies your record keeping and
helps reduce fund expenses.
__I want to receive a combined quarterly mailing for all
my accounts.
Fundamatic (See Reverse Side)
Applications must be received before the start date for
processing.
This program's deposit privilege can be revoked by
Colonial without prior notice if any check is not paid
upon presentation. Colonial has no obligation to notify
the shareholder of non-payment of any draw. This program
may be discontinued by Colonial by written notice at least
30 business days prior to the due date of any draw or by
the shareholder at any time.
To the Bank Named on the Reverse Side:
Your depositor has authorized Colonial Investors Service
Center to collect amounts due under an investment program
from his/her personal checking account. When you pay and
charge the draws to the account of your depositor
executing the authorization payable to the order of
Colonial Investors Service Center, Colonial Management
Associates, Inc., hereby indemnifies and holds you
harmless from any loss (including reasonable expenses) you
may suffer from honoring such draw, except any losses due
to your payment of any draw against insufficient funds.
D-461L-594
Checkwriting Signature Card
(Class A Shares Only)
Colonial Mutual Funds
Signature Card for the Bank of Boston ("Bank").
- -----------------------------------------------
Name of Fund
- -----------------------------------------------
Fund account number
To request additional signature cards, please call Colonial at 1-800-248-
2828. Account Name:
You must sign below exactly as your account is registered.
X
- -----------------------------------------------
Signature
X
- -----------------------------------------------
Signature
By signing this card, you are subject to the conditions printed on the
reverse side. If adding this privilege to an existing account, your
signatures must be guaranteed.
Checkwriting Privilege
By electing the checkwriting privilege and signing the signature card, I
acknowledge that I am subject to the rules and regulations of the Bank of
Boston ("Bank") as currently existing and as they may be amended from time
to time. I designate the Bank as my representative to present checks drawn
on my Fund account to the Fund or its Agent and deposit the proceeds in
this checking account. I understand that the shares for which share
certificates have been issued or requested cannot be redeemed in this
manner.
I understand that if my Fund account is registered in joint tenancy, that
all checks must include all signatures of all persons named on the account.
If the account is registered in joint tenancy, each person guarantees the
genuineness of all other parties' signatures.
Minimum and Maximum
I understand that checks may not be in amounts less than $500 nor more than
$100,000, and that the Fund reserves the right to change these limits in its
sole discretion. I agree that neither the Fund nor its Agent is responsible
for any loss, expense, or cost arising from these redemptions. Also, if I
have recently made additional investments, I understand that redemption
proceeds will not be available until the check used to purchase the
investment (including a certified or cashier's check) has been cleared by
the bank on which it is drawn, which could take up to 15 days or more.
D-256A-1094
