##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
 For quarterly period ended June 30, 2005
    
    Commission file number 333-40028
 Front Range Capital Corporation
  Colorado
    
    84-0970160(State or other jurisdiction
incorporation or organization)
    
    (I.R.S. Employer
Identification No.)390 Interlocken Crescent Suite 600, Broomfield, Colorado
    
    80021(Address of principal executive offices)
    
    (Zip code)
 (303) 926-0300
  Yes þ
    
    No o
  Yes o
    
    No þ




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PageFORWARD-LOOKING STATEMENTS
    
    
    1PART I  FINANCIAL INFORMATION
    
    
    2Item 1. Financial Statements
    
    
    2Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    9Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    21Item 4. Controls and Procedures
    
    
    23PART II  OTHER INFORMATION
    
    
    24Item 1. Legal Proceedings
    
    
    24Item 5. Other Information
    
    
    24Item 6. Exhibits
    
    
    26SIGNATURES
    
    
    27Rule 13a-14(a)/15d-14(a) Certification of CEORule 13a-14(a)/15d-14(a) Certification of CFOSection 1350 Certification of CEOSection 1350 Certification of CFO




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##### Table of Contents



§
    
    the strength of the United States and Colorado economies which may be less favorable than
expected;§
    
    the economic impact of the war in Iraq;§
    
    changes in the interest rate environment;§
    
    changes in laws, regulations and policies affecting banking, securities and monetary and
financial matters;§
    
    significantly increasing competitive pressure in the banking industry;§
    
    operational risks including data processing system failures or fraud;§
    
    consumer spending and saving habits;§
    
    changes in accounting policies and practices;§
    
    volatility of rate sensitive deposits; and§
    
    asset/liability matching risks and liquidity risks.
  - 1 -




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Item 1. Financial Statements
 FRONT RANGE CAPITAL CORPORATION AND SUBSIDIARIES
 CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
 At June 30,
    
    At December 31,2005
    
    2004
    
    2004Assets:Cash and due from banks
    
    $
    15,127,000
    
    
    $
    13,611,000
    
    
    $
    14,298,000Investment securities available for sale
    
    
    80,161,000
    
    
    
    63,945,000
    
    
    
    80,806,000Nonmarketable securities
    
    
    4,396,000
    
    
    
    4,018,000
    
    
    
    4,084,000LoansReal estate-construction
    
    
    71,650,000
    
    
    
    58,854,000
    
    
    
    59,520,000Real estate-commercial
    
    
    146,578,000
    
    
    
    129,927,000
    
    
    
    142,256,000Real estate-residential
    
    
    51,964,000
    
    
    
    53,909,000
    
    
    
    50,462,000Commercial
    
    
    35,577,000
    
    
    
    33,451,000
    
    
    
    32,409,000Consumer
    
    
    6,771,000
    
    
    
    6,856,000
    
    
    
    6,501,000Total loans
    
    
    312,540,000
    
    
    
    282,997,000
    
    
    
    291,148,000Less unearned income
    
    
    (1,276,000
    )
    
    
    (1,238,000
    )
    
    
    (1,109,000
    )Loans, net of unearned income
    
    
    311,264,000
    
    
    
    281,759,000
    
    
    
    290,039,000Allowance for loan losses
    
    
    (3,661,000
    )
    
    
    (2,849,000
    )
    
    
    (3,553,000
    )Loans, net of allowance for loan losses
    
    
    307,603,000
    
    
    
    278,910,000
    
    
    
    286,486,000Premises and equipment, net
    
    
    10,801,000
    
    
    
    10,331,000
    
    
    
    10,963,000Cash value of life insurance
    
    
    8,321,000
    
    
    
    8,156,000
    
    
    
    8,297,000Other real estate owned
    
    
    10,767,000
    
    
    
    8,420,000
    
    
    
    10,302,000Accrued interest receivable
    
    
    1,496,000
    
    
    
    1,242,000
    
    
    
    1,347,000Deferred income taxes
    
    
    2,602,000
    
    
    
    2,481,000
    
    
    
    2,214,000Other assets
    
    
    1,304,000
    
    
    
    1,609,000
    
    
    
    1,611,000Total Assets
    
    $
    442,578,000
    
    
    $
    392,723,000
    
    
    $
    420,408,000Liabilities:Deposits:Noninterest-bearing demand
    
    $
    59,667,000
    
    
    $
    56,008,000
    
    
    $
    60,771,000Interest-bearing demand
    
    
    133,409,000
    
    
    
    113,972,000
    
    
    
    124,355,000Savings
    
    
    14,786,000
    
    
    
    15,941,000
    
    
    
    15,631,000Time certificates, $100,000 and over
    
    
    72,053,000
    
    
    
    71,769,000
    
    
    
    75,523,000Other time certificates
    
    
    62,735,000
    
    
    
    72,643,000
    
    
    
    67,912,000Total deposits
    
    
    342,650,000
    
    
    
    330,333,000
    
    
    
    344,192,000Short-term funds borrowed
    
    
    51,175,000
    
    
    
    11,815,000
    
    
    
    27,020,000Long-term debt
    
    
    11,307,000
    
    
    
    14,290,000
    
    
    
    11,499,000Subordinated debentures
    
    
    9,485,000
    
    
    
    9,485,000
    
    
    
    9,485,000Accrued interest payable
    
    
    801,000
    
    
    
    491,000
    
    
    
    672,000Other liabilities
    
    
    3,571,000
    
    
    
    3,363,000
    
    
    
    4,036,000Total Liabilities
    
    $
    418,989,000
    
    
    $
    369,777,000
    
    
    $
    396,904,000Shareholders Equity:Preferred stock, $.001 par value; authorized 100,000,000 shares;
issued and outstanding 14,067 shares,
    
    
    
    
    
    
    
    
    
    
    Additional paid-in capital, preferred stock
    
    
    3,620,000
    
    
    
    3,670,000
    
    
    
    3,620,000Common stock, Class A (voting) and Class B (non-voting),
$.001 par value; authorized 200,000,000 shares,
issued and outstanding 1,887,369 shares
    
    
    2,000
    
    
    
    2,000
    
    
    
    2,000Additional paid-in capital, common stock
    
    
    11,282,000
    
    
    
    11,282,000
    
    
    
    11,282,000Retained earnings
    
    
    9,108,000
    
    
    
    8,899,000
    
    
    
    8,364,000Accumulated other comprehensive income (loss)
    
    
    (423,000
    )
    
    
    (907,000
    )
    
    
    236,000Total Shareholders Equity
    
    
    23,589,000
    
    
    
    22,946,000
    
    
    
    23,504,000Total Liabilities and Shareholders Equity
    
    $
    442,578,000
    
    
    $
    392,723,000
    
    
    $
    420,408,000
  - 2 -




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FRONT RANGE CAPITAL CORPORATION AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
 Three months ended June 30,
    
    Six months ended June 30,2005
    
    2004
    
    2005
    
    2004(unaudited)
    
    (unaudited)Interest and Dividend Income:Interest and fees on loans
    
    $
    5,827,000
    
    
    $
    5,078,000
    
    
    $
    11,230,000
    
    
    $
    10,216,000Interest and dividends on investment
securities available for saleTaxable
    
    
    561,000
    
    
    
    385,000
    
    
    
    1,084,000
    
    
    
    793,000Tax exempt
    
    
    229,000
    
    
    
    196,000
    
    
    
    467,000
    
    
    
    371,000Dividends
    
    
    52,000
    
    
    
    39,000
    
    
    
    101,000
    
    
    
    83,000Interest on federal funds sold and other
    
    
    5,000
    
    
    
    2,000
    
    
    
    9,000
    
    
    
    4,000Total interest income
    
    
    6,674,000
    
    
    
    5,700,000
    
    
    
    12,891,000
    
    
    
    11,467,000Interest Expense:Interest on interest-bearing demand deposits
    
    
    463,000
    
    
    
    259,000
    
    
    
    919,000
    
    
    
    533,000Interest on savings
    
    
    18,000
    
    
    
    8,000
    
    
    
    37,000
    
    
    
    17,000Interest on time certificates of deposit
    
    
    1,164,000
    
    
    
    916,000
    
    
    
    2,201,000
    
    
    
    1,671,000Interest on short-term borrowing
    
    
    434,000
    
    
    
    49,000
    
    
    
    675,000
    
    
    
    162,000Interest on long-term debt
    
    
    155,000
    
    
    
    182,000
    
    
    
    309,000
    
    
    
    379,000Interest on subordinated debentures
    
    
    274,000
    
    
    
    274,000
    
    
    
    549,000
    
    
    
    549,000Total interest expense
    
    
    2,508,000
    
    
    
    1,688,000
    
    
    
    4,690,000
    
    
    
    3,311,000Net Interest Income
    
    
    4,166,000
    
    
    
    4,012,000
    
    
    
    8,201,000
    
    
    
    8,156,000Provision for loan losses
    
    
    207,000
    
    
    
    293,000
    
    
    
    506,000
    
    
    
    403,000Net Interest Income after Provision for Loan Losses
    
    
    3,959,000
    
    
    
    3,719,000
    
    
    
    7,695,000
    
    
    
    7,753,000Noninterest Income:Service charges and customer service fees
    
    
    580,000
    
    
    
    614,000
    
    
    
    1,115,000
    
    
    
    1,199,000Gain on sale of securities available for sale
    
    
    
    
    
    
    
    
    
    
    370,000
    
    
    
    207,000Mortgage referral fees
    
    
    109,000
    
    
    
    177,000
    
    
    
    194,000
    
    
    
    285,000Other
    
    
    260,000
    
    
    
    120,000
    
    
    
    416,000
    
    
    
    307,000Total Noninterest Income
    
    
    949,000
    
    
    
    911,000
    
    
    
    2,095,000
    
    
    
    1,998,000Noninterest Expense:Salaries and employee benefits
    
    
    2,627,000
    
    
    
    2,333,000
    
    
    
    5,033,000
    
    
    
    4,570,000Occupancy expense
    
    
    421,000
    
    
    
    419,000
    
    
    
    834,000
    
    
    
    846,000Furniture and equipment
    
    
    228,000
    
    
    
    197,000
    
    
    
    438,000
    
    
    
    389,000Data processing
    
    
    205,000
    
    
    
    202,000
    
    
    
    415,000
    
    
    
    401,000Marketing
    
    
    143,000
    
    
    
    192,000
    
    
    
    232,000
    
    
    
    324,000Printing and supplies
    
    
    63,000
    
    
    
    67,000
    
    
    
    143,000
    
    
    
    134,000Loan and collection
    
    
    72,000
    
    
    
    106,000
    
    
    
    194,000
    
    
    
    217,000ATM and Debit Card
    
    
    94,000
    
    
    
    83,000
    
    
    
    177,000
    
    
    
    192,000Other real
estate  Heritage Place
    
    
    144,000
    
    
    
    125,000
    
    
    
    272,000
    
    
    
    281,000Loss on sale of OREO and other foreclosed assets
    
    
    9,000
    
    
    
    (65,000
    )
    
    
    18,000
    
    
    
    34,000Other
    
    
    578,000
    
    
    
    612,000
    
    
    
    1,026,000
    
    
    
    1,087,000Total Noninterest Expense
    
    
    4,584,000
    
    
    
    4,271,000
    
    
    
    8,782,000
    
    
    
    8,475,000Income Before Income Taxes
    
    
    324,000
    
    
    
    359,000
    
    
    
    1,008,000
    
    
    
    1,276,000Provision for income taxes
    
    
    19,000
    
    
    
    48,000
    
    
    
    163,000
    
    
    
    280,000Net Income
    
    $
    305,000
    
    
    $
    311,000
    
    
    $
    845,000
    
    
    $
    996,000Comprehensive Income (loss):Change in unrealized gain (loss) on
securities available for sale, net
    
    
    446,000
    
    
    
    (1,393,000
    )
    
    
    (659,000
    )
    
    
    (1,150,000
    )Comprehensive Income (loss)
    
    $
    751,000
    
    
    
    ($1,082,000
    )
    
    $
    186,000
    
    
    
    ($154,000
    )Average Common Shares Outstanding
    
    
    1,887,369
    
    
    
    1,887,369
    
    
    
    1,887,369
    
    
    
    1,887,369Diluted Average Common Shares Outstanding
    
    
    1,897,869
    
    
    
    1,897,869
    
    
    
    1,897,869
    
    
    
    1,897,869Per Share DataBasic earnings
    
    $
    0.13
    
    
    $
    0.15
    
    
    $
    0.39
    
    
    $
    0.49Diluted earnings
    
    $
    0.13
    
    
    $
    0.15
    
    
    $
    0.39
    
    
    $
    0.49Dividends declared on common stock
    
    $
    0.00
    
    
    $
    0.00
    
    
    $
    0.00
    
    
    $
    0.00
  - 3 -




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##### Table of Contents



FRONT RANGE CAPITAL CORPORATION AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY
(UNAUDITED)
 AccumulatedOtherPreferred
    
    Common
    
    Retained
    
    ComprehensiveStock
    
    Stock
    
    Earnings
    
    Income (loss) , Net
    
    TotalBalance, December 31, 2003
    
    $
    3,670,000
    
    
    $
    11,284,000
    
    
    $
    7,975,000
    
    
    $
    243,000
    
    
    $
    23,172,000Net income for the period
    
    
    
    
    
    
    
    
    
    
    996,000
    
    
    
    
    
    
    
    996,000Change in unrealized gain on securities
available-for-sale, net of reclassification
adjustment and tax effects
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,150,000
    )
    
    
    (1,150,000
    )Dividends declared on 2000 Series B
preferred stock
    
    
    
    
    
    
    
    
    
    
    (72,000
    )
    
    
    
    
    
    
    (72,000
    )Balance June 30, 2004
    
    $
    3,670,000
    
    
    $
    11,284,000
    
    
    $
    8,899,000
    
    
    ($
    907,000
    )
    
    $
    22,946,000Balance, December 31, 2004
    
    $
    3,620,000
    
    
    $
    11,284,000
    
    
    $
    8,364,000
    
    
    $
    236,000
    
    
    $
    23,504,000Net income for the period
    
    
    
    
    
    
    
    
    
    
    845,000
    
    
    
    
    
    
    
    845,000Change in unrealized gain (loss) on securities
available-for-sale, net of reclassification
adjustment and tax effects
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (659,000
    )
    
    
    (659,000
    )Dividends declared on 2000 Series B
preferred stock
    
    
    
    
    
    
    
    
    
    
    (101,000
    )
    
    
    
    
    
    
    (101,000
    )Balance June 30, 2005
    
    $
    3,620,000
    
    
    $
    11,284,000
    
    
    $
    9,108,000
    
    
    ($
    423,000
    )
    
    $
    23,589,000
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FRONT RANGE CAPITAL CORPORATION AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 For the six monthsended June 30,2005
    
    2004(unaudited)Cash Flows from Operating Activities:Net income
    
    $
    845,000
    
    
    $
    996,000Adjustments to reconcile net income to net cash provided by
operating activities:Depreciation and amortization
    
    
    510,000
    
    
    
    476,000Net amortization of securities
    
    
    145,000
    
    
    
    165,000(Gain) on available for sale securities, net
    
    
    (370,000
    )
    
    
    (207,000
    )Provision for loan losses
    
    
    506,000
    
    
    
    403,000Loss on sale of OREO and foreclosed assets
    
    
    18,000
    
    
    
    133,000Net change in assets and liabilities:Decrease (increase) in accrued interest receivable
    
    
    (149,000

    )
    
    
    84,000Decrease (increase) in other assets
    
    
    304,000
    
    
    
    (127,000
    )Increase (decrease) in accrued interest payable
    
    
    129,000
    
    
    
    (30,000
    )(Decrease) in other liabilities
    
    
    (465,000
    )
    
    
    (367,000
    )Net Cash Provided by Operating Activities
    
    
    1,473,000
    
    
    
    1,526,000Cash Flows from Investing Activities:Proceeds from sale of securities available-for-sale
    
    
    7,356,000
    
    
    
    17,309,000Proceeds from maturities, payments and calls of securities
available-for-sale
    
    
    4,877,000
    
    
    
    3,164,000Purchases of securities available-for-sale
    
    
    (12,410,000
    )
    
    
    (23,612,000
    )Purchases of non-marketable securities
    
    
    (312,000
    )
    
    
    (584,000
    )Net decrease (increase) in loans
    
    
    (22,565,000
    )
    
    
    3,003,000(Purchases) of property and equipment
    
    
    (348,000
    )
    
    
    (452,000
    )Proceeds from sale of other real estate owned
    
    
    404,000
    
    
    
    1,647,000Proceeds from sale of foreclosed assets
    
    
    34,000
    
    
    
    509,000Net Cash Provided by (Used in) Investing Activities
    
    
    (22,964,000
    )
    
    
    984,000Cash Flows from Financing Activities:Net increase (decrease) in deposits
    
    
    (1,542,000
    )
    
    
    26,820,000Net increase (decrease) in short-term borrowings
    
    
    24,155,000
    
    
    
    (29,260,000
    )Payments of principal on long-term debt
    
    
    (192,000
    )
    
    
    (2,691,000
    )Dividends paid on 2000 Series B Preferred Stock
    
    
    (101,000
    )
    
    
    (72,000
    )Net Cash Provided by (Used in) Financing Activities
    
    
    22,320,000
    
    
    
    (5,203,000
    )Net increase (decrease) in cash and cash equivalents
    
    
    829,000
    
    
    
    (2,693,000
    )Beginning
    
    
    14,298,000
    
    
    
    16,304,000Ending
    
    $
    15,127,000
    
    
    $
    13,611,000Supplemental Disclosure of Noncash and Financial Activities:Other real estate acquired in settlement of loans
    
    $
    822,000
    
    
    $
    382,000Supplemental Disclosure of Cash Flow information:Cash paid for interest expense
    
    $
    4,561,000
    
    
    $
    3,341,000Cash paid for income taxes
    
    
    
    
    
    $
    380,000
  - 5 -




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##### Table of Contents



Notes to Unaudited Consolidated Financial Statements
 Note 1: General Summary of Significant Accounting Policies
  Principles of Consolidation
  Nature of Operations
  Earnings per Common Share
   - 6 -




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##### Table of Contents



For the three months
    
    For the six monthsended June 30,
    
    ended June 30,2005
    
    2004
    
    2005
    
    2004Numerator:Net income
    
    $
    305,000
    
    
    $
    311,000
    
    
    $
    845,000
    
    
    $
    996,000Less preferred stock dividends
    
    
    53,000
    
    
    
    36,000
    
    
    
    101,000
    
    
    
    72,000Net income applicable to common stock
    
    $
    252,000
    
    
    $
    275,000
    
    
    $
    744,000
    
    
    $
    924,000Denominator:Average number of common shares
outstanding used to calculate
basic earnings per common share
    
    
    1,887,000
    
    
    
    1,887,000
    
    
    
    1,887,000
    
    
    
    1,887,000Effect of dilutive convertible
preferred stock
    
    
    11,000
    
    
    
    11,000
    
    
    
    11,000
    
    
    
    11,000Average number of common shares
used to calculate diluted earnings per
common share
    
    
    1,898,000
    
    
    
    1,898,000
    
    
    
    1,898,000
    
    
    
    1,898,000Basic and diluted earnings per common share
    
    $
    0.13
    
    
    $
    0.15
    
    
    $
    0.39
    
    
    $
    0.49Dividends declared on common stock
    
    $
    0.00
    
    
    $
    0.00
    
    
    $
    0.00
    
    
    $
    0.00
 Use of Estimates in the Preparation of Financial Statements
  - 7 -




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##### Table of Contents



FRONT RANGE CAPITAL CORPORATION AND SUBSIDIARIES
 )
 Three months ended
    
    Six months endedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    
    2004Net interest income (FTE)
    
    $
    4,314,000
    
    
    $
    4,135,000
    
    
    $
    8,502,000
    
    
    $
    8,389,000Provision for loan losses
    
    
    (207,000
    )
    
    
    (293,000
    )
    
    
    (506,000
    )
    
    
    (403,000
    )Noninterest income
    
    
    949,000
    
    
    
    911,000
    
    
    
    2,095,000
    
    
    
    1,998,000Noninterest expense
    
    
    (4,584,000
    )
    
    
    (4,271,000
    )
    
    
    (8,782,000
    )
    
    
    (8,475,000
    )Provision for income taxes (FTE)
    
    
    (167,000
    )
    
    
    (171,000
    )
    
    
    (464,000
    )
    
    
    (513,000
    )Net income
    
    $
    305,000
    
    
    $
    311,000
    
    
    $
    845,000
    
    
    $
    996,000Average common shares outstanding
    
    
    1,887,369
    
    
    
    1,887,369
    
    
    
    1,887,369
    
    
    
    1,887,369Diluted average common shares outstanding
    
    
    1,897,869
    
    
    
    1,897,869
    
    
    
    1,897,869
    
    
    
    1,897,869Common shares outstanding at period end
    
    
    1,887,369
    
    
    
    1,887,369
    
    
    
    1,887,369
    
    
    
    1,887,369As Reported:Basic earnings per common share
    
    $
    0.13
    
    
    $
    0.15
    
    
    $
    0.39
    
    
    $
    0.49Diluted earnings per common share
    
    $
    0.13
    
    
    $
    0.15
    
    
    $
    0.39
    
    
    $
    0.49Return on assets (1)
    
    
    0.28
    %
    
    
    0.32
    %
    
    
    0.39
    %
    
    
    0.51
    %Return on equity (1)
    
    
    5.25
    %
    
    
    5.34
    %
    
    
    7.27
    %
    
    
    8.51
    %Net interest margin
    
    
    4.39
    %
    
    
    4.74
    %
    
    
    4.41
    %
    
    
    4.81
    %Net loan charge-offs to average loans
    
    
    0.00
    %
    
    
    0.12
    %
    
    
    0.13
    %
    
    
    0.15
    %Efficiency ratio (FTE)
    
    
    87.10
    %
    
    
    84.64
    %
    
    
    82.87
    %
    
    
    81.59
    %Average Balances:Total assets
    
    $
    438,978,000
    
    
    $
    392,125,000
    
    
    $
    433,175,000
    
    
    $
    392,630,000Earning assets
    
    
    394,569,000
    
    
    
    350,976,000
    
    
    
    388,967,000
    
    
    
    350,918,000Total loans
    
    
    307,392,000
    
    
    
    284,236,000
    
    
    
    302,751,000
    
    
    
    285,459,000Total deposits
    
    
    335,524,000
    
    
    
    323,959,000
    
    
    
    338,910,000
    
    
    
    312,644,000Shareholders equity
    
    
    23,299,000
    
    
    
    23,412,000
    
    
    
    23,426,000
    
    
    
    23,548,000Balances at Period End:Total assets
    
    
    
    
    
    
    
    
    
    $
    442,578,000
    
    
    $
    392,723,000Earning assets
    
    
    
    
    
    
    
    
    
    
    397,267,000
    
    
    
    351,935,000Total loans
    
    
    
    
    
    
    
    
    
    
    311,264,000
    
    
    
    281,759,000Total deposits
    
    
    
    
    
    
    
    
    
    
    342,650,000
    
    
    
    330,333,000Shareholders equity
    
    
    
    
    
    
    
    
    
    
    23,589,000
    
    
    
    22,946,000Financial Ratios at Period End:Allowance for loan losses to loans
    
    
    
    
    
    
    
    
    
    
    1.18
    %
    
    
    1.01
    %Book value per common share *
    
    
    
    
    
    
    
    
    
    $
    10.77
    
    
    $
    10.66Equity to assets
    
    
    
    
    
    
    
    
    
    
    5.33
    %
    
    
    5.84
    %Regulatory total capital
to risk-weighted assets
    
    
    
    
    
    
    
    
    
    
    10.15
    %
    
    
    10.97
    %Dividends paid per common share
    
    
    
    
    
    
    
    
    
    $
    0.00
    
    
    $
    0.00
 
 (1)
    
    annualized*
    
    excludes accumulated other comprehensive income (loss) - 8 -




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
   Critical Accounting Policies
  Financial Condition
  Net Income
  Three months ended
    
    Six months endedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    
    2004Net interest income (FTE)
    
    $
    4,314,000
    
    
    $
    4,135,000
    
    
    $
    8,502,000
    
    
    $
    8,389,000Provision for loan losses
    
    
    (207,000
    )
    
    
    (293,000
    )
    
    
    (506,000
    )
    
    
    (403,000
    )Noninterest income
    
    
    949,000
    
    
    
    911,000
    
    
    
    2,095,000
    
    
    
    1,998,000Noninterest expense
    
    
    (4,584,000
    )
    
    
    (4,271,000
    )
    
    
    (8,782,000
    )
    
    
    (8,475,000
    )Provision for income taxes (FTE)
    
    
    (167,000
    )
    
    
    (171,000
    )
    
    
    (464,000
    )
    
    
    (513,000
    )Net income
    
    $
    305,000
    
    
    $
    311,000
    
    
    $
    845,000
    
    
    $
    996,000
  - 9 -




---



##### Table of Contents



Net Interest Income
   Three months ended
    
    Six months endedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    
    2004Interest income
    
    $
    6,674,000
    
    
    $
    5,700,000
    
    
    $
    12,891,000
    
    
    $
    11,467,000Interest expense
    
    
    (2,508,000
    )
    
    
    (1,688,000
    )
    
    
    (4,690,000
    )
    
    
    (3,311,000
    )FTE adjustment
    
    
    148,000
    
    
    
    123,000
    
    
    
    301,000
    
    
    
    233,000Net interest income (FTE)
    
    
    4,314,000
    
    
    $
    4,135,000
    
    
    $
    8,502,000
    
    
    $
    8,389,000Average earning assets
    
    $
    394,569,000
    
    
    $
    350,976,000
    
    
    $
    388,967,000
    
    
    $
    350,918,000Net interest margin (FTE)
    
    
    4.39
    %
    
    
    4.74
    %
    
    
    4.41
    %
    
    
    4.81
    %
  - 10 -




---



##### Table of Contents



Interest Income
   Interest Expense
   - 11 -




---



##### Table of Contents



Net Interest Margin (FTE)
  Three months ended
    
    Six months endedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    
    2004Yield on interest-earning assets
    
    
    6.93
    %
    
    
    6.67
    %
    
    
    6.84
    %
    
    
    6.70
    %Rate paid on interest-bearing liabilities
    
    
    2.84
    %
    
    
    2.17
    %
    
    
    2.72
    %
    
    
    2.12
    %Net interest spread
    
    
    4.09
    %
    
    
    4.50
    %
    
    
    4.12
    %
    
    
    4.58
    %Impact of all other net
noninterest-bearing funds
    
    
    0.30
    %
    
    
    0.24
    %
    
    
    0.29
    %
    
    
    0.23
    %Net interest margin
    
    
    4.39
    %
    
    
    4.74
    %
    
    
    4.41
    %
    
    
    4.81
    %
   Summary of Average Balances, Yields/Rates and Interest Differential
  - 12 -




---



##### Table of Contents



For the three months endedJune 30, 2005
    
    June 30, 2004(Dollars in thousands)Interest
    
    Rates
    
    
    
    
    
    Interest
    
    RatesAverage
    
    Income/
    
    Earned/
    
    Average
    
    Income/
    
    Earned/Balance
    
    Expense
    
    Paid
    
    Balance
    
    Expense
    
    PaidAssets:Loans
    
    $
    307,391
    
    
    $
    5,840
    
    
    
    7.62
    %
    
    $
    284,236
    
    
    $
    5,086
    
    
    
    7.20
    %Investment securities  taxable
    
    
    61,679
    
    
    
    613
    
    
    
    3.99
    %
    
    
    47,070
    
    
    
    424
    
    
    
    3.62
    %Investment securities  nontaxable
    
    
    24,725
    
    
    
    364
    
    
    
    5.90
    %
    
    
    18,875
    
    
    
    311
    
    
    
    6.63
    %Federal funds sold and due
from banks (interest-bearing)
    
    
    774
    
    
    
    5
    
    
    
    2.59
    %
    
    
    795
    
    
    
    2
    
    
    
    1.01
    %Total interest-earning assets
    
    
    394,569
    
    
    
    6,822
    
    
    
    6.93
    %
    
    
    350,976
    
    
    
    5,823
    
    
    
    6.67
    %Other assets
    
    
    44,409
    
    
    
    
    
    
    
    
    
    
    
   41,149Total assets
    
    $
    438,978
    
    
    $
    6,822
    
    
    
    
    
    
    $
    392,125
    
    
    $
    5,823Liabilities and shareholders equity:Interest-bearing demand deposits
    
    $
    122,333
    
    
    $
    463
    
    
    
    1.52
    %
    
    $
    114,046
    
    
    $
    259
    
    
    
    0.91
    %Savings deposits
    
    
    15,132
    
    
    
    18
    
    
    
    0.48
    %
    
    
    14,331
    
    
    
    8
    
    
    
    0.22
    %Time deposits
    
    
    141,038
    
    
    
    1,164
    
    
    
    3.31
    %
    
    
    143,259
    
    
    
    916
    
    
    
    2.57
    %Other short-term borrowed funds
    
    
    54,725
    
    
    
    434
    
    
    
    3.18
    %
    
    
    16,713
    
    
    
    49
    
    
    
    1.18
    %Long-term debt
    
    
    11,375
    
    
    
    155
    
    
    
    5.47
    %
    
    
    14,360
    
    
    
    182
    
    
    
    5.10
    %Subordinated debentures
    
    
    9,485
    
    
    
    274
    
    
    
    11.59
    %
    
    
    9,485
    
    
    
    274
    
    
    
    11.62
    %Total interest-bearing liabilities
    
    $
    354,088
    
    
    $
    2,508
    
    
    
    2.84
    %
    
    $
    312,194
    
    
    $
    1,688
    
    
    
    2.17
    %Noninterest-bearing deposits
    
    
    57,021
    
    
    
    
    
    
    
    
    
    
    
    52,323Other liabilities
    
    
    4,570
    
    
    
    
    
    
    
    
    
    
    
    4,196Shareholders equity
    
    
    23,299
    
    
    
    
    
    
    
    
    
    

    
    23,412Total liabilities
and shareholders equity
    
    $
    438,978
    
    
    
    
    
    
    
    
    
    
    $
    392,125Net interest spread(1)
    
    
    
    
    
    
    
    
    
    
    4.09
    %
    
    
    
    
    
    
    
    
    
    
    4.50
    %Net interest income and interest margin
(2)
    
    
    
    
    
    $
    4,314
    
    
    
    4.39
    %
    
    
    
    
    
    $
    4,135
    
    
    
    4.74
    %
 
 (1)
    
    Net interest spread represents the average yield earned on interest-earning assets minus the
average rate paid on interest-bearing liabilities.(2)
    
    Net interest margin is computed by calculating the difference between interest income and
expense, divided by the average balance of interest-earning assets. - 13 -




---



##### Table of Contents



For the six months endedJune 30, 2005
    
    June 30, 2004(Dollars in thousands)Interest
    
    Rates
    
    
    
    
    
    Interest
    
    RatesAverage
    
    Income/
    
    Earned/
    
    Average
    
    Income/
    
    Earned/Balance
    
    Expense
    
    Paid
    
    Balance
    
    Expense
    
    PaidAssets:Loans
    
    $
    302,751
    
    
    $
    11,256
    
    
    
    7.50
    %
    
    $
    285,459
    
    
    $
    10,231
    
    
    
    7.21
    %Investment securities  taxable
    
    
    60,318
    
    
    
    1,185
    
    
    
    3.96
    %
    
    
    47,083
    
    
    
    876
    
    
    
    3.74
    %Investment securities  nontaxable
    
    
    25,125
    
    
    
    742
    
    
    
    5.96
    %
    
    
    17,578
    
    
    
    589
    
    
    
    6.74
    %Federal funds sold and due
from banks (interest-bearing)
    
    
    773
    
    
    
    9
    
    
    
    2.35
    %
    
    
    798
    
    
    
    4
    
    
    
    1.01
    %Total interest-earning assets
    
    
    388,967
    
    
    
    13,192
    
    
    
    6.84
    %
    
    
    350,918
    
    
    
    11,700
    
    
    
    6.70
    %Other assets
    
    
    44,208
    
    
    
    
    
    
    
    
    
    
    
    41,712Total assets
    
    $
    433,175
    
    
    $
    13,192
    
    
    
    
    
    
    $
    392,630
    
    
    $
    11,700Liabilities and shareholders equity:Interest-bearing demand deposits
    
    $
    124,080
    
    
    $
    919
    
    
    
    1.49
    %
    
    $
    115,705
    
    
    $
    533
    
    
    
    0.93
    %Savings deposits
    
    
    15,192
    
    
    
    37
    
    
    
    0.49
    %
    
    
    14,085
    
    
    
    17
    
    
    
    0.24
    %Time deposits
    
    
    142,728
    
    
    
    2,201
    
    
    
    3.11
    %
    
    
    131,787
    
    
    
    1,671
    
    
    
    2.55
    %Other short-term borrowed funds
    
    
    45,328
    
    
    
    675
    
    
    
    3.00
    %
    
    
    27,529
    
    
    
    162
    
    
    
    1.18
    %Long-term debt
    
    
    11,433
    
    
    
    309
    
    
    
    5.45
    %
    
    
    15,199
    
    
    
    379
    
    
    
    5.01
    %Subordinated debentures
    
    
    9,485
    
    
    
    549
    
    
    
    11.67
    %
    
    
    9,485
    
    
    
    549
    
    
    
    11.64
    %Total interest-bearing liabilities
    
    $
    348,246
    
    
    $
    4,690
    
    
    
    2.72
    %
    
    $
    313,790
    
    
    $
    3,311
    
    
    
    2.12
    %Noninterest-bearing deposits
    
    
    56,911
    
    
    
    
    
    
    
    
    
    
    
    51,067Other liabilities
    
    
    4,592
    
    
    
    
    
    
    
    
    
    
    
    4,225Shareholders equity
    
    
    23,426
    
    
    
    
    
    
    
    
    
    
    
    23,548Total liabilities
and shareholders equity
    
    $
    433,175
    
    
    
    
    
    
    
    
    
    
    $
    392,630Net interest spread(1)
    
    
    
    
    
    
    
    
    
    
    4.12
    %
    
    
    
    
    
    
    
    
    
    
    4.58
    %Net interest income and
interest margin(2)
    
    
    
    
    
    $
    8,502
    
    
    
    4.41
    %
    
    
    
    
    
    $
    8,389
    
    
    
    4.81
    %
 
 (1)
    
    Net interest spread represents the average yield earned on interest-earning assets minus the
average rate paid on interest-bearing liabilities.(2)
    
    Net interest margin is computed by calculating the difference between interest income and
expense, divided by the average balance of interest-earning assets. Summary of Changes in Interest Income and Expense due to Changes in Average Asset and Liability
Balances and Yields Earned and Rates Paid
  - 14 -




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##### Table of Contents



Three months ended June 30, 2005compared with three monthsended June 30, 2004Volume
    
    Rate
    
    TotalIncrease (decrease) in interest income:Loans
    
    $
    414,000
    
    
    $
    340,000
    
    
    $
    754,000Investments  taxable
    
    
    132,000
    
    
    
    57,000
    
    
    
    189,000Investments  nontaxable
    
    
    96,000
    
    
    
    (43,000
    )
    
    
    53,000Federal funds sold
    
    
    
    
    
    
    3,000
    
    
    
    3,000Total interest-earning assets
    
    
    642,000
    
    
    
    357,000
    
    
    
    999,000Increase (decrease) in interest expense:Interest-bearing demand deposits
    
    
    19,000
    
    
    
    185,000
    
    
    
    204,000Savings deposits
    
    
    
    
    
    
    10,000
    
    
    
    10,000Time deposits
    
    
    (14,000
    )
    
    
    262,000
    
    
    
    248,000Other short term borrowings
    
    
    111,000
    
    
    
    274,000
    
    
    
    385,000Long-term debt
    
    
    (38,000
    )
    
    
    11,000
    
    
    
    (27,000
    )Subordinated debentures
    
    
    
    
    
    
    
    
    
    
    Total interest-bearing liabilities
    
    
    78,000
    
    
    
    742,000
    
    
    
    820,000Increase (decrease) in net interest income
    
    $
    564,000
    
    
    
    ($385,000
    )
    
    $
    179,000
 Six months ended June 30, 2005compared with six monthsended June 30, 2004Volume
    
    Rate
    
    TotalIncrease (decrease) in interest income:Loans
    
    $
    620,000
    
    
    $
    405,000
    
    
    $
    1,025,000Investments  taxable
    
    
    246,000
    
    
    
    63,000
    
    
    
    309,000Investments  nontaxable
    
    
    253,000
    
    
    
    (100,000
    )
    
    
    153,000Federal funds sold
    
    
    
    
    
    
    5,000
    
    
    
    5,000Total interest-earning assets
    
    
    1,119,000
    
    
    
    373,000
    
    
    
    1,492,000Increase (decrease) in interest expense:Interest-bearing demand deposits
    
    
    39,000
    
    
    
    347,000
    
    
    
    386,000Savings deposits
    
    
    1,000
    
    
    
    19,000
    
    
    
    20,000Time deposits
    
    
    139,000
    
    
    
    391,000
    
    
    
    530,000Other short term borrowings
    
    
    105,000
    
    
    
    408,000
    
    
    
    513,000Long-term debt
    
    
    (94,000
    )
    
    
    24,000
    
    
    
    (70,000
    )Subordinated debentures
    
    
    
    
    
    
    
    
    
    
    Total interest-bearing liabilities
    
    
    190,000
    
    
    
    1,189,000
    
    
    
    1,379,000Increase (decrease) in net interest income
    
    $
    929,000
    
    
    
    ($816,000
    )
    
    $
    113,000
 Provision for Loan Losses
  - 15 -




---



##### Table of Contents



Noninterest Income
  Three months ended
    
    Six months endedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    
    2004Service charges on deposit accounts
    
    $
    580,000
    
    
    $
    614,000
    
    
    $
    1,115,000
    
    
    $
    1,199,000Gain on sale of investments
    
    
    
    
    
    
    
    
    
    
    370,000
    
    
    
    207,000Mortgage referral fees
    
    
    109,000
    
    
    
    177,000
    
    
    
    194,000
    
    
    
    285,000Other noninterest income
    
    
    260,000
    
    
    
    120,000
    
    
    
    416,000
    
    
    
    307,000Total noninterest income
    
    $
    949,000
    
    
    $
    911,000
    
    
    $
    2,095,000
    
    
    $
    1,998,000
   - 16 -




---



##### Table of Contents



Noninterest Expense
  Three months ended
    
    Six months endedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    
    2004Salaries and employee benefits
    
    $
    2,627,000
    
    
    $
    2,333,000
    
    
    $
    5,033,000
    
    
    $
    4,570,000Occupancy
    
    
    421,000
    
    
    
    419,000
    
    
    
    834,000
    
    
    
    846,000Furniture and Equipment
    
    
    228,000
    
    
    
    197,000
    
    
    
    438,000
    
    
    
    389,000Data processing
    
    
    205,000
    
    
    
    202,000
    
    
    
    415,000
    
    
    
    401,000Advertising and marketing
    
    
    143,000
    
    
    
    192,000
    
    
    
    232,000
    
    
    
    324,000Printing and supplies
    
    
    63,000
    
    
    
    67,000
    
    
    
    143,000
    
    
    
    134,000Loan and collection
    
    
    72,000
    
    
    
    106,000
    
    
    
    194,000
    
    
    
    217,000ATM and Debit Card
    
    
    94,000
    
    
    
    83,000
    
    
    
    177,000
    
    
    
    192,000Other real estate- Heritage Place
    
    
    144,000
    
    
    
    125,000
    
    
    
    272,000
    
    
    
    281,000Net loss (gain) on sale of OREO
and other foreclosed assets
    
    
    9,000
    
    
    
    (65,000
    )
    
    
    18,000
    
    
    
    34,000Other
    
    
    578,000
    
    
    
    612,000
    
    
    
    1,026,000
    
    
    
    1,087,000Total
    
    $
    4,584,000
    
    
    $
    4,271,000
    
    
    $
    8,782,000
    
    
    $
    8,475,000Average full time equivalent staff
    
    
    164
    
    
    
    152
    
    
    
    164
    
    
    
    153Noninterest expense to revenue (FTE)
    
    
    87.10
    %
    
    
    84.64
    %
    
    
    82.87
    %
    
    
    81.59
    %
   Provision for Income Tax
  - 17 -




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Classified Assets
   Nonperforming Loans
       - 18 -




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##### Table of Contents



At June 30, 2005
    
    At June 30, 2004
    
    At December 31, 2004(unaudited)(dollars in thousands)Performing nonaccrual loans
    
    $
    1,958
    
    
    $
    316
    
    
    $
    2,126Nonperforming, nonaccrual loans
    
    
    2,231
    
    
    
    652
    
    
    
    2,174Total nonaccrual loans
    
    
    4,189
    
    
    
    968
    
    
    
    4,300Loans 90 days past due and still accruing
    
    
    119
    
    
    
    103
    
    
    
    90Total nonperforming loans
    
    
    4,308
    
    
    
    1,071
    
    
    
    4,390Other real estate owned,
excluding Heritage Place
    
    
    2,596
    
    
    
    249
    
    
    
    2,131Foreclosed assets
    
    
    26
    
    
    
    63
    
    
    
    5Total nonperforming assets
    
    $
    6,930
    
    
    $
    1,383
    
    
    $
    6,526Nonperforming loans to total loans
    
    
    1.4
    %
    
    
    0.4
    %
    
    
    1.5
    %Allowance for loan losses/nonperforming loans
    
    
    85.0
    %
    
    
    266.0
    %
    
    
    80.9
    %Nonperforming assets to total assets
    
    
    1.6
    %
    
    
    0.4
    %
    
    
    1.6
    %Allowance for loan losses to nonperforming assets
    
    
    52.8
    %
    
    
    206.0
    %
    
    
    54.4
    %
 Allowance for Loan Losses
    -19-




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##### Table of Contents



Three months ended
    
    Six months endedJune 30,
    
    June 30,2005
    
    2004
    
    2005
    
    2004Balance, beginning of period
    
    $
    3,461
    
    
    $
    2,890
    
    
    $
    3,553
    
    
    $
    2,872Loan loss provision
    
    
    207
    
    
    
    293
    
    
    
    506
    
    
    
    403Loans charged off
    
    
    (183
    )
    
    
    (384
    )
    
    
    (586
    )
    
    
    (492
    )Recoveries of previously
charged-off loans
    
    
    176
    
    
    
    50
    
    
    
    188
    
    
    
    66Net (charge-offs) recoveries
    
    
    (7
    )
    
    
    (334
    )
    
    
    (398
    )
    
    
    (426
    )Balance, end of period
    
    $
    3,661
    
    
    $
    2,849
    
    
    $
    3,661
    
    
    $
    2,849Allowance for loan losses/loans outstanding
    
    
    
    
    
    
    
    
    
    
    1.18
    %
    
    
    1.01
    %
 Capital Resources
  -20-




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##### Table of Contents



To Be WellAt
    
    Minimum
    
    Capitalized UnderAt June 30,
    
    December 31,
    
    Regulatory
    
    Prompt Corrective2005
    
    2004
    
    2004
    
    Requirement
    
    Action ProvisionsTier I Capital (to risk-weighted assets)Consolidated
    
    
    7.6
    %
    
    
    8.2
    %
    
    
    7.7
    %Bank
    
    
    9.1
    %
    
    
    9.9
    %
    
    
    9.4
    %
    
    
    4.0
    %
    
    
    6.0
    %Total Capital (to risk-weighted assets)Consolidated
    
    
    10.2
    %
    
    
    11.0
    %
    
    
    10.5
    %Bank
    
    
    10.1
    %
    
    
    10.8
    %
    
    
    10.5
    %
    
    
    8.0
    %
    
    
    10.0
    %Tier I Leverage (to average assets)Consolidated
    
    
    6.2
    %
    
    
    6.8
    %
    
    
    6.3
    %Bank
    
    
    7.5
    %
    
    
    8.2
    %
    
    
    7.7
    %
    
    
    4.0
    %
    
    
    5.0
    %
 Off-Balance Sheet Items
  Certain Contractual Obligations
  Payment due by periodLess than
    
    1-3
    
    3-5
    
    More thanTotal
    
    one year
    
    years
    
    years
    
    5 years(dollars in thousands)Long-term debt
    
    $
    11,307
    
    
    $
    2,265
    
    
    $
    2,600
    
    
    $
    1,397
    
    
    $
    5,045Operating lease obligations
    
    
    3,359
    
    
    
    786
    
    
    
    1,489
    

    
    
    1,066
    
    
    
    18Other long-term liabilities:Subordinated debentures
    
    
    9,485
    
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    9,485Total contractual obligations
    
    $
    24,151
    
    
    $
    3,051
    
    
    $
    4,089
    
    
    $
    2,463
    
    
    $
    14,548
 
 Item 3. Quantitative and Qualitative Disclosures about Market Risk
 Asset and Liability Management
  -21-




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Liquidity
  -22-




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##### Table of Contents



Item 4. Controls and Procedures
   -23-




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##### Table of Contents



Item 1. Legal Proceedings
  
 Item 5. Other Information
 Heritage Place
 In August 2001, the Bank purchased three parcels of undeveloped property in Broomfield, Colorado.

The first transaction involved a purchase of undeveloped property from Joseph J. Fuentes and
Christine R. Fuentes located at 9590 Coalton Drive, Broomfield, Colorado 80020, also known as 604
Interlocken Boulevard, Broomfield, Colorado 80020, for a purchase price of approximately
$2,423,900. The second transaction involved the Banks purchase from Coalton Acres, LLC of two
parcels comprising 161,094 square feet of undeveloped property adjacent to 9590 Coalton Drive and
part of the development known as The FlatIron, for a purchase price of approximately $3,942,495.
The aggregate combined purchase price for the properties was approximately $6,371,000. The parcels
are collectively referred to as Heritage Place. When the Bank purchased the parcels that now
comprise Heritage Place, the Bank intended to sell Heritage Place to an investor or group to
develop Heritage Place and thereafter the Bank intended to purchase a pad within the newly
developed property to open a new branch and relocate some of the Companys and the Banks
administrative offices.The Bank entered into a letter of intent in September 2002 with Heritage Place Holdings, LLC and
Heritage Place Partners, LLC (together, the Developers) that discussed the proposed sale of
Heritage Place to the Developers along with the Banks right to purchase a pad inside Heritage
Place once the development was complete. At the time the Bank executed the letter of intent, the
individual members of the Developers included Mr. Beauprez, as well as others unaffiliated with the
Company or the Bank. In September 2002, officers of the Bank and the Company met with
representatives of the Federal Reserve Bank and the Colorado Division of Banking to discuss the
relationship of the proposed transaction to federal and state banking laws and regulations and to
provide an opportunity for federal and state banking regulators to comment upon the letter of
intent. In November 2002, the Bank and the Developers terminated the letter of intent because the
development project was no longer economically feasible to the Developers due to market conditions.Following termination of the letter of intent, the Bank continues to consider its best course of
action regarding Heritage Place including, but not limited to, structuring a similar transaction
with developers if market conditions improve in the future; preparing Heritage Place for sale to
different investors, except for the pad the Bank could develop for a new branch location; or
selling Heritage Place including the pad. Of the approximately 8.2 acre Heritage Place site, a
bank pad of approximately 1.5 acres has been carved out for a potential branch building. In July
2003, the remaining 6.7 acres were listed for sale with a commercial broker. If a potential buyer
would have an interest in purchasing the entire 8.2 acres, the Bank would be willing to consider
this also.The Bank has incurred and continues to incur costs while holding the Heritage Place property for
sale. As of June 30, 2005, the Bank had capitalized total costs of $9,953,000 relating to
preparing Heritage Place for sale and development, including fees for a site plan, annexation,
zoning, architectural and tap fees. These costs are capitalized and are reflected as an asset on
the Companys unaudited consolidated balance sheet as presented in this report. In addition, the
Bank has incurred related expenses of $272,000 for the six months ended June 30, 2005, largely
related to holding the property. Of this amount, $63,000 was
 -24 -




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##### Table of Contents



Other Property
   -25-




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##### Table of Contents



Item 6. Exhibits
  Exhibit No.
    
    Description3.1*
    
    Articles of Incorporation of Front Range Capital Corporation.3.2**
    
    Articles of Third Amendment to the Articles of Incorporation.3.3*
    
    Bylaws of Front Range Capital Corporation4.1*
    
    Form of Indenture by and between Front Range Capital Corporation and Wilmington Trust Company4.2*
    
    Form of Subordinated Debenture (included as an exhibit to Exhibit 4.1)4.3*
    
    Certificate of Trust of Front Range Capital Trust I, as amended and restated4.4*
    
    Trust Agreement between Front Range Capital Corporation, Wilmington Trust Company and the
Administrative Trustees named therein4.5*
    
    Form of Amended and Restated Trust Agreement between Front Range Capital Corporation and
Wilmington Trust Company and the Administrative Trustees named therein4.6*
    
    Form of Trust Preferred Securities Certificate (included as an exhibit to Exhibit 4.5)4.7*
    
    Form of Trust Preferred Securities Guarantee Agreement between Front Range Capital
Corporation and Wilmington Trust Company4.8*
    
    Revised Form of Agreement of Expenses and Liabilities (included as an exhibit to Exhibit 4.5)10.1*
    
    Lease Agreement between Lafayette State Bank and Fruehauf Investments Ltd.10.2*
    
    Promissory Note by Front Range Capital Corporation payable to Bankers Bank of the West10.3*
    
    Amendment and Restatement of Executive Retirement Plan of Heritage Bank10.4*
    
    Indexed Salary Continuation Plan of Heritage Bank10.5*
    
    Flexible Premium Life Insurance Endorsement Method Split Dollar Plan Agreement31.1
    
    Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer31.2
    
    Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer32.1
    
    Section 1350 Certification of Chief Executive Officer32.2
    
    Section 1350 Certification of Chief Financial Officer
 
 *
    
    Previously filed with the Companys Registration Statement on Form SB-2 (333-40028 and
333-40028-01) and incorporated herein by reference.**
    
    Previously filed with the Companys Annual Report on Form 10-KSB for the year ended December
31, 2000 and incorporated herein by reference -26-




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##### Table of Contents



SIGNATURES
  FRONT RANGE CAPITAL CORPORATION(Registrant)Date: August 12, 2005
    
    By:
    
    /s/ William A. Mitchell, Jr.William A. Mitchell, Jr.Chief Executive Officer and President(Principal Executive Officer)Date: August 12, 2005
    
    By:
    
    /s/ Alice M. VossAlice M. VossChief Financial Officer(Principal Financial and Accounting Officer)
 -27-




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##### Table of Contents



Exhibit Index
 Exhibit No.
    
    Description3.1*
    
    Articles of Incorporation of Front Range Capital Corporation.3.2**
    
    Articles of Third Amendment to the Articles of Incorporation.3.3*
    
    Bylaws of Front Range Capital Corporation4.1*
    
    Form of Indenture by and between Front Range Capital Corporation and Wilmington Trust Company4.2*
    
    Form of Subordinated Debenture (included as an exhibit to Exhibit 4.1)4.3*
    
    Certificate of Trust of Front Range Capital Trust I, as amended and restated4.4*
    
    Trust Agreement between Front Range Capital Corporation, Wilmington Trust Company and the
Administrative Trustees named therein4.5*
    
    Form of Amended and Restated Trust Agreement between Front Range Capital Corporation and
Wilmington Trust Company and the Administrative Trustees named therein4.6*
    
    Form of Trust Preferred Securities Certificate (included as an exhibit to Exhibit 4.5)4.7*
    
    Form of Trust Preferred Securities Guarantee Agreement between Front Range Capital
Corporation and Wilmington Trust Company4.8*
    
    Revised Form of Agreement of Expenses and Liabilities (included as an exhibit to Exhibit 4.5)10.1*
    
    Lease Agreement between Lafayette State Bank and Fruehauf Investments Ltd.10.2*
    
    Promissory Note by Front Range Capital Corporation payable to Bankers Bank of the West10.3*
    
    Amendment and Restatement of Executive Retirement Plan of Heritage Bank10.4*
    
    Indexed Salary Continuation Plan of Heritage Bank10.5*
    
    Flexible Premium Life Insurance Endorsement Method Split Dollar Plan Agreement31.1
    
    Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer31.2
    
    Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer32.1
    
    Section 1350 Certification of Chief Executive Officer32.2
    
    Section 1350 Certification of Chief Financial Officer
 
 *
    
    Previously filed with the Companys Registration Statement on Form SB-2 (333-40028 and
333-40028-01) and incorporated herein by reference.**
    
    Previously filed with the Companys Annual Report on Form 10-KSB for the year ended December
31, 2000 and incorporated herein by reference -28-