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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number: 811-10533
Exact name of registrant as specified
in charter: Reserve Municipal Money Market Trust
Address of principal executive offices: 1250 Broadway
New York, NY 10001-3701
Name and address of agent for service: Amy W. Bizar
1250 Broadway
New York, NY 10001-3701
Registrant's telephone number, including
area code: 212-401-5500
Date of fiscal year end: May 31
Date of reporting period: November 30, 2005
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ITEM 1. SEMI-ANNUAL REPORTS TO SHAREHOLDERS
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[THE RESERVE A TRADITION OF FINANCIAL INNOVATION(SM) LOGO]
1250 Broadway, New York, NY 10001-3701
212-401-5500
GENERAL INFORMATION AND 24-HOUR YIELD AND BALANCE INFORMATION
800-637-1700 - www.TheR.com
This literature is not authorized for distribution to prospective investors
unless preceded or accompanied by an appropriate current prospectus.
Distributor--Resrv Partners, Inc.
RTET/SEMI-ANNUAL 11/05
[THE RESERVE A TRADITION OF FINANCIAL INNOVATION(SM) LOGO]
SEMI-ANNUAL REPORT
RESERVE TAX-EXEMPT TRUST
INTERSTATE TAX-EXEMPT FUND
CALIFORNIA TAX-EXEMPT FUND
CONNECTICUT TAX-EXEMPT FUND
FLORIDA TAX-EXEMPT FUND
MASSACHUSETTS TAX-EXEMPT FUND
MICHIGAN TAX-EXEMPT FUND
NEW JERSEY TAX-EXEMPT FUND
OHIO TAX-EXEMPT FUND
PENNSYLVANIA TAX-EXEMPT FUND
VIRGINIA TAX-EXEMPT FUND
RESERVE NEW YORK TAX-EXEMPT TRUST
NEW YORK TAX-EXEMPT FUND
RESERVE MUNICIPAL MONEY-MARKET TRUST
LOUISIANA MUNICIPAL MONEY-MARKET FUND
MINNESOTA MUNICIPAL MONEY-MARKET FUND
NOVEMBER 30, 2005
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RESERVE TAX-EXEMPT TRUST--INTERSTATE TAX-EXEMPT FUND
STATEMENTS OF NET ASSETS--NOVEMBER 30, 2005 (UNAUDITED)
<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS--99.5%
ARIZONA--1.5%
$ 5,100,000 Apache County IDA for Tucson Electric Power Co., 2.94% - 3.00%, 12/15/18(a) $ 5,100,000
2,000,000 Apache County IDA for Tucson Electric Power Co., 2.94%, 12/1/20(a) 2,000,000
3,600,000 Arizona HCF for Royal Oaks, 3.05%, 3/1/27(a) 3,600,000
1,000,000 Phoenix IDR for Del Mar Terrace, 2.98%, 10/1/29(a) 1,000,000
3,400,000 Pima County IDA for Tucson Electric Power Co., Series A, 3.00%, 12/1/22(a) 3,400,000
---------------
15,100,00
---------------
CALIFORNIA--11.0%
9,445,000 California Pollution Control Wadham Energy, 2.96%, 11/1/17(a) 9,445,000
3,780,000 California State Economic Recovery, Series C-7, 2.95%, 7/1/23 3,780,000
6,200,000 California State, GO Series A-1, 3.07%, 5/1/40(a) 6,200,000
300,000 California Statewide for Covenant Retirement Community, 2.99%, 12/1/25(a) 300,000
20,315,000 California Water Department Reserve Powersupply, Series B-3, 2.94%, 5/1/22(a) 20,315,000
2,688,000 Irvine Assessment, District 87-8, 2.95%, 9/2/24(a) 2,688,000
6,250,000 Irvine Assessment, District 93-14, 2.94%, 9/2/25(a) 6,250,000
20,685,000 Long Beach California Harbor, Series A, 2.98%, 5/15/27(a) 20,685,000
1,000,000 Los Angeles MFH for Grand Promenade Project, 2.98%, 4/1/32(a) 1,000,000
16,200,000 Metropolitan Water District, Series B-2, 3.01%, 7/1/28(a) 16,200,000
24,500,000 Metropolitan Water District, Series C-2, 2.92%, 7/1/36(a) 24,500,000
900,000 Santa Ana County, El Cammo Hospital District, 3.06%, 8/1/15(a) 900,000
---------------
112,263,00
---------------
COLORADO--3.0%
500,000 Broomfield IDA for Buckeye Investments, 3.07%, 12/1/09(a) 500,000
6,600,000 Colorado EDA for Bear Creek School Project, 3.06%, 10/1/32(a) 6,600,000
20,900,000 Colorado HFA for Adventist Health Sunbelt, Series B, 3.05%, 11/15/34(a) 20,900,000
2,800,000 University of Colorado, Series B, 2.99%, 11/15/35(a) 2,800,000
---------------
30,800,000
---------------
CONNECTICUT--4.8%
1,260,000 Connecticut DAR for Independent Living Project, 2.97%, 7/1/15(a) 1,260,000
640,000 Connecticut DAR for Pierce Memorial Baptist, 2.97%, 10/1/28(a) 640,000
600,000 Connecticut HEFA for Hotchkiss School, Series A, 3.01%, 7/1/30(a)(c) 600,000
400,000 Connecticut HEFA for Kingswood Oxford School, 3.00%, 7/1/30(a) 400,000
25,900,000 Connecticut HEFA for Yale University, Series T-2, 3.00%, 7/1/29(a)(c) 25,900,000
15,000,000 Connecticut HEFA for Yale University, Series X-3, 2.92%, 7/1/37(a)(c) 15,000,000
100,000 Connecticut Special Tax for Transportation Infrastructure,
Series 1, 3.03%, 9/1/20(a) 100,000
2,900,000 Connecticut State Development Authority for Solid Waste, 3.01%, 8/1/23(a) 2,900,000
300,000 Connecticut State HEFA, 2.86%, 7/1/27(a) 300,000
410,000 Connecticut State, GO Series 97, 3.00%, 5/15/14(a) 410,000
1,000,000 Hartford Redev. Agency MHR for Underwood Towers Project, 3.00%, 6/1/20(a) 1,000,000
650,000 New Canaan Housing Authority for Village at Waveny Care Center, 2.96%, 1/1/22(a) 650,000
430,000 Shelton County HFA for Crosby Commons Project, 3.08%, 1/1/31(a) 430,000
---------------
49,590,000
---------------
FLORIDA--5.2%
10,310,000 Alachua County HFA for Oak Hammock University, 3.03%, 10/1/32(a) 10,310,000
2,300,000 Capital Finance Authority for Glenridge Palmer Ranch, 3.03%, 6/1/12(a) 2,300,000
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
1
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<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS (CONTINUED)
FLORIDA (CONTINUED)
$ 300,000 Duval County HFA for Lighthouse Bay Apartments, 3.04%, 12/1/32(a) $ 300,000
5,945,000 Florida HFA for Collins Cove Senior Apartments, 3.02%, 2/1/36(a) 5,945,000
3,900,000 Florida HFA for Wellesley Apartments, Series O, 2.93%, 8/1/35(a) 3,900,000
6,875,000 Florida HFC Multifamily for Bridgewater Club, 3.02%, 6/1/34(a) 6,875,000
5,420,000 Florida HFC Multifamily for Magnolia Pointe Apts., Series J, 3.10%, 6/1/39(a) 5,420,000
1,100,000 Orange County for YMCA, Series A, 3.10%, 5/1/27(a) 1,100,000
8,500,000 Palm Beach County for Morse Obligation Group, 3.07%, 5/1/33(a) 8,500,000
8,500,000 Palm Beach County for Raymond F Kravis Center, 2.98%, 7/1/32(a) 8,500,000
500,000 Sarasota County HFA for Bay Village, 3.10%, 12/1/23(a) 500,000
---------------
53,650,00
---------------
GEORGIA--2.4%
1,204,268 Georgia Muni Assoc. Pool Bd. COP, 3.06%, 12/15/20(a) 1,204,268
4,970,000 Marietta HFA for Woold Glen, 3.03%, 7/1/24(a) 4,970,000
17,870,000 Meag's, 2.96%, 1/1/26(a) 17,870,000
---------------
24,044,268
---------------
HAWAII--1.4%
12,000,000 Honolulu City & County GO, Series 2001-C, 2.28%, 12/1/13(b) 12,000,000
1,800,000 Honolulu City & County GO, Series 2001-C, 2.28%, 12/1/18(b) 1,800,000
---------------
13,800,000
---------------
IOWA--0.7%
1,000,000 Des Moines HRB for Iowa Methodist Medical Center, 3.00%, 8/1/15(a) 1,000,000
5,725,000 Iowa Community Project, Series C, 3.05%, 11/15/34(a) 5,725,000
---------------
6,725,000
---------------
LOUISIANA--5.8%
1,000,000 Lake Charles District Revenue for Conoco, Series A, 3.00%, 9/1/29(a) 1,000,000
935,000 Lake Charles HRB & Term. District Revenue for CITGO Corp., 3.00%, 8/1/07(a) 935,000
879,000 Louisiana Environmental Facilities Community DAR, Series A, 3.06%, 11/01/34(a) 879,000
15,000,000 Louisiana Local Government, 3.08%, 10/1/35(a) 15,000,000
35,000 Louisiana Offshore Term. Auth. Deepwater Port Rev. for Loop LLC,
Series A 3.00%, 9/1/17(a) 35,000
100,000 Louisiana Offshore Term. Auth. Deepwater Port Rev. for Loop LLC,
Series A, 3.00%, 9/1/14(a) 100,000
5,000,000 Louisiana Offshore Terminal, 3.05%, 9/1/08(a) 5,000,000
35,000 Louisiana PFA for Kenner Hotel Ltd., 2.94%, 12/1/15(a) 35,000
35,000 Louisiana PFA, 3.60%, 7/1/33(a) 35,000
35,000 Louisiana PFA, Multi-family, 3.06%, 6/15/31(a) 35,000
20,450,000 Louisiana State University, 3.03%, 7/1/30(a) 20,450,000
375,000 Port of New Orleans Cold Storage Project, 3.10%, 11/1/22(a) 375,000
9,335,000 South Louisiana Port, 3.04%, 1/1/27(a) 9,335,000
4,882,000 South Louisiana Port Marine Term. for Occidental Petroleum Corp., 2.98%, 7/1/18(a) 4,882,000
1,319,000 South Louisiana Port Marine Term. for Occidental Petroleum Corp., 3.00%, 7/1/21(a) 1,319,000
---------------
59,415,000
---------------
MARYLAND--2.8%
3,900,000 Howard County for Vantage House Facility, Series A, 3.05% 6/1/32(a) 3,900,000
1,305,000 Maryland HEFA Pooled Loan Program, Series D, 3.02%, 1/1/29(a) 1,305,000
1,000,000 Maryland State Health & Higher Education for Carnegie Institute, 3.06%, 10/1/37(a) 1,000,000
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
2
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<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS (CONTINUED)
MARYLAND (CONTINUED)
$ 1,975,000 Maryland State Health & Higher Education for Trinity College, 3.05%, 11/1/26(a) $ 1,975,000
9,130,000 Maryland State HEFA for Adventist Health Care, Series A, 3.07%, 1/1/35(a) 9,130,000
10,150,000 Maryland State Trans. Auth. for Baltimore/Washington Airport,
Series A, 2.98%, 7/1/13(a) 10,150,000
1,000,000 Montgomery County EDA for Riderwood Village Inc., 3.07%, 3/1/34(a) 1,000,000
---------------
28,460,000
---------------
MASSACHUSETTS--11.6%
2,390,000 Massachusetts DFA for Bedford Notre Dame Health Care, 3.13%, 10/1/29(a) 2,390,000
10,825,000 Massachusetts DFA for Briarwood Retirement, Series A, 3.04%, 1/1/35(a) 10,825,000
13,800,000 Massachusetts DFA for Brooksby Village project, 3.04%, 7/1/32(a) 13,800,000
180,000 Massachusetts DFA for Gann Academy Project, 2.90%, 6/1/32(a) 180,000
9,945,000 Massachusetts DFA for Jewish Geriatric Services, 2.98%, 5/15/34(a) 9,945,000
662,000 Massachusetts DFA for Smith College, 3.02%, 7/1/24(a)(c) 662,000
100,000 Massachusetts HEFA for Berklee College of Music, Series D, 2.87%, 10/1/27(a) 100,000
8,500,000 Massachusetts HEFA for Cap Asset Program, Series E & D, 2.94% - 3.01%, 1/1/35(a) 8,500,000
6,300,000 Massachusetts HEFA for Harvard University, 2.68%, 1/1/24(a)(c) 6,300,000
20,000,000 Massachusetts HEFA for Harvard University, Series Y, 2.80%, 7/1/35(a)(c) 20,000,000
35,000,000 Massachusetts HEFA for Massachusetts Institute of Technology,
Series J-2, 2.93%, 7/1/31(a)(c) 35,000,000
100,000 Massachusetts HEFA for Wellesley College, Series E, 2.93%, 7/1/22(a)(c) 100,000
200,000 Massachusetts HEFA for Williams College, Series E, 3.02%, 8/1/14(a) 200,000
100,000 Massachusetts HFA for Single Family, 2.98%, 12/1/30(a) 100,000
11,000,000 Massachusetts WRA, Series 99-B, 2.90%, 8/1/28(a) 11,000,000
100,000 Massachusetts WSR, Series A, 2.98% 11/1/24(a) 100,000
---------------
119,202,000
---------------
MICHIGAN--6.2%
5,880,000 Ann Arbor Michigan Economic Dev Corp. - Glacier Inc. Pj, Series A, 2.92%, 11/1/25(a) 5,880,000
2,300,000 Detroit Michigan Sew Disp Rev Var, Series B, 3.00%, 7/1/33(a) 2,300,000
100,000 Garden City Hospital Finance Authority, Series 96-A, 3.08%, 9/1/26(a) 100,000
900,000 Jackson County EDC for Thrifty Leoni Inc., 3.05%, 12/1/14(a) 900,000
16,440,000 Jackson County EDC for Vista Grande Villa, 2.98%, 11/1/31(a) 16,440,000
5,250,000 Michigan HDA for Berrien Woods, Series A, 3.15%, 7/1/32(a) 5,250,000
1,100,000 Michigan HDA Multi-Family Revenue for River Place Apts., 2.99%, 6/1/18(a) 1,100,000
785,000 Michigan HDA, Series B, 2.70%, 4/1/19(a) 785,000
235,000 Michigan State Hospital Finance Authority-Hosp Equipment Ln Prog- A, 2.98%, 12/1/23(a) 235,000
400,000 Michigan Strategic Fund for Clark Retirement Community, 3.04%, 6/1/31(a) 400,000
2,445,000 Michigan Strategic Fund for Haven Christian Services, 3.07%, 11/15/34(a) 2,445,000
4,340,000 Michigan Strategic Fund for Henry Ford Museum Village, 3.00%, 12/1/33(a) 4,340,000
950,000 Michigan Strategic Fund for Mot LLC Project, 3.07%, 12/1/34(a) 950,000
345,000 Michigan Strategic Fund for Peachwood Center Association, 3.00%, 6/1/16(a) 345,000
110,000 Michigan Strategic Fund, 3.03%, 1/1/14(a) 110,000
100,000 Oakland University, 3.06%, 3/1/31(a) 100,000
20,520,000 Wayne Charter County Detroit Met Cnty A, 3.03%, 12/1/16(a) 20,520,000
1,000,000 Woodhaven Brownstown School District, Series B, 1.86%, 5/1/34(a) 1,000,000
---------------
63,200,000
---------------
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
3
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<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS (CONTINUED)
MINNESOTA--0.6%
$ 200,000 Cohasset for Minnesota Power & Light, 3.07%, 6/1/13(a) $ 200,000
270,000 Minnesota Health for Fairview Health Services, 2.97%, 11/15/32(a) 270,000
2,073,000 Minnesota HEFA for Carleton College, Series 6D, 3.02%, 4/1/35(a) 2,073,000
14,000 Minnesota HEFA for St. Olaf College, Series 5-H, 3.03%, 10/1/30(a)(c) 14,000
172,000 Minnesota HEFA for St. Olaf College, Series 5-M1, 3.03%, 10/1/32(a)(c) 172,000
1,881,000 Minnesota Housing Finance Agency, Series C, 3.08%, 1/1/35(a) 1,881,000
105,000 Minnesota Revenue for People Serving People Project, 3.08%, 10/1/21(a) 105,000
81,000 Regents University, Series A, 3.09%, 7/1/08(a) 81,000
117,000 Roseville Commercial Development for Berger Transfer & Storage, 3.00%, 12/1/15(a) 117,000
66,000 St. Paul Housing & Redev. Authority for Public Radio Project, 3.03%, 6/16/10(a) 66,000
100,000 St. Paul Housing & Redev. Authority District Heating Revenue, 3.00%, 12/1/12(a) 100,000
881,000 St. Paul Housing & Redev. Authority MHR for Highland Ridge, 3.05%, 10/1/33(a) 881,000
---------------
5,960,000
---------------
MISSOURI--0.0%^
190,000 Platte County IDR for Platte Care Facility, 3.35%, 10/1/10 (a) 190,000
---------------
NEVADA--2.4%
19,500,000 Carson City Tahoe Hospital, 3.05%, 9/1/33(a) 19,500,000
5,000,000 Carson City Tahoe Medical Center, 3.05%, 9/1/35(a) 5,000,000
---------------
24,500,000
---------------
NEW JERSEY--3.4%
900,000 Hudson County NJ Impt Auth, 2.48%, 7/15/26(a) 900,000
600,000 New Jersey EDA for Bayonne Dock, 2.31%, 12/1/27(a) 600,000
2,740,000 New Jersey EDA for Geriatric Services Housing Project, 2.33%, 11/1/31(a) 2,740,000
9,700,000 New Jersey EDA for Newark Container LLC, 3.01%, 7/1/30(a) 9,700,000
385,000 New Jersey EDA for RJB Associates, ERN, 2.46%, 8/1/08(a) 385,000
4,775,000 New Jersey EDA for SCH Princeton Project, 2.75%, 07/1/22(a) 4,775,000
600,000 New Jersey EDA for Stolthaven Perth Amboy, Series A, 2.90%, 1/15/18(a) 600,000
500,000 New Jersey EDA for US Golf Association, 2.46%, 5/1/23(a) 500,000
1,300,000 New Jersey HCF for Communtity Hospital Group, Series A-1, 2.45%, 7/1/20(a) 1,300,000
595,000 New Jersey HCF for St. Barnabas Hospital, Series A, 2.33%, 7/1/31(a) 595,000
1,560,000 New Jersey Sports Authority Expo, Series C, 2.48%, 9/1/24(a) 1,560,000
300,000 New Jersey State Edl Facs Auth- Princeton University, Series B, 2.90%, 7/1/21(a)(c) 300,000
7,900,000 Port Authority of New York & New Jersey Versatile Obligation,
Series 2, 2.94%, 5/1/19(a) 7,900,000
3,000,000 Salem County New Jersey Impt Auth Rev- Friends Home Woodstown, Inc., 3.00%, 4/1/34(a) 3,000,000
---------------
34,855,000
---------------
NEW MEXICO--2.3%
23,870,000 Farmington County PCR for Arizona Public Service, Series B, 2.96% - 3.00%, 9/1/24(a) 23,870,000
---------------
NEW YORK--15.7%
8,000,000 Metropolitan Transportation Authority, Series E-1, 3.03%, 11/1/35(a) 8,000,000
20,200,000 New York City IDA for Korean Airlines, Series A, 2.99%, 11/1/24(a) 20,200,000
36,500,000 New York City WFA, Series C-1, 3.00%, 6/15/18(a) 36,500,000
2,500,000 New York City, GO Series A4, 2.94%, 8/1/15(a) 2,500,000
3,600,000 New York City, GO Series A4, 2.97%, 8/1/23(a) 3,600,000
3,600,000 New York City, GO Series A4, 3.00%, 8/1/21(a) 3,600,000
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
4
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<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS (CONTINUED)
NEW YORK (CONTINUED)
$ 15,000,000 New York City, GO Series F3, 3.02%, 9/1/35(a) $ 15,000,000
5,200,000 New York City, TFA, Series H3, 2.98%, 11/1/22(a) 5,200,000
4,000,000 New York State HFA for 10 Liberty Street, 2.95%, 5/1/35(a) 4,000,000
1,300,000 New York State HFA for Bleecker Terrace Apt., 3.07%, 7/1/15(a) 1,300,000
4,200,000 New York State HFA for W 43rd Street, 2.38%, 11/1/34(a) 4,200,000
46,295,000 New York State LGAC., Series D, & F, 2.85% - 2.94%, 4/1/25(a) 46,295,000
10,000,000 Westchester IDA for Catherine Field Home, 3.01%, 1/1/31(a) 10,000,000
400,000 Yonkers IDA Civic Facility for Consumers Union, 3.00%, 7/1/21(a) 400,000
---------------
160,795,000
---------------
NORTH CAROLINA--0.2%
600,000 North Carolina EFA for Cardinal Gibbons, 3.05%, 8/1/14(a) 600,000
1,000,000 North Carolina Medical Care Community for Stanley Total Living
Center, 3.10%, 4/1/18(a) 1,000,000
---------------
1,600,000
---------------
OHIO--4.1%
4,500,000 Akron Bath Copley HDR for Summa Health System, Series B, 3.08%, 11/1/34(a) 4,500,000
200,000 Butler County HCF for Lifesphere, 3.25%, 5/1/27(a) 200,000
300,000 Clinton County for Wilmington Airport, 3.05%, 6/1/11(a) 300,000
3,800,000 Cuyahoga County EDA for Cleveland Botanical Gardens, 3.08%, 7/1/31(a) 3,800,000
2,170,000 Cuyahoga County for Cleveland Health Education Museum, 3.06%, 3/1/32(a) 2,170,000
300,000 Cuyahoga County HCF for Devon Oaks, 3.05%, 2/1/34(a) 300,000
7,400,000 Evandale County IDR for SHV Realty, Inc., 3.00%, 9/1/15(a) 7,400,000
295,000 Franklin County Hospital Revenue for U.S. Health Corp., 3.03%, 12/1/20(a) 295,000
1,105,000 Franklin County Hospital Revenue for U.S. Health Corp., Series 96, 3.03%, 12/1/21(a) 1,105,000
2,500,000 Hamilton County HCF, 3.03%, 6/1/35(a) 2,500,000
150,000 Hamilton County HRB for Alliance Health, Series A, 2.87%, 1/1/18(a) 150,000
190,000 Kent State University Receipts, 3.06%, 5/1/31(a) 190,000
4,020,000 Licking County HCF, 3.05%, 11/1/33(a) 4,020,000
10,000 Marion County Hospital Improvement, Pooled Lease Program, 3.07%, 11/1/21(a) 10,000
690,000 Middleburgh Heights for Southwest General Hospital, 3.07%, 8/15/22(a) 690,000
6,800,000 Ohio Air Quality DAR for Columbus Southern, Series C, 3.07%, 12/1/38(a) 6,800,000
100,000 Ohio Air Quality DAR for Ohio Edison, Series A, 2.95%, 2/1/14(a) 100,000
2,000,000 Ohio Air Quality DAR PCR for Ohio Edison, Series C, 3.01%, 6/1/23(a) 2,000,000
1,330,000 Ohio Higher EFA for Ashland University, 3.08%, 9/1/24(a) 1,330,000
100,000 Ohio State EFA for Western University. 2.93%, 10/1/31(a) 100,000
700,000 Ohio WDA PCR for Cleveland Electric, Series B, 3.00%, 8/1/20(a) 700,000
200,000 Ohio WDA PCR for Edison Project B, 3.06%, 9/1/18(a) 200,000
3,100,000 Paulding County Waste Disposal for Lafarge Corporation, 2.94%, 8/1/26(a) 3,100,000
200,000 Toledo City Services Special Assessment, 3.03%, 12/1/06(a) 200,000
---------------
42,160,000
---------------
OKLAHOMA--0.0%^
500,000 Oklahoma City for Christian College, 3.25%, 7/1/15(a) 500,000
---------------
OREGON--0.0%^
500,000 Portland MFH for South Park, 3.02%, 12/1/11(a) 500,000
---------------
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
5
<Page>
<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS (CONTINUED)
PENNSYLVANIA--8.4%
$ 3,500,000 Allegheny Higher Education for Carnegie Mellon University, 2.98%, 12/1/33(a) $ 3,500,000
250,000 Chartiers Valley IDR, 3.06%, 8/1/07(a) 250,000
1,750,000 Delaware County IDR for Sun, Inc., 3.00%, 11/1/33(a) 1,750,000
10,900,000 Emmaus General Authority Revenue, Series G-18, 3.01%, 3/1/24(a) 10,900,000
775,000 Lawrence County for Villa Maria, 3.06%, 7/1/33(a) 775,000
1,215,000 Lebanon County HCF for ECC Retirement Village, 3.08%, 10/15/25(a) 1,215,000
3,000,000 Lehigh County IDA, 3.00%, 12/1/15(a) 3,000,000
2,000,000 Manheim School District, 3.03%, 5/1/23(a) 2,000,000
1,900,000 Montgomery County for Higher Ed. William Penn Charter, 3.06%, 9/15/31(a) 1,900,000
200,000 Pennnsylvania State HEFA, 2.61%, 11/1/14(a) 200,000
1,460,000 Pennsylvania EDA for B & W Ebensburg Project, 3.02%, 12/1/11(a) 1,460,000
28,000,000 Pennsylvania Turnpike, Series A3, 2.98%, 12/1/30(a) 28,000,000
1,600,000 Philadelphia IDR for Fox Chase Cancer Center Project, 2.98%, 7/1/25(a) 1,600,000
10,705,000 Quakertown Pennsylvania General Authority Revenue, 3.05%, 7/1/26(a) 10,705,000
1,000,000 Scranton Redevelopment Authority Revenue for Parking Facility, 3.08%, 6/1/33(a) 1,000,000
70,000 South Fork Conemaugh Health System Series A, 2.90%, 7/1/28(a) 70,000
14,000,000 Westmoreland County Redstone Highlands, 3.05% - 3.06%, 1/1/36(a) 14,000,000
3,935,000 Wilkens Area IDA for Fairview Extended Care, Series B, 3.00%, 1/1/21(a) 3,935,000
---------------
86,260,000
---------------
PUERTO RICO--0.6%
159,000 Puerto Rico Government Development Bank, 2.85%, 12/1/15(a) 159,000
6,460,000 Puerto Rico Highway & Transportation Authority, Series A, 2.93%, 7/1/28(a) 6,460,000
---------------
6,619,000
---------------
TENNESSEE--0.0%^
695,000 Chattanooga IDA for Baylor School, 3.05%, 11/1/16(a) 695,000
---------------
TEXAS--1.2%
3,700,000 Harris County IDA for Baytank Houston, Inc., 2.98%, 2/1/20(a) 3,700,000
8,000,000 Travis County Querencia Barton Creek, Series C, 3.05%, 11/15/35(a) 8,000,000
---------------
11,700,000
---------------
UTAH--0.2%
2,000,000 Utah Transit Authority Sales Tax Revenue, Series B, 3.03%, 9/1/32(a) 2,000,000
---------------
VIRGINIA--2.5%
4,015,000 Alexandria County IDA for Goodwin House, 2.96%, 10/1/35(a) 4,015,000
1,300,000 Arlington County Virginia Rev for Ballston Public Parking, 3.02%, 8/1/17(a) 1,300,000
600,000 Chesapeake County IDA for Cheaspeake General Hospital, Series B, 3.00%, 7/1/31(a) 600,000
925,000 Clarke County IDA for Winchester Medical Center, 3.06%, 1/1/30(a) 925,000
1,100,000 Fairfax County EDA Smithsonian Institute, 3.02%, 12/1/33(a) 1,100,000
650,000 Hampton County MFH for Shoreline Apartments, 3.00%, 12/1/19(a) 650,000
250,000 Henrico County EDA for Westminster Centerbury, Series B, 3.05%, 7/1/08(a) 250,000
1,200,000 Henrico County EDA for White Oaks Ltd Project, 3.03%, 10/1/27(a) 1,200,000
2,200,000 King George Garnet Inc. Project, 3.10%, 9/01/21(a) 2,200,000
900,000 Norfolk IDR for Hospital Facilities-Children, 3.05%, 6/1/20(a) 900,000
850,000 Peninsula Port Authority for Dominion Terminal, 3.00%, 7/1/16(a) 850,000
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
6
<Page>
<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS (CONTINUED)
VIRGINIA (CONTINUED)
$ 2,045,000 Portsmouth Redevelopment HSG Multifamily, 3.05%, 6/1/30(a) $ 2,045,000
9,705,000 University of Virginia, Series A, 3.03%, 6/1/34(a)(c) 9,705,000
---------------
25,740,000
---------------
WASHINGTON--1.5%
15,000,000 Washington State, GO, 2.88%, 6/1/20(a) 15,000,000
---------------
TOTAL INVESTMENTS (COST* $1,019,193,268) 99.5% 1,019,193,268
COMPREHENSIVE MANAGEMENT FEES PAYABLE 0.0 (8,567)
DISTRIBUTION (12b-1) FEES PAYABLE 0.0 (1,561)
OTHER ASSETS, LESS LIABILITIES 0.5 5,129,757
----- ---------------
NET ASSETS 100.0% $ 1,024,312,897
===== ===============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE OF EACH CLASS
BASED ON SHARES OF BENEFICIAL INTEREST, $.001 PAR VALUE OUTSTANDING AND
EQUIVALENT TO THE NET ASSETS OF EACH CLASS:
283,530,413 SHARES CLASS R $ 1.00
===============
36,246,483 SHARES CLASS TREASURER'S TRUST $ 1.00
===============
10,028 SHARES CLASS 75 $ 1.00
===============
1,329,456 SHARES CLASS 70 $ 1.00
===============
483,664 SHARES CLASS 45 $ 1.00
===============
36,220,811 SHARES CLASS 25 $ 1.00
===============
104,021 SHARES CLASS 15 $ 1.00
===============
10,189 SHARES CLASS 12 $ 1.00
===============
666,377,832 SHARES CLASS 8 $ 1.00
===============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
7
<Page>
RESERVE TAX-EXEMPT TRUST--CALIFORNIA TAX-EXEMPT FUND
STATEMENT OF NET ASSETS--NOVEMBER 30, 2005 (UNAUDITED)
<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS--96.7%
CALIFORNIA--96.7%
$ 395,000 Alameda Contra Costa Capitol Improvements Ser F 3.09%, 08/01/23(a) $ 395,000
2,200,000 California Statewide CDA for Early Education Community
Center 3.02%, 09/01/31(a) 2,200,000
3,000,000 California State GO Sub Ser A-1, 3.07% 5/01/40(a) 3,000,000
1,000,000 California State GO Sub Ser A-2, 3.07% 5/01/40(a) 1,000,000
3,000,000 California HFA Revenue Ser P, 3.09%, 2/01/27(a) 3,000,000
3,720,000 Cailfornia Infra & Econ Dev Sri Intl Ser A, 3.00%, 09/01/28(a) 3,720,000
2,820,000 California Poll Cntrl Colmac Energy Ser A, 2.97%, 12/01/16(a) 2,820,000
4,000,000 California Poll Ctl Wadham Energy Lp 2.96%, 11/01/17(a) 4,000,000
775,000 California Ssc Fin Cops Cap Impts Ser C, 2.90%, 07/01/22(a) 775,000
2,900,000 California State Econ Recovery Ser C-7, 2.95%, 07/01/23(a) 2,900,000
1,400,000 California State Wt Res Power Supply Rev., Ser B-3, 2.94%, 5/01/22(a) 1,400,000
7,390,000 California State Dept Of Water Water Supply, 3.00%, 05/01/22(a) 7,390,000
6,600,000 California Statewide CDA Covenant Retirement Cm, 2.99%, 12/01/25(a) 6,600,000
2,175,000 Chula Vista Charter City for Home Depot, Inc., 2.93%, 12/01/10(a) 2,175,000
6,900,000 Dublin Calif Multi HSG Park Sierra Ser A, 2.99%, 06/01/28(a) 6,900,000
1,000,000 Fremont Calif COP Improvement Financing PJ 3.01%, 08/01/30(a) 1,000,000
1,400,000 Fremont Calif COP Police Fac Refining Proj., 3.01%, 08/01/28(a) 1,400,000
700,000 Irvine Assmnt Dist Impt Bd Act 1915 94-13, 2.95%, 9/02/22(a) 700,000
1,500,000 Irvine Calif, Assmnt Dist #97-16, 2.95%, 9/02/22(a) 1,500,000
2,346,000 Irvine Calif, Imp Bd Dist # 0-18 Ser A, 2.95%, 9/02/26(a) 2,346,000
2,200,000 Irvine Ranch Calif, Wtr Dist, 2.95%, 10/01/10(a) 2,200,000
900,000 Irvine Ranch Calif, Wtr Dist, 2.94%, 8/01/16(a) 900,000
775,000 Irvine Ranch Calif, Wtr 3.00%, 8/01/09(a) 775,000
4,500,000 Long Beach Calif, Hbr Rev, Ser A, 2.98%, 05/15/27(a) 4,500,000
2,400,000 Los Angeles Calif, Community Redev Multifamily HSG,
Series A, 2.98%, 12/01/38(a) 2,400,000
4,000,000 Los Angeles Calif MFH Grnd Promenade Proj, 2.98%, 4/01/32(a) 4,000,000
1,300,000 Metro Dist So, California Waterworks Rev Ser-B-2, 3.01%, 07/01/28(a) 1,300,000
1,000,000 Ontario Calif, Mfh Park Centre Partn., 3.02%, 8/01/07(a) 1,000,000
1,665,000 Orange County Sanitation Authority, 2.97%, 8/01/13(a) 1,665,000
3,100,000 Riverside County for TylerSpring Apartments, Series C, 2.96%, 9/01/14(a) 3,100,000
4,000,000 San Francisco MFHR for Filmore Center, Series B, 3.02%, 08/01/31(a) 4,000,000
1,400,000 Santa Ana Calif, Uni School Dist., 2.96%, 7/01/15(a) 1,400,000
4,500,000 Santa Clara Calif, El Cammo Hosp. District., 3.06%, 8/01/15(a) 4,500,000
3,800,000 Stockton California HCF for Dameron Hosp., Series A, 3.00%, 12/01/32(a) 3,800,000
6,400,000 Turlock Irrigation Disrict Transportation Ser A, 2.95%, 1/01/31(a) 6,400,000
1,200,000 Tustin California Impt 1915 Reassmnt Dist No. 95-2, 2.95%, 9/02/2013(a) 1,200,000
---------------
98,361,000
---------------
TOTAL INVESTMENTS (COST* $98,361,000) 96.7% 98,361,000
COMPREHENSIVE MANAGEMENT FEES PAYABLE 0.0 (2,231)
DISTRIBUTION (12b-1) FEES PAYABLE 0.0 (558)
OTHER ASSETS, LESS LIABILITIES 3.3 3,410,438
----- ---------------
NET ASSETS 100.0% $ 101,768,649
===== ===============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE, BASED ON
101,768,649 SHARES OF BENEFICIAL INTEREST, $.001 PAR VALUE OUTSTANDING $ 1.00
===============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
8
<Page>
RESERVE TAX-EXEMPT TRUST--CONNECTICUT TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS--NOVEMBER 30, 2005 (UNAUDITED)
<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS--81.4%
CONNECTICUT--73.7%
$ 1,200,000 Connecticut DAR for Independent Living, 2.97%, 7/1/15(a) $ 1,200,000
2,150,000 Connecticut DAR for Pierce Memorial Baptist, 2.97%, 10/1/28(a) 2,150,000
1,200,000 Connecticut State DAR for Solid Waste, 3.01%, 8/1/23(a) 1,200,000
1,200,000 Connecticut HEFA for Edgehill Health, Series C, 2.86%, 7/1/27(a) 1,200,000
1,200,000 Connecticut HEFA for Hotchkiss School, Series A, 2.98%, 7/1/30(a)(c) 1,200,000
600,000 Connecticut HEFA for Kingswood-Oxford School, 3.00%, 7/1/30(a) 600,000
1,200,000 Connecticut HEFA for Klingberg Family Center, 3.01%, 7/1/32(a) 1,200,000
1,000,000 Connecticut HEFA for Yale University Series T-2, 3.00%, 07/1/29(a)(c) 1,000,000
200,000 Connecticut HEFA for Yale University, Series V-1, 2.90%, 7/1/36(a)(c) 200,000
1,800,000 Connecticut HFA, Sub Series D-3, 3.03%, 5/15/33(a) 1,800,000
2,100,000 Connecticut Special Tax Obligation for Transportation
Infrastructure, 3.03%, 9/1/20(a) 2,100,000
1,205,000 Connecticut State GO Series 1-A, 3.03%, 2/15/21(a) 1,205,000
1,200,000 Hartford Redev. Agency MHR for Underwood Towers Project, 3.00%, 6/1/20(a) 1,200,000
500,000 New Canaan Housing Authority for Geer Woods Project, 3.03%, 8/1/31(a) 500,000
1,200,000 New Canaan Housing Authority for Village at Waveny Care
Center, 2.96%, 1/1/22(a) 1,200,000
1,200,000 Shelton County HFA for Crosby Commons Project, 3.08%, 1/1/31(a) 1,200,000
---------------
19,155,000
---------------
PUERTO RICO--7.7%
2,000,000 Puerto Rico Government Bank, 2.85%, 12/1/15(b) 2,000,000
---------------
TOTAL INVESTMENTS (COST* $21,155,000) 81.4% 21,155,000
OTHER ASSETS, LESS LIABILITIES 18.6 4,820,025
----- ---------------
NET ASSETS 100.0% $ 25,975,025
===== ===============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE, BASED ON
25,975,025 SHARES OF BENEFICIAL INTEREST, $.001 PAR VALUE OUTSTANDING $ 1.00
===============
</Table>
RESERVE TAX-EXEMPT TRUST--CONNECTICUT TAX-EXEMPT FUND
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 2005 (UNAUDITED)
<Table>
ASSETS
Investments in securities, at value (Cost $21,155,000) $ 21,155,000
Cash 4,766,172
Interest receivable 58,211
Fund shares Sold 186
---------------
Total Assets 25,979,569
---------------
LIABILITIES
Comprehensive management fees payable 2,651
Distribution (12b-1) fees payable 839
Income dividend payable 977
Chief Compliance Officer salary expense 77
---------------
Total Liabilities 4,544
---------------
NET ASSETS $ 25,975,025
===============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE, BASED ON 25,975,025
SHARES OF BENEFICIAL INTEREST, $.001 PAR VALUE OUTSTANDING $ 1.00
===============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
9
<Page>
RESERVE TAX-EXEMPT TRUST--FLORIDA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS--NOVEMBER 30, 2005 (UNAUDITED)
<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS--88.4%
FLORIDA--86.8%
$ 4,140,000 Alachua County HFA for Oak Hammock University, 3.03%, 10/1/32(a) $ 4,140,000
2,000,000 Broward County Florida EFA, City College Project, 3.05%, 11/1/31(a) 2,000,000
1,930,000 Broward County HFA for Jacaranda Village Apartments, 3.00%, 9/1/22(a) 1,930,000
3,135,000 Capital Finance Authority for Glenride Palmer Ranch, 3.03%, 6/1/12(a) 3,135,000
3,340,000 Collier County for Cleveland Health Clinic, 2.98%, 1/1/35(a) 3,340,000
1,925,000 Dade County IDA for Dolphins Stadium, Series C, 2.93%, 1/1/16(a) 1,925,000
2,100,000 Dade County Water Service, 2.97%, 10/5/22(a) 2,100,000
1,200,000 Duval County HFA for Lighthouse Bay Apartments, 3.04%, 12/1/32(a) 1,200,000
1,600,000 Florida Higher Educational Facilities Authority for St Thomas
University, 3.00%, 1/1/19(a) 1,600,000
2,000,000 Florida HFC Multifamily for Bridgewater Club, 3.02%, 6/1/34(a) 2,000,000
1,130,000 Florida HFC Multifamily for Magnolia Pointe Apartments, 3.10%, 6/1/39(a) 1,130,000
1,000,000 Jacksonville Florida HFA, Series A, 3.00%, 8/15/33(a) 1,000,000
2,080,000 Jacksonville Florida Dist Energy System Ser A, 3.00%, 10/1/34(a) 2,080,000
1,295,000 Lee County IDA for Bonita Community Health Services, Series A, 3.06%, 12/1/29(a) 1,295,000
1,100,000 Manatee County PCR for Florida Power & Light, 3.00%, 9/1/24(a) 1,100,000
4,300,000 Miami Dade County IDA for Airis Miami LLC, Series A, 3.08%, 10/15/25(a) 4,300,000
1,185,000 Orange County YMCA, Series A, 3.10%, 5/1/27(a) 1,185,000
1,500,000 Palm Beach County for Morse Obligation Group, 3.07%, 5/1/33(a) 1,500,000
2,200,000 Palm Beach County for Raymond F Kravis Center Project, 2.98%, 7/1/32(a) 2,200,000
1,800,000 Palm Beach County for School Board, Series B, 3.03%, 8/1/27 (a) 1,800,000
1,000,000 Pinellas County HFA, 3.05%, 11/1/15(a) 1,000,000
2,000,000 Port Orange for Palmer College, 3.07%, 10/1/32(a) 2,000,000
1,000,000 Putnam County Dev. Authority PCR for Florida Power & Light, 3.00%, 9/1/24(a) 1,000,000
200,000 Seminole County IDA HCF for Florida Living Nursing, 3.24%, 2/1/11(a) 200,000
400,000 University of North Florida Capital Improvements Project, 3.09%, 11/1/24(a) 400,000
700,000 Volusia County IDR for Easter Seal Society of Volusia, 3.15%, 9/1/21(a) 700,000
---------------
46,260,000
---------------
PUERTO RICO--1.6%
847,000 Puerto Rico Government Development Bank, 2.85%, 12/1/15(b) 847,000
---------------
TOTAL INVESTMENTS (COST* $47,107,000) 88.4% 47,107,000
OTHER ASSETS, LESS LIABILITIES 11.6 6,177,071
----- ---------------
NET ASSETS 100.0% $ 53,284,071
===== ===============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE, BASED ON 53,284,071
SHARES OF BENEFICIAL INTEREST, $.001 PAR VALUE OUTSTANDING $ 1.00
===============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
10
<Page>
RESERVE TAX-EXEMPT TRUST--FLORIDA TAX-EXEMPT FUND
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 2005 (UNAUDITED)
<Table>
ASSETS
Investments in securities, at value (Cost $47,107,000) $ 47,107,000
Cash 6,055,732
Interest receivable 122,220
Other assets 10,238
---------------
Total Assets 53,295,190
---------------
LIABILITIES
Comprehensive management fees payable 6,496
Distribution (12b-1) fees payable 1,624
Other liabilities 2,999
---------------
Total Liabilities 11,119
---------------
NET ASSETS $ 53,284,071
===============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE, BASED ON
53,284,071 SHARES OF BENEFICIAL INTEREST, $.001 PAR VALUE OUTSTANDING $ 1.00
===============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
11
<Page>
RESERVE TAX-EXEMPT TRUST--MASSACHUSETTS TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS--NOVEMBER 30, 2005 (UNAUDITED)
<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS--94.4%
$ 700,000 Massachusetts DFA for Briarwood Retirement Series A, 2.98%, 11/1/24(a) $ 700,000
800,000 Massachusetts DFA for Brooksby Village Project, 3.04%, 7/1/32(a) 800,000
445,000 Massachusetts DFA for Dean College, 3.00%, 10/1/29(a) 445,000
720,000 Massachusetts DFA for Gann Academy Project, 2.54%, 6/1/32(a) 720,000
700,000 Massachusetts DFA for Jewish Geriatric Services, 2.98%, 5/15/34(a) 700,000
655,000 Massachusetts DFA for Mystic Valley School, 3.05%, 6/15/08(a) 655,000
800,000 Massachusetts DFA for Salem Community Corporation, 3.04%, 1/1/35(a) 800,000
800,000 Massachusetts DFA for Smith College, 3.02%, 7/1/24 - 7/1/29(a)(c) 800,000
800,000 Massachusetts DFA IDR for Ocean Spray Cranberries, 3.04%, 10/15/11(a) 800,000
800,000 Massachusetts DFA IDR for You Incorporated, 2.95%, 9/1/32(a) 800,000
850,000 Massachusetts GO, Series 97-B, 3.00%, 9/1/16(a) 850,000
135,000 Massachusetts HEFA for Becker College, Series A-2, 3.16%, 7/1/09(a) 135,000
700,000 Massachusetts HEFA for Berklee College of Music, Series B, 2.87%, 10/1/27(a) 700,000
160,000 Massachusetts HEFA for Cap Asset Program, Series D, 2.94%, 1/1/35(a) 160,000
700,000 Massachusetts HEFA for Harvard University, Series Y, 2.80%, 7/1/35(a)(c) 700,000
700,000 Massachusetts HEFA for MIT, Series J-2, 2.93%, 7/1/31(a)(c) 700,000
800,000 Massachusetts HEFA for Wellesley College, Series E, 2.93%, 7/1/22(a)(c) 800,000
700,000 Massachusetts HEFA for Williams College, Series E, 3.02%, 8/1/14(a)(c) 700,000
1,665,000 Massachusetts HFA for Single Family, 2.98%, 12/1/30(a) 1,665,000
575,000 Massachusetts IFA for Lowell Mills Association, Series 95, 3.16%, 12/1/20(a) 575,000
600,000 Massachusetts IFA for Tech Mold & Tool, 3.07%, 6/1/18(a) 600,000
700,000 Massachusetts WRA, Series 99-B, 2.90%, 8/1/28(a) 700,000
630,000 Massachusetts WRA, Series B, 2.98%, 4/1/28(a) 630,000
1,250,000 Massachusetts WRA, Series C, 2.98%, 8/1/37(a) 1,250,000
200,000 Massachusetts WRA, Series C, 3.03%, 8/1/20(a) 200,000
200,000 Massachusetts WRA, Series D, 3.00%, 8/1/17(a) 200,000
---------------
17,785,000
---------------
TOTAL INVESTMENTS (COST* $17,785,000) 94.4% 17,785,000
OTHER ASSETS, LESS LIABILITIES 5.6 1,048,081
----- ---------------
NET ASSETS 100.0% $ 18,833,081
===== ===============
</Table>
MASSACHUSETTS TAX-EXEMPT FUND
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 2005 (UNAUDITED)
<Table>
ASSETS
Investments in securities, at value (Cost* $17,785,000) $ 17,785,000
Cash 1,001,244
Interest receivable 50,940
---------------
Total Assets 18,837,184
---------------
LIABILITIES
Comprehensive management fees payable 2,494
Distribution (12b-1) fees payable 623
Income dividend payable 930
Other liabilities 56
---------------
Total Liabilities 4,103
---------------
NET ASSETS $ 18,833,081
===============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE, BASED ON 18,833,081
SHARES OF BENEFICIAL INTEREST, $.001 PAR VALUE OUTSTANDING $ 1.00
===============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
12
<Page>
RESERVE TAX-EXEMPT TRUST--MICHIGAN TAX-EXEMPT FUND
SCHEDULE OF NET ASSETS--NOVEMBER 30, 2005 (UNAUDITED)
<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS--97.8%
MICHIGAN--92.8%
$ 600,000 Ann Arbor Michigan EDC, Glacier Inc. Pj, Series A, 2.63%, 11/1/25(a) $ 600,000
1,400,000 Detroit Michigan Sew Disp Rev Var, Series B, 3.00%, 7/1/33(a) 1,400,000
400,000 Garden City HFA, Series 96-A, 3.08%, 9/1/26(a) 400,000
500,000 Grand Rapids Economic Development Corp, 3.05%, 6/1/12(a) 500,000
400,000 Jackson County for Thrify Leoni Inc, Series A, 3.05%, 12/1/14(a) 400,000
600,000 Jackson County for Vista Grande Villa, Series A, 2.98%, 11/1/31(a) 600,000
700,000 Michigan State HFA for Hosp Equipment Ln Prog- A, 2.98%, 12/1/23(a) 700,000
700,000 Michigan HDA Multi-Family Revenue for River Place Apts., 2.99%, 6/1/18(a) 700,000
700,000 Michigan HDA Mult-Family Rev-Berrien Woods 111, Series A, 3.15%, 7/1/32(a) 700,000
1,160,000 Michigan Strategic Fund for Henry Ford Museum Village, 3.00%, 12/1/33(a) 1,160,000
300,000 Michigan Strategic Fund for M&P Cap LLC, Series A, 3.13%, 6/1/34(a) 300,000
600,000 Michigan Strategic Fund for Mot LLC, 3.07%, 12/1/34(a) 600,000
700,000 Michigan State Stategic Fund Solid Waste Diso Rev, 3.03%, 1/1/14(a) 700,000
700,000 Michigan Strategic Fund for Haven Christian Services, 3.07%, 11/15/34(a) 700,000
1,080,000 Michigan State University Revenue, Series A, 3.00%, 8/15/32(a) 1,080,000
700,000 Milan Michigan Area Schools, 3.00%, 5/1/30(a) 700,000
500,000 Oakland County Michigan EDC for Ltd-Graph-Tech Inc, 3.13%, 4/1/28(a) 500,000
700,000 Oakland University, 3.06%, 3/1/31(a) 700,000
700,000 Wayne Charter County, Series A, 3.03%, 12/1/16(a) 700,000
---------------
13,140,000
---------------
PUERTO RICO--5.0%
700,000 Puerto Rico Government Development Bank, 2.85%, 12/1/15(b) 700,000
---------------
700,000
---------------
TOTAL INVESTMENTS (COST* $13,840,000) 97.8% 13,840,000
COMPREHENSIVE MANAGEMENT FEES PAYABLE 0.0 (1,981)
DISTRIBUTION (12b-1) FEES PAYABLE 0.0 (474)
OTHER ASSETS, LESS LIABILITIES 2.2 318,821
----- ---------------
NET ASSETS 100.0% $ 14,156,366
===== ===============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE, BASED ON
14,156,366 SHARES OF BENEFICIAL INTEREST, $.001 PAR VALUE OUTSTANDING $ 1.00
===============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
13
<Page>
RESERVE TAX-EXEMPT TRUST--NEW JERSEY TAX-EXEMPT FUND
STATEMENT OF INVESTMENTS--NOVEMBER 30, 2005 (UNAUDITED)
<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS--88.0%
NEW JERSEY--88.0%
$ 1,160,000 Atlantic County Pooled Government Loan Program, 3.00%, 7/1/26(a) $ 1,160,000
450,000 Hudson County NJ Impt Auth Auth, 2.96%, 7/15/26(a) 450,000
2,000,000 Monmouth County NJ Improv Auth, 2.90%, 8/1/16(a) 2,000,000
2,400,000 New Jersey EDA for Bayonne Dock, 2.97%, 12/1/27(a) 2,400,000
1,900,000 New Jersey EDA for Airis Newark Project, 2.98%, 1/1/19(a) 1,900,000
800,000 New Jersey EDA for Foreign Trade, Series 98, 3.00%, 12/1/07(a) 800,000
1,515,000 New Jersey EDA for RJB Associates, ERN, 3.01%, 8/1/08(a) 1,515,000
1,915,000 New Jersey EDA for Church & Dwight, 2.98%, 12/1/08(a) 1,915,000
400,000 New Jersey EDA for Solthaven Proj, Series A, 2.90%, 1/15/18(a) 400,000
2,300,000 New Jersey EDA for Lawrence School Proj., Series B, 2.82%, 7/1/26(a) 2,300,000
2,000,000 New Jersey EDA for Newark Container LLC, 3.01%, 7/1/30(a) 2,000,000
900,000 New Jersey Health Care Facs Financing Auth, Series A, 2.96%, 7/1/31(a) 900,000
1,400,000 New Jersey HCF Authority Cap Asset Ser A, 2.95%, 7/1/35(a) 1,400,000
1,900,000 New Jersey EDA for Golf Asso, Project, 3.01%, 05/1/23(a) 1,900,000
3,700,000 New Jersey EDA for Thermal Marina Energy LLC, Series A, 2.98%, 9/1/31(a) 3,700,000
1,960,000 New Jersey EDA for Geriatrics Housing Services Series P-J, 2.96%, 11/1/31(a) 1,960,000
2,000,000 New Jersey EDA for Huntington SCH Princeton, 3.01%, 11/1/34(a) 2,000,000
3,930,000 New Jersey Sports Authority Expo, Series C, 2.96%, 9/1/24(a) 3,930,000
1,850,000 New Jersey State EFA- Princeton University, Series B, 2.90%, 7/1/21(a)(c) 1,850,000
560,000 New Jersey EDA for SCH Princeton Project, 2.75%, 07/1/22(a) 560,000
1,900,000 New Jersey State HFA for Single Family Hsg., Series O, 3.08%, 10/1/26(a) 1,900,000
1,000,000 New Jersey Turnpike Authority, Series 91-D, 2.95%, 1/1/18(a) 1,000,000
1,200,000 New Jersey Turnpike Authority, Series C-1, 2.90%, 1/1/24(a) 1,200,000
3,300,000 Port Authority of New York & New Jersey Special
Obligation Revenue, 2.97%, 8/1/24(a) 3,300,000
2,000,000 Salem County New Jersey Impt Auth Rev- Friends Home
Woodstown, Inc., 3.00%, 4/1/34 (a) 2,000,000
---------------
44,440,000
---------------
TOTAL INVESTMENTS (COST* $44,440,000) 88.0% 44,440,000
OTHER ASSETS, LESS LIABILITIES 12.0 6,041,905
----- ---------------
NET ASSETS 100.0% $ 50,481,905
===== ===============
</Table>
RESERVE TAX-EXEMPT TRUST--NEW JERSEY TAX-EXEMPT FUND
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 2005 (UNAUDITED)
<Table>
ASSETS
Investments in securities, at value (Cost $44,440,000) $ 44,440,000
Cash 5,906,162
Interest receivable 146,355
Other assets 105
---------------
Total Assets 50,492,622
---------------
LIABILITIES
Comprehensive management fees payable 6,674
Distribution (12b-1) fees payable 1,679
Other liabilities 140
Income dividend payable 2,224
---------------
Total Liabilities 10,717
---------------
NET ASSETS $ 50,481,905
===============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE, BASED ON
50,481,905 SHARES OF BENEFICIAL INTEREST, $.001 PAR VALUE OUTSTANDING $ 1.00
===============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
14
<Page>
RESERVE TAX-EXEMPT TRUST--OHIO TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS--NOVEMBER 30, 2005 (UNAUDITED)
<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS--92.6%
OHIO--92.6%
$ 500,000 Akron Bath Copley HDR for Summa Health System, Series B, 3.08%, 11/1/34(a) $ 500,000
375,000 Allen County HCF for Mennonite Home, 3.05%, 2/1/18(a) 375,000
800,000 Butler County HCF for Lifesphere, 3.25%, 5/1/27(a) 800,000
500,000 Centerville HCR for Bethany Lutheran, 3.02%, 5/1/08(a) 500,000
400,000 Cleveland Airport Systems Revenue, Series D, 3.02%, 1/1/27(a) 400,000
600,000 Cleveland Income Tax Revenue, 2.87%, 1/1/27(a) 600,000
830,000 Cuyahoga County Cleveland Health, 3.06%, 3/1/32(a) 830,000
490,000 Cuyahoga County for S&R Playhouse, 2.70%, 12/1/09(a) 490,000
700,000 Cuyahoga County HCF for Devon Oaks, 3.05%, 2/1/34(a) 700,000
700,000 Cuyahoga County HRB EDA for Cleveland Botanical Gardens, 3.08%, 7/1/31(a) 700,000
800,000 Evandale County IDR for SHV Realty Inc., 3.00%, 9/1/15(a) 800,000
800,000 Franklin County Hospital Revenue for U.S. Health Corp.,
Series A, 3.03%, 12/1/21(a) 800,000
1,000,000 Geauga County for Heather Hill Inc, 3.04%, 7/1/23(a) 1,000,000
735,000 Greene County IDA for Fairview, Series B, 3.00%, 1/1/11(a) 735,000
655,000 Hamilton County HRB for Alliance Health, Series A, 2.87%, 1/1/18(a) 655,000
195,000 Kent State University Receipts, 3.06%, 5/1/31(a) 195,000
1,480,000 Licking County HCF, 3.05%, 11/1/33(a) 1,480,000
935,000 Middleburgh Heights HR for Southwest General Health, 3.07%, 8/15/22(a) 935,000
700,000 Ohio Air Quality DAR for Columbus Southern, Series C, 3.07%, 12/1/38(a) 700,000
570,000 Ohio State Higher Educational Facility Revenue for Ashland Univ.
3.08%, 9/1/24(a) 570,000
900,000 Ohio State Higher Educational Facility Revenue for Western Univ.
3.01%, 10/1/31(a) 900,000
600,000 Ohio State University, 2.95%, 12/1/17 - 12/1/27(a)(c) 600,000
700,000 Ohio WDA PCR for Cleveland Electric, Series B, 3.00%, 8/1/20(a) 700,000
800,000 Ohio WDA PCR for Edison Project B, 3.06%, 9/1/18(a) 800,000
800,000 Paulding County Waste Disposal for Lafarge Corporation, 2.94%, 8/1/26(a) 800,000
800,000 Toledo City Services Special Assessment, 3.03%, 12/1/06(a) 800,000
500,000 Toledo County Port Authority, 3.05%, 15/15/38(a) 500,000
---------------
18,865,000
---------------
TOTAL INVESTMENTS (COST* $18,865,000) 92.6% 18,865,000
OTHER ASSETS, LESS LIABILITIES 7.4 1,513,321
----- ---------------
NET ASSETS 100.0% $ 20,378,321
===== ===============
</Table>
RESERVE TAX-EXEMPT TRUST--OHIO TAX-EXEMPT FUND
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 2005 (UNAUDITED)
<Table>
ASSETS
Investments in securities, at value (Cost $18,865,000) $ 18,865,000
Cash 1,467,471
Interest receivable 48,404
---------------
Total Assets 20,380,875
---------------
LIABILITIES
Comprehensive management fees payable 824
Distribution (12b-1) fees payable 662
Income dividend payable 1,004
Other liabilities 64
---------------
Total Liabilities 2,554
---------------
NET ASSETS $ 20,378,321
===============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE, BASED ON
20,378,321 SHARES OF BENEFICIAL INTEREST, $.001 PAR VALUE OUTSTANDING $ 1.00
===============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
15
<Page>
RESERVE TAX-EXEMPT TRUST--PENNSYLVANIA TAX-EXEMPT FUND
STATEMENT OF INVESTMENTS--NOVEMBER 30, 2005 (UNAUDITED)
<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS--90.4%
PENNSYLVANIA--90.4%
$ 790,000 Allentown IDA for Diocese of Alletown 2.98%, 12/1/29(a) $ 790,000
2,200,000 Allegheny Higher Education for Carnegie Mellon University, 2.98%, 12/1/33(a) 2,200,000
1,800,000 Allegheny IDA for UPMC Health Systems, Series C, 3.05%, 3/1/15(a) 1,800,000
200,000 Berks County IDR for Visiting Nurse Services, Series A, 3.15%, 12/1/15(a) 200,000
645,000 Berks County IDR for Visiting Nurse Services, Series A, 3.30%, 12/1/15(a) 645,000
3,800,000 Bucks County IDA for Shv Real Estate Inc, 3.00%, 7/1/15(a) 3,800,000
64,000 Chartiers Valley IDR, 3.06%, 8/1/07(a) 64,000
1,585,000 Cumberland County PA, 3.03%, 12/1/32(a) 1,585,000
1,600,000 Chester County IDA for Archdiocese, 2.98%, 7/1/31(a) 1,600,000
700,000 Delaware County IDR for Sun, Inc., 3.00%, 11/1/33(a) 700,000
2,000,000 Emmaus General Authority Revenue, Series G, 3.01%, 3/1/24(a) 2,000,000
700,000 Indiana County IDA for Conemaugh 3.00%, 6/1/27(a) 700,000
1,480,000 Lawrence County IDA for Var Villa Maria PJ., 3.06%, 7/1/33(a) 1,480,000
1,965,000 Lebanon County HCF for ECC Retirement Village, 3.08%, 10/15/25(a) 1,965,000
2,000,000 Lehigh County IDA, 3.00%, 12/1/15(a) 2,000,000
2,000,000 Manheim School District, 3.03%, 5/1/23(a) 2,000,000
430,000 Montgomery County IDR for Girl Scouts of Southeastern PA, 3.15%, 2/1/25(a) 430,000
1,445,000 Fork PA, Conemaugh Health System Series A, 2.90%, 7/1/28(a) 1,445,000
2,000,000 Pennsylvania EDA for B & W Ebensburg Project, 3.02%, 12/1/11(a) 2,000,000
1,600,000 Pennsylvania Higher Education Agency for Ebensburg Project, 3.03%, 1/1/18(a) 1,600,000
1,800,000 Pennsylvania HEFA for Temple University, 3.03%, 11/1/14(a) 1,800,000
2,000,000 Pennsylvania Turnpike, Series A3, 2.98%, 12/1/30(a) 2,000,000
1,300,000 Philadelphia Housing and Higher Education Authority for
Childrens Hospital, 2.98%, 7/1/31(a) 1,300,000
1,490,000 Philadelphia IDR for Fox Chase Cancer Center Project, 2.98%, 7/1/25(a) 1,490,000
1,710,000 Quakertown Pennsylvania General Authority Revenue, 3.05%, 7/1/26(a) 1,710,000
2,595,000 Schuylkill County IDA for Northeastern Power, 3.04%, 12/1/22(a) 2,595,000
2,000,000 Washington County, 2.99%, 7/1/34(a) 2,000,000
2,000,000 Westmoreland County Redstone Highlands, 3.06%, 1/1/36(a) 2,000,000
1,275,000 Wilkins Area IDA for Fairview Extended Care, Series B, 3.00%, 1/1/21(a) 1,275,000
---------------
45,174,000
---------------
TOTAL INVESTMENTS (COST* $45,174,000) 90.4% 45,174,000
OTHER ASSETS, LESS LIABILITIES 9.6 4,772,440
----- ---------------
NET ASSETS 100.0% $ 49,946,440
===== ===============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
16
<Page>
RESERVE TAX-EXEMPT TRUST--PENNSYLVANIA TAX-EXEMPT FUND
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 2005 (UNAUDITED)
<Table>
ASSETS
Investments in securities, at value (Cost* $45,174,000) $ 45,174,000
Cash 4,670,171
Interest receivable 112,238
---------------
Total Assets 49,956,409
---------------
LIABILITIES
Comprehensive management fees payable 6,162
Distribution (12b-1) fees payable 1,540
Accrued interest overdraft 123
Income dividend payable 2,015
Other liabilities 129
---------------
Total Liabilities 9,969
---------------
NET ASSETS $ 49,946,440
===============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE, BASED ON
49,946,440 SHARES OF BENEFICIAL INTEREST, $.001 PAR VALUE OUTSTANDING $ 1.00
===============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
17
<Page>
RESERVE TAX-EXEMPT TRUST--VIRGINIA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS--NOVEMBER 30, 2005 (UNAUDITED)
<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS--81.6%
VIRGINIA--71.6%
$ 700,000 Alexandria County IDA for Goodwin House, 2.96%, 10/1/35(a) $ 700,000
700,000 Arlington County for Ballston Public Parking, 3.02%, 8/1/17(a) 700,000
500,000 Charlottesville IDA for Seminole, Series B, 3.08%, 12/1/13(a) 500,000
600,000 Chesapeake Virginia Hospital, Series B, 3.00%, 7/1/31(a) 600,000
700,000 Clarke County IDR, 3.06%, 1/1/30(a) 700,000
700,000 Hampton MFH for Shoreline Apartments, 3.00%, 12/1/19(a) 700,000
530,000 Hanover County IDA for Covenent Woods, 3.07%, 7/1/29(a) 530,000
700,000 Henrico County EDA for Westminster Centerbury, Series B, 3.05%, 7/1/08(a) 700,000
700,000 Henrico County EDA (CITI-AMT)for White Oaks LTD Proj., 3.03%, 10/1/27(a) 700,000
700,000 King George County VA Inc. Proj.,3.10%, 9/01/21(a) 700,000
700,000 Peninsula Port Authority for Dominion Terminal, 3.00%, 7/1/16(a) 700,000
555,000 Portsmouth Redev Marsh Landing PJ, Series A, 3.05%, 6/1/30(a) 555,000
1,200,000 Richmond IDA for Cogentrix of Richmond Proj A, 3.10%, 12/1/17(a) 1,200,000
1,100,000 University of Virginia Revenue, Series A, 3.03%, 6/1/34(a)(c) 1,100,000
---------------
10,085,000
---------------
PUERTO RICO--10.0%
700,000 Puerto Rico Government Bank, 2.85%, 12/1/15(b) 700,000
700,000 Puerto Rico Highway & Transportation Authority, Series A, 2.93%, 7/1/28(b) 700,000
---------------
1,400,000
---------------
TOTAL INVESTMENTS (COST* $11,485,000) 81.6% 11,485,000
OTHER ASSETS, LESS LIABILITIES 18.4 2,592,438
----- ---------------
NET ASSETS 100.0% $ 14,077,438
===== ===============
</Table>
RESERVE TAX-EXEMPT TRUST--VIRGINIA TAX-EXEMPT FUND
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 2005 (UNAUDITED)
<Table>
ASSETS
Investments in securities, at value (Cost $11,485,000) $ 11,485,000
Cash 2,565,640
Interest receivable 29,805
---------------
Total Assets 14,080,445
---------------
LIABILITIES
Comprehensive management fees payable 1,854
Distribution (12b-1) fees payable 464
Other liabilities 38
Interest payable 651
---------------
Total Liabilities 3,007
---------------
NET ASSETS $ 14,077,438
===============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE, BASED ON
14,077,438 SHARES OF BENEFICIAL INTEREST, $.001 PAR VALUE OUTSTANDING $ 1.00
===============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
18
<Page>
RESERVE NEW YORK TAX-EXEMPT TRUST--NEW YORK TAX-EXEMPT FUND
STATEMENT OF NET ASSETS--NOVEMBER 30, 2005 (UNAUDITED)
<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS--99.2%
NEW JERSEY--2.9%
$ 5,000,000 Port Authority of New York & New Jersey Versatile Structure, 2.97%, 8/1/24(a) $ 5,000,000
---------------
NEW YORK--96.0%
4,900,000 Babylon IDR for Ogden Martin, 2.94%, 1/1/19(a) 4,900,000
615,000 Bleecker HDC for Terrace Apt. Project S85, 3.07%, 7/1/15(a) 615,000
3,670,000 Cattaraugus County IDA for YMCA, 3.11%, 9/1/28(a) 3,670,000
1,000,000 Dutchess IDA for Trinity Pawling School, 3.03%, 10/1/32(a) 1,000,000
2,550,000 Franklin County IDA Civic Facility for Trudeau Institute, 2.95%, 12/1/20(a) 2,550,000
2,400,000 Guilderland IDA for Eastern Industrial Park, Series 93-A, 2.95%, 12/1/08(a) 2,400,000
6,700,000 Jay Street Development Corp., Series A-1, 2.96%, 5/1/22(a) 6,700,000
6,600,000 Long Island Power Authority Electric System Revenue, 2.95% - 2.97%, 5/1/33(a) 6,600,000
7,000,000 Metropolitan Transportation Authority, 3.03%, 11/1/35(a) 7,000,000
2,200,000 Monroe County for Margaret Woodbury Strong Museum, 3.10%, 4/1/35(a) 2,200,000
1,500,000 Monroe County for St. Ann's Home Project, 2.96%, 7/1/30(a) 1,500,000
4,860,000 Nassau County, 2.92%, 11/15/22(a) 4,860,000
4,100,000 New York City Cultural Resources for Asian Society, 3.02%, 4/1/30(a) 4,100,000
8,000,000 New York City DAR for Greenwich LLC, Series, 2.99% 12/1/39(a) 8,000,000
5,300,000 New York City IDA for American Society for Technion, 2.94%, 10/1/33(a) 5,300,000
4,000,000 New York City IDA for Childrens Oncology Society, 2.97%, 5/1/21(a) 4,000,000
6,000,000 New York City IDA for Korean Airlines, Series A, 2.99%, 11/1/24(a) 6,000,000
5,000,000 New York City IDA for Liberty, 3.03%, 12/1/39(a) 5,000,000
13,000,000 New York City WFA, Series G, 2.97%, 6/15/25(a) 13,000,000
2,600,000 New York City, GO Series A4, 2.97%, 8/1/23(a) 2,600,000
7,220,000 New York City, GO Series A4, 3.00%, 8/1/21(a) 7,220,000
7,000,000 New York City, TFA, Series H3, 2.98%, 11/1/22(a) 7,000,000
1,500,000 New York State Energy Resources and Development, 3.02%, 12/1/27(a) 1,500,000
8,200,000 New York State HFA for 10 Liberty Street, 2.95%, 5/1/35(a) 8,200,000
12,000,000 New York State HFA, 2.98% - 3.00%, 11/1/34(a) 12,000,000
2,175,000 New York State IDA for Rotterdam, 2.95%, 11/1/09(a) 2,175,000
6,000,000 New York State LGAC., Series D, 2.94%, 4/1/25(a) 6,000,000
6,000,000 New York State R&D Con Ed, Series C-2, 2.98%, 11/1/39(a) 6,000,000
3,665,000 Schenectady County IDA for Sunnyview Hospital & Rehab.,
Series A, 3.06%, 8/1/33(a) 3,665,000
4,610,000 Tompkins County IDA for Kendal Ithaca Community Care,
Series B, 2.96%, 7/1/24(a) 4,610,000
7,100,000 Triborough Bridge & Tunnel Authority, Series F, 3.03%, 11/1/32(a) 7,100,000
6,320,000 Westchester IDA for Catherine Field Home, 3.01%, 1/1/31(a) 6,320,000
3,400,000 Yonkers IDA Civic Facility for Consumers Union, 3.00%, 7/1/21(a) 3,400,000
---------------
167,185,000
---------------
PUERTO RICO--0.3%
500,000 Puerto Rico Government Development Bank, 2.85%, 12/1/15(b) 500,000
---------------
TOTAL INVESTMENTS (COST* $172,685,000) 99.2% $ 172,685,000
COMPREHENSIVE MANAGEMENT FEES PAYABLE (0.0)^ (3,815)
DISTRIBUTION (12b-1) FEES PAYABLE (0.0)^ (954)
OTHER ASSETS, LESS LIABILITIES 0.8 1,400,103
----- ---------------
NET ASSETS 100.0% $ 174,080,334
===== ===============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE BASED ON
174,080,334 SHARES OF BENEFICIAL INTEREST, $.001 PAR VALUE OUTSTANDING $ 1.00
===============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
19
<Page>
RESERVE MUNICIPAL MONEY-MARKET TRUST--LOUISIANA MUNICIPAL MONEY-MARKET FUND
SCHEDULE OF INVESTMENTS--NOVEMBER 30, 2005 (UNAUDITED)
<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS--80.2%
LOUISIANA--65.6%
$ 65,000 Lake Charles HRB & Term. District Revenue for CITGO Corp., 3.00%, 8/1/07(a) $ 65,000
121,000 Louisiana Environment Facilities Community DAR, Series A, 3.06%, 11/1/34(a) 121,000
65,000 Louisiana PFA for Kenner Hotel Limited, 2.94%, 12/1/15(a) 65,000
65,000 Louisiana PFA, Equipment Facs, 3.60%, 7/1/33(a) 65,000
65,000 Louisiana PFA, Multi-family, 3.06%, 6/15/31(a) 65,000
65,000 Louisiana Offshore Term. Auth. Deepwater Port Rev. for Loop LLC,
Series A, 3.00%, 9/1/17(a) 65,000
125,000 Port of New Orleans Cold Storage Project, 3.10%, 11/1/22(a) 125,000
118,000 South Louisiana Port Marine Term. for Occidental Petroleum
Corp., 2.98%, 7/1/18(a) 118,000
106,000 South Louisiana Port Marine Term. for Occidental Petroleum
Corp., 3.00%, 7/1/21(a) 106,000
65,000 South Louisiana Port Marine Term. for Holnam Project., 3.04%, 1/1/27(a) 65,000
---------------
860,000
---------------
PUERTO RICO--14.6%
126,000 Puerto Rico Government Development Bank, 2.85%, 12/1/15(b) 126,000
65,000 Puerto Rico Highway & Transportation Authority, Series A, 2.93%, 07/1/28(b) 65,000
---------------
191,000
---------------
TOTAL INVESTMENTS (COST* $1,051,000) 80.2% 1,051,000
OTHER ASSETS, LESS LIABILITIES 19.8 259,177
----- ---------------
NET ASSETS 100.0% $ 1,310,177
===== ===============
</Table>
RESERVE MUNICIPAL MONEY-MARKET TRUST--LOUISIANA MUNICIPAL MONEY-MARKET FUND
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 2005 (UNAUDITED)
<Table>
ASSETS
Inverstment in securities, at value (Cost $1,051,000) $ 1,051,000
Cash 256,487
Inerest receivable 2,788
---------------
Total Assets 1,310,275
---------------
LIABILITIES
Income dividend payable 88
Interest payable 10
---------------
Total Liabilities 98
---------------
NET ASSETS $ 1,310,177
===============
NET ASSETS VALVE, OFFERING AND REDEMPTION PRICE PER SHARE, BASED ON
1,310,177 SHARES OF BENEFICAL INTEREST, $.001 PAR VALUE OUTSTANDING $ 1.00
===============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
20
<Page>
RESERVE MUNICIPAL MONEY-MARKET TRUST--MINNESOTA MUNICIPAL MONEY-MARKET FUND
SCHEDULE OF INVESTMENTS--NOVEMBER 30, 2005 (UNAUDITED)
<Table>
<Caption>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------- ---------------
TAX-EXEMPT OBLIGATIONS--80.0%
MINNESOTA--67.8%
$ 200,000 Andover Senior Housing for Presbyterian Homes, 3.05%, 11/15/33(a) $ 200,000
100,000 Brooklyn Center for Brookdale Corp II, 3.08%, 12/1/14(a) 100,000
100,000 Cohasset for Minnesota Power & Light, Project B, 3.07%, 6/1/13(a) 100,000
100,000 Mankato Multi-family Revenue for Highland Park, 3.08%, 5/1/27(a) 100,000
65,000 Minnesota Health for Fairview Health Services, 2.97%, 11/15/32(a) 65,000
26,000 Minnesota HEFA for St. Olaf College, 3.03%, 10/1/30(a) 26,000
93,000 Minnesota HEFA for St. Olaf College, Series 5-M1, 3.03%, 10/1/32(a) 93,000
125,000 Minnesota Revenue for People Serving People Project, 3.08%, 10/1/21(a) 125,000
119,000 Minnesota Housing Finance Agency, Series C, 3.08%, 1/1/35(a) 119,000
177,000 Minnesota HEFA for Carleton College, Series 6D, 3.02%, 4/1/35(a) 177,000
63,000 Roseville Commercial Dev. Revenue for Berger Transfer & Storage, 3.00%, 12/1/15 63,000
85,000 St. Louis Park Revenue for Catholic Finance Corp., 3.06%, 10/1/25(a) 85,000
110,000 St. Paul Housing & Redev. Authority District Heating Revenue, 2.38%, 12/1/12(a) 110,000
119,000 St. Paul Housing & Redev. Authority MHR for Highland Ridge, 3.05%, 10/1/33(a) 119,000
34,000 St. Paul Housing & Redev. Authority for Public Radio Project, 3.03%, 6/16/10(a) 34,000
119,000 University of Minnesota, Series A, 3.09%, 7/1/08(a)(c) 119,000
---------------
1,635,000
---------------
PUERTO RICO--12.2%
119,000 Puerto Rico Government Development Bank, 2.85%, 12/1/15(a) 119,000
175,000 Puerto Rico Highway & Transportation Authority, Series A, 2.93%, 7/1/28(a) 175,000
---------------
294,000
---------------
TOTAL INVESTMENTS (COST* $1,929,000) 80.0% 1,929,000
OTHER ASSETS, LESS LIABILITIES 20.0 482,337
----- ---------------
NET ASSETS 100.0% $ 2,411,337
===== ===============
</Table>
RESERVE MUNICIPAL MONEY-MARKET TRUST--MINNESOTA MUNICIPAL MONEY-MARKET FUND
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 2005 (UNAUDITED)
<Table>
ASSETS
Investments in securities, at value (Cost $1,929,000) $ 1,929,000
Cash 477,543
Interest receivable 5,265
---------------
Total Assets 2,411,808
---------------
LIABILITIES
Comprehensive management fees payable 311
Distribution (12b-1) fees payable 78
Income dividend payable 78
Other liabilities 4
---------------
Total Liabilities 471
---------------
NET ASSETS $ 2,411,337
===============
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE, BASED ON
2,411,337 SHARES OF BENEFICIAL INTEREST, $.001 PAR VALUE OUTSTANDING $ 1.00
===============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
21
<Page>
SECURITY TYPE ABBREVIATIONS
CDA -- Community Development Authority
COP -- Certificate of Participation
DAR -- Development Authority Revenue Bonds
DFA -- Development Finance Agency
EDA -- Economic Development Authority Revenue Bonds
EDC -- Economic Development Corporation
EFA -- Education Facilities Authority
GO -- General Obligation Bonds
HCF -- Health Care Facilities Revenue Bonds
HDA -- Hospital Development Authority
HDC -- Housing Development Corporation Bonds
HDR -- Housing Development Revenue
HEFA -- Health & Education Facilities Authority
HFA -- Housing Finance Authority Revenue Bonds
HFC -- Housing Finance Corporation
HRB -- Hospital Revenue Bonds
IDA -- Industrial Development Authority Revenue Bonds
IDR -- Industrial Development Agency Revenue Bonds
IFA -- Industrial Finance Authority
LGAC -- Local Government Assistance Corp.
MFH -- Multifamily Housing Revenue Bonds
MFHR -- Multifamily Facilities Housing Revenue Bonds
MHR -- Multifamily Housing Revenue Bonds
PCR -- Pollution Control Revenue Bonds
PFA -- Public Finance Authority
TFA -- Transitional Finance Authority
WDA -- Water Development Authority
WFA -- Water Finance Authority
WRA -- Water Resource Authority
WSR -- Water & Sewer System Revenue Bonds
- ----------
(a) Variable rate securities. The interest rates shown are as reported on
November 30, 2005, are subject to change periodically. Securities payable
on demand are collateralized by bank letters of credit or other credit
agreements.
(b) Securities are collateralized by bank letters of credit or other credit
agreements.
(c) Obligations of educational facilities.
* The cost of the investments for federal income tax purposes is the same as
the cost for financial reporting purposes.
^ Amount is less than 0.05%.
SEE NOTES TO FINANCIAL STATEMENTS.
22
<Page>
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED NOVEMBER 30, 2005 (UNAUDITED)
<Table>
<Caption>
RESERVE TAX-EXEMPT TRUST
----------------------------------------------------------
CALIFORNIA CONNECTICUT FLORIDA MASSACHUSETTS
FUND FUND FUND FUND
------------ ------------ ------------ -------------
INTEREST INCOME (Note 1) $ 1,259,786 $ 309,208 $ 562,384 $ 243,914
------------ ------------ ------------ -------------
EXPENSES (Note 2)
Comprehensive management fees 419,585 102,796 179,151 79,328
Distribution (12b-1) fees 104,729 25,699 44,788 19,909
Interest expense -- -- 433 --
Other expense 313 77 124 56
------------ ------------ ------------ -------------
Total expenses before waiver 524,627 128,572 224,496 99,293
Less: expenses waived (Note 2) -- -- -- --
------------ ------------ ------------ -------------
Net Expenses 524,627 128,572 224,496 99,293
------------ ------------ ------------ -------------
NET INVESTMENT INCOME, representing Net Increase in
Net Assets from Investment Operations $ 735,159 $ 180,636 $ 337,888 $ 144,621
============ ============ ============ =============
</Table>
<Table>
<Caption>
RESERVE TAX-EXEMPT TRUST
-------------------------------------------------------------------------
MICHIGAN NEW JERSEY OHIO PENNSYLVANIA VIRGINIA
FUND FUND FUND FUND FUND
------------ ------------ ------------- ------------ ------------
INTEREST INCOME (Note 1) $ 202,827 $ 580,082 $ 250,307 $ 530,204 $ 165,226
------------ ------------ ------------- ------------ ------------
EXPENSES (Note 2)
Comprehensive management fees 65,972 191,097 80,014 168,233 54,756
Distribution (12b-1) fees 16,472 47,774 20,050 42,058 13,689
Interest expense -- -- -- 123 --
Other expense 48 140 64 130 38
------------ ------------ ------------- ------------ ------------
Total expenses before waiver 82,492 239,011 100,128 210,544 68,483
Less: expenses waived (Note 2) -- -- -- -- --
------------ ------------ ------------- ------------ ------------
Net Expenses 82,492 239,011 100,128 210,544 68,483
------------ ------------ ------------- ------------ ------------
NET INVESTMENT INCOME, representing Net Increase in
Net Assets from Investment Operations $ 120,335 $ 341,071 $ 150,179 $ 319,660 $ 96,743
============ ============ ============= ============ ============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
23
<Page>
<Table>
<Caption>
RESERVE MUNICIPAL MONEY-MARKET TRUST
RESERVE NEW YORK ------------------------------------
TAX-EXEMPT TRUST LOUISIANA MINNESOTA
---------------- MUNICIPAL MUNICIPAL
NEW YORK MONEY-MARKET MONEY-MARKET
FUND FUND FUND
-------------- -------------- --------------
INTEREST INCOME (Note 1) $ 2,098,633 $ 8,988 $ 21,812
-------------- -------------- --------------
EXPENSES (Note 2)
Comprehensive management fees 702,459 2,922 7,401
Distribution (12b-1) fees 175,615 731 1,851
Interest expense -- -- --
Other expense 513 2 4
-------------- -------------- --------------
Total expenses 878,587 3,655 9,256
Less: expenses waived (Note 2) -- (1,854) (446)
-------------- -------------- --------------
Net Expenses 878,587 1,801 8,810
-------------- -------------- --------------
NET INVESTMENT INCOME, representing Net Increase in
Net Assets from Investment Operations $ 1,220,046 $ 7,187 $ 13,002
============== ============== ==============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
24
<Page>
<Table>
INTEREST INCOME (Note 1) $ 14,137,238
------------
EXPENSES (Note 2)
COMPREHENSIVE MANAGEMENT FEES:
Class R 1,069,431
Class Treasurer's Trust 112,165
Class 75 28
Class 70 5,541
Class 45 661
Class 25 52,557
Class 15 78
Class 12 5
Class 8 319,932
DISTRIBUTION (12b-1) FEES:
Class R 267,358
Class 75 10
Class 70 2,216
Interest expense 2,073
Other expense 3,175
------------
Total expenses before waiver 1,835,230
Less: expenses waived 2) --
------------
Net Expenses 1,835,230
------------
NET INVESTMENT INCOME, representing Net Increase in
Net Assets from Investment Operations $ 12,302,008
============
</Table>
RESERVE TAX-EXEMPT TRUST--INTERSTATE TAX-EXEMPT FUND
STATEMENT OF CHANGES IN NET ASSETS (UNAUDITED)
<Table>
<Caption>
SIX MONTHS ENDED YEAR ENDED
NOVEMBER 30,2005 MAY 31, 2005
---------------- ---------------
INCREASE IN NET ASSETS FROM INVESTMENT OPERATIONS:
Net investment income $ 12,302,008 $ 12,477,598
---------------- ---------------
DIVIDENDS PAID TO SHAREHOLDERS FROM
NET INVESTMENT INCOME (Note 1):
Class R (1,984,320) (1,904,802)
Class Treasurer's Trust (349,170) (357,612)
Class 75 (99) (2)
Class 70 (20,220) (21,974)
Class 45 (3,121) (158)
Class 25 (450,899) (387,135)
Class 15 (1,203) (1,570)
Class 12 (120) (71)
Class 8 (9,492,856) (9,804,274)
---------------- ---------------
Total dividends to shareholders (12,302,008) (12,477,598)
---------------- ---------------
FROM CAPITAL SHARE TRANSACTIONS (NOTE 6)
(at net asset value of $1.00 per share):
Proceeds from sale of shares 6,383,413,578 7,530,222,443
Dividends reinvested 12,219,597 12,477,598
Cost of shares redeemed (6,783,642,029) (6,518,644,846)
---------------- ---------------
(388,008,854) 1,024,055,195
---------------- ---------------
Net increase (decrease) in net assets (388,008,854) 1,024,055,195
NET ASSETS:
Beginning of year 1,412,321,751 388,266,556
---------------- ---------------
End of year $ 1,024,312,897 $ 1,412,321,751
================ ===============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
25
<Page>
STATEMENTS OF CHANGES IN NET ASSETS (UNAUDITED)
<Table>
<Caption>
RESERVE TAX-EXEMPT TRUST
-----------------------------------------------------------------
CALIFORNIA FUND CONNECTICUT FUND
------------------------------- -------------------------------
SIX MONTHS SIX MONTHS
ENDED ENDED
NOVEMBER 30, YEAR ENDED NOVEMBER 30, YEAR ENDED
2005 MAY 31,2005 2005 MAY 31,2005
-------------- -------------- -------------- --------------
INCREASE (DECREASE) IN NET ASSETS
FROM INVESTMENT OPERATIONS:
Net investment income $ 735,159 $ 718,269 $ 180,636 $ 141,646
-------------- -------------- -------------- --------------
DIVIDENDS PAID TO SHAREHOLDERS FROM:
Net Investment Income (Note 1) (735,159) (718,269) (180,636) (141,646)
-------------- -------------- -------------- --------------
FROM CAPITAL SHARE TRANSACTIONS
(at net asset value of $1.00 per share):
Proceeds from sale of shares 204,163,955 450,880,899 43,193,629 64,118,583
Dividends reinvested 729,895 718,269 179,659 141,646
Cost of shares redeemed (208,327,374) (447,611,652) (40,785,032) (62,338,249)
-------------- -------------- -------------- --------------
(3,433,524) 3,987,516 2,588,256 1,921,980
-------------- -------------- -------------- --------------
Net increase (decrease) in net assets (3,433,524) 3,987,516 2,588,256 1,921,980
NET ASSETS:
Beginning of year 105,202,173 101,214,657 23,386,769 21,464,789
-------------- -------------- -------------- --------------
End of year $ 101,768,649 $ 105,202,173 $ 25,975,025 $ 23,386,769
============== ============== ============== ==============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
26
<Page>
<Table>
<Caption>
RESERVE TAX-EXEMPT TRUST
----------------------------------------------------------------------------------------
FLORIDA FUND MASSACHUSETTS FUND MICHIGAN FUND
---------------------------- ---------------------------- ----------------------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED
NOVEMBER 30, YEAR ENDED NOVEMBER 30, YEAR ENDED NOVEMBER 30, YEAR ENDED
2005 MAY 31,2005 2005 MAY 31,2005 2005 MAY 31,2005
----------------------------------------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS
FROM INVESTMENT OPERATIONS:
Net investment income $ 337,888 $ 326,913 $ 144,621 $ 123,894 $ 120,335 $ 82,915
------------- ------------- ------------- ------------- ------------- -------------
DIVIDENDS PAID TO SHAREHOLDERS FROM:
Net investment income (Note 1) (337,888) (326,913) (144,621) (123,894) (120,335) (82,915)
------------- ------------- ------------- ------------- ------------- -------------
FROM CAPITAL SHARE TRANSACTIONS
(at net asset value of $1.00
per share):
Proceeds from sale of shares 111,586,752 212,489,726 40,867,914 70,696,703 26,801,513 40,145,244
Dividends reinvested 335,446 326,913 143,691 123,894 119,583 82,915
Cost of shares redeemed (101,731,646) (209,176,509) (44,331,105) (66,487,254) (29,396,980) (35,670,278)
------------- ------------- ------------- ------------- ------------- -------------
10,190,552 3,640,130 (3,319,500) 4,333,343 (2,475,884) 4,557,881
------------- ------------- ------------- ------------- ------------- -------------
Net increase (decrease) in net assets 10,190,552 3,640,130 (3,319,500) 4,333,343 (2,475,884) 4,557,881
NET ASSETS:
Beginning of year 43,093,519 39,453,389 22,152,581 17,819,238 16,632,250 12,074,369
------------- ------------- ------------- ------------- ------------- -------------
End of year $ 53,284,071 $ 43,093,519 $ 18,833,081 $ 22,152,581 $ 14,156,366 $ 16,632,250
============= ============= ============= ============= ============= =============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
27
<Page>
<Table>
<Caption>
RESERVE TAX-EXEMPT TRUST
-----------------------------------------------------------------
NEW JERSEY FUND OHIO FUND
------------------------------- -------------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
NOVEMBER 30, MAY 31, NOVEMBER 30, MAY 31,
2005 2005 2005 2005
-------------- -------------- -------------- --------------
INCREASE (DECREASE) IN NET ASSETS
FROM INVESTMENT OPERATIONS:
Net investment income $ 341,071 $ 337,190 $ 150,179 $ 111,931
-------------- -------------- -------------- --------------
DIVIDENDS PAID TO SHAREHOLDERS FROM:
Net investment income (Note 1) (341,071) (337,190) (150,179) (111,931)
-------------- -------------- -------------- --------------
FROM CAPITAL SHARE TRANSACTIONS
(at net asset value of $1.00 per share):
Proceeds from sale of shares 123,423,527 282,434,698 35,091,329 80,335,415
Dividends reinvested 338,847 337,190 149,176 111,931
Cost of shares redeemed (118,269,553) (288,028,722) (33,886,170) (72,335,170)
-------------- -------------- -------------- --------------
5,492,821 (5,256,834) 1,354,335 8,112,176
-------------- -------------- -------------- --------------
Net increase (decrease) in net assets 5,492,821 (5,256,834) 1,354,335 8,112,176
NET ASSETS:
Beginning of year 44,989,084 50,245,918 19,023,986 10,911,810
-------------- -------------- -------------- --------------
End of year $ 50,481,905 $ 44,989,084 $ 20,378,321 $ 19,023,986
============== ============== ============== ==============
<Caption>
RESERVE TAX-EXEMPT TRUST
-----------------------------------------------------------------
PENNSYLVANIA FUND VIRGINIA FUND
------------------------------- -------------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
NOVEMBER 30, MAY 31, NOVEMBER 30, MAY 31,
2005 2005 2005 2005
-------------- -------------- -------------- --------------
INCREASE (DECREASE) IN NET ASSETS
FROM INVESTMENT OPERATIONS:
Net investment income $ 319,660 $ 306,095 $ 96,743 $ 81,075
-------------- -------------- -------------- --------------
DIVIDENDS PAID TO SHAREHOLDERS FROM:
Net investment income (Note 1) (319,660) (306,095) (96,743) (81,075)
-------------- -------------- -------------- --------------
FROM CAPITAL SHARE TRANSACTIONS
(at net asset value of $1.00 per share):
Proceeds from sale of shares 90,190,049 163,192,232 37,466,868 72,769,957
Dividends reinvested 317,645 306,095 96,187 81,075
Cost of shares redeemed (85,254,619) (164,865,058) (37,191,215) (70,194,502)
-------------- -------------- -------------- --------------
5,253,075 (1,366,731) 371,840 2,656,530
-------------- -------------- -------------- --------------
Net increase (decrease) in net assets 5,253,075 (1,366,731) 371,840 2,656,530
NET ASSETS:
Beginning of year 44,693,365 46,060,096 13,705,598 11,049,068
-------------- -------------- -------------- --------------
End of year $ 49,946,440 $ 44,693,365 $ 14,077,438 $ 13,705,598
============== ============== ============== ==============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
28
<Page>
<Table>
<Caption>
RESERVE NEW YORK
TAX-EXEMPT TRUST RESERVE MUNICIPAL MONEY-MARKET TRUST
------------------------------- ------------------------------------
LOUISIANA MUNICIPAL
NEW YORK FUND MONEY-MARKET FUND
------------------------------- ------------------------------------
SIX MONTHS SIX MONTHS
ENDED ENDED
NOVEMBER 30, YEAR ENDED NOVEMBER 30, YEAR ENDED
2005 MAY 31,2005 2005 MAY 31,2005
-------------- -------------- -------------- --------------
INCREASE (DECREASE) IN NET ASSETS
FROM INVESTMENT OPERATIONS:
Net investment income $ 1,220,046 $ 1,155,796 $ 7,187 $ 1,888
-------------- -------------- -------------- --------------
DIVIDENDS PAID TO SHAREHOLDERS FROM:
Net investment income (Note 1) (1,220,046) (1,155,796) (7,187) (1,888)
-------------- -------------- -------------- --------------
FROM CAPITAL SHARE TRANSACTIONS
(at net asset value of $1.00 per share):
Proceeds from sale of shares 297,890,272 517,833,490 2,145,968 1,146,967
Dividends reinvested 1,209,728 1,155,796 7,099 1,888
Cost of shares redeemed (289,442,636) (527,148,018) (1,136,075) (1,041,556)
-------------- -------------- -------------- --------------
9,657,364 (8,158,732) 1,016,992 107,299
-------------- -------------- -------------- --------------
Net increase (decrease) in net assets 9,657,364 (8,158,732) 1,016,992 107,299
NET ASSETS:
Beginning of year 164,422,970 172,581,702 293,185 185,886
-------------- -------------- -------------- --------------
End of year $ 174,080,334 $ 164,422,970 $ 1,310,177 $ 293,185
============== ============== ============== ==============
<Caption>
RESERVE MUNICIPAL MONEY-MARKET TRUST
------------------------------------
MINNESOTA MUNICIPAL
MONEY-MARKET FUND
------------------------------------
SIX MONTHS
ENDED
NOVEMBER 30, YEAR ENDED
2005 MAY 31,2005
-------------- --------------
INCREASE (DECREASE) IN NET ASSETS
FROM INVESTMENT OPERATIONS:
Net investment income $ 13,002 $ 7,523
-------------- --------------
DIVIDENDS PAID TO SHAREHOLDERS FROM:
Net investment income (Note 1) (13,002) (7,523)
-------------- --------------
FROM CAPITAL SHARE TRANSACTIONS
(at net asset value of $1.00 per share):
Proceeds from sale of shares 8,411,725 5,904,669
Dividends reinvested 12,908 7,523
Cost of shares redeemed (7,417,935) (5,153,400)
--------------
- --------------w
1,006,698 758,792
-------------- --------------
Net increase (decrease) in net assets 1,006,698 758,792
NET ASSETS:
Beginning of year 1,404,639 645,847
-------------- --------------
End of year $ 2,411,337 $ 1,404,639
============== ==============
</Table>
SEE NOTES TO FINANCIAL STATEMENTS.
29
<Page>
NOTES TO FINANCIAL STATEMENTS
(1) SIGNIFICANT ACCOUNTING POLICIES:
Reserve New York Tax-Exempt Trust, Reserve Tax-Exempt Trust and Reserve
Municipal Money-Market Trust (collectively, the "Trusts") are registered
with the Securities Exchange Commission ("SEC") under the Investment
Company Act of 1940, as amended ("the Investment Company Act"), as open-end
management investment companies. The policies summarized below are
consistently followed in the preparation of each Trust's financial
statements in conformity with generally accepted accounting principles.
A. The Trusts' authorized shares of beneficial interest are unlimited. As
of November 30, 2005, there were eleven (11) separate series of Reserve
Tax-Exempt Trust authorized (Interstate Tax-Exempt Fund, California
Tax-Exempt Fund, Connecticut Tax-Exempt Fund, Florida Tax-Exempt Fund,
Massachusetts Tax-Exempt Fund, Michigan Tax-Exempt Fund, New Jersey
Tax-Exempt Fund, Ohio Tax-Exempt Fund, Pennsylvania Tax-Exempt Fund,
Virginia Tax-Exempt Fund and Interstate II Tax-Exempt Fund (which has not
commenced operations)); one (1) series of Reserve New York Tax-Exempt Trust
(New York Tax-Exempt Fund) and two (2) separate series of Reserve Municipal
Money-Market Trust (Louisiana Money-Market Fund and Minnesota Money-Market
Fund) authorized and outstanding (each a "Fund", and collectively the
"Funds"). The Funds each offer a single class of shares, except for the
Interstate Tax-Exempt Fund, which currently offers twelve classes of shares
as follows: Class 8, Class 12, Class 15, Class 20, Class 25, Class 35,
Class 45, Treasurer's Trust, Class 70, Class 75, Class 95 and Class R.
These financial statements and notes apply to all above mentioned series of
all Trusts, except for the Interstate II Tax-Exempt Fund.
B. Securities are valued at amortized cost, which approximates market
value. The amortized cost method values a security at cost plus accrued
interest at the time of purchase and thereafter assumes a constant
amortization to maturity of any discount or premium, irrespective of
intervening changes in interest rates or market values. For purposes of
compliance with Rule 2a-7 of the Investment Company Act, and for computing
the portfolios' average weighted life to maturity, the maturity of floating
or variable rate instruments in which the Funds may invest will be deemed
to be for floating rate instruments (1) the notice period required before
the Funds are entitled to receive payment of the principal amount of the
instrument; and for variable rate instruments the longer of (1) above or
(2) the period remaining until the instrument's next rate adjustment.
C. It is each Fund's policy to comply with Subchapter M of the Internal
Revenue Code and to distribute all income to its shareholders. Accordingly,
no Federal income tax provision is required.
D. Security transactions are recorded on a trade date basis. Interest
income is accrued daily, and security premium or discount is amortized or
accreted daily. The Interstate Tax-Exempt Fund allocates investment income
and fund level expenses (expenses other than the comprehensive management
fee and distribution fee) on a daily basis based upon the relative
proportion of net assets of each class.
E. Net investment income is distributed to shareholders daily and
automatically reinvested in additional Fund shares, unless the shareholder
has elected in writing to receive cash.
F. The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities on
the date of the financial statements and the reported amounts of income and
expenses during the reporting periods. Actual results could differ from
those estimates.
G. During the fiscal year, the Funds incurred overdraft positions with
their custodian bank. Any related interest charges are shown in each Fund's
statement of operations.
(2) MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
Pursuant to an Investment Management Agreement (the "Agreement") between
Reserve Management Company, Inc. ("RMCI") and each Trust on behalf of each
of its series, RMCI serves as each Fund's Investment Adviser, subject to
the policies adopted by the Board of Trustees. Under the Agreement, RMCI is
responsible for the supervision of the day-to-day operations, manages each
Fund's investments, effects purchases and sales thereof, and absorbs
certain promotional expenses. The Funds, with the exception of Interstate
Tax-Exempt Fund, pay RMCI a comprehensive management fee, which is accrued
daily at the annual rate of 0.80% of the average daily net assets of each
Fund. The Interstate Tax-Exempt Fund pays RMCI a comprehensive management
fee, accrued daily, at an annual rate based on the average daily net assets
of each class of the Fund's shares according to the following schedule:
Class 8, 0.08%; Class 12, 0.12%; Class 15, 0.15%; Class 20, 0.20%; Class
25, 0.25%; Class 35, 0.35%; Class 45, 0.45%; Treasurer's Trust, 0.60%;
Class 70, 0.50%; Class 75, 0.55%; Class 95, 0.75%; Class R, 0.80%. The
comprehensive management fee includes the investment advisory fee, all
administrative and customary operating expenses of each Fund, as well as
shareholder liaison services (such as, responding to customer inquiries and
providing information on their investments), recordkeeping charges,
accounting expenses, transfer agent costs and the expenses of preparing,
printing and mailing shareholder reports and prospectuses. Excluded from
the definition of customary operating expenses are: compensation of Chief
Compliance Officer, interest charges, taxes, brokerage fees and
commissions, extraordinary legal and accounting fees and other
extraordinary expenses, payments under the Trust's Distribution Plan, as
defined below, and the fees of the Trustees who are not interested persons,
as defined in the Investment Company Act (the "non-interested Trustees"),
for which each Fund pays its direct or allocated share. The Louisiana and
Minnesota Municipal Money-Market Funds also pay the state (blue sky) and
SEC registration fees applicable to those Funds. For the six months ended
November 30, 2005, RMCI voluntarily waived a portion of its comprehensive
management fee in the amounts listed below:
<Table>
<Caption>
FUND AMOUNT
---- ------
Louisiana Municipal Money-Market Fund $ 1,854
Minnesota Municipal Money-Market Fund 446
</Table>
Certain Officers and Trustees of the Trusts are also Officers of RMCI.
As of November 30, 2005, RMCI owned 11% of the Louisiana and 6% of the
Minnesota Municipal-Money Market Funds.
30
<Page>
DISTRIBUTION ASSISTANCE:
The Funds have adopted a Rule 12b-1 Distribution Plan and entered into a
Distribution Agreement with Resrv Partners, Inc., an affiliate of RMCI,
which allows the Funds to pay fees for certain shareholder services and for
expenses related to the sale of its shares for the Funds that offer a
single class of shares and of Interstate Tax-Exempt Fund Class R, Class 95,
Class 75 and Class 70 Shares. The rate of distribution expenses may not
exceed 0.20% per year of the Classes' average daily net assets.
(3) CONCENTRATION OF CREDIT RISK:
Total assets of each Fund in the Trusts include a concentration of cash
that is held in accounts with the Funds' Custodian.
(4) INVESTMENT CONCENTRATION:
The Funds invest substantially all of their assets in portfolios of
tax-exempt obligations issued by states, territories and possessions of the
United States and their subdivisions. The issuers' ability to meet their
obligations may be affected by economic, regional or political
developments. In order to reduce the credit risks associated with such
factors, the Funds invest substantially all of their portfolio assets in
obligations backed by letters of credit, bond insurance of financial
institutions, financial guaranty assurance agencies and/or other credit
enhancement arrangements as shown below as a percentage of each Fund's net
assets at November 30, 2005:
INTERSTATE TAX-EXEMPT FUND 99.8%
<Table>
LETTER OF CREDIT
ABN-AMRO Bank NV 0.7%
Allied Irish Bank, PLC 0.5%
Bank of America NA 2.7%
Bank of Montreal 0.3%
Bank of New York 3.2%
Bank of Nova Scotia 4.8%
Barclays Bank PLC 2.4%
Bayerische Landesbank Girozentrale 3.4%
BNP Paribas 2.0%
Citibank, NA 4.1%
Comerica Bank 2.5%
Credit Suisse First Boston 0.5%
Den Danske Bank 0.9%
DEPFA Bank, PLC 4.6%
FHLB 0.5%
Fifth Third Bank 0.3%
Fortis Bank 1.4%
FRMC 1.2%
Harris Trust & Savings Bank 0.1%
Harvard University 2.6%
HBOS PLC 0.6%
JPMorganChase Bank 2.7%
Keybank NA 1.4%
Kredietbank NV 1.0%
La Salle Bank, NA 4.6%
Landesbank Baden-Wurttemberg 0.4%
Landesbank Hessen-Thuerinigen Girozentrale 3.5%
Lloyds TSB Bank PLC 3.8%
M&T Bank 1.0%
MIT. Mass Inst Tech 3.4%
Natexis Banques Populaires 0.1%
Northern Trust Co. 1.0%
PNC Bank, NA 1.4%
Princeton University 0.5%
Rabobank Nederland 2.3%
Regions Bank 0.1%
Royal Bank of Canada, Montreal 1.0%
Royal Bank of Scotland 1.5%
Smith College 0.1%
Societe Generale 1.1%
State Street Bank & Trust Co. 1.1%
Suntrust Bank of Nashville NA 0.5%
Suntrust Bank of Atlanta 3.2%
University of Virginia 1.0%
US Bank, NA MPLS 3.1%
Wachovia Bank NA 2.6%
Wells Fargo Bank NA 1.0%
Westdeutsche Landesbank AG 0.4%
Yale 4.0%
* BOND INSURANCE
AMBAC 2.7%
FGIC 3.4%
FSA 3.8%
MBIA 2.8%
</Table>
31
<Page>
<Table>
CALIFORNIA TAX-EXEMPT FUND 96.6%
LETTER OF CREDIT
Allied Irish Bank, PLC 2.2%
Bank of America NA 3.9%
Bank of New York 4.9%
Bank of Nova Scotia 8.2%
BNP Paribas 4.2%
Calyon NY 1.0%
Citibank, NA 1.3%
Comerica Bank 3.1%
Den Danske Bank 3.9%
Fortis Babk 2.9%
Kredietbank NV, Brussels 9.3%
La Salle Bank, NA 6.5%
Landesbank Baden-Wurttemberg 1.6%
Landesbank Hessen-Thuerinigen Girozentrale 4.9%
Republic N.B. New York 2.4%
Royal Bank of Canada, Montreal 1.0%
Societe Generale 6.3%
State Street Bank & Trust Co. 6.6%
US Bank NA 3.7%
Wachovia Bank NA 2.1%
Wells Fargo Bank NA 3.7%
* BOND INSURANCE
AMBAC 1.6%
FRMC 3.9%
MBIA 7.4%
CONNECTICUT TAX-EXEMPT FUND 81.2%
LETTER OF CREDIT
Allied Irish Bank, PLC 6.9%
Bank of America 4.6%
Bank of Montreal 4.6%
JPMorganChase Bank 4.6%
Kreditbank NV, Brussels 4.6%
La Salle Bank, NA 8.3%
Landesbank Hessen-Thueringen Girozentrale 4.6%
Northern Trust Co. 4.6%
Wachovia Bank NA 6.5%
Yale 4.6%
* BOND INSURANCE
AMBAC 6.9%
FGIC 8.1%
FSA 4.6%
MBIA 7.7%
FLORIDA TAX-EXEMPT FUND 86.5%
LETTER OF CREDIT
Bank of America NA 4.5%
BNP Paribas 7.8%
Citibank, NA 3.8%
Fifth Third Bank 2.4%
Florida Power & Light 3.9%
HBOS PLC 5.9%
JPMorganChase Bank 6.3%
Keybank NA 2.8%
La Salle Bank NA 3.8%
Northern Trust Co. 4.1%
Republic National Bank 3.6%
Societe Generale 3.6%
State Street Bank & Trust Co. 3.9%
Suntrust Bank 6.3%
Wachovia Bank NA 6.1%
* BOND INSURANCE
AMBAC 8.1%
FGIC 3.9%
FRMC 2.3%
FSA 3.4%
</Table>
32
<Page>
<Table>
MASSACHUSETTS TAX-EXEMPT FUND 94.1%
LETTER OF CREDIT
Allied Irish Bank, PLC 3.8%
Bank of America 3.8%
Bank of Nova Scotia 3.5%
Comercia Bank, Detroit 4.2%
Depfa Bank, PLC 4.5%
Harvard University 3.7%
La Salle Bank, NA 4.2%
Landesbank Baden-Wurttemberg 1.1%
Landesbank Hessen-Thueringen Girozentrale 4.8%
Lloyds TSB Bank PLC 3.7%
MIT Mass Inst Tech 3.7%
PNC 4.2%
Royal Bank of Scotland 2.4%
Smith College 4.2%
State ST. Bank & Trust Co. Boston 3.7%
Sun Trust Bank of Atlanta 3.2%
Wachovia Bank NA 4.2%
Wellesley College 4.2%
Williams College 3.7%
* BOND INSURANCE
AMBAC 3.3%
FGIC 6.6%
FSA 8.8%
MBIA 4.6%
MICHIGAN TAX-EXEMPT FUND 97.3%
LETTER OF CREDIT
Bank of America, NA 4.9%
Barclay 4.9%
Comerica Bank 8.2%
Depfa Bank PLC 7.6%
FHLB 4.9%
Fifth Third Bank 4.9%
JPMorganChase Bank 8.5%
Kredietbank NV 4.9%
La Salle Bank, NA 4.2%
Landesbank Hessen-Thuerinigen Girozentrale 4.9%
National City Bank 7.8%
Standard Federal Bank, NA 3.5%
Wachovia Bk & TR Co. 3.5%
* BOND INSURANCE
AMBAC 4.9%
FGIC 4.9%
FSA 9.9%
MBIA 4.9%
NEW JERSEY TAX-EXEMPT FUND 88.2%
LETTER OF CREDIT
Allied Irish Bank, PLC 4.0%
Bank of America 3.9%
Bank of New York 6.4%
Bank of Nova Scotia 3.8%
Bayerische Landesbank Girozentrale 6.5%
Citibank, NA 4.8%
Dexia Credit Local 3.8%
JPMorganChase Bank 9.1%
Kredietbank NV. Brussels 2.3%
Lloyds TSB Bank PLC 3.9%
PNC Bank, NA 6.8%
Princeton University 4.8%
Suntrust Bank 4.8%
Wachovia Bank NA 7.3%
* BOND INSURANCE
AMBC 3.8%
FGIC 2.0%
FSA 2.4%
MBIA 7.8%
</Table>
33
<Page>
<Table>
OHIO TAX-EXEMPT FUND 92.6%
LETTER OF CREDIT
ABN-AMRO Bank NV 3.9%
Allied Irish Bank, PLC 3.4%
Bank of America, NA 3.6%
Bank of Nova Scotia 2.5%
Barclays Bank PLC 3.4%
Bayerische Landesbank Girozentrale 3.9%
BNP Paribas 3.4%
Citibank, NA 3.9%
Fifth Third Bank 4.6%
HBOS PLC 7.3%
JPMorganChase Bank 7.4%
Keybank NA 6.9%
La Salle Bank, NA 3.4%
Landesbank Hessen-Thurin 4.4%
National City Bank 2.5%
Ohio State University 2.9%
Republic National Bank 2.4%
State Street Bank & Trust Co. 3.9%
US Bank NA 3.9%
Wachovia Bank NA 3.9%
Wells Fargo Bank NA 2.0%
Westdeutsche Landesbank AG 2.0%
* BOND INSURANCE
AMBAC 2.9%
MBIA 4.2%
PENNSYLVANIA TAX-EXEMPT FUND 90.5%
LETTER OF CREDIT
ABN-AMRO Bank NV 7.6%
Allied Irish Bank, PLC 3.0%
Bank of America NA 4.0%
Bank of Nova Scotia 4.0%
Bay Landesbank Girozentrale 4.0%
Comerica Bank 3.6%
Depfa Bank, PLC 4.0%
Dexia Bank 5.2%
JPMorganChase Bank 4.4%
Kredietbank NV. Brussels 3.2%
Landesbank Hessen-Thuerinigen Girozentrale 8.4%
Northern Trust Co. 3.9%
PNC Bank, NA 7.2%
Rabobank Nederland 4.0%
University of Pennsylvania 4.0%
Wachovia Bank NA 7.3%
* BOND INSURANCE
AMBAC 3.2%
FSA 4.0%
MBIA 5.5%
VIRGINIA TAX-EXEMPT FUND 81.8%
LETTER OF CREDIT
Bank of America NA 5.0%
BNP Paribas 8.5%
BB&T NA 7.3%
Citibank 5.0%
JP Morgan/ Chase 5.0%
Kredietbank NV. Brussels 5.0%
Suntrust Bank 8.2%
University of Virginia 7.8%
US Bank NA 5.0%
Wachovia Bank NA 5.0%
* BOND INSURANCE
AMBAC 5.0%
FRMC 5.0%
FSA 5.0%
MBIA 5.0%
</Table>
34
<Page>
<Table>
NEW YORK TAX-EXEMPT FUND 99.6%
LETTER OF CREDIT
ABN/AMRO 4.1%
Allied Irish Bank, PLC 3.6%
Bank of America NA 4.1%
Bank of New York 4.3%
Bayerische Landesbank Girozentrale 3.7%
Citibank, NA 3.5%
Comerica Bank. Detroit 3.6%
Depfa Bank, PLC 3.8%
Fortis Babk 4.0%
FRMC 4.7%
JP Morgan Chase 4.0%
Keybank NA Cleveland OH 7.1%
Landesbank Baden-Wurternberg 4.1%
Landesbank Hessen-Thueringen Girozentrale 4.0%
Lloyds 3.0%
Rabobank 3.5%
Republic N.B. New York 0.9%
Royal Bank of Canada, Montreal 4.0%
Royal Bank of Scotland 0.9%
Societe Generale 3.5%
Wachovia BK & TR CO. NA North Carolina 2.7%
Wells Fargo Bank NA 4.6%
Westdeutsche Landesbank Girozentrale 4.5%
* BOND INSURANCE
FGIC 7.5%
FSA 5.6%
MBIA 0.3%
LOUISIANA MUNICIPAL MONEY-MARKET FUND 80.4%
LETTER OF CREDIT
Bank of America NA 5.0%
Bank of New York 9.0%
Bayerische Landesbank Girozentrale 8.1%
FNMA 5.0%
Hibernia National Bank 5.0%
JPMorganChase Bank 5.0%
Natexis Banques Populaires 5.0%
Regions Bank 9.2%
Suntrust Bank 9.5%
Wachovia Bank 5.0%
* BOND INSURANCE
AMBAC 5.0%
MBIA 9.6%
MINNESOTA MUNICIPAL MONEY-MARKET FUND 88.0%
LETTER OF CREDIT
Allied Irish Bank, PLC 5.0%
Dexia Bank 4.6%
FNMA 8.3%
Harris Trust & Savings Bank 5.0%
La Salle Bank, NA 8.3%
Lloyds TSB Bank PLC 5.0%
University of Minnesota 5.0%
US Bank NA 9.3%
Wells Fargo Bank NA 10.0%
Westdeutsche Landesbank AG 7.5%
* BOND INSURANCE
AMBAC 10.0%
FRMC 5.0%
MBIA 5.0%
</Table>
* Some securities may be backed by both a line of credit and bond insurance.
^ Amount is less than 0.05%.
35
<Page>
(5) COMPOSITION OF NET ASSETS:
At November 30, 2005, the composition of each Fund's net assets was as
follows:
<Table>
<Caption>
INTERSTATE CALIFORNIA CONNECTICUT FLORIDA MASSACHUSETTS
FUND FUND FUND FUND FUND
--------------- --------------- --------------- --------------- ---------------
Par Value $ 1,024,313 $ 101,769 $ 25,975 $ 53,284 $ 18,833
Additional-Paid-in-Capital 1,023,288,584 101,666,880 25,949,050 53,230,787 18,814,248
--------------- --------------- --------------- --------------- ---------------
Net Assets $ 1,024,312,897 $ 101,768,649 $ 25,975,025 $ 53,284,071 $ 18,833,081
=============== =============== =============== =============== ===============
<Caption>
MICHIGAN NEW JERSEY OHIO PENNSYLVANIA VIRGINIA
FUND FUND FUND FUND FUND
--------------- --------------- --------------- --------------- ---------------
Par Value $ 14,156 $ 50,482 $ 20,378 $ 49,946 $ 14,077
Additional-Paid-in-Capital 14,142,210 50,431,423 20,357,943 49,896,494 14,063,361
--------------- --------------- --------------- --------------- ---------------
Net Assets $ 14,156,366 $ 50,481,905 $ 20,378,321 $ 49,946,440 $ 14,077,438
=============== =============== =============== =============== ===============
<Caption>
NEW YORK LOUISIANA MINNESOTA
FUND FUND FUND
--------------- --------------- ---------------
Par Value $ 174,080 $ 1,310 $ 2,411
Additional-Paid-in-Capital 173,906,254 1,308,867 2,408,926
--------------- --------------- ---------------
Net Assets $ 174,080,334 $ 1,310,177 $ 2,411,337
=============== =============== ===============
</Table>
The tax basis of each Fund's assets is the same as the basis for financial
reporting at November 30, 2005.
(6) CAPITAL SHARE TRANSACTIONS:
For the six months ended November 30, 2005, and year ended May 31, 2005,
the capital share transactions of each class of the Interstate Tax-Exempt
Fund, each at a net asset value of $1 per share, were as follows:
<Table>
<Caption>
SIX MONTHS ENDED NOVEMBER 30, 2005
---------------------------------------------------------------------------------------------------------
TREASURER'S
CLASS R TRUST CLASS 75 CLASS 70 CLASS 45 CLASS 25
--------------- --------------- --------------- --------------- --------------- ---------------
Sold 540,368,722 188,136,544 61,000 147,712,807 811,439 53,947,501
Reinvested 1,961,959 344,531 98 20,137 3,086 454,570
Redeemed (520,229,326) (200,947,304) (51,172) (147,348,396) (400,712) (95,848,659)
--------------- --------------- --------------- --------------- --------------- ---------------
Net Increase
(Decrease) 22,101,355 (12,466,229) 9,926 384,548 413,813 (41,446,588)
=============== =============== =============== =============== =============== ===============
<Caption>
CLASS 15 CLASS 12 CLASS 8
--------------- --------------- ---------------
Sold 14 3 5,452,375,548
Reinvested 1,192 117 9,433,907
Redeemed (13) (1) (5,818,816,446)
--------------- --------------- ---------------
Net Increase (Decrease) 1,193 119 (357,006,991)
=============== =============== ===============
</Table>
36
<Page>
For the years ended May 31, 2005 and May 31, 2004, the capital share
transactions of each class of the Interstate Tax-Exempt Fund, each at a net
asset value of $1 per share, were as follows:
<Table>
<Caption>
YEAR ENDED MAY 31, 2005
---------------------------------------------------------------------------------------------------------
OCTOBER 1, 2004* OCTOBER 1, 2004*
TREASURER'S TO MAY 31, 2005 TO MAY 31, 2005
CLASS R TRUST CLASS 75 CLASS 70 CLASS 45 CLASS 25
--------------- --------------- --------------- --------------- --------------- ---------------
Sold 1,218,219,096 257,552,413 1,510 75,609,267 65,703 106,352,469
Reinvested 1,904,802 357,612 2 21,974 158 387,135
Redeemed (1,242,244,626) (231,731,228) (1,411) (74,686,333) (6,055) (44,943,518)
--------------- --------------- --------------- --------------- --------------- ---------------
Net Increase
(Decrease) (22,120,728) 26,178,797 101 944,908 59,806 61,796,086
=============== =============== =============== =============== =============== ===============
<Caption>
FEBRUARY 1, 2005*
TO MAY 31, 2005
CLASS 15 CLASS 12 CLASS 8
--------------- ----------------- ---------------
Sold 24 9,999 5,872,411,962
Reinvested 1,570 71 9,804,274
Redeemed (15) -- (4,925,031,660)
--------------- --------------- ---------------
Net Increase (Decrease) 1,579 10,070 957,184,576
=============== =============== ===============
</Table>
- ----------
* Commencement of Class operations.
37
<Page>
(7) FINANCIAL HIGHLIGHTS:
Contained below is per share operating performance data for a share of
beneficial interest outstanding for each of the periods as indicated.
<Table>
<Caption>
CLASS R
------------------------------------------------------------------------------
SIX
MONTHS
ENDED YEARS ENDED MAY 31,
NOV. 30, --------------------------------------------------------------
2005 2005 2004 2003 2002 2001
---------- ---------- ---------- ---------- ---------- ----------
INTERSTATE TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
---------- ---------- ---------- ---------- ---------- ----------
Net investment income 0.0074 0.0070 0.0010 0.0034 0.0108 0.0289
Dividends from net investment income (0.0074) (0.0070) (0.0010) (0.0034) (0.0108) (0.0289)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
========== ========== ========== ========== ========== ==========
Total Return 0.74% 0.70% 0.10% 0.34% 1.09% 2.95%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 283.5 $ 261.4 $ 283.5 $ 280.4 $ 295.7 $ 296.2
Ratio of expenses to average net assets 1.00%(a) 1.00% 1.00% 1.00% 1.01% 1.01%
Ratio of expenses to average net assets
net of fee waivers 1.00%(a) 1.00% 0.90% 0.99% 1.01% 1.01%
Ratio of net investment income to
average net assets 1.46%(a) 0.69% 0.10% 0.33% 1.08% 2.89%
<Caption>
TREASURER'S TRUST
-----------------------------------------------------------------------------
SIX
MONTHS APRIL 17,
ENDED YEARS ENDED MAY 31, 2001* TO
NOV. 30, ------------------------------------------------- MAY 31,
2005 2005 2004 2003 2002 2001
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at beginning of period $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
---------- ---------- ---------- ---------- ---------- ----------
Net investment income 0.0094 0.0109 0.0040 0.0074 0.0149 0.0002
Dividends from net investment income (0.0094) (0.0109) (0.0040) (0.0074) (0.0149) (0.0002)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
========== ========== ========== ========== ========== ==========
Total Return 0.95% 1.10% 0.40% 0.74% 1.50% 0.02%
RATIOS/SUPPLEMENTAL DATA
Net assets end of period (millions) $ 36.2 $ 48.7 $ 22.5 $ 29.2 $ 20.5 $ 85.4
Ratio of expenses to average net assets 0.60%(a) 0.60% 0.60% 0.60% 0.61% 0.60%(a)
Ratio of net investment income to average
net assets 1.86%(a) 1.24% 0.37% 0.71% 1.59% 2.56%(a)
</Table>
38
<Page>
<Table>
<Caption>
CLASS 75 CLASS 70
-------------------------- ------------------------
SIX SIX
MONTHS SEPTEMBER 23, MONTHS AUGUST 16,
ENDED 2004* TO ENDED 2004* TO
NOV. 30, MAY 31, NOV. 30, MAY 31,
2005 2005 2005 2005
-------- ------------- -------- -----------
Net asset value at
beginning of period $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
-------- ------------- -------- -----------
Net investment income 0.0086 0.0083 0.0089 0.0092
Dividends from net
investment income (0.0086) (0.0083) (0.0089) (0.0092)
-------- ------------- -------- -----------
Net asset value at end of period $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
======== ============= ======== ===========
Total Return 0.87% 0.83% 0.89% 0.93%
RATIOS/SUPPLEMENTAL DATA
Net assets end of period
(millions) $ 0.0 $ --^ $ 1.3 $ 0.9
Ratio of expenses to average
net assets 0.75%(a) 0.75%(a) 0.70%(a) 0.71%(a)
Ratio of net investme income
to average net assets 1.71%(a) 1.60%(a) 1.76%(a) 1.10%(a)
<Caption>
CLASS 45
--------------------------------
SIX
MONTHS YEAR AUGUST 7,
ENDED ENDED 2003* TO
NOV. 30, MAY 31, MAY 31,
2005 2005 2004
-------- -------- ---------
Net asset value at
beginning of period $ 1.0000 $ 1.0000 $ 1.0000
-------- -------- ---------
Net investment income 0.0102 0.0123 0.0044
Dividends from net
investment income (0.0102) (0.0123) (0.0044)
-------- -------- ---------
Net asset value at end of period $ 1.0000 $ 1.0000 $ 1.0000
======== ======== =========
Total Return 1.02% 1.25% 0.45%
RATIOS/SUPPLEMENTAL DATA
Net assets end of period
(millions) $ 0.5 $ 0.10 $ --^
Ratio of expenses to average
net assets 0.45%(a) 0.46% 0.44%(a)
Ratio of net investme income
to average net assets 2.01%(a) 1.37% 0.55%(a)
</Table>
<Table>
<Caption>
CLASS 25
------------------------------------------------------------------------------
SIX
MONTHS MAY 29,
ENDED YEARS ENDED MAY 31, 2001* TO
NOV. 30, ------------------------------------------------- MAY 31,
2005 2005 2004 2003 2002 2001
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at beginning of period $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
---------- ---------- ---------- ---------- ---------- ----------
Net investment income 0.0112 0.0144 0.0075 0.0109 0.0184 0.0002
Dividends from net investment income (0.0112) (0.0144) (0.0075) (0.0109) (0.0184) (0.0002)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
========== ========== ========== ========== ========== ==========
Total Return 1.12% 1.46% 0.75% 1.09% 1.86% 0.02%
RATIOS/SUPPLEMENTAL DATA
Net assets end of period (millions) $ 36.2 $ 77.7 $ 15.9 $ 17.8 $ 16.3 $ 45.7
Ratio of expenses to average net assets 0.25%(a) 0.25% 0.25% 0.25% 0.26% 0.25%(a)
Ratio of net investment income to
average net assets 2.21%(a) 1.76% 0.74% 1.07% 1.96% 2.91%(a)
</Table>
39
<Page>
<Table>
<Caption>
CLASS 15
----------------------------------------------------------------
SIX
MONTHS JANUARY 13,
ENDED 2003* TO
NOV. 30, YEARS ENDED MAY 31, MAY 31,
------------ ----------------------------- -----------
2005 2005 2004 2003
------------ ------------ -------------- -----------
Net asset value at beginning of period $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ -------------- -----------
Net investment income 0.0117 0.0154 0.0085 0.0039
Dividends from net investment income (0.0117) (0.0154) (0.0085) (0.0039)
------------ ------------ -------------- -----------
Net asset value at end of period $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
============ =========== =========== ===========
Total Return 1.17% 1.56% 0.86% 0.39%
RATIOS/SUPPLEMENTAL DATA
Net assets end of period (millions) $ 0.1 $ 0.10 $ 0.1 $ 0.1
Ratio of expenses to average net assets 0.15%(a) 0.16% 0.15% 0.15%(a)
Ratio of net investment income to average
net assets 2.31%(a) 1.54% 0.85% 1.03%(a)
<Caption>
CLASS 12
----------------------------
SIX
MONTHS FEBRUARY 1,
ENDED 2005* TO
NOV. 30, MAY 31,
2005 2005
--------- -----------
Net asset value at beginning of period $ 1.0000 $ 1.0000
--------- -----------
Net investment income 0.0118 0.0069
Dividends from net investment income (0.0118) (0.0069)
--------- -----------
Net asset value at end of period $ 1.0000 $ 1.0000
========= ===========
Total Return 1.19% 0.70%
RATIOS/SUPPLEMENTAL DATA
Net assets end of period (millions) $ 0.0 $ --^
Ratio of expenses to
average net assets 0.12%(a) 0.12%(a)
Ratio of net investment income to
average net assets 2.36%(a) 2.12%(a)
<Caption>
CLASS 8
----------------------------------------------------------
SIX
MONTHS JANUARY 13,
ENDED YEARS ENDED MAY 31, 2003* TO
NOV. 30, ----------------------------- MAY 31,
2005 2005 2004 2003
--------- -------------- ------------- -------------
Net asset value at beginning of period $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
--------- -------------- ------------- -------------
Net investment income 0.0120 0.0161 0.0092 0.0042
Dividends from net investment income (0.0120) (0.0161) (0.0092) (0.0042)
--------- -------------- ------------- -------------
Net asset value at end of period $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
========= ============== ============= =============
Total Return 1.21% 1.64% 0.93% 0.42%
RATIOS/SUPPLEMENTAL DATA
Net assets end of period (millions) $ 666.4 $ 1,023.4 $ 66.2 $ 0.1
Ratio of expenses to
average net assets 0.08%(a) 0.08% 0.08% 0.08%(a)
Ratio of net investment income to
average net assets 2.38%(a) 1.80% 0.92% 1.10%(a)
</Table>
40
<Page>
<Table>
<Caption>
SIX
MONTHS
ENDED
NOV. 30,
2005
------------
CALIFORNIA TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000
------------
Net investment income 0.0071
Dividends from net investment income (0.0071)
------------
Net asset value at end of year $ 1.0000
============
Total Return 0.71%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 101.8
Ratio of expenses to average net assets 1.00%(a)
Ratio of expenses to average net
assets net of fee waivers 1.00%(a)
Ratio of net investment income to
average net assets 1.40%(a)
<Caption>
YEARS ENDED MAY 31,
------------------------------------------------------------------------
2005 2004 2003 2002 2001
------------ ------------ ------------ ------------ ------------
CALIFORNIA TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
Net investment income 0.0068 0.0006 0.0033 0.0098 0.0236
Dividends from net investment income (0.0068) (0.0006) (0.0033) (0.0098) (0.0236)
------------ ------------ ------------ ------------ ------------
Net asset value at end of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
============ ============ ============ ============ ============
Total Return 0.69% 0.06% 0.33% 0.98% 2.42%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 105.2 $ 101.2 $ 109.0 $ 109.3 $ 136.2
Ratio of expenses to average net assets 1.00% 1.00% 1.00% 1.01% 1.00%
Ratio of expenses to average net
assets net of fee waivers 1.00% 0.89% 0.99% 1.01% 1.00%
Ratio of net investment income to
average net assets 0.69% 0.06% 0.32% 1.00% 2.36%
<Caption>
SIX
MONTHS
ENDED
NOV. 30,
2005
------------
CONNECTICUT TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000
------------
Net investment income 0.0071
Dividends from net investment income (0.0071)
------------
Net asset value at end of year $ 1.0000
============
Total Return 0.71%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 26.0
Ratio of expenses to average net assets 1.00%(a)
Ratio of expenses to average net
assets net of fee waivers 1.00%(a)
Ratio of net investment income to
average net assets 1.41%(a)
<Caption>
YEARS ENDED MAY 31,
------------------------------------------------------------------------
2005 2004 2003 2002 2001
------------ ------------ ------------ ------------ ------------
CONNECTICUT TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
Net investment income 0.0068 0.0006 0.0025 0.0092 0.0273
Dividends from net investment income (0.0068) (0.0006) (0.0025) (0.0092) (0.0273)
------------ ------------ ------------ ------------ ------------
Net asset value at end of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
============ ============ ============ ============ ============
Total Return 0.68% 0.06% 0.25% 0.92% 2.75%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 23.4 $ 21.5 $ 36.4 $ 41.2 $ 40.2
Ratio of expenses to average net assets 1.00% 1.00% 1.00% 1.01% 1.01%
Ratio of expenses to average net
assets net of fee waivers 1.00% 0.86% 0.98% 1.01% 1.01%
Ratio of net investment income to
average net assets 0.68% 0.06% 0.25% 0.92% 2.73%
</Table>
41
<Page>
<Table>
<Caption>
SIX
MONTHS
ENDED
NOV. 30,
2005
------------
FLORIDA TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000
------------
Net investment income 0.0075
Dividends from net investment income (0.0075)
------------
Net asset value at end of year $ 1.0000
============
Total Return 0.76%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 53.3
Ratio of expenses to average net
assets 1.00%(a)
Ratio of expenses to average net
assets net of fee waivers 1.00%(a)
Ratio of net investment income to
average net assets 1.51%(a)
<Caption>
YEARS ENDED MAY 31,
------------------------------------------------------------------------
2005 2004 2003 2002 2001
------------ ------------ ------------ ------------ ------------
FLORIDA TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
Net investment income 0.0072 0.0006 0.0036 0.0105 0.0294
Dividends from net investment income (0.0072) (0.0006) (0.0036) (0.0105) (0.0294)
------------ ------------ ------------ ------------ ------------
Net asset value at end of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
============ ============ ============ ============ ============
Total Return 0.73% 0.06% 0.36% 1.05% 2.98%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 43.1 $ 39.5 $ 45.9 $ 32.1 $ 28.9
Ratio of expenses to average net
assets 1.00% 1.00% 1.00% 1.00% 1.01%
Ratio of expenses to average net
assets net of fee waivers 1.00% 0.91% 0.99% 1.00% 1.01%
Ratio of net investment income to
average net assets 0.74% 0.06% 0.35% 0.99% 2.94%
</Table>
<Table>
<Caption>
SIX
MONTHS
ENDED
NOV. 30,
2005
------------
MASSACHUSETTS TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000
------------
Net investment income 0.0073
Dividends from net investment income (0.0073)
------------
Net asset value at end of year $ 1.0000
============
Total Return 0.74%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 18.8
Ratio of expenses to average net
assets 1.00%(a)
Ratio of expenses to average net
assets net of fee waivers 1.00%(a)
Ratio of net investment income to
average net assets 1.45%(a)
<Caption>
YEARS ENDED MAY 31,
------------------------------------------------------------------------
2005 2004 2003 2002 2001
------------ ------------ ------------ ------------ ------------
MASSACHUSETTS TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
Net investment income 0.0068 0.0006 0.0030 0.0099 0.0279
Dividends from net investment income (0.0068) (0.0006) (0.0030) (0.0099) (0.0279)
------------ ------------ ------------ ------------ ------------
Net asset value at end of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
============ ============ ============ ============ ============
Total Return 0.68% 0.06% 0.30% 0.99% 2.85%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 22.2 $ 17.8 $ 20.8 $ 21.0 $ 18.8
Ratio of expenses to average net
assets 1.01% 1.01% 1.00% 1.00% 1.00%
Ratio of expenses to average net
assets net of fee waivers 1.00% 0.88% 0.98% 1.00% 1.00%
Ratio of net investment income to
average net assets 0.69% 0.06% 0.30% 0.99% 2.79%
</Table>
42
<Page>
<Table>
<Caption>
SIX
MONTHS
ENDED
NOV. 30,
2005
------------
MICHIGAN TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000
------------
Net investment income 0.0074
Dividends from net investment income (0.0074)
------------
Net asset value at end of year $ 1.0000
============
Total Return 0.74%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 14.2
Ratio of expenses to average net
assets 1.00%(a)
Ratio of expenses to average net
assets net of fee waivers 1.00%(a)
Ratio of net investment income to
average net assets 1.46%(a)
<Caption>
YEARS ENDED MAY 31,
------------------------------------------------------------------------
2005 2004 2003 2002 2001
------------ ------------ ------------ ------------ ------------
MICHIGAN TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
Net investment income 0.0069 0.0006 0.0029 0.0080 0.0276
Dividends from net investment income (0.0069) (0.0006) (0.0029) (0.0080) (0.0276)
------------ ------------ ------------ ------------ ------------
Net asset value at end of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
============ ============ ============ ============ ============
Total Return 0.70% 0.06% 0.29% 0.81% 2.83%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 16.6 $ 12.1 $ 7.9 $ 8.5 $ 4.8
Ratio of expenses to average net
assets 1.01% 1.00% 1.00% 1.01% 1.00%
Ratio of expenses to average net
assets net of fee waivers 1.00% 0.91% 0.98% 1.00% 1.00%
Ratio of net investment income to
average net assets 0.77% 0.06% 0.29% 0.64% 2.76%
</Table>
<Table>
<Caption>
SIX
MONTHS
ENDED
NOV. 30,
2005
------------
NEW JERSEY TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000
------------
Net investment income 0.0072
Dividends from net investment income (0.0072)
------------
Net asset value at end of year $ 1.0000
============
Total Return 0.72%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 50.5
Ratio of expenses to average net
assets 1.00%(a)
Ratio of expenses to average net
assets net of fee waivers 1.00%(a)
Ratio of net investment income to
average net assets 1.43%(a)
<Caption>
YEARS ENDED MAY 31,
------------------------------------------------------------------------
2005 2004 2003 2002 2001
------------ ------------ ------------ ------------ ------------
NEW JERSEY TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
Net investment income 0.0068 0.0006 0.0029 0.0101 0.0277
Dividends from net investment income (0.0068) (0.0006) (0.0029) (0.0101) (0.0277)
------------ ------------ ------------ ------------ ------------
Net asset value at end of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
============ ============ ============ ============ ============
Total Return 0.68% 0.06% 0.29% 1.01% 2.83%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 45.0 $ 50.2 $ 56.0 $ 57.5 $ 52.9
Ratio of expenses to average net
assets 1.00% 1.00% 1.00% 1.01% 1.01%
Ratio of expenses to average net
assets net of fee waivers 0.99% 0.87% 0.97% 1.01% 1.01%
Ratio of net investment income to
average net assets 0.66% 0.06% 0.28% 0.94% 2.77%
</Table>
43
<Page>
<Table>
<Caption>
SIX
MONTHS
ENDED
NOV. 30,
2005
------------
OHIO TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000
------------
Net investment income 0.0075
Dividends from net investment income (0.0075)
------------
Net asset value at end of year $ 1.0000
============
Total Return 0.75%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 20.4
Ratio of expenses to average net
assets 1.00%(a)
Ratio of expenses to average net
assets net of fee waivers 1.00%(a)
Ratio of net investment income to
average net assets 1.50%(a)
<Caption>
YEARS ENDED MAY 31,
------------------------------------------------------------------------
2005 2004 2003 2002 2001
------------ ------------ ------------ ------------ ------------
OHIO TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
Net investment income 0.0071 0.0006 0.0030 0.0082 0.0281
Dividends from net investment income (0.0071) (0.0006) (0.0030) (0.0082) (0.0281)
------------ ------------ ------------ ------------ ------------
Net asset value at end of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
============ ============ ============ ============ ============
Total Return 0.71% 0.06% 0.30% 0.83% 2.88%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 19.0 $ 10.9 $ 10.4 $ 5.7 $ 8.1
Ratio of expenses to average net
assets 1.00% 1.01% 1.00% 1.01% 1.00%
Ratio of expenses to average net
assets net of fee waivers 1.00% 0.92% 0.99% 1.01% 1.00%
Ratio of net investment income to
average net assets 0.79% 0.06% 0.29% 0.81% 2.81%
</Table>
<Table>
<Caption>
SIX
MONTHS
ENDED
NOV. 30,
2005
------------
PENNSYLVANIA TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000
------------
Net investment income 0.0076
Dividends from net investment income (0.0076)
------------
Net asset value at end of year $ 1.0000
============
Total Return 0.76%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 49.9
Ratio of expenses to average net
assets 1.00%(a)
Ratio of expenses to average net
assets net of fee waivers 1.00%(a)
Ratio of net investment income to
average net assets 1.52%(a)
<Caption>
YEARS ENDED MAY 31,
------------------------------------------------------------------------
2005 2004 2003 2002 2001
------------ ------------ ------------ ------------ ------------
PENNSYLVANIA TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
Net investment income 0.0070 0.0007 0.0036 0.0097 0.0287
Dividends from net investment income (0.0070) (0.0007) (0.0036) (0.0097) (0.0287)
------------ ------------ ------------ ------------ ------------
Net asset value at end of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
============ ============ ============ ============ ============
Total Return 0.70% 0.07% 0.36% 0.97% 2.97%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 44.7 $ 46.1 $ 40.6 $ 51.5 $ 34.1
Ratio of expenses to average net
assets 1.00% 1.00% 1.00% 1.01% 1.00%
Ratio of expenses to average net
assets net of fee waivers 1.00% 0.93% 1.00% 1.01% 1.00%
Ratio of net investment income to
average net assets 0.70% 0.07% 0.34% 0.89% 2.87%
</Table>
44
<Page>
<Table>
<Caption>
SIX
MONTHS
ENDED
NOV. 30,
2005
------------
VIRGINIA TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000
------------
Net investment income 0.0070
Dividends from net investment income (0.0070)
------------
Net asset value at end of year $ 1.0000
============
Total Return 0.71%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 14.1
Ratio of expenses to average net
assets 1.00%(a)
Ratio of expenses to average net
assets net of fee waivers 1.00%(a)
Ratio of net investment income to
average net assets 1.41%(a)
<Caption>
YEARS ENDED MAY 31,
------------------------------------------------------------------------
2005 2004 2003 2002 2001
------------ ------------ ------------ ------------ ------------
VIRGINIA TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
Net investment income 0.0067 0.0006 0.0025 0.0069 0.0253
Dividends from net investment income (0.0067) (0.0006) (0.0025) (0.0069) (0.0253)
------------ ------------ ------------ ------------ ------------
Net asset value at end of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
============ ============ ============ ============ ============
Total Return 0.67% 0.06% 0.25% 0.69% 2.77%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 13.7 $ 11.0 $ 11.3 $ 13.0 $ 6.7
Ratio of expenses to average net
assets 1.00% 1.00% 1.00% 1.01% 1.00%
Ratio of expenses to average net
assets net of fee waivers 1.00% 0.90% 0.95% 0.99% 1.00%
Ratio of net investment income to
average net assets 0.70% 0.06% 0.24% 0.60% 2.53%
<Caption>
SIX
MONTHS
ENDED
NOV. 30,
2005
------------
NEW YORK TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000
------------
Net investment income 0.0070
Dividends from net investment income (0.0070)
------------
Net asset value at end of year $ 1.0000
============
Total Return 0.70%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 174.1
Ratio of expenses to average net
assets 1.00%(a)
Ratio of expenses to average net
assets net of fee waivers 1.00%(a)
Ratio of net investment income to
average net assets 1.39%(a)
<Caption>
YEARS ENDED MAY 31,
------------------------------------------------------------------------
2005 2004 2003 2002 2001
------------ ------------ ------------ ------------ ------------
NEW YORK TAX-EXEMPT FUND
Net asset value at beginning of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------ ------------
Net investment income 0.0067 0.0006 0.0034 0.0095 0.0281
Dividends from net investment income (0.0067) (0.0006) (0.0034) (0.0095) (0.0281)
------------ ------------ ------------ ------------ ------------
Net asset value at end of year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
============ ============ ============ ============ ============
Total Return 0.67% 0.06% 0.34% 0.95% 2.87%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (millions) $ 164.4 $ 172.6 $ 228.4 $ 234.4 $ 281.6
Ratio of expenses to average net
assets 1.02% 1.02% 1.00% 1.01% 1.01%
Ratio of expenses to average net
assets net of fee waivers 1.01% 0.89% 0.99% 1.01% 1.01%
Ratio of net investment income to
average net assets 0.66% 0.06% 0.34% 0.94% 2.81%
</Table>
45
<Page>
<Table>
<Caption>
SIX
MONTHS
ENDED
NOV. 30,
2005
------------
LOUISIANA MUNICIPAL MONEY-MARKET FUND
Net asset value at beginning of period $ 1.0000
------------
Net investment income 0.0086
Dividends from net investment income (0.0086)
------------
Net asset value at end of period $ 1.0000
============
Total Return 0.86%
RATIOS/SUPPLEMENTAL DATA
Net assets end of period (millions) $ 1.3
Ratio of expenses to average net assets 1.00%(a)
Ratio of expenses to average net assets net
of fee waivers 0.49%(a)
Ratio of net investment income to average
net assets 1.97%(a)
<Caption>
APRIL 17
YEARS ENDED MAY 31, 2002* TO
------------------------------------------ MAY 31,
2005 2004 2003 2002
------------ ------------ ------------ ------------
LOUISIANA MUNICIPAL MONEY-MARKET FUND
Net asset value at beginning of period $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------
Net investment income 0.0065 0.0007 0.0032 0.0014
Dividends from net investment income (0.0065) (0.0007) (0.0032) (0.0014)
------------ ------------ ------------ ------------
Net asset value at end of period $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
============ ============ ============ ============
Total Return 0.66% 0.07% 0.32% 0.14%
RATIOS/SUPPLEMENTAL DATA
Net assets end of period (millions) $ 0.3 $ 0.2 $ 0.1 $ 0.1
Ratio of expenses to average net assets 1.01% 1.00% 1.00% 1.04%(a)
Ratio of expenses to average net assets net
of fee waivers 1.00% 0.64% 0.57% 0.00%(a)
Ratio of net investment income to average
net assets 0.74% 0.06% 0.32% 1.15%(a)
</Table>
<Table>
<Caption>
SIX
MONTHS
ENDED
NOV. 30,
2005
------------
MINNESOTA MUNICIPAL MONEY-MARKET FUND
Net asset value at beginning of period $ 1.0000
------------
Net investment income 0.0069
Dividends from net investment income (0.0069)
------------
Net asset value at end of period $ 1.0000
============
Total Return 0.70%
RATIOS/SUPPLEMENTAL DATA
Net assets end of period (millions) $ 2.4
Ratio of expenses to average net assets 1.00%(a)
Ratio of expenses to average net assets net
of fee waivers 0.95%(a)
Ratio of net investment income to average
net assets 1.41%(a)
<Caption>
APRIL 17
YEARS ENDED MAY 31, 2002* TO
------------------------------------------ MAY 31,
2005 2004 2003 2002
------------ ------------ ------------ ------------
MINNESOTA MUNICIPAL MONEY-MARKET FUND
Net asset value at beginning of period $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
------------ ------------ ------------ ------------
Net investment income 0.0066 0.0006 0.0044 0.0017
Dividends from net investment income (0.0066) (0.0006) (0.0044) (0.0017)
------------ ------------ ------------ ------------
Net asset value at end of period $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000
============ ============ ============ ============
Total Return 0.66% 0.06% 0.44% 0.17%
RATIOS/SUPPLEMENTAL DATA
Net assets end of period (millions) $ 1.4 $ 0.6 $ 0.2 $ 0.1
Ratio of expenses to average net assets 1.00% 1.01% 1.00% 1.04%(a)
Ratio of expenses to average net assets net
of fee waivers 0.99% 0.78% 0.69% 0.00%(a)
Ratio of net investment income to average
net assets 0.78% 0.06% 0.43% 1.40%(a)
</Table>
- ----------
* Inception of Class Operations.
(a) Annualized.
^ Amount is less than $50,000.
(8) OTHER MATTERS
Management has determined that certain of the Funds' service contracts and
distribution plans have lapsed due to an administrative error. RMCI is
taking all necessary steps to remedy this, including obtaining Board and
shareholder approval of the retention of fees paid and the approval of new
service contracts and distribution plans.
(9) COMMITMENTS AND CONTINGENCIES:
In the normal course of business, the Funds enter into contracts that
contain a variety of representations and warranties and provide general
indemnifications. The Funds' general exposure under these arrangements is
unknown, as this would involve future claims that may be made against the
Funds that have not yet occurred. However, based on experience, the Funds
expect the risk of loss to be remote.
46
<Page>
EXPENSE EXAMPLE (UNAUDITED)
As a shareholder of a Fund, you incur two types of costs: (1)
transaction/redemption fees; and (2) ongoing costs, including management fees;
distribution and/or service (12b-1) fees; and other Fund expenses. This Example
is intended to help you understand your ongoing costs (in dollars) of investing
in a Fund and to compare these costs with the ongoing costs of investing in
other mutual funds.
The Example is based on an investment of $1,000 invested at June 1, 2005 and
held for the entire period ending November 30, 2005.
ACTUAL EXPENSES
The first line of the table below provides information about actual account
values and actual expenses. You may use the information in this line, together
with the amount you invested, to estimate the expenses that you paid over the
period. Simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply the result by the number
in the first line under the heading entitled "Expenses Paid During Period" to
estimate the expenses you paid on your account during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line of the table below provides information about hypothetical
account values and hypothetical expenses based on each Fund's actual expense
ratio and an assumed rate of return of 5% per year before expenses, which is not
the actual return for any of the Funds. The hypothetical account values and
expenses may not be used to estimate the actual ending account balance or
expenses you paid for the period. You may use this information to compare the
ongoing costs of investing in each Fund with those of other funds. To do so,
compare this 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as sales
charges (loads), redemption fees, or exchange fees. Therefore, the second line
of the table is useful in comparing ongoing costs only, but will not help you
determine the relative total costs of owning different funds. In addition, if
these transactional costs were included, your costs would have been higher.
<Table>
<Caption>
BEGINNING ACCOUNT VALUE ENDING ACCOUNT VALUE
MAY 31, 2005 NOVEMBER 30, 2005 EXPENSES PAID DURING PERIOD*
----------------------- -------------------- ----------------------------
INTERSTATE TAX-EXEMPT CLASS R
Actual $ 1,000.00 $ 1,003.71 $ 5.01
Hypothetical $ 1,000.00 $ 1,019.81 $ 5.26
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 1.00%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
INTERSTATE TAX-EXEMPT TREASURER'S TRUST
Actual $ 1,000.00 $ 1,004.76 $ 3.01
Hypothetical $ 1,000.00 $ 1,021.91 $ 3.16
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 0.60%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
INTERSTATE TAX-EXEMPT CLASS 75
Actual $ 1,000.00 $ 1,004.36 $ 3.76
Hypothetical $ 1,000.00 $ 1,021.12 $ 3.95
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 0.75%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
INTERSTATE TAX- EXEMPT CLASS 70
Actual $ 1,000.00 $ 1,004.46 $ 3.51
Hypothetical $ 1,000.00 $ 1,021.38 $ 3.69
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 0.70%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
47
<Page>
<Table>
<Caption>
BEGINNING ACCOUNT VALUE ENDING ACCOUNT VALUE
MAY 31, 2005 NOVEMBER 30, 2005 EXPENSES PAID DURING PERIOD*
----------------------- -------------------- ----------------------------
INTERSTATE TAX- EXEMPT CLASS 45
Actual $ 1,000.00 $ 1,005.11 $ 2.26
Hypothetical $ 1,000.00 $ 1,022.70 $ 2.37
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 0.45%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
INTERSTATE TAX- EXEMPT CLASS 25
Actual $ 1,000.00 $ 1,005.62 $ 1.25
Hypothetical $ 1,000.00 $ 1,023.75 $ 1.32
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 0.25%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
INTERSTATE TAX- EXEMPT CLASS 15
Actual $ 1,000.00 $ 1,005.87 $ 0.75
Hypothetical $ 1,000.00 $ 1,024.28 $ 0.79
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 0.15%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
INTERSTATE TAX- EXEMPT CLASS 12
Actual $ 1,000.00 $ 1,005.97 $ 0.60
Hypothetical $ 1,000.00 $ 1,024.44 $ 0.63
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 0.12%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
INTERSTATE TAX- EXEMPT CLASS 8
Actual $ 1,000.00 $ 1,006.07 $ 0.40
Hypothetical $ 1,000.00 $ 1,024.65 $ 0.42
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 0.08%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
CALIFORNIA TAX-EXEMPT
Actual $ 1,000.00 $ 1,003.56 $ 5.01
Hypothetical $ 1,000.00 $ 1,019.81 $ 5.26
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 1.00%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
CONNECTICUT TAX-EXEMPT
Actual $ 1,000.00 $ 1,003.56 $ 5.01
Hypothetical $ 1,000.00 $ 1,019.81 $ 5.26
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 1.00%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
FLORIDA TAX-EXEMPT
Actual $ 1,000.00 $ 1,003.81 $ 5.01
Hypothetical $ 1,000.00 $ 1,019.81 $ 5.26
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 1.00%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
MASSACHUSETTS TAX-EXEMPT
Actual $ 1,000.00 $ 1,003.71 $ 5.01
Hypothetical $ 1,000.00 $ 1,019.81 $ 5.26
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 1.00%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
48
<Page>
<Table>
<Caption>
BEGINNING ACCOUNT VALUE ENDING ACCOUNT VALUE
MAY 31, 2005 NOVEMBER 30, 2005 EXPENSES PAID DURING PERIOD*
----------------------- -------------------- ----------------------------
MICHIGAN TAX-EXEMPT
Actual $ 1,000.00 $ 1,003.71 $ 5.01
Hypothetical $ 1,000.00 $ 1,019.81 $ 5.26
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 1.00%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
NEW JERSEY TAX-EXEMPT
Actual $ 1,000.00 $ 1,003.61 $ 5.01
Hypothetical $ 1,000.00 $ 1,019.81 $ 5.26
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 1.00%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
OHIO TAX-EXEMPT
Actual $ 1,000.00 $ 1,003.76 $ 5.01
Hypothetical $ 1,000.00 $ 1,019.81 $ 5.26
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 1.00%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
PENNSYLVANIA TAX-EXEMPT
Actual $ 1,000.00 $ 1,003.81 $ 5.01
Hypothetical $ 1,000.00 $ 1,019.81 $ 5.26
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 1.00%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
VIRGINIA TAX-EXEMPT
Actual $ 1,000.00 $ 1,003.56 $ 5.01
Hypothetical $ 1,000.00 $ 1,019.81 $ 5.26
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 1.00%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
NEW YORK TAX-EXEMPT
Actual $ 1,000.00 $ 1,003.51 $ 5.01
Hypothetical $ 1,000.00 $ 1,019.81 $ 5.26
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 1.00%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
LOUISIANA MUNICIPAL MONEY-MARKET FUND
Actual $ 1,000.00 $ 1,006.12 $ 2.46
Hypothetical $ 1,000.00 $ 1,022.49 $ 2.58
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 0.49%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
<Table>
MINNESOTA MUNICIPAL MONEY-MARKET FUND
Actual $ 1,000.00 $ 1,003.76 $ 4.76
Hypothetical $ 1,000.00 $ 1,020.07 $ 5.00
</Table>
* Expenses are equal to the Fund's annualized expense ratio of 0.95%,
multiplied by the average account value over the period, multiplied by
183/365 (to reflect the one-half year period).
49
<Page>
AVAILABILITY OF PROXY VOTING INFORMATION
The day-to-day investment management decisions of each Fund are the
responsibility of that Fund's investment adviser, RMCI. RMCI is primarily
responsible for determining how to vote proxies with respect to companies in
which the respective Fund invests and for the ongoing review and evaluation of
its own proxy voting policies and corresponding compliance with applicable law.
RMCI's proxy voting policies and procedures, as well as information about how a
particular proxy was voted, may be obtained without charge by calling
800-637-1700 to request a copy or by visiting the SEC's website at www.sec.gov.
Information regarding how each Fund voted proxies relating to portfolio
securities during the 12-month period ended June 30, 2005 is available on the
SEC's website or by calling the toll-free number listed above.
AVAILABILITY OF QUARTERLY PORTFOLIO SCHEDULE
The Funds file a complete schedule of portfolio holdings with the SEC for the
first and third quarters of each fiscal year on Form N-Q. The Forms N-Q are
available on the SEC's website at www.sec.gov and may be reviewed and copied at
the SEC's Public Reference Room in Washington, DC. Information on the operation
of the Public Reference Room may be obtained by calling 1-800-SEC-0330.
APPROVAL OF "COMPREHENSIVE FEE" INVESTMENT MANAGEMENT AGREEMENTS
The Investment Management Agreements are renewed annually if approved by the
Trustees and by a separate vote of a majority of the non-interested Trustees.
Each Investment Management Agreement may be terminated without penalty, upon
sixty (60) days' written notice by RMCI or by a vote of the Trustees or of a
majority of the outstanding voting shares of a Fund. The Board met on June 30,
2005, to consider the approval of the Investment Management Agreements with
RMCI. At that meeting, the Board had the opportunity to meet with the
representatives of RMCI to determine whether each agreement is in the best
interests of the respective Fund and its shareholders. The Board, including a
majority of the Independent Trustees, so concluded and voted to recommend each
Investment Management Agreement to the respective Fund's shareholders for their
approval (where applicable).
NATURE, EXTENT AND QUALITY OF SERVICE
The Board received and considered information regarding the nature, extent and
quality of the advisory and other services provided to each Fund by RMCI. The
Board considered the background and experience of RMCI's management and the
expertise of personnel of RMCI with regard to investing in the type of
securities in which the Funds invest. The Trustees concluded that the nature and
extent of the services provided by RMCI under each Investment Management
Agreement were necessary and appropriate for the conduct and the business and
investment activities of each Fund. The Trustees also concluded that the quality
of the advisory and administrative services was satisfactory.
COMPARATIVE FEE AND EXPENSES
The comprehensive management fee charged under each Investment Management
Agreement encompasses all of the services necessary for the operation of the
relevant Fund. Therefore, in evaluating the fee relative to other funds the
Trustees thought the most appropriate comparison was to the respective expense
ratios of the Funds. The Trustees compared each Fund's expense ratio to (i) the
average expense ratio of all money market funds with similar investment
objectives and policies; and (ii) the expense ratios of money market funds which
are believed to be direct competitors of the Funds ("peer funds"), i.e., money
market funds which are distributed through third-party broker/dealers and other
financial institutions which do not have their own proprietary money market
funds. The Trustees noted that the expense ratio of the institutional classes of
shares of each Fund was comparable to or lower than the average expense ratio of
other money market funds as well as those of peer funds. They also noted that
the expense ratios of the retail classes of shares were higher than the average
of other money market funds but comparable to the expense ratios of peer funds.
Based upon their review, the Trustees concluded that the fee payable under each
Investment Management Agreement is competitive.
COMPARATIVE PERFORMANCE
The Trustees noted that each of the Funds slightly underperformed relative to
other money market funds with similar objectives and policies. In this regard,
the Trustees noted that the Funds generally invest in a more conservative and
risk averse manner than their peers. For example,
50
<Page>
the Funds do not invest in commercial paper and typically have a shorter average
maturity than many other money market funds. The Trustees concluded that, under
the circumstances, the performance of the Funds was satisfactory.
PROFITABILITY
The Trustees received, analyzed and considered a profitability analysis of RMCI
based on the fees paid and payable under each Investment Management Agreement,
including any fee waivers or fee caps, and the costs incurred to provide
required services, as well as other relationships between the Funds on the one
hand and RMCI affiliates on the other. The Trustees concluded, with respect to
each Fund, that RMCI's profitability was not excessive in light of the nature,
extent and quality of the services provided and expected to be provided under
Investment Management Agreements.
BREAKPOINTS AND ECONOMIES OF SCALE
As the comprehensive management fee is currently structured, fee levels do not
reflect economies of scale that potentially could be realized as the Funds grow.
The Trustees noted the potential benefits to shareholders of a comprehensive fee
which would tend to limit increases in the Funds' expense ratios even if the
costs of providing services increase and the related entrepreneurial risk
assumed by RMCI through such an approach. Based on the foregoing, the Trustees
concluded that the absence of breakpoints was reasonable.
OTHER BENEFITS
The Trustees concluded that RMCI does not realize any other quantifiable
material benefits from its relationship with the Funds.
No single factor reviewed by the Board was identified by the Board as the
principal factor in determining whether to approve the Investment Management
Agreements with respect to each Fund.
SUBSEQUENT EVENTS
The Independent Trustees met on September 22, 2005 to reconsider their previous
determinations regarding the Investment Management Agreements in light of
certain deficiencies in internal controls identified by RMCI related to
reconciling bank statements, monitoring compliance with certain Internal Revenue
Code requirements and identifying and collecting amounts due certain of funds in
the Reserve/Hallmark complex. The Independent Trustees were advised that these
matters had previously been discussed with the Audit Committee and the Funds'
independent auditors and that RMCI has instituted additional procedures to
enhance its internal controls for the Funds and committed to continue to
strengthen the Funds' overall control environment. The Independent Trustees were
further advised that the identified deficiencies had no material impact to
shareholders, fund net asset value or Fund performance.
The Independent Trustees expressed concern about the quality of certain
non-advisory services provided by RMCI but were satisfied with steps RMCI had
taken and had committed to take. Based on consideration of all factors they
deemed relevant, including the steps taken by RMCI and RMCI's commitment to
continue to strengthen the overall control environment, the Independent Trustees
reaffirmed their previous determinations to approve the Investment Management
Agreements.
CHANGES IN ACCOUNTANTS
On September 29, 2005, PricewaterhouseCoopers, LLP informed management that it
was resigning as independent accountants for the Funds. PricewaterhouseCoopers,
LLP was previously engaged as the independent registered public accounting firm
to audit the Funds' financial statements.
PricewaterhouseCoopers, LLP issued reports on the Fund's financial statements as
of May 31, 2004 and May 31, 2005. Such reports did not contain an adverse
opinion or a disclaimer of opinion, nor were they qualified or modified as to
uncertainty, audit scope, or accounting principles.
PricewaterhouseCoopers, LLP's resignation was accepted by the Funds' Audit
Committee and the Board of Trustees.
During the fiscal year ended May 31, 2004, the fiscal year ended May 31, 2005
and through September 29, 2005 there were no disagreements with
PricewaterhouseCoopers, LLP on any matter of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure, which
disagreements, if not resolved to the satisfaction of PricewaterhouseCoopers,
LLP, would have caused it to make reference to the subject matter of the
disagreements in connection with its report. During the fiscal year ended May
31, 2004, the fiscal year ended May 31, 2005 and through September 29, 2005 none
of the events enumerated in paragraphs (1)(v)(B) through (D) of Item 304(a) of
Regulation S-K occurred.
51
<Page>
As part of its report dated September 26, 2005 filed as an exhibit to the Funds'
Form N-SAR filed on September 28, 2005, PricewaterhouseCoopers, LLP advised
management that certain bank accounts were not reconciled adequately and that
procedures were not adequate to ensure compliance with Internal Revenue Code
requirements necessary to eliminate tax at the Fund level. These conditions have
been corrected.
The Funds have selected KPMG, LLP as their new auditors as of December 28, 2005.
The Funds provided PricewaterhouseCoopers LLP with a copy of these disclosures
and have requested PricewaterhouseCoopers LLP to furnish the Funds with a letter
addressed to the Commission stating whether it agrees with the statements made
by the Funds herein and, if not, stating the respects in which it does not
agree. A copy of such letter is filed as an exhibit to the Trust's most recently
filed Form N-SAR.
52
<Page>
(This page has been left blank intentionally.)
<Page>
ITEM 2. CODE OF ETHICS.
Not applicable.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
Not applicable, as the schedule of investments in securities of unaffiliated
issuers as of the close of the reporting period is included as part of the
report to shareholders filed under Item 1 of this Form.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATES.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The Chief Executive and Financial Officers concluded that the Registrant's
Disclosure Controls and Procedures are effective based on the evaluation of the
Disclosure Controls and Procedures as of a date within 90 days of the filing
date of this report.
(b) There has been no change in the Registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred
during the second fiscal quarter of the period covered by this report that has
materially affected, or is reasonably likely to materially affect, the
Registrant's internal control over financial reporting.
<Page>
ITEM 12. EXHIBITS.
(a)(1) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2 requirements through filing of an exhibit: Not
applicable.
(a)(2) Certification of chief executive officer and chief financial
officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002:
Filed herewith
(b) Certification of chief executive officer and chief financial
officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002:
Furnished herewith
<Page>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, as amended, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.
Reserve Municipal Money Market Trust
By: /s/ Bruce R. Bent II
--------------------
Name: Bruce R. Bent II
Title: Co-Chief Executive Officer
Date: February 3, 2006
By: /s/ Arthur T. Bent III
----------------------
Name: Arthur T. Bent III
Title: Co-Chief Executive Officer
Date: February 3, 2006
Pursuant to the requirements of the Securities Exchange Act of 1934
and the Investment Company Act of 1940, as amended, this report has been signed
by the following persons on behalf of the registrant and in the capacities and
on the dates indicated.
By: /s/ Bruce R. Bent II
--------------------
Name: Bruce R. Bent II
Title: Co-Chief Executive Officer
Date: February 3, 2006
By: /s/ Arthur T. Bent III
----------------------
Name: Arthur T. Bent III
Title: Co-Chief Executive Officer
Date: February 3, 2006
By: /s/ Bruce R. Bent
------------------
Name: Bruce R. Bent
Title: Treasurer and Chief Financial Officer
Date: February 3, 2006