AQUILA INVESTMENT MANAGEMENT LLC

AQUILA INVESTMENT MANAGEMENT LLC

May 15, 2014

Board of Trustees of

Aquila Tax-Free Fund of Colorado

000 Xxxx 00xx Xxxxxx

Suite 3600

New York, New York  10036

Re:           Investment Advisory Fee Waiver

Ladies and Gentlemen:

Reference is made to that certain Advisory and Administration Agreement, dated as of October 11, 2013 (the “Agreement”) by and between Aquila Investment Management LLC (the “Manager”) and Aquila Tax-Free Fund of Colorado (the “Fund”), pursuant to which the Manager has agreed to provide certain investment advisory and administrative services to the Fund.

The parties have agreed that the Manager shall waive certain fees otherwise payable to it under the Agreement as provided herein.  Accordingly, the Manager hereby agrees that for the period from the date hereof until the Termination Date (as defined below), the Manager shall waive that portion of the fee to which it is otherwise entitled under the Agreement so that the Manager’s fees shall be as follows:

The annual rates payable shall be equivalent to 0.48 of 1% of such net asset value on net assets of the Fund up to $400,000,000; 0.46 of 1% of the Fund’s net assets above that amount to $1,000,000,000 and 0.44 of 1% of the Fund’s net assets above $1,000,000,000.

As used herein:

·   “Termination Date” means earliest of (1) the termination of the Agreement, (2) the date as of which the Fund ceases to operate, (3) the date as of which the Sub-Advisory Fee Waiver (as defined below) is eliminated or removed or (4) September 30, 2015; and

·   “Sub-Advisory Fee Waiver” means the waiver of sub-advisory fees payable to Davidson Fixed Income Management, Inc., doing business as Xxxxxxxxxxx Xxxxxx Capital Management, the sub-adviser to the Fund (the “Sub-Adviser”), reflected in the 2014 letter agreement dated as of May 13, 2014 between the Manager, the Fund and the Sub-Adviser.

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The arrangement set forth in this letter may be amended only with the written agreement of the parties hereto.

Please sign below to confirm your agreement with the foregoing.

AQUILA INVESTMENT MANAGEMENT LLC

(Registrant)

By:           /s/ Xxxxx X. Xxxxxxxx                                                      

Xxxxx X. Xxxxxxxx

President and Chief Executive Officer

Accepted and agreed:

AQUILA TAX-FREE FUND OF COLORADO

By:           /s/ Xxxxxxx X. Xxxxxx, III                                                      

Name:  Xxxxxxx X. Xxxxxx, III

Title:  Executive Vice President