File Nos. 33-12381 & 811-5047
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-12
TAX-FREE FUND OF COLORADO
(Exact Name of Registrant as Specified in Charter)
380 Madison Avenue, Suite 2300
New York, New York 10017
(Address of Principal Executive Offices)
(212) 697-6666
(Registrant's Telephone Number)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
<page>
Important Notice
Please Read Immediately
Aquila
Group of Funds
Tax-Free Fund of Colorado
380 Madison Avenue, Suite 2300, New York, New York 10017
Notice of Annual Meeting of
Shareholders to Be Held
on June 24, 2009
To Shareholders of the Fund:
The purpose of this Notice is to advise you that an Annual Meeting of the
Shareholders of Tax-Free Fund of Colorado (the "Fund"), will be held:
Place: (a) Colorado Convention Center
Room 507, 700 14th Street
Denver, Colorado;
Time: (b) on Wednesday, June 24, 2009
at 10:00 a.m. Mountain Daylight Time;
Purposes: (c) for the following purposes:
(i) to elect nine Trustees; each Trustee elected
will hold office until the next annual meeting of the
Fund's shareholders or until his or her successor is
duly elected (Proposal No. 1);
(ii) to ratify (that is, to approve) or reject the
selection of Tait, Weller & Baker LLP as the Fund's
independent registered public accounting firm for
the fiscal year ending December 31, 2009 (Proposal
No. 2); and
(iii) to act upon any other matters which may
properly come before the Meeting at the scheduled
time and place or any adjourned meeting or meetings.
Who Can
Vote What
Shares: (d) To vote at the Meeting, you must have been a
shareholder on the Fund's records at the close of
business on March 30, 2009 (the "record date").
Also, the number of shares of each of the Fund's
outstanding classes of shares that you held at that
time and the respective net asset values of each
class of shares at that time determine the number
of votes you may cast at the Meeting (or any
adjourned meeting or meetings).
By order of the Board of Trustees,
EDWARD M. W. HINES
Secretary
May 20, 2009
Please Note:
If you do not expect to attend the Meeting, please vote by any of three ways: by
the Internet, by telephone or by completing the enclosed proxy card and
returning it in the accompanying stamped envelope. To avoid unnecessary expense
to the Fund, we request your cooperation in voting no matter how large or small
your holding may be.
Tax-Free Fund of Colorado
380 Madison Avenue, Suite 2300, New York, New York 10017
Proxy Statement
Introduction
The purpose of the Notice preceding this Proxy Statement is to advise you
of the time, place and purposes of an Annual Meeting of the Shareholders of
Tax-Free Fund of Colorado (the "Fund"). The purpose of this Proxy Statement is
to give you information on which you may base your voting decisions.
The Fund's Manager (the "Manager") is Aquila Investment Management LLC, 380
Madison Avenue, Suite 2300, New York, NY 10017, a subsidiary of the Fund's
founder, Aquila Management Corporation. The Fund's principal underwriter (the
"Distributor") is Aquila Distributors, Inc., 380 Madison Avenue, Suite 2300, New
York, NY 10017. The Fund's Investment Sub-Adviser (the "Sub-Adviser") is
Kirkpatrick Pettis Capital Management, a Division of Davidson Fixed Income
Management, 1600 Broadway, Denver, Colorado 80202.
A copy of the Fund's most recent annual report will be sent to you without
charge upon written request to the Distributor, at the above address, or by
calling 800-437-1020 toll-free or 212-697-6666.
This Notice and Proxy Statement are first being mailed on or about May 20,
2009.
You should read this Proxy Statement prior to voting. If your shares are
registered in the name of your broker or someone other than yourself, you may
authorize that person to vote your shares. If your shares are registered in your
name, then you may vote in one of three ways:
(1) Proxy Card
The enclosed proxy card authorizes the persons named (or their substitutes)
to vote your shares; the Fund calls these persons the "proxy holders." As to the
election of Trustees you may authorize the proxy holders to vote your shares for
the entire slate indicated below by marking the appropriate box on the proxy
card or by merely signing and returning your proxy card with no instructions. Or
you may withhold the authority of the proxy holders to vote on the election of
Trustees by marking the appropriate box. Also, you may withhold that authority
as to any particular nominee by following the instructions on the proxy card.
As to the other matter listed on the proxy card, you may direct the proxy
holders to vote your shares on this proposal by marking the appropriate box
"For" or "Against" or instruct them not to vote your shares on the proposal by
marking the "Abstain" box. If you return your signed proxy card and do not mark
a box on the proposal, the proxy holders will vote your shares for that
proposal.
(2) Internet Voting
To vote your shares by the Internet, please contact the Fund at the
Internet address shown on your proxy card. You will be prompted to enter the
control number on your proxy card. Follow the instructions on the screen, using
your proxy card as a guide. If you vote by the Internet, you need not return the
proxy card by mail.
(3) Telephone Voting
To vote your shares by telephone, call the toll-free number on your proxy
card. You will be prompted to enter the control number on your proxy card.
Follow the recorded instructions using your proxy card as a guide. If you vote
by phone, you need not return the proxy card by mail.
General Information
You may end the power of the proxy holders to vote your shares by: (i) so
notifying the Fund in writing; (ii) signing a new and different proxy card (if
the Fund receives it before the old one is used); (iii) voting your shares at
the meeting in person or by your duly appointed agent; or (iv) calling the
toll-free number provided or contacting the Fund's Internet address, both of
which are detailed on your proxy card, entering your control number and revoking
your previous vote.
Proxies for shares held by brokers in "street name" and not voted or marked
as abstentions will be counted for purposes of determining a quorum. They will
be counted as present at the meeting in determining voting results, and will
therefore have the same effect as negative votes.
The Fund is sending you this Notice and Proxy Statement in connection with
the solicitation by its Trustees of proxies to be used at the Annual Meeting to
be held at the time and place and for the purposes indicated in the Notice or
any adjourned meeting or meetings. Whenever it is stated in this Proxy Statement
that a matter is to be acted on at the Meeting, this means the meeting held at
the scheduled time or any adjourned meeting or meetings.
The Fund pays the costs of the solicitation. Proxies are being solicited by
the use of the mails; they may also be solicited by telephone, facsimile and
personal interviews. Brokerage firms, banks and others may be requested to
forward this Notice and Proxy Statement to beneficial owners of the Fund's
shares so that these owners may authorize the voting of their shares. The Fund
will pay these firms their out-of-pocket expenses for doing so.
On the record date, the Fund had three classes of shares outstanding. All
shareholders of the Fund are entitled to vote at the Meeting. Each shareholder
on the record date is entitled to one vote for each dollar (and a proportionate
fractional vote for each fraction of a dollar) of net asset value (determined as
of the record date) represented by full and fractional shares of any class held
on the record date. On the record date, the net asset value per share of each of
the Fund's outstanding classes of shares was as follows: Class A Shares, $10.09;
Class C Shares, $10.07; and Class Y Shares, $10.11. The meeting is expected to
act only upon matters that affect the Fund as a whole: the election of Trustees
and the selection of an independent registered public accounting firm. On
matters that affect the Fund as a whole, all shareholders of the Fund, including
the shareholders of all classes of shares of the Fund, are entitled to vote at
the meeting.
On the record date, the total number of shares outstanding for each class
of shares was as follows: Class A Shares, 18,837,969; Class C Shares, 886,185;
and Class Y Shares, 1,383,954.
On the record date, the following holders held 5% or more of a class of the
Fund's outstanding shares. On the basis of information received from the
institutional holders, the Fund's management believes that all of the shares
indicated are held by them for the benefit of clients.
Name and address of
the holder of Record Number of shares Percent of class
Institutional 5% shareholders
Merrill Lynch Pierce Fenner
& Smith Inc. 1,082,703 Class A Shares 5.75%
FBO its Customers 97,353 Class C Shares 10.99%
4800 Deer Lake Drive East 191,450 Class Y Shares 13.83%
Jacksonville, FL
Alpine Trust & Asset
Management 370,147 Class Y Shares 26.75%
225 N. 5th Street
Grand Junction, CO
NFS LLC FEBO
AMG National Bank/Haws & Co. 177,613 Class Y Shares 12.83%
6501 E. Belleview Avenue
Suite 400
Englewood CO
Additional 5% Shareholders
The Fund's management is not aware of any other person beneficially owning more
than 5% of any class of its outstanding shares as of such date.
Election of Trustees
(Proposal No. 1)
At the Meeting, nine Trustees are to be elected. Each Trustee elected will
serve until the next annual meeting or until his or her successor is duly
elected. The nominees selected by the Trustees are named in the table below. See
"Introduction" above for information as to how you can vote your shares in the
election of Trustees.
The following material includes information about each nominee and each
officer of the Fund. All shares of the Fund listed as owned by the Trustees are
Class A Shares unless indicated otherwise. All of the nominees, except for Mr.
Calderon and Mr. Gammage, are presently Trustees and were elected by the
shareholders in June 2008. The Nominating Committee is proposing the election of
Mr. Calderon and Mr. Gammage at the suggestion of Trustees of another of the
funds in the Aquila Group of Funds. All nominees have consented to serve if
elected.
Nominees(1)
Number of
Positions Portfolios Other Directorships
Held with in Fund Held by Trustee
Fund and Complex (The position held is
Name, Address(2) and Length of Principal Occupation(s) Overseen a directorship unless
Date of Birth Service(3) During Past 5 Years by Trustee indicated otherwise.)
Interested
Trustee(4)
Diana P. Herrmann Trustee Vice Chair and Chief Executive 12 ICI Mutual Insurance Company
New York, NY since 2000 Officer of Aquila Management
(02/25/58) and Corporation, Founder of the
President Aquila Group of Funds and parent
since 1999 of Aquila Investment Management
LLC, Manager since 2004,
President since 1997, Chief
Operating Officer, 1997-2008, a
Director since 1984, Secretary
since 1986 and previously its
Executive Vice President, Senior
Vice President or Vice President,
1986-1997; Chief Executive
Officer and Vice Chair since
2004, President and Manager of
the Manager since 2003, and Chief
Operating Officer of the Manager,
2003-2008; Chair, Vice Chair,
President, Executive Vice
President or Senior Vice
President of funds in the Aquila
Group of Funds since 1986;
Director of the Distributor since
1997; Governor, Investment
Company Institute (a trade
organization for the U.S. mutual
fund industry dedicated to
protecting shareholder interests
and educating the public about
investing) and head of its Small
Funds Committee since 2004;
active in charitable and
volunteer organizations.
Non-interested
Trustees
Anne J. Mills Chair of the President, Loring Consulting 4 None
Castle Rock, CO Board of Company since 2001; Vice
(12/23/38) Trustees President for Business Management
since 2005 and CFO, Ottawa University,
and Trustee 1992-2001, 2006-2008; IBM
since 1987 Corporation, 1965-1991; currently
active with various charitable,
educational and religious
organizations.
Gary C. Cornia Vice Chair Dean, Marriott School of 4 Lincoln Institute of
Orem, UT of the Board Management, Brigham Young LandPolicy, Cambridge, MA
(06/24/48) of Trustees University, since 2008; Director,
since 2006 Romney Institute of Public
and Trustee Management, Marriott School of
since 2000 Management, 2004 - 2008;
Professor, Marriott School of
Management, 1980 - present; Past
President, the National Tax
Association; Fellow, Lincoln
Institute of Land Policy, 2002 -
present; Associate Dean, Marriott
School of Management, Brigham
Young University, 1991-2000;
member, Utah Governor's Tax
Review Committee since 1993.
Tucker Hart Adams Trustee President, The Adams Group, Inc., 3 Griffis/Blessings, Inc.
Colorado Springs, CO since 1989 an economic consulting firm, (commercial property
(01/11/38) since 1989; formerly Chief development and management);
Economist, United Banks of Kachi Partners (middle market
Colorado; currently or formerly buyouts); Colorado Health
active with numerous professional Facilities Authority
and community organizations.
Ernest Calderon Nominee Founder, Calderon Law Offices, 1 None
Phoenix, AZ since 2004; Equity Partner,
(10/24/57) Jennings, Strouss & Salmon, PLC,
1993-2004; member, Arizona Board
of Regents since 2003 and member
of Governor Janice Brewer's
Transition Team since 2009; Past
President, Grand Canyon Council
of Boy Scouts of America; Past
President, State Bar of Arizona,
2003-2004; member, American Law
Institute.
Thomas A. Trustee Vice President of Robinson, 4 None
Christopher since 2004 Hughes & Christopher, C.P.A.s,
Danville, KY P.S.C., since 1977; President, A
(12/19/47) Good Place for Fun, Inc., a
sports facility, since 1987;
currently or formerly active with
various professional and
community organizations.
Grady Gammage, Jr. Nominee Founding partner, Gammage & 2 None
Phoenix, AZ Burnham, PLC, a law firm,
(10/01/51) Phoenix, Arizona, since 1983;
director, Central Arizona Water
Conservation District, 1992-2004;
director, Arizona State
University Foundation since 1998;
Maricopa Partnership for Arts &
Culture; Public Architecture;
Arizona Historical Foundation.
Lyle W. Hillyard Trustee President of the law firm of 2 None
Logan, UT since 2006 Hillyard, Anderson & Olsen,
(09/25/40) Logan, Utah, since 1967; member
of Utah Senate, 1985 to present,
in the following positions:
President, 2000, Senate Majority
Leader, 1999-2000, Assistant
Majority Whip, 1995-1998; served
as Chairman of the following Utah
Senate Committees: Tax and
Revenue, Senate Judiciary
Standing, Joint Executive
Appropriations, and Senate Rules;
currently serves as Co-Chair,
Joint Executive Appropriations.
John C. Lucking Trustee President, Econ-Linc, an economic 3 None
Phoenix, AZ since 2000 consulting firm, since 1995;
(05/20/43) formerly Consulting Economist,
Bank One Arizona and Chief
Economist, Valley National Bank;
member, Arizona's Joint
Legislative Budget Committee
Economic Advisory Panel and the
Western Blue Chip Economic
Forecast Panel; Board member,
Northern Arizona University
Foundation since 1997; member,
various historical, civic and
economic associations.
Other Individuals
Trustees Emeritus(6)
Lacy B. Herrmann Founder and Founder and Chairman of the N/A N/A
New York, NY Chairman Board, Aquila Management
(05/12/29) Emeritus Corporation, the sponsoring
since 2005; organization and parent of the
Chairman of Manager or Administrator and/or
the Board of Adviser or Sub-Adviser to each
Trustees, fund of the Aquila Group of
1987-2004 Funds; Chairman of the Manager or
Administrator and/or Adviser or
Sub-Adviser to each since 2004;
Founder and Chairman Emeritus of
each fund in the Aquila Group of
Funds; previously Chairman and a
Trustee of each fund in the
Aquila Group of Funds since its
establishment until 2004 or 2005;
Director of the Distributor since
1981 and formerly Vice President
or Secretary, 1981-1998; Trustee
Emeritus, Brown University and
the Hopkins School; active in
university, school and charitable
organizations.
J. William Weeks Trustee Retired; limited partner in real N/A N/A
Palm Beach, FL Emeritus estate partnerships Alex, Brown &
(06/22/27) since 2006 Sons No. 1 and 2; formerly Senior
Vice President or Vice President
of the Aquila Municipal Bond
Funds; and Vice President of the
Distributor.
Officers
Charles E. Executive Executive Vice President of all N/A N/A
Childs, III Vice funds in the Aquila Group of
New York, NY President Funds and the Manager and the
(04/01/57) since 2003 Manager's parent since 2003;
Executive Vice President and
Chief Operating Officer of the
Manager's parent since 2008;
formerly Senior Vice President,
corporate development, Vice
President, Assistant Vice
President and Associate of the
Manager's parent since 1987;
Senior Vice President, Vice
President or Assistant Vice
President of the Aquila
Money-Market Funds, 1988-2003.
Alan R. Stockman Senior Vice Senior Vice President, Tax-Free N/A N/A
Glendale, AZ President Fund of Colorado, since 2009;
(07/31/54) since 2009 Senior Vice President, Tax-Free
Trust of Arizona since 2001, Vice
President, 1999-2001; Vice
President, Aquila Rocky Mountain
Equity Fund since 1999; Bank One,
Commercial Client Services
representative, 1997-1999; Trader
and Financial Consultant,
National Bank of Arizona (Zions
Investment Securities Inc.),
Phoenix, Arizona 1996-1997.
Robert W. Anderson Chief Chief Compliance Officer of the N/A N/A
New York, NY Compliance Fund and each of the other funds
(08/23/40) Officer in the Aquila Group of Funds, the
since 2004 Manager and the Distributor since
and 2004, Compliance Officer of the
Assistant Manager or its predecessor and
Secretary current parent 1998-2004;
since 2000 Assistant Secretary of the Aquila
Group of Funds since 2000.
Joseph P. DiMaggio Chief Chief Financial Officer of the N/A N/A
New York, NY Financial Aquila Group of Funds since 2003
(11/06/56) Officer and Treasurer since 2000.
since 2003
and
Treasurer
since 2000
Edward M. W. Hines Secretary Shareholder of Butzel Long, a N/A N/A
New York, NY since 1987 professional corporation, counsel
(12/16/39) to the Fund, since 2007; Partner
of Hollyer Brady Barrett & Hines
LLP, its predecessor as counsel,
1989-2007; Secretary of the
Aquila Group of Funds.
John M. Herndon Assistant Assistant Secretary of the Aquila N/A N/A
New York, NY Secretary Group of Funds since 1995 and
(12/17/39) since 1995 Vice President of the three
Aquila Money-Market Funds since
1990; Vice President of the
Manager or its predecessor and
current parent since 1990.
Lori A. Vindigni Assistant Assistant Treasurer of the Aquila N/A N/A
New York, NY Treasurer Group of Funds since 2000;
(11/02/66) since 2000 Assistant Vice President of the
Manager or its predecessor and
current parent since 1998; Fund
Accountant for the Aquila Group
of Funds, 1995-1998.
(1) The Fund's Statement of Additional Information includes additional
information about the Trustees and is available, without charge, upon request by
calling 800-437-1020 (toll-free) or by visiting the EDGAR Database at the SEC's
internet site at www.sec.gov.
(2) The mailing address of each Trustee and officer is c/o Tax-Free Fund of
Colorado, 380 Madison Avenue, Suite 2300, New York, NY 10017.
(3) Each Trustee holds office until the next annual meeting of shareholders or
until his or her successor is elected and qualifies. The term of office of each
officer is one year.
(4) Ms. Herrmann is an interested person of the Fund as an officer of the Fund,
as a director, officer and shareholder of the Manager's corporate parent, as an
officer and Manager of the Manager, and as a shareholder and director of the
Distributor. Ms. Herrmann is the daughter of Lacy B. Herrmann, the Founder and
Chairman Emeritus of the Fund.
(5) In this material Pacific Capital Cash Assets Trust, Pacific Capital U.S.
Government Securities Cash Assets Trust and Pacific Capital Tax-Free Cash Assets
Trust, each of which is a money-market fund, are called the "Aquila Money-Market
Funds"; Hawaiian Tax-Free Trust, Tax-Free Trust of Arizona, Tax-Free Trust of
Oregon, Tax-Free Fund of Colorado, Churchill Tax-Free Fund of Kentucky,
Narragansett Insured Tax-Free Income Fund and Tax-Free Fund For Utah, each of
which is a tax-free municipal bond fund, are called the "Aquila Municipal Bond
Funds"; Aquila Rocky Mountain Equity Fund is an equity fund; Aquila Three Peaks
High Income Fund is a high income corporate bond fund; considered together,
these 12 funds are called the "Aquila Group of Funds."
(5) A Trustee Emeritus may attend Board meetings but has no voting power.
Securities Holdings of the Nominees
(as of 12/31/08)
Aggregate Dollar
Dollar Range of Range of Ownership
Name of Ownership in Tax-Free Fund of in the Aquila
Trustee Colorado (1) Group of Funds (1)
Interested Trustees
Diana P. Herrmann C E
Non-interested Trustees
Tucker H. Adams B C
Ernest Calderon C(2) C
Thomas A. Christopher C E
Gary C. Cornia D E
Grady Gammage, Jr. B(3) E
Lyle W. Hillyard B D
John C. Lucking C C
Anne J. Mills D D
(1) A. None
B. $1-$10,000
C. $10,001-$50,000
D. $50,001-$100,000
E. over $100,000
(2) As of February 2009.
(3) As of May 2009.
None of the non-interested Trustees or their immediate family members holds
of record or beneficially any securities of the Manager, the Sub-Adviser or the
Distributor.
The Fund does not currently pay fees to any of the Fund's officers or to
Trustees affiliated with the Manager or the Sub-Adviser. For its fiscal year
ended December 31, 2008, the Fund paid a total of $106,441 in compensation and
reimbursement of expenses to the Trustees. No other compensation or remuneration
of any type, direct or contingent, was paid by the Fund to its Trustees.
The Fund is one of the twelve funds in the Aquila Group of Funds, which
consist of three money-market funds, seven tax-free municipal bond funds, a high
income corporate bond fund and an equity fund. The following table lists the
compensation of all nominees for Trustee who received compensation from the Fund
or from other funds in the Aquila Group of Funds during the Fund's fiscal year.
None of such nominees has any pension or retirement benefits from the Fund or
any of the other funds in the Aquila Group of Funds.
Compensation Number of
from all boards on
Compensation funds in the which the
from the Aquila Trustee now
Name Fund Group of Funds serves
Tucker H.
Adams $10,917 $47,500 3
Ernest
Calderon $0 $18,500 1
Thomas A.
Christopher $15,107 $73,500 4
Gary C.
Cornia $10,750 $65,000 4
Grady
Gammage, Jr. $0 $32,500 2
Lyle W.
Hillyard $10,750 $21,500 2
John C.
Lucking $10,750 $40,000 3
Anne J.
Mills $17,750 $77,000 4
Class A Shares may be purchased without a sales charge by the Fund's
Trustees and officers.
The Fund's Manager is a wholly-owned subsidiary of Aquila Management
Corporation ("AMC"), founder of each fund in the Aquila Group of Funds. As of
April 30, 2009, these funds had aggregate assets of approximately $4.1 billion,
of which approximately $2.3 billion consisted of assets of the tax-free
municipal bond funds. AMC's address is the same as that of the Manager. AMC,
which was founded in 1984, is currently controlled by Mr. Lacy B. Herrmann and
his wife, Mrs. Elizabeth B. Herrmann, directly and through certain trusts.
Under proposed transactions, which are expected to occur in 2009, no
individual will hold with the power to vote, directly or indirectly, more than
24.9% of the voting shares of the Manager. The shareholders of the Fund, as well
as those of all the other funds in the Aquila Group of Funds, have approved new
advisory and administration agreements and, if applicable, new sub-advisory
agreements, in anticipation of the expected change of control of the Manager.
The transactions will not result in any changes in the Fund's advisory fees and
expenses, the services provided, the investment approach or style of the Manager
with respect to the Fund, or the personnel or operations of the Manager.
During the fiscal year ended December 31, 2008, the Fund paid $1,020,555 in
management fees.
During the fiscal year ended December 31, 2008, $93,553 was paid under
Part I of the Fund's Distribution Plan to Qualified Recipients with respect to
the Class A Shares, of which $3,685 was retained by the Distributor. With
respect to Class C Shares, during the same period, $71,409 was paid under Part
II of the Plan and $23,803 was paid under the Fund's Shareholder Services Plan.
Of these total payments of $95,212, the Distributor retained $20,626. All of
such payments were for compensation.
During the fiscal year ended December 31, 2008, the Fund paid $70,416 to
Butzel Long, a professional corporation, independent counsel to the Fund, for
legal services. Edward M.W. Hines, Secretary of the Fund, is a shareholder of
that firm.
The Distributor currently handles the distribution of the shares of the
funds in the Aquila Group of Funds, including the Fund. Under the Distribution
Agreement, the Distributor is responsible for the payment of certain printing
and distribution costs relating to prospectuses and reports as well as the costs
of supplemental sales literature, advertising and other promotional activities.
The shares of the Distributor are owned 24% by Diana P. Herrmann, 74% by Mr.
Herrmann and other members of his immediate family and the balance by Aquila
Management Corporation.
Other Information on Trustees
The Trustees have appointed a standing Audit Committee consisting of all of
the Trustees who are "independent" and are not "interested persons" of the Fund,
as that term is defined in the Investment Company Act of 1940. The members of
the Audit Committee are Anne J. Mills, Tucker Hart Adams, Thomas A. Christopher,
Gary C. Cornia, Lyle W. Hillyard and John C. Lucking. The Committee (i) selects
the Fund's independent registered public accounting firm (subject to shareholder
ratification); (ii) reviews the methods, scope and result of audits and the fees
charged; and (iii) reviews the adequacy of the Fund's internal accounting
procedures and controls. Selection of the independent registered public
accounting firm is also ratified by the Board of Trustees. The Audit Committee
held three meetings during the Fund's last fiscal year. The Board of Trustees
has adopted a written charter for the Audit Committee.
During the Fund's last fiscal year, the Board of Trustees held four
meetings. Each current Trustee was present for at least 75% of the total number
of Board meetings and meetings of committees of which such Trustee was a member.
The Fund's policy is that all Trustees who can do so attend the Annual
Meeting. At the last Annual Meeting all of the Trustees were present.
The Fund has a Nominating Committee, consisting of all of the
non-"interested" Trustees. The Nominating Committee held one meeting during the
last fiscal year. The committee will consider nominees recommended by the
shareholders who may send recommendations to the committee in care of the
Manager at 380 Madison Avenue, Suite 2300, New York, NY 10017. Recommendations
of nominees from shareholders are not treated differently than proposals from
other sources. The charter of the Nominating Committee is available on the
Fund's website at www.aquilafunds.com.
Shareholder communications intended for the Board of Trustees (or one or
more specified Trustees) may be sent to them in care of the Manager at the above
address.
Since the beginning of the Fund's most recently completed fiscal year, no
Trustee purchased or sold any shares of any class of the Manager, Sub-Adviser or
the parents or subsidiaries of either.
Vote Required
To be elected, each nominee must receive the affirmative votes of a
majority of the shares present.
Ratification or Rejection
of Selection of
Independent Registered Public Accounting Firm
(Proposal No. 2)
Tait, Weller & Baker LLP ("TWB"), which is currently serving as the Fund's
independent registered public accounting firm, has been selected by the Fund's
Audit Committee and ratified by the Board of Trustees, including a majority of
the non-"interested" Trustees, as the Fund's independent registered public
accounting firm for the fiscal year ending December 31, 2009. Such selection is
submitted to the shareholders for ratification or rejection.
The following table represents fees for professional audit services
rendered by TWB for the audit of the Fund's annual financial statements, and
fees billed for other services rendered by TWB, for the fiscal years ended
December 31, 2007 and 2008.
2007 2008
Audit Fees $16,000 $16,800
Audit related fees 0 0
------- ------
Audit and audit related fees $16,000 $16,800
Tax fees (1) 3,000 3,100
All other fees 0 0
------ ------
Total $19,000 $19,900
====== ======
(1) Tax fees consisted of fees for tax consultation and tax compliance services.
TWB did not perform any services during the last fiscal year for the Fund's
investment adviser (the Manager) or any entity controlling, controlled by or
under common control with the Manager that provides services to the Fund.
All audit and non-audit services performed by TWB on behalf of the Fund or
non-audit services performed on behalf of affiliated entities within the
investment company complex where such engagement relates directly to the
operations and financial reporting of the Fund are pre-approved by the Audit
Committee. Services to be considered between meetings of the Committee are
pre-approved by a selected member of the Committee in accordance with applicable
regulations and subject to additional procedures established by the Committee.
The Audit Committee has reviewed all services performed and fees charged by
TWB and has accepted TWB's representation that it is independent in recommending
re-appointment of it for the fiscal year ending December 31, 2009.
TWB has no direct or indirect financial interest in the Fund, the Manager
or the Sub-Adviser. It is expected that representatives of TWB will not be
present at the meeting but will be available should any matter arise requiring
their presence.
Vote Required
Approval requires the affirmative votes of a majority of the shares
present.
Shareholder Proposals
Under the proxy rules of the Securities and Exchange Commission,
shareholder proposals meeting tests contained in those rules may, under certain
conditions, be included in the Fund's proxy statement and proxy card for a
particular annual meeting. One of these conditions relates to the timely receipt
by the Fund of any such proposal. Under these rules, proposals submitted for
inclusion in the proxy material for the Fund's next annual meeting after the
annual meeting to which this Proxy Statement relates must be received by the
Fund not less than 120 days before the anniversary of the date of this Proxy
Statement. Accordingly, a shareholder proposal intended to be presented at the
Fund's 2010 annual meeting must be received by the Fund by January 19, 2010 in
order to be included in the Fund's proxy material relating to that meeting. The
date for such submission could change, depending on the scheduled date for the
next annual meeting; if so, shareholders will be notified.
The fact that the Fund receives a shareholder proposal in a timely
manner does not insure its inclusion in the Fund's proxy material, since there
are other requirements in the proxy rules relating to such inclusion.
A shareholder wishing to provide notice of a proposal in the manner
prescribed by Rule 14a-4 (c)(1) under the Securities Exchange Act of 1934 must
submit written notice of the proposal to the Fund by April 2, 2010.
Other Business
The Fund does not know of any other matter which will come up for action at
the Meeting. If any other matter or matters properly come up for action at the
Meeting, including any adjournment of the Meeting, the proxy holders will vote
the shares which your proxy card, Internet or telephone vote entitles them to
vote, in accordance with their judgment on such matter or matters, except as
noted. That is, by signing and returning your proxy card or by voting by
telephone or the Internet, you give the proxy holders discretionary authority as
to any such matter or matters.
IMPORTANT NOTICE
PLEASE READ IMMEDIATELY
Tax-Free Fund of Colorado
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
to be held on June 24, 2009
PROXY STATEMENT
<page>
EVERY SHAREHOLDER'S VOTE IS IMPORTANT
Your Proxy Vote is important!
And now you can Vote your Proxy on the PHONE or the INTERNET.
It saves Money! Telephone and Internet voting saves postage costs. Savings which
can help minimize expenses.
It saves Time! Telephone and Internet voting is instantaneous - 24 hours a day.
It's Easy! Just follow these simple steps:
1. Read your Proxy Statement and have it at hand.
2. Call toll-free 1-866-241-6192, or go to website: www.proxy-direct.com
3. Follow the recorded or on-screen directions.
4. Do not mail your Proxy Card when you vote by phone or Internet.
Please detach at perforation before mailing.
PROXY AQUILA GROUP OF FUNDS PROXY
TAX-FREE FUND OF COLORADO Proxy for Annual Meeting of
Shareholders - June 24, 2009
Proxy Solicited on Behalf of the Board of Trustees
The shareholder(s) of Tax-Free Fund of Colorado (the "Fund") whose signature(s)
appear(s) below does/do hereby appoint DIANA P. HERRMANN, CHARLES E. CHILDS, III
and EDWARD M. W. HINES, or any of them, as attorneys and proxies of the
undersigned, with full power of substitution, to attend the Annual Meeting of
Shareholders of the Fund to be held on Wednesday, June 24, 2009 at the Colorado
Convention Center, Room 507, 700 14th Street, Denver, Colorado, at 10:00 a.m.
Mountain Daylight Time, and all adjournments thereof, and thereat to vote the
shares held in the name of the undersigned on the record date for said meeting
on the matters listed on the reverse side. Such shares are entitled to one vote
for every dollar of net asset value represented by the share balance printed
below.
Management recommends a vote FOR all nominees in Proposal No. 1 and FOR Proposal
No. 2. The shares represented hereby will be voted as indicated on the reverse
or FOR if no choice is indicated.
VOTE VIA THE TELEPHONE: 1-866-241-6192
VOTE VIA THE INTERNET: www.proxy-direct.com
Note: PLEASE SIGN EXACTLY AS YOUR NAMES(S) APPEAR(S) ON THIS
PROXY CARD. When signing as custodian, attorney, executor,
administrator, trustee, guardian, etc., please sign your title as
such. Joint owners should each sign.
------------------------------------------------
Signature
-------------------------------------------------
Signature (if held jointly)
-------------------------------------------------
Date_____________________________________________
Yes No
-- --
I plan to attend the Annual Meeting in Denver. [__] [__]
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED ABOVE.
EVERY SHAREHOLDER'S VOTE IS IMPORTANT
Important Notice Regarding the Availability of Proxy Materials for the
Aquila Group of Funds Shareholder Meeting to Be Held on June 24, 2009.
The Proxy Statement for this meeting is available at:
https://www.proxy-direct.com/aqu19896
PLEASE SIGN, DATE AND RETURN YOUR
PROXY TODAY
Please detach at perforation before mailing.
Please read the proxy statement prior to voting. TO VOTE, MARK BLOCKS BELOW IN
BLUE OR BLACK INK AS IN THIS EXAMPLE:
TAX-FREE FUND OF COLORADO ANNUAL MEETING
1. Election of Trustee Nominees:
01. Tucker Hart Adams 02. Ernest Calderon 03. Thomas A. Christopher
04. Gary C. Cornia 05. Grady Gammage, Jr. 06. Diana P. Herrmann*
07. Lyle W. Hillyard 08. John C. Lucking 09. Anne J. Mills
*Interested Trustee
For All Withhold All For All Except
__ __ __
[__] [__] [__]
To withhold authority to vote for one or more (but not all) nominees, mark "For
All Except" and write the nominee number(s) and/or name(s) on the line below.
- --------------------
2. Action on selection of Tait, Weller & Baker LLP as independent registered
public accounting firm. (Annual Meeting Proposal No. 2 in Proxy Statement)
For Against Abstain
__ __ __
[__] [__] [__]
As to any other matter said proxies shall vote in accordance with their best
judgment.
Annual Meeting Attendance - You are encouraged to attend the Annual Meeting of
Shareholders. If you can attend, please so indicate on the proxy card or e-mail
us at info@aquilafunds.com
HAS YOUR ADDRESS CHANGED DO YOU HAVE ANY COMMENTS
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THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED ON THE REVERSE SIDE.