-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, NPtuCVCj7nNYwXNbkbKq6dLefsUfjNWR69mBo/+8/m2m7V+3jIjd1mXCfpOYp1gP oX5tzrZBKZXQj1ciAoWySg== 0001193125-07-193788.txt : 20070831 0001193125-07-193788.hdr.sgml : 20070831 20070831120758 ACCESSION NUMBER: 0001193125-07-193788 CONFORMED SUBMISSION TYPE: N-CSRS PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20070630 FILED AS OF DATE: 20070831 DATE AS OF CHANGE: 20070831 EFFECTIVENESS DATE: 20070831 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IRONWOOD SERIES TRUST CENTRAL INDEX KEY: 0001049629 IRS NUMBER: 043386084 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-CSRS SEC ACT: 1940 Act SEC FILE NUMBER: 811-08507 FILM NUMBER: 071093605 BUSINESS ADDRESS: STREET 1: 2 PORTLAND SQUARE CITY: PORTLAND STATE: ME ZIP: 04101-4049 BUSINESS PHONE: (800) 472-6114 MAIL ADDRESS: STREET 1: C/O CITIGROUP GLOBAL TRANSACTION SVCS STREET 2: 2 PORTLAND SQUARE CITY: PORTLAND STATE: ME ZIP: 04101-4049 FORMER COMPANY: FORMER CONFORMED NAME: ICM SERIES TRUST DATE OF NAME CHANGE: 19971112 0001049629 S000004537 Ironwood Isabelle Small Company Stock Fund C000012438 Institutional Shares IZZIX C000012439 Investment Shares IZZYX N-CSRS 1 dncsrs.txt IRONWOOD SERIES TRUST As filed with the Securities and Exchange Commission on August 31, 2007 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 811-08507 IRONWOOD SERIES TRUST Two Portland Square Portland, Maine 04101 207-879-1900 Warren J. Isabelle, President Suite 240 21 Custom House Street Boston, MA 02109 (800) 472-6114 Date of fiscal year end: DECEMBER 31 Date of reporting period: JANUARY 1, 2007 - JUNE 30, 2007 ITEM 1. REPORT TO STOCKHOLDERS. [LOGO OF IRONWOOD FUNDS] Ironwood Series Trust www.ironwoodfunds.com ----------------- Ironwood Isabelle Small Company Stock Fund Investment Shares Symbol: IZZYX Institutional Shares Symbol: IZZIX Semi-Annual Report June 30, 2007 (Unaudited) Ironwood Isabelle Small Company Stock Fund Table Of Contents SHAREHOLDER LETTER......................................................... 1 PORTFOLIO OF INVESTMENTS................................................... 7 STATEMENT OF ASSETS AND LIABILITIES........................................ 10 STATEMENT OF OPERATIONS.................................................... 11 STATEMENTS OF CHANGES IN NET ASSETS........................................ 12 FINANCIAL HIGHLIGHTS....................................................... 14 NOTES TO FINANCIAL STATEMENTS.............................................. 18 ADDITIONAL INFORMATION..................................................... 25 Ironwood Isabelle Small Company Stock Fund Shareholder Letter To our shareholders: For the first half of the year, the six month period ending June 30, 2007, I am pleased to report that the Ironwood Isabelle Small Company Stock Fund (the "Fund") Investment Shares had a total return of 8.92%, versus its benchmark index, the Russell 2000 Index (the "Index"), which returned 6.45%. This represents a continuation of the success of our efforts which have produced one and three year average annual returns for the period ending June 30, 2007 of 23.94% and 15.60%, respectively, against those of the Index of 16.43% and 13.45%, respectively. For a longer term perspective, the Fund's 5-year and since inception (03/09/98) average annual returns were 11.52% and 9.64%, respectively. For this writing I am forgoing my typical letter to you which admittedly devolves into a broad discussion of current macroeconomic trends and happenings followed by a somewhat impassioned explanation of why and how we are different: Our forte is seeking out those interesting situations which we can then scrutinize to a level that will allow us to develop a detailed investment thesis for each. The common element to all is a meaningful mismatch in our view of economic value versus what the market is currently affording. Enough said: Rather than again continuing to travel down a well worn path, let me just describe how I think we accomplished the job for the period. PERFORMANCE DATA IS FOR THE PERIOD ENDED 06/30/07, REPRESENTS PAST PERFORMANCE AND IS NO GUARANTEE OF FUTURE RESULTS. CURRENT PERFORMANCE MAY BE HIGHER OR LOWER THAN THE PERFORMANCE DATA QUOTED. INVESTMENT RETURN AND PRINCIPAL VALUE WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN ORIGINAL COST. AS STATED IN THE FUND'S PROSPECTUS, THE FUND'S ANNUAL OPERATING EXPENSE RATIO (GROSS) FOR INVESTMENT SHARES IS 2.14%. HOWEVER, THE FUND'S ADVISER HAS CONTRACTUALLY AGREED TO WAIVE A PORTION OF ITS FEES AND/OR REIMBURSE EXPENSES SUCH THAT TOTAL OPERATING EXPENSES DO NOT EXCEED 1.95%. CONTRACTUAL WAIVERS MAY BE CHANGED OR ELIMINATED AT ANY TIME WITH THE CONSENT OF THE BOARD OF TRUSTEES. FOR THE MOST RECENT MONTH-END PERFORMANCE, PLEASE CALL 800-472-6114. 1 We submit that performance is ultimately governed by the merit of our portfolio selections: The portfolio should thus fare as the net sum of its individual heroes and villains, and the best way to portray the overall result is to detail how the important participants behaved. The year started much as the last had ended, with the culmination of a number of portfolio holdings either being acquired or becoming the object of merger and acquisition activity. The transaction initiated by Merck (NYSE: MRK) to purchase Sirna Therapeutics (formerly Nasdaq: (RNAI) was completed literally on the first trading day of the new year, and was followed by the closing of Level Three's (Nasdaq: LVLT) acquisition of Broadwing (formerly Nasdaq: BWNG) for stock, which afforded the portfolio an opportunity to avail itself of an additional gain of 22% as investors gained an understanding of the benefits this addition offered. Shortly thereafter, a unit of Goldman Sachs decided to enter the insurance brokerage business by acquiring yet another of our investments, USI Holdings (formerly Nasdaq:USIH), and finally, long held time share resort purveyor Sunterra (formerly OTC: SNRR) was bought by Diamond Resorts. This strong start helped carry the portfolio toward its good first half performance, with most markets pushing higher as well. Notable decliners included Proliance (AMEX: PLI), a manufacturer and distributor of after-market automotive heat-exchange equipment, down 31%, and Novavax (Nasdaq: NVAX), a biopharmaceutical company developing truly novel vaccine technology, down 29%. In each case we redoubled our efforts to ascertain that our investment thesis remained intact and warranted further patience. We visited the management of Proliance in Connecticut, and came away feeling that the company had figured itself out so to speak in the global world of manufacturing such that we believed there was yet a potential for positive growth with proper execution of its business model. In the case of Novavax, like many smaller development companies, no news is bad news, and that is just the kind of short term difficulty we had to sit through. The Fund's big winners reflected both the strength of the underlying companies as businesses, but more importantly offered confirmation that these companies are positioned well in the Fund's portfolio. Although the Fund has held many of its portfolio names for 18 months or more and has derived substantial gains from a good number of them, in most cases we believe that their full potential has yet to be realized. That is how we feel about ICO Inc. (Nasdaq: ICOC) a polymer and plastics processor, 2 which rose an amazing 87% during the first six months of the year. The stock price has increased from the Fund's initial purchase around two years ago, some five-fold, keeping in line with our investment thesis. Similarly, A M Castle (NYSE: CAS), a distributor of value added metals, advanced 42%, and, despite a seven-fold rise in price over the past several years, we believe there is adequate appreciation to be had before our economic value target is reached. We cite Hooker Furniture (Nasdaq: HOFT), which gained 45%, Petrohawk Energy (NYSE: HK), up 38%, and Omnova Solutions (NYSE: OMN), up 32%, as other holdings that position the Fund's portfolio well. It is important to note that past performance is not an indicator of future results. I am pleased to say that our changes to the portfolio were fairly modest, precipitated in part by the aforementioned acquisitions and the sale of Dynegy (NYSE: DYN) which reached its target price. New entries to the portfolio came from a broad cross section of the economy: Allied Defense Group (AMEX: ADG), a diversified defense company which upgrades older weapons and logistics platforms; Ampco-Pittsburgh (NYSE:AP), the only major domestic manufacturer of calendaring rolls for steel mills; C E Franklin (AMEX: CFK), a leading supplier of oil and gas exploration and development tools and supplies for central and western Canada; Citizens First Bancorp (Nasdaq: CTZN), a smaller eastern Michigan based community bank; Gene Logic (Nasdaq: GLGC), formerly a genetics discovery company now collaborating with large pharmaceutical companies to apply genetic expertise to the revamping of older or previously discontinued drug candidates; Industrial Enterprises of America (Nasdaq: IEAM), a turnaround situation involved in the packaging and marketing of refrigerants and specialty automotive chemicals and additives; and finally International Coal (NYSE: ICO), a coal mining company with locations in Appalachia and Illinois. To be sure, we might have done better, but aside from timing issues and forced turnover as described above we believe that the strength and return potential of the current portfolio maintains. In closing I trust that this more granular analysis of individual performance provides better insight into how we perceive the task of portfolio management. We will continue to put forth our best efforts in approaching that task on behalf of our shareholders, in the sincere belief that 'hard work' pays. 3 As always we appreciate the support of our shareholders and look forward to reporting to you in the future. Respectfully submitted, [Signature of Warren J. Isabelle] Warren J. Isabelle Portfolio Manager - -------- INVESTMENTS IN SMALLER COMPANIES CARRY GREATER RISK THAN IS CUSTOMARILY ASSOCIATED WITH LARGER COMPANIES FOR VARIOUS REASONS SUCH AS NARROWER PRODUCT LINES, LIMITED FINANCIAL RESOURCES AND LESS DEPTH IN MANAGEMENT. RETURNS SHOWN ARE FOR THE FUND'S INVESTMENT SHARES; OTHER SHARE CLASS RETURNS WILL VARY. THE VIEWS IN THIS REPORT WERE THOSE OF THE FUND MANAGER AS OF JUNE 30, 2007 UNLESS OTHERWISE NOTED, AND MAY NOT REFLECT HIS VIEWS ON THE DATE THIS REPORT IS FIRST PUBLISHED OR ANYTIME THEREAFTER. THESE VIEWS ARE INTENDED TO ASSIST SHAREHOLDERS IN UNDERSTANDING THEIR INVESTMENTS IN THE FUND AND DO NOT CONSTITUTE INVESTMENT ADVICE. 4 Ironwood Isabelle Small Company Stock Fund Investment Class Illustration Of $10,000 Investment The graph below reflects the change in value of a hypothetical $10,000 investment in the Ironwood Isabelle Small Company Stock Fund (the "Fund") Investment Class compared with a broad-based securities market index since the Investment Class' inception. The Russell 2000 Index is composed of the 2,000 smallest stocks in the Russell 3000 Index, a market weighted index of the 3,000 largest U.S. publicly traded companies. The Fund is professionally managed while the Index is unmanaged and not available for investment. IRONWOOD ISABELLE SMALL COMPANY STOCK INVESTMENT VALUE REPORT FUND INCEPTION (3/9/1998) TO 6/30/2007 Fund Number: Fund Name: Initial Investment: Benchmark: Datapoint Frequency: Currency: 3800101 RUSSELL2000 DATE ---- 3/9/1998 10,000 10,000 3/31/1998 10,000 10,431 4/30/1998 9,900 10,488 5/31/1998 9,460 9,924 6/30/1998 9,040 9,944 7/31/1998 7,770 9,139 8/31/1998 5,910 7,365 9/30/1998 6,110 7,941 10/31/1998 6,480 8,265 11/30/1998 6,730 8,698 12/31/1998 6,910 9,236 1/31/1999 7,250 9,359 2/28/1999 6,920 8,601 3/31/1999 6,690 8,735 4/30/1999 7,550 9,518 5/31/1999 8,260 9,657 6/30/1999 8,390 10,094 7/31/1999 8,390 9,817 8/31/1999 8,390 9,453 9/30/1999 8,250 9,455 10/31/1999 8,370 9,494 11/30/1999 9,280 10,061 12/31/1999 10,330 11,199 1/31/2000 10,860 11,020 2/29/2000 11,690 12,839 3/31/2000 11,880 11,993 4/30/2000 11,740 11,271 5/31/2000 11,260 10,614 6/30/2000 11,690 11,540 7/31/2000 11,530 11,168 8/31/2000 11,710 12,020 9/30/2000 12,050 11,667 10/31/2000 11,300 11,146 11/30/2000 10,840 10,002 12/31/2000 11,129 10,861 1/31/2001 12,009 11,427 2/28/2001 11,835 10,677 3/31/2001 11,794 10,155 4/30/2001 12,347 10,949 5/31/2001 13,043 11,218 6/30/2001 14,067 11,605 7/31/2001 12,808 10,977 8/31/2001 12,224 10,623 9/30/2001 9,972 9,193 10/31/2001 10,545 9,731 11/30/2001 11,067 10,484 12/31/2001 12,101 11,131 1/31/2002 12,071 11,015 2/28/2002 11,886 10,713 3/31/2002 13,699 11,575 4/30/2002 13,955 11,680 5/31/2002 13,473 11,162 6/30/2002 13,658 10,608 7/31/2002 11,549 9,006 8/31/2002 10,965 8,983 9/30/2002 9,829 8,338 10/31/2002 9,798 8,605 11/30/2002 10,811 9,373 12/31/2002 9,992 8,851 1/31/2003 9,409 8,606 2/28/2003 8,559 8,346 3/31/2003 8,426 8,454 4/30/2003 9,378 9,255 5/31/2003 10,494 10,248 6/30/2003 11,108 10,434 7/31/2003 11,293 11,087 8/31/2003 12,081 11,595 9/30/2003 11,999 11,381 10/31/2003 12,736 12,337 11/30/2003 13,310 12,774 12/31/2003 14,129 13,034 1/31/2004 14,722 13,600 2/29/2004 15,040 13,722 3/31/2004 14,866 13,850 4/30/2004 14,907 13,143 5/31/2004 14,630 13,353 6/30/2004 15,255 13,915 7/31/2004 13,944 12,978 8/31/2004 13,617 12,911 9/30/2004 14,303 13,517 10/31/2004 14,323 13,784 11/30/2004 15,582 14,979 12/31/2004 16,688 15,423 1/31/2005 16,023 14,779 2/28/2005 16,350 15,029 3/31/2005 15,767 14,599 4/30/2005 14,518 13,763 5/31/2005 15,337 14,664 6/30/2005 16,176 15,229 7/31/2005 17,180 16,194 8/31/2005 16,811 15,894 9/30/2005 17,251 15,944 10/31/2005 16,606 15,449 11/30/2005 17,062 16,199 12/31/2005 17,491 16,125 1/31/2006 19,269 17,571 2/28/2006 19,821 17,522 3/31/2006 20,913 18,373 4/30/2006 20,717 18,370 5/31/2006 19,331 17,338 6/30/2006 19,012 17,449 7/31/2006 18,166 16,882 8/31/2006 19,417 17,381 9/30/2006 19,220 17,526 10/31/2006 21,453 18,535 11/30/2006 21,456 19,023 12/31/2006 21,633 19,087 1/31/2007 21,842 19,406 2/28/2007 21,810 19,252 3/31/2007 22,180 19,458 4/30/2007 22,357 19,808 5/31/2007 23,354 20,619 6/30/2007 23,563 20,317 PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND IS NO GUARANTEE OF FUTURE RESULTS. CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE DATA QUOTED. INVESTMENT RETURN AND PRINCIPAL VALUE WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN ORIGINAL COST. FOR THE MOST RECENT MONTH END PERFORMANCE, PLEASE CALL (800) 472-6114. THE PERFORMANCE TABLE AND GRAPH DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES. TOTAL RETURN FIGURES INCLUDE THE REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS. SOME OF THE FUND'S FEES HAVE BEEN WAIVED OR EXPENSES REIMBURSED; OTHERWISE TOTAL RETURN WOULD HAVE BEEN LOWER. 5 Ironwood Isabelle Small Company Stock Fund Institutional Class Illustration Of $10,000 Investment The graph below reflects the change in value of a hypothetical $10,000 investment in the Ironwood Isabelle Small Company Stock Fund (the "Fund") Institutional Class compared with a broad-based securities market index since the Institutional Class' inception. The Russell 2000 Index is composed of the 2,000 smallest stocks in the Russell 3000 Index, a market weighted index of the 3,000 largest U.S. publicly traded companies. The Fund is professionally managed while the Index is unmanaged and not available for investment. IRONWOOD ISABELLE SMALL COMPANY STOCK INVESTMENT VALUE REPORT FUND INCEPTION (3/27/1998) TO 6/30/2007 Fund Number: Fund Name: Initial Investment: Benchmark: Datapoint Frequency: Currency: 3800102 RUSSELL2000 DATE ---- 3/27/1998 10,000 10,000 3/31/1998 9,970 10,074 4/30/1998 9,870 10,130 5/31/1998 9,460 9,584 6/30/1998 9,040 9,605 7/31/1998 7,780 8,827 8/31/1998 5,920 7,113 9/30/1998 6,120 7,670 10/31/1998 6,480 7,982 11/30/1998 6,740 8,401 12/31/1998 6,920 8,920 1/31/1999 7,260 9,039 2/28/1999 6,940 8,307 3/31/1999 6,690 8,437 4/30/1999 7,560 9,193 5/31/1999 8,270 9,327 6/30/1999 8,400 9,749 7/31/1999 8,400 9,481 8/31/1999 8,400 9,130 9/30/1999 8,270 9,132 10/31/1999 8,390 9,169 11/30/1999 9,300 9,717 12/31/1999 10,360 10,817 1/31/2000 10,890 10,643 2/29/2000 11,720 12,400 3/31/2000 11,920 11,583 4/30/2000 11,780 10,886 5/31/2000 11,300 10,251 6/30/2000 11,740 11,145 7/31/2000 11,580 10,787 8/31/2000 11,760 11,610 9/30/2000 12,100 11,268 10/31/2000 11,350 10,765 11/30/2000 10,900 9,660 12/31/2000 11,179 10,490 1/31/2001 12,079 11,036 2/28/2001 11,905 10,312 3/31/2001 11,854 9,807 4/30/2001 12,417 10,575 5/31/2001 13,113 10,835 6/30/2001 14,147 11,209 7/31/2001 12,888 10,602 8/31/2001 12,315 10,260 9/30/2001 10,042 8,879 10/31/2001 10,636 9,398 11/30/2001 11,158 10,126 12/31/2001 12,233 10,751 1/31/2002 12,202 10,639 2/28/2002 12,018 10,347 3/31/2002 13,850 11,179 4/30/2002 14,116 11,281 5/31/2002 13,625 10,780 6/30/2002 13,820 10,245 7/31/2002 11,690 8,698 8/31/2002 11,107 8,676 9/30/2002 9,950 8,053 10/31/2002 9,930 8,311 11/30/2002 10,953 9,053 12/31/2002 10,124 8,549 1/31/2003 9,541 8,312 2/28/2003 8,681 8,061 3/31/2003 8,548 8,165 4/30/2003 9,510 8,939 5/31/2003 10,646 9,898 6/30/2003 11,281 10,077 7/31/2003 11,465 10,708 8/31/2003 12,264 11,199 9/30/2003 12,182 10,992 10/31/2003 12,939 11,915 11/30/2003 13,523 12,338 12/31/2003 14,362 12,588 1/31/2004 14,976 13,135 2/29/2004 15,294 13,253 3/31/2004 15,130 13,376 4/30/2004 15,171 12,694 5/31/2004 14,894 12,896 6/30/2004 15,539 13,439 7/31/2004 14,198 12,534 8/31/2004 13,871 12,470 9/30/2004 14,577 13,055 10/31/2004 14,598 13,312 11/30/2004 15,877 14,467 12/31/2004 17,013 14,895 1/31/2005 16,338 14,274 2/28/2005 16,676 14,516 3/31/2005 16,092 14,100 4/30/2005 14,813 13,293 5/31/2005 15,652 14,163 6/30/2005 16,563 14,709 7/31/2005 17,576 15,641 8/31/2005 17,218 15,351 9/30/2005 17,679 15,399 10/31/2005 17,013 14,921 11/30/2005 17,478 15,645 12/31/2005 17,918 15,574 1/31/2006 19,748 16,970 2/28/2006 20,334 16,923 3/31/2006 21,457 17,744 4/30/2006 21,262 17,742 5/31/2006 19,846 16,745 6/30/2006 19,517 16,853 7/31/2006 18,650 16,305 8/31/2006 19,944 16,787 9/30/2006 19,748 16,927 10/31/2006 22,043 17,902 11/30/2006 22,060 18,373 12/31/2006 22,234 18,434 1/31/2007 22,456 18,743 2/28/2007 22,424 18,594 3/31/2007 22,820 18,793 4/30/2007 23,011 19,130 5/31/2007 24,025 19,914 6/30/2007 24,247 19,623 PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND IS NO GUARANTEE OF FUTURE RESULTS. CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE DATA QUOTED. INVESTMENT RETURN AND PRINCIPAL VALUE WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN ORIGINAL COST. FOR THE MOST RECENT MONTH END PERFORMANCE, PLEASE CALL (800) 472-6114. THE PERFORMANCE TABLE AND GRAPH DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES. TOTAL RETURN FIGURES INCLUDE THE REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS. SOME OF THE FUND'S FEES HAVE BEEN WAIVED OR EXPENSES REIMBURSED; OTHERWISE TOTAL RETURN WOULD HAVE BEEN LOWER. 6 Ironwood Isabelle Small Company Stock Fund Portfolio Of Investments June 30, 2007 - (Unaudited) MARKET SHARES SECURITY VALUE ------ -------- ------ COMMON STOCK - 99.88% CONSUMER DISCRETIONARY & SERVICES - 12.83% 65,300 4Kids Entertainment, Inc.+ $ 979,500 1,522,900 Danka Business Systems plc, ADR+ 1,675,190 50,000 Hooker Furniture Corp. 1,122,000 379,700 Westaff, Inc.+ 1,647,898 ---------- 5,424,588 ---------- CONSUMER STAPLES - 3.16% 70,400 Chiquita Brands International, Inc. 1,334,784 ---------- OTHER ENERGY - 7.91% 90,000 CE Franklin, Ltd.+ 1,048,500 171,300 International Coal Group, Inc.+ 1,024,374 80,200 Petrohawk Energy Corp.+ 1,271,972 ---------- 3,344,846 ---------- FINANCIAL SERVICES - 8.82% 12,000 Arch Capital Group, Ltd.+ 870,480 28,600 Citizens First Bancorp, Inc. 623,480 73,300 Eastern Insurance Holdings, Inc. 1,164,737 21,900 Hanover Insurance Group, Inc. 1,068,501 ---------- 3,727,198 ---------- HEALTH CARE - 12.96% 15,000 Analogic Corp. 1,102,650 193,601 ARIAD Pharmaceuticals, Inc.+ 1,062,870 290,500 Durect Corp.+ 1,118,425 599,300 Gene Logic, Inc.+ 827,034 472,600 Novavax, Inc.+ 1,370,540 ---------- 5,481,519 ---------- MATERIALS & PROCESSING - 29.10% 35,100 AM Castle & Co. 1,260,441 28,300 Ampco-Pittsburgh Corp. 1,134,547 105,300 Chemtura Corp. 1,169,883 131,000 ICO, Inc.+ 1,384,670 155,850 Industrial Enterprises of America, Inc.+ 787,042 128,400 Material Sciences Corp.+ 1,513,836 74,400 Novagold Resources, Inc.+ 1,118,232 58,100 Olin Corp. 1,220,100 The accompanying notes are an integral part of the financial statements. 7 Ironwood Isabelle Small Company Stock Fund Portfolio Of Investments June 30, 2007 - (Unaudited), (Continued) MARKET SHARES SECURITY VALUE ------ -------- ------ MATERIALS & PROCESSING (CONTINUED) 232,500 Omnova Solutions, Inc.+ $ 1,406,625 181,800 PolyOne Corp.+ 1,307,142 ----------- 12,302,518 ----------- PRODUCER DURABLES - 12.85% 65,650 Allied Defense Group, Inc.+ 504,849 196,200 Cherokee International Corp.+ 969,228 282,900 Magne tek, Inc.+ 1,456,935 366,600 Proliance International, Inc.+ 1,136,460 78,100 Williams Controls, Inc.+ 1,365,969 ----------- 5,433,441 ----------- TECHNOLOGY - 10.30% 233,500 ActivIdentity Corp.+ 1,074,100 419,800 InFocus Corp.+ 936,154 232,300 Iomega Corp.+ 1,080,195 608,844 SoftBrands, Inc.+ 1,266,395 ----------- 4,356,844 ----------- UTILITIES - 1.95% 202,000 Aquila, Inc.+ 826,180 ----------- TOTAL COMMON STOCK (COST $32,206,621) 42,231,918 ----------- SHORT-TERM INVESTMENT - 0.30% MONEY MARKET FUND - 0.30% 127,819 Fifth Third Institutional Money Market, 5.21% (Cost $127,819) 127,819 ----------- TOTAL INVESTMENTS (COST $32,334,440)* - 100.18% $42,359,737 OTHER ASSETS NET OF LIABILITIES - (0.18)% (75,396) ----------- NET ASSETS - 100.00% $42,284,341 =========== - -------- + Non-income producing security. ADR American Depositary Receipt. plc Public Limited Company. The accompanying notes are an integral part of the financial statements. 8 Ironwood Isabelle Small Company Stock Fund Portfolio Of Investments June 30, 2007 - (Unaudited), (Continued) * Cost for Federal income tax purposes is substantially the same as for financial statement purposes and net unrealized appreciation (depreciation) consists of: Gross Unrealized Appreciation $11,459,760 Gross Unrealized Depreciation (1,434,463) ----------- Net Unrealized Appreciation (Depreciation) $10,025,297 =========== MAKE INTO A PIE CHART AS IN PREVIOUS REPORTS PORTFOLIO HOLDINGS % of Total Investments Health Care 12.9% Consumer Discretionary & Services 12.8% Producer Durables 12.8% Materials & Processing 29.1% Technology 10.3% Financial Services 8.8% Other Energy 7.9% Consumer Staples 3.1% Utilities 2.0% Money Market Fund 0.3% ----- 100.0% The accompanying notes are an integral part of the financial statements. 9 Ironwood Isabelle Small Company Stock Fund Statement Of Assets And Liabilities June 30, 2007 - (Unaudited) ASSETS: Investments in securities at market value (cost $32,334,440) $42,359,737 Cash 12 Receivable for securities sold 257 Receivable for Fund shares sold 8,474 Interest and dividends receivable 6,492 Prepaid expenses 25,982 ----------- TOTAL ASSETS 42,400,954 ----------- LIABILITIES: Due to custodian 699 Payable for Fund shares redeemed 20,000 Payable to adviser 18,256 Payable for trustees' fees and expenses 3,800 Other accrued expenses 73,858 ----------- TOTAL LIABILITIES 116,613 ----------- NET ASSETS $42,284,341 =========== NET ASSETS CONSIST OF: Paid-in capital 25,078,380 Accumulated net investment income (loss) (329,251) Accumulated net realized gain (loss) on investments 7,509,915 Net unrealized appreciation (depreciation) of investments 10,025,297 ----------- NET ASSETS $42,284,341 =========== INVESTMENT CLASS SHARES: Net Assets (unlimited shares of $0.001 par beneficial interest authorized; 2,628,498 shares outstanding) $38,508,263 ----------- Net asset value, offering and redemption price per Investment Class Share $ 14.65 ----------- INSTITUTIONAL CLASS SHARES: Net Assets (unlimited shares of $0.001 par beneficial interest authorized; 246,745 shares outstanding) $ 3,776,078 ----------- Net asset value, offering and redemption price per Institutional Class Share $ 15.30 ----------- The accompanying notes are an integral part of the financial statements. 10 Ironwood Isabelle Small Company Stock Fund Statement Of Operations SIX MONTHS ENDED JUNE 30, 2007 (UNAUDITED) ------------- INVESTMENT INCOME Dividends $ 96,605 ----------- EXPENSES Investment advisory fees 223,478 Administration fees 20,113 Transfer agent fees Investment Class Shares 43,049 Institutional Class Shares 8,167 Distribution fees Investment Class Shares 51,336 Accounting fees 28,098 Custodian fees 5,144 Professional fees 74,299 Registration fees 18,384 Trustees' fees and expenses 14,645 Compliance services fees 16,419 Miscellaneous fees 27,667 ----------- TOTAL EXPENSES 530,799 Fees waived and expenses reimbursed (104,943) ----------- NET EXPENSES 425,856 ----------- NET INVESTMENT INCOME (LOSS) (329,251) ----------- REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS Net realized gain (loss) on investments 8,288,201 Net change in unrealized appreciation (depreciation) of investments (4,171,387) ----------- Net realized and unrealized gain (loss) on investments 4,116,814 ----------- INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ 3,787,563 =========== The accompanying notes are an integral part of the financial statements. 11 Ironwood Isabelle Small Company Stock Fund Statements Of Changes In Net Assets SIX MONTHS ENDED JUNE 30, 2007 YEAR ENDED (UNAUDITED) DECEMBER 31, 2006 ---------------- ----------------- OPERATIONS Net investment income (loss) $ (329,251) $ (909,268) Net realized gain (loss) on investments 8,288,201 9,758,029 Net change in unrealized appreciation (depreciation) of investments (4,171,387) (1,733,844) ------------ ------------ Increase (decrease) in net assets resulting from operations 3,787,563 7,114,917 ------------ ------------ DISTRIBUTIONS TO SHAREHOLDERS: Net realized gains: Investment Class -- (11,290,626) Institutional Class -- (848,162) ------------ ------------ Total distributions to shareholders -- (12,138,788) ------------ ------------ CAPITAL SHARE TRANSACTIONS Proceeds from shares subscribed: Investment Class 3,577,228 76,340,325 Institutional Class 53,389 1,251,221 Reinvestment of distributions: Investment Class -- 11,021,168 Institutional Class -- 754,704 Redemption of shares: Investment Class (14,724,886) (85,552,148) Institutional Class (163,225) (10,783,631) ------------ ------------ Increase (Decrease) in net assets from capital share transactions (a) (11,257,494) (6,968,361) ------------ ------------ TOTAL INCREASE (DECREASE) IN NET ASSETS (7,469,931) (11,992,232) ------------ ------------ NET ASSETS Beginning of period 49,754,272 61,746,504 ------------ ------------ End of period (including accumulated net investment loss of $329,251, and $0, respectively) $ 42,284,341 $ 49,754,272 ============ ============ The accompanying notes are an integral part of the financial statements. 12 Ironwood Isabelle Small Company Stock Fund Statements Of Changes In Net Assets - (Continued) SIX MONTHS ENDED JUNE 30, 2007 YEAR ENDED (UNAUDITED) DECEMBER 31, 2006 ---------------- ----------------- NET ASSETS (CONTINUED) (a) Transactions in capital stock were: Investment Class Shares sold 261,119 4,685,871 Reinvestment of distributions -- 835,570 Shares redeemed (1,066,354) (5,606,838) ---------- ---------- Increase (Decrease) in shares outstanding (805,235) (85,397) ========== ========== Institutional Class Shares sold 3,766 75,280 Reinvestment of distributions -- 54,848 Shares redeemed (11,247) (664,149) ---------- ---------- Increase (Decrease) in shares outstanding (7,481) (534,021) ========== ========== The accompanying notes are an integral part of the financial statements. 13 Ironwood Isabelle Small Company Stock Fund Financial Highlights The table below sets forth financial data for one share of capital stock outstanding throughout each year or period indicated. SIX MONTHS ENDED JUNE 30, 2007 YEAR ENDED INVESTMENT CLASS (UNAUDITED) DECEMBER 31, 2006 - ---------------- ---------------- ----------------- NET ASSET VALUE, BEGINNING OF PERIOD $ 13.45 $ 14.26 ------- ------- Increase (decrease) from investment operations: Net investment loss (0.10)(a) (0.21)(a) Net realized and unrealized gains (losses) on investments 1.30(a) 3.51(a) ------- ------- NET INCREASE (DECREASE) FROM INVESTMENT OPERATIONS 1.20 3.30 ------- ------- Less distributions from net realized gains -- (4.11) ------- ------- NET ASSET VALUE, END OF PERIOD $ 14.65 $ 13.45 ======= ======= TOTAL RETURN (B)(C) 8.92% 23.68% RATIOS/SUPPLEMENTAL DATA Net assets, end of period (in 000s) $38,508 $46,187 Ratio of expenses to average net assets: Before waivers and/or reimbursements 2.36% 2.13% After waivers and/or reimbursements 1.95% 1.90% Ratio of net investment income (loss) to average net assets: (d) Before waivers and/or reimbursements (1.90)% (1.59)% After waivers and/or reimbursements (1.49)% (1.35)% Portfolio turnover rate 21.72% 131.30% - -------- (a) Calculated based on average shares outstanding during the period. (b) Assumes initial investment at net asset value at the beginning of each period, reinvestment of all distributions and the complete redemption of the investment at the end of the period. Total return reflects performance based on net operating expenses. During any period in which fees were waived or expenses reimbursed, total return would have been lower if expenses had not been reduced. (c) Not annualized for periods less than one year. (d) Annualized for periods less than one year. The accompanying notes are an integral part of the financial statements. 14 Ironwood Isabelle Small Company Stock Fund Financial Highlights - (Continued) YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED DECEMBER 31, 2005 DECEMBER 31, 2004 DECEMBER 31, 2003 DECEMBER 31, 2002 ----------------- ----------------- ----------------- ----------------- $ 16.31 $ 13.80 $ 9.76 $ 11.82 -------- -------- -------- -------- (0.23)(a) (0.19)(a) (0.13)(a) (0.14) 0.91(a) 2.70(a) 4.17(a) (1.92) -------- -------- -------- -------- 0.68 2.51 4.04 (2.06) -------- -------- -------- -------- (2.73) -- -- -- -------- -------- -------- -------- $ 14.26 $ 16.31 $ 13.80 $ 9.76 ======== ======== ======== ======== 4.81% 18.12% 41.39% (17.43)% $ 50,171 $ 70,825 $ 67,983 $ 64,552 2.04% 1.89% 1.94% 1.80% 1.95% 1.86% 1.88% 1.71% (1.56)% (1.38)% (1.32)% (1.17)% (1.47)% (1.35)% (1.26)% (1.08)% 65.68% 90.58% 51.70% 50.41% The accompanying notes are an integral part of the financial statements. 15 Ironwood Isabelle Small Company Stock Fund Financial Highlights The table below sets forth financial data for one share of capital stock outstanding throughout each year or period indicated. SIX MONTHS ENDED JUNE 30, 2007 YEAR ENDED INSTITUTIONAL CLASS (UNAUDITED) DECEMBER 31, 2006 - ------------------- ---------------- ----------------- NET ASSET VALUE, BEGINNING OF PERIOD $14.03 $ 14.68 ------ ------- Increase (decrease) from investment operations: Net investment loss (0.09)(a) (0.18)(a) Net realized and unrealized gains (losses) on investments 1.36(a) 3.64(a) ------ ------- NET INCREASE (DECREASE) FROM INVESTMENT OPERATIONS 1.27 3.46 ------ ------- Less distributions from net realized gains -- (4.11) ------ ------- NET ASSET VALUE, END OF PERIOD $15.30 $ 14.03 ====== ======= TOTAL RETURN (B)(C) 9.05% 24.09% RATIOS/SUPPLEMENTAL DATA Net assets, end of period (in 000s) $3,776 $ 3,568 Ratio of expenses to average net assets: Before waivers and/or reimbursements 2.59% 2.27% After waivers and/or reimbursements 1.70% 1.69% Ratio of net investment income (loss) to average net assets: (d) Before waivers and/or reimbursements (2.13)% (1.73)% After waivers and/or reimbursements (1.24)% (1.15)% Portfolio turnover rate 21.72% 131.30% - -------- (a) Calculated based on average shares outstanding during the period. (b) Assumes initial investment at net asset value at the beginning of each period, reinvestment of all distributions and the complete redemption of the investment at the end of the period. Total return reflects performance based on net operating expenses. During any period in which fees were waived or expenses reimbursed, total return would have been lower if expenses had not been reduced. (c) Not annualized for periods less than one year. (d) Annualized for periods less than one year. The accompanying notes are an integral part of the financial statements. 16 Ironwood Isabelle Small Company Stock Fund Financial Highlights - (Continued) YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED DECEMBER 31, 2005 DECEMBER 31, 2004 DECEMBER 31, 2003 DECEMBER 31, 2002 ----------------- ----------------- ----------------- ----------------- $ 16.63 $ 14.03 $ 9.89 $ 11.95 -------- -------- -------- -------- (0.20)(a) (0.16)(a) (0.10)(a) (0.11) 0.98(a) 2.76(a) 4.24(a) (1.95) -------- -------- -------- -------- 0.78 2.60 4.14 (2.06) -------- -------- -------- -------- (2.73) -- -- -- -------- -------- -------- -------- $ 14.68 $ 16.63 $ 14.03 $ 9.89 ======== ======== ======== ======== 5.31% 18.46% 41.86% (17.24)% $ 11,576 $ 15,193 $ 18,253 $ 20,920 1.81% 1.63% 1.61% 1.49% 1.70% 1.61% 1.55% 1.44% (1.35)% (1.12)% (0.98)% (0.86)% (1.24)% (1.10)% (0.93)% (0.82)% 65.68% 90.58% 51.70% 50.41% The accompanying notes are an integral part of the financial statements. 17 Ironwood Isabelle Small Company Stock Fund Notes to Financial Statements June 30, 2007 - (Unaudited) NOTE 1 - ORGANIZATION Ironwood Isabelle Small Company Stock Fund (formerly known as ICM/Isabelle Small Cap Value Fund) (the "Fund") is a series of Ironwood Series Trust (formerly known as ICM Series Trust) (the "Trust"), which was organized as a Massachusetts business trust pursuant to a Declaration of Trust dated November 18, 1997. The Trust is registered under the Investment Company Act of 1940, as amended (the "1940 Act"). The Fund offers two classes of shares, Investment Shares and Institutional Shares (collectively, the "Shares"), each of which has equal rights as to class and voting privileges. The Investment Shares have exclusive voting rights with respect to its distribution plan pursuant to Rule 12b-1 under the 1940 Act ("12b-1 Plan") and are subject to 12b-1 Plan expenses. The Fund commenced operations on March 9, 1998 (March 27, 1998 for the Institutional Shares). The investment objective of the Fund is to seek capital appreciation by investing its assets primarily in relatively undervalued common stocks of domestic small companies. NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of its financial statements. These policies are in conformity with accounting principles generally accepted in the United States of America ("generally accepted accounting principles"). The preparation of financial statements in conformity with generally accepted accounting principles requires management makes estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, as well as the reported amounts for revenues and expenses during the reporting period. Actual results could differ from those estimates. SECURITY VALUATION. Exchange traded securities and over-the-counter securities listed on the NASDAQ National Market System for which market quotations are readily available are valued using the last reported sales price or the NASDAQ Official Closing Price ("NOCP"), provided by independent pricing services as of the close of 18 Ironwood Isabelle Small Company Stock Fund Notes to Financial Statements June 30, 2007 - (Unaudited), (Continued) trading on the New York Stock Exchange on each Fund business day. In the absence of a sale or NOCP, such securities are valued at the mean of the last bid and asked price. Non-exchange traded securities for which quotations are available are generally valued at the mean between the current bid and asked prices. Money market instruments that mature in sixty days or less may be valued at amortized cost. The Fund values securities at fair value pursuant to procedures adopted by the Trust's Board of Trustees if (1) market quotations are insufficient or not readily available; or (2) the Adviser believes that the prices or values available are unreliable. Fair valuation is based on subjective factors and as a result, the fair value price of an asset may differ from the asset's market price and may not be the price at which the asset may be sold. Fair valuation could result in a different net asset value ("NAV") than a NAV determined by using market quotes. INVESTMENT INCOME AND SECURITIES TRANSACTIONS. Securities transactions are accounted for on the date the securities are purchased or sold (trade date). Realized gains and losses are based on the identified cost basis for both financial statement and federal income tax purposes. Dividend income is accrued and recorded on the ex-dividend date. Interest income and expenses are accrued daily. FEDERAL INCOME TAXES. The Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code and distribute all of its net investment income and capital gains to shareholders. Accordingly no provision for Federal income tax is required. For the fiscal year ended December 31, 2006, the Fund reclassified $909,268 to increase net investment income (loss), $398,091 to increase accumulated net realized loss on investments and $511,177 to decrease paid-in-capital. The reclassification has no impact on the net asset value of the Fund and is primarily due to net operating losses. 19 Ironwood Isabelle Small Company Stock Fund Notes to Financial Statements June 30, 2007 - (Unaudited), (Continued) As of December 31, 2006, distributable earnings on a tax basis were as follows: Unrealized Appreciation (Depreciation) $ 13,418,398 INCOME AND EXPENSES. Expenses directly attributable to a particular class are charged directly to such class. In calculating net asset value per share of each class, investment income, realized and unrealized gains and losses and expenses, other than class specific expenses, are allocated daily to each class of shares based on the proportion of net assets of each class at the beginning of that day. REPURCHASE AGREEMENTS. The Fund may invest in repurchase agreements. The Fund will require the financial institution with which the Fund enters into a repurchase agreement to maintain collateral at all times with a value equal to the amount the Fund paid for the securities. In the event of default, the Fund may have difficulties with the disposition of any securities held as collateral. REDEMPTION FEES. A shareholder who redeems or exchanges shares within 30 days of purchase will incur a redemption fee of 2.00% of the current net asset value of shares redeemed or exchanged, subject to certain limitations. The fee is charged for the benefit of the remaining shareholders and will be paid to the Fund to help offset transaction costs. The fee is accounted for as an addition to paid-in capital. The Fund reserves the right to modify the terms of or terminate the fee at any time. There are limited exceptions to the imposition of the redemption fee. DISTRIBUTIONS TO SHAREHOLDERS. Distributions to shareholders from net investment income and net capital gain if any, are declared and paid at least annually. The amount of the distribution are determines in accordance with income tax regulations which may differ from generally accepted accounting principles. The differences are due primarily to 20 Ironwood Isabelle Small Company Stock Fund Notes to Financial Statements June 30, 2007 - (Unaudited), (Continued) differing treatments of income and gain on various investment securities held by the Fund timing differences and differing characterizations of distributions made by the Fund. NEW ACCOUNTING PRONOUNCEMENTS. In June 2006, Financial Accounting Standards Board issued Financial Interpretation No. 48, Accounting for Uncertainty in Income Taxes (the "Interpretation") which is effective for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years no later than June 30, 2007. This Interpretation prescribes a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return, and requires certain expanded disclosures. Fund management has determined that the Fund did not have any unrecognized tax benefits as a result of tax positions taken in the current or prior reporting periods that would require reporting under FIN 48. In September 2006, the FASB issued Statement of Financial Accounting Standards No. 157 "Fair Value Measurements" ("SFAS 157") which is effective for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. SFAS 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. Management has recently begun to evaluate the application of SFAS 157, and has not at this time determined the impact, if any, resulting from its adoption on the Fund's financial statements. NOTE 3 - PURCHASES AND SALES OF SECURITIES Purchases and sales of securities, other than short-term investments, aggregated $9,723,113 and $21,907,937, respectively, for the six months ended June 30, 2007. 21 Ironwood Isabelle Small Company Stock Fund Notes to Financial Statements June 30, 2007 - (Unaudited), (Continued) NOTE 4 - ADVISORY FEES, SERVICING FEES, AND OTHER TRANSACTIONS WITH RELATED PARTIES INVESTMENT ADVISER - Ironwood Investment Management, LLC (formerly known as Ironwood Capital Management, LLC) ("Ironwood") serves as the investment adviser for the Fund pursuant to an investment advisory agreement (the "Agreement"). Under the terms of the Agreement, Ironwood receives an investment advisory fee from the Fund, accrued daily and paid monthly, at an annual rate of 1.00% of the average daily net assets of the Fund. Pursuant to the terms of the Agreement, Ironwood is obligated for as long as the Agreement remains in effect, to limit total annual Fund operating expenses to 1.95% of the average daily net assets annually for the Investment Shares and 1.70% of the average daily net assets annually for the Institutional Shares, and to waive such fees and reimburse expenses to the extent that they exceed these amounts. For the six months ended June 30, 2007, advisory fees of $99,517 were waived by Ironwood. DISTRIBUTOR - Foreside Fund Services, LLC is the Fund's distributor (the "Distributor). The Distributor is not affiliated with the Adviser or Citigroup Fund Services, LLC, ("Citigroup"), or its affiliated companies. The Fund has adopted a 12b-1 Plan with the respect to the Investment Shares in accordance with Rule 12-1 of the 1940 Act. Under the 12b-1 Plan, the Fund compensates the Distributor, at a rate of up to 0.25% of average daily net assets of the Investment Shares for distribution expenses borne or paid to others, by the Distributor. OTHER SERVICE PROVIDERS - Citigroup provides administration, portfolio accounting and transfer agency services to the Fund. Certain employees of Citigroup are also Officers of the Trust. Foreside Compliance Services, LLC ("FCS") an affiliate of the Distributor, provides a Principal Financial Officer (effective June 12, 2007) and a Chief Compliance Officer as well as certain additional compliance support functions to the Trust. Prior to February 22, 2007, 22 Ironwood Isabelle Small Company Stock Fund Notes to Financial Statements June 30, 2007 - (Unaudited), (Continued) compliance services were provided by the Distributor. FCS has no role in determining the investment policies or which securities are to be purchased or sold by the Fund. Certain officers or employees of FCS are also officers of the Trust. In addition, the Fund has entered into separate service and operating agreements with Charles Schwab & Co., Inc. ("Schwab") and Fidelity Brokerage Services Inc./National Financial Services Corp. ("NFSC"), whereby Schwab and NFSC make shares of the Fund available to their clients in exchange for a servicing fee. These fees are included as part of the Transfer Agency fees on the statement of operations. For the six-month period ended June 30, 2007, Bank of New York Securities ("BONY Securities") reimbursed certain fund accounting expenses in the amount of $5,394 due to the Fund's direction of portfolio transactions to BONY Securities during the period. The custodian, Fifth Third Bank (the "Custodian"), has agreed to compensate the Fund and decrease custody fees for interest on any cash balances left uninvested. For the six months ended June 30, 2007, the Fund was reimbursed expenses of $32 by the Custodian. No Trustee, officer or employee of Ironwood, FCS or Citigroup, or any affiliate thereof, receives any compensation from the Trust for serving as a Trustee or officer of the Trust. Disinterested trustees received $14,608 in compensation from the Trust during the six months ended June 30, 2007. 23 Ironwood Isabelle Small Company Stock Fund Notes to Financial Statements June 30, 2007 - (Unaudited), (Continued) NOTE 5 - LINE OF CREDIT The Fund has entered into a line of credit agreement with the Custodian to be used for temporary purposes, primarily for financing redemptions. The agreement provides that the Fund may borrow up to $5,000,000. The aggregate outstanding principal amount of all loans may not exceed $5,000,000. Interest is charged to the Fund, based on its borrowings, at a rate equal to the rate of interest on overnight facilities which the Custodian is offering to other borrowers and potential borrowers of comparable financial condition on the business day that a loan is made pursuant to the agreement. During the six months ended June 30, 2007, the Fund was charged $722 from borrowings under the line of credit. As of June 30, 2007, the Fund had no loans outstanding under the line of credit. NOTE 6 - OTHER INFORMATION On June 30, 2007, two shareholders held approximately 48% of the outstanding shares of the Fund's Investment Shares. These shareholders are omnibus accounts, which are held on behalf of several individual shareholders. As of the same date, five shareholders held approximately 79% of the outstanding shares of the Fund's Institutional Shares. One of these shareholders is an omnibus account, which is held on behalf of several individual shareholders. 24 Ironwood Isabelle Small Company Stock Fund Additional Information June 30, 2007 - (Unaudited) PROXY VOTING INFORMATION A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to securities held in the Fund's portfolio is available, without charge and upon request, by calling (800) 472-6114 and on the SEC's website at www.sec.gov. The Fund's proxy voting record for the twelve-month period ended June 30, is available, without charge and upon request, by calling (800) 472-6114, on the Fund's website www.ironwoodfunds.com and on the SEC's website at www.sec.gov. AVAILABILITY OF QUARTERLY PORTFOLIO SCHEDULES The Fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Fund's Forms N-Q are available, without charge and upon request, on the SEC's website at www.sec.gov. or may be reviewed and copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330. SHAREHOLDER EXPENSES As a shareholder of the Fund you incur two types of costs: (1) transactional costs (i.e. redemption fees) and (2) ongoing costs, including management fees, distribution fees with respect to Investment Shares and other Fund expenses. This example is intended to help you understand these ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The following example is based on $1,000 invested at the beginning of the year and held for the entire period from January 1, 2007 through June 30, 2007. 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 25 Ironwood Isabelle Small Company Stock Fund Additional Information December 31, 2006 - (Unaudited), (Continued) 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 "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 provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. 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 cost of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. Please note that expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs had been included, your costs would have been higher. BEGINNING ENDING EXPENSES ACCOUNT VALUE ACCOUNT VALUE PAID DURING JANUARY 1, 2007 JUNE 30, 2007 PERIOD* --------------- ------------- ----------- INVESTMENT SHARES Actual Return $1,000.00 $1,089.21 $10.10 Hypothetical Return $1,000.00 $1,015.12 $ 9.74 INSTITUTIONAL SHARES Actual Return $1,000.00 $1,090.52 $ 8.81 Hypothetical Return $1,000.00 $1,016.36 $ 8.50 - -------- * EXPENSES ARE EQUAL TO THE FUND'S ANNUALIZED EXPENSE RATIOS OF 1.95% AND 1.70% FOR INVESTMENT SHARES AND INSTITUTIONAL SHARES, RESPECTIVELY, MULTIPLIED BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE NUMBER OF DAYS IN MOST RECENT FISCAL HALF-YEAR/365 (TO REFLECT THE HALF-YEAR PERIOD). 26 Ironwood Investment Management, LLC And Ironwood Funds THE IRONWOOD TREE is a small, hardy tree, which yields a very useful and solid wood. Patiently, these trees remain under the forest canopy until taller neighbors fall. Once given the opportunity, the Ironwood grows quickly to reach its full potential. We believe this imagery is appropriate for our firm as well as our investment style. IRONWOOD INVESTMENT MANAGEMENT, LLC, the investment manager of the Ironwood Isabelle Small Company Stock Fund, is an investment management firm specializing in investing in small company stocks. Ironwood Series Trust Two Portland Square Portland, ME 04101 1-800-472-6114 DISTRIBUTOR Foreside Fund Services, LLC Two Portland Square, 1st Floor Portland, ME 04101 www.foresides.com - -------------------------------------------------------------------------------- This report is submitted for the general information of the shareholders of the Fund. It is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus, which includes information regarding the Fund's risks, objectives, fees and expenses, experience of its management, and other information. There are risks associated with investing in funds of this type that invest in stocks of small-sized companies, which tend to be more volatile and less liquid than stocks of larger companies. Past Fund performance is not indicative of future results. FOR ACCOUNT INFORMATION, CURRENT PERFORMANCE AND PRICES, CALL 1-800-472-6114 BETWEEN THE HOURS OF 9:00 A.M. AND 5:00 P.M. (EASTERN TIME), MONDAY THROUGH FRIDAY. 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. Included as part of report to stockholders under Item 1. 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 AFFILIATED PURCHASERS. Not applicable. ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS Not applicable. ITEM 11. CONTROLS AND PROCEDURES (a)The registrant's President and Treasurer have concluded that the registrant's disclosure controls and procedures (as defined in rule 30a-3(c) under the Investment Company Act of 1940 (the "Act")) are effective, based on their evaluation of these disclosure controls and procedures as of a date within 90 days of the filing date of this report. (b)There were no changes in the registrant's internal control over financial reporting (as defined in rule 30a-3(d) under the Act) that occurred during the registrant's second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting. ITEM 12. EXHIBITS. (a)(1) Not applicable. (a)(2) Certifications pursuant to Rule 30a-2(a) of the Investment Company Act of 1940 as amended, and Section 302 of the Sarbanes-Oxley Act of 2002 (Exhibit filed herewith). (a)(3) Not applicable. (b) Certifications pursuant to Rule 30a-2(b) of the Investment Company Act of 1940, as amended, and Section 906 of the Sarbanes-Oxley Act of 2002 (Exhibit filed herewith). SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Registrant Ironwood Series Trust By /s/ Warren J. Isabeile -------------------------------- Warren J. Isabelle, President Date 8/30/2007 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By /s/ Warren J. Isabelle -------------------------------- Warren J. Isabelle, President Date 8/30/2007 By /s/ Trudance L.C. Bakke -------------------------------- Trudance L.C. Bakke, Treasurer Date 8/28/2007 EX-99.CERT 2 dex99cert.txt CERTIFICATIONS IRONWOOD SERIES TRUST I, Warren J. Isabelle, certify that: 1. I have reviewed this report on Form N-CSR of Ironwood Series Trust; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, and changes in net assets of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: (a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (d)Disclosed in this report any change in the registrant's internal control over financial reporting 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; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: 8/30/2007 /s/ Warren J. Isabelle ----------------------------- Warren J. Isabelle President IRONWOOD SERIES TRUST I, Trudance L.C. Bakke, certify that: 1. I have reviewed this report on Form N-CSR of Ironwood Series Trust; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, and changes in net assets of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: (a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (d)Disclosed in this report any change in the registrant's internal control over financial reporting 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; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: 8/28/2007 /s/ Trudance L.C. Bakke ----------------------------- Trudance L.C. Bakke Treasurer EX-99.906CT 3 dex99906ct.txt CERTIFICATIONS PURSUANT TO SECTION 906 CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 (SUBSECTIONS (A) AND (B) OF SECTION 1350, CHAPTER 63 OF TITLE 18, UNITED STATES CODE) In connection with the attached Report of the Ironwood Series Trust (the "Trust") on Form N-CSR to be filed with the Securities and Exchange Commission (the "Report"), each of the undersigned officers of the Trust does hereby certify that, to the best of such officer's knowledge: 1. The Report fully complies with the requirements of 13(a) or 15(d) of the Securities and Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Trust as of, and for, the periods presented in the Report. Dated: 8/30/2007 /s/ Warren J. Isabelle - --------------------------------- Warren J. Isabelle President Dated: 8/28/2007 /s/ Trudance L.C. Bakke - --------------------------------- Trudance L.C. Bakke Treasurer A signed original of this written statement required by Section 906 has been provided to the Trust and will be retained by the Trust and furnished to the Securities and Exchange Commission or its staff upon request. -----END PRIVACY-ENHANCED MESSAGE-----