-----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, TMYPEMtBGjmhTo4w7FtTS+HVhCfK+V0f8Ti6QBsphvrnOn1tAvkiOf3xRUOFjpIL IyZDXw9JSVUNHlc1xPMbyA== 0001035449-03-000403.txt : 20031030 0001035449-03-000403.hdr.sgml : 20031030 20031030160851 ACCESSION NUMBER: 0001035449-03-000403 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20030831 FILED AS OF DATE: 20031030 EFFECTIVENESS DATE: 20031030 FILER: COMPANY DATA: COMPANY CONFORMED NAME: LINDBERGH FUNDS CENTRAL INDEX KEY: 0000801286 STATE OF INCORPORATION: MA FISCAL YEAR END: 0831 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-09437 FILM NUMBER: 03966845 BUSINESS ADDRESS: STREET 1: 5520 TELEGRAPH RD STREET 2: #204 CITY: ST LOUIS STATE: MO ZIP: 63129 BUSINESS PHONE: 3144160055 MAIL ADDRESS: STREET 1: 5520 TELEGRAPH RD STREET 2: #204 CITY: ST LOUIS STATE: MO ZIP: 63129 N-CSR 1 lindberghncsr0803.txt LINDBERGH FUNDS 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: 811-09437 Lindbergh Funds --------------- (Exact name of registrant as specified in charter) 5520 Telegraph Rd. St. Louis, MO 63129 - -------------------------------------------------------- (Address of principal executive offices) (Zip code) Timothy Ashburn Unified Fund Services, Inc. 431 N Pennsylvania St. Indianapolis, IN 46204 (Name and address of agent for service) Registrant's telephone number, including area code: 314-416-0055 Date of fiscal year end: 08/31 ------------ Date of reporting period: 08/31/03 ---------- Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection and policymaking roles. A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. ss. 3507. Item 1. Reports to Stockholders. Lindbergh Signature Fund An actively managed asset allocation fund. Annual Report August 31, 2003 TABLE OF CONTENTS Management Discussion and Analysis 1 Performance Summary 4 Schedule of Investments 5 Statement of Assets & Liabilities 8 Statement of Operations 9 Statement of Changes in Net Assets 10 Financial Highlights 11 Notes to Financial Statements 12 Auditor's Report 17 Trustee and Officer Information 18 Additional Information 19 Privacy Policy 20 Management Discussion and Analysis September 8, 2003 Dear Fellow Shareholder: Through the close of the Signature Fund's fiscal year, August 31, stock investors this year had enjoyed at least a reprieve from the brutal pounding delivered by a very relentless bear market. With the advent of spring, the stock market bear returned to the woods (perhaps to hibernate) and this, for a change, gave the market bulls the upper hand. And with the bulls back in the driver's seat, investors are again basking in the warmth of positive returns. As you can see in the accompanying table, year to date, through August 31, 2003, Signature Fund investors have enjoyed a positive 11.4% return. Signature Fund returns modestly lag the stock market as measured by the S&P 500, which has gained 16.0%. - -------------------------------- ------------ ------------- Year to Date thru Since 8/31/03 Inception* - -------------------------------- ------------ ------------- Lindbergh Signature Fund 11.4% -3.9% S&P 500 16.0% -7.3% Wilshire 5000 18.4% -6.8% Russell 2000 31.0% 1.5% NASDAQ 35.6% -19.5% - -------------------------------- ------------ ------------- *Fund inception - February 1, 2000 - -------------------------------- ------------ ------------- By comparison, narrow, and more speculative stock indexes such as the small company index, the Russell 2000, and the tech-stock laden NASDAQ, have enjoyed far superior results relative to, both the stock market itself, and the Signature Fund. But the Signature Fund's underperformance is not surprising; in fact, it's to be expected. Why? To begin with, as manager of the Signature Fund, I am most fortunate in the sense that I have considerable latitude to adjust its portfolio structure in an effort to improve returns. To the extent I am successful in such efforts, fund shareholders benefit in two ways. Not only do they enjoy above average returns, but such efforts tend to reduce risk. And speaking of risk, investors these past few years have been forced to confront more than the usual amount of uncertainties such as a faltering economy, war in Iraq, rising oil prices, and volatile interest rates. Given these geopolitical and macro-economic risks, I have purposely structured the fund's portfolio defensively (low stock market exposure) during those periods where such risks were most acute. - -------------------------------- ------------ Returns 12//31/01 thru 8/31/02 - -------------------------------- ------------ Lindbergh Signature Fund -4.6% S&P 500 -19.4% Wilshire 5000 -18.4% Russell 2000 -19.3% NASDAQ -32.6% - -------------------------------- ------------ As you can see in the nearby table, this flexibility to position the Signature Fund more defensively can substantially benefit fund shareholders. The returns depicted were excerpted from the last year's annual report. During the period shown, the stock averages were suffering major losses, but Signature Fund losses, by comparison, were well contained. It's also noteworthy that the numbers in the two tables tend to mirror each other. The NASDAQ, for example, showed both huge losses last year and huge gains this year, but through the math of compounding it takes a gain of 48% to offset the 32.6% loss shown in the second table. Nonetheless, when managing an investment portfolio to limit losses, one must expect, at times, to incur costs in terms of lower returns. If, for example, the Signature Fund is defensively structured, and the stock market quickly reverses direction, moving from a general downtrend to an uptrend, Signature Fund returns will lag stock market returns until it becomes more fully invested. Such a reversal occurred in early March when the stock market began its current advance. As the evidence began to accumulate that the market was in for a more sustained advance, I greatly increased the 1 equity component of the Signature Fund's portfolio. But by not fully participating in the early stages of this upward move, the Signature Fund thus far this year has modestly underperformed the stock market year to date and for the fiscal year ending August 31. For the fiscal year, the Fund gained 6.5% vs. a 12.1% return for the S&P 500. To briefly summarize, a willingness to be defensive (hold less stock), will, at times, carry a short-term opportunity costs in the form of below-average returns. Results this year reflect such a cost, but as you can see in the second table, there are also large potential benefits. What does this mean for the year ahead? Although there is always a possible opportunity cost associated with a below-average stock market exposure, I continue to believe that fund shareholders will be rewarded by my efforts to limit losses during periods where risks are more acute. And for the economy and stock market, the potential for disappointments and negative developments remains higher than usual. Therefore, in my view, the risk of stock investors suffering more losses easily exceeds the possible opportunity costs of not fully participating in the next big up move. As you'll see, for this and the reasons described below, I believe it's best for investors to err on the side of caution. Part of my concern with risks in the stock market relate to the economy. Despite the hope and expectations of most investors, I see no evidence that the economy is on the road to a more sustainable and vigorous growth path. I don't think another recession is likely, but it is, nonetheless, a growing possibility. Instead, for the time being, I expect economic growth will simply remain below average as the economy tries to muddle through major structural problems. While economic growth is likely to remain sub par in the foreseeable future, growth during this year's summer and early fall months will be stronger than normal. That's due primarily to the huge dose of economic stimulus provided by this spring's round of interest rate cuts, the Bush administration's tax cuts, and spending for the Iraqi war. But once the benefits of this stimulus dissipates, I expect economic growth will again prove disappointingly sluggish. My skepticism about the economy's growth potential over the next year really boils down to a few key points. The first point to keep in mind: Only two factors have kept the economy from sliding into an extended slump - consumption fueled by cash taken out from home refinancings and two major tax cuts. In essence, the economy has been propped up the past few years by short-term measures - falling interest rates and tax cuts. Next point: With short-term interest rates hovering around one percent, the refinancing boom as a force for economic growth is spent; it's over. And with an election year looming, it's unlikely we're going to see yet another round of tax cuts. With these props to economic growth now set to fall by the wayside, the economy is left standing on some very wobbly legs. Just how wobbly becomes apparent when you consider this basic fact: The American public has been spending well beyond its means. Personal incomes, for instance, are growing at an annual rate in the 2.0-2.5 percent range, but consumer spending is growing much faster than income. When the growth in consumption exceeds the growth in income, it constitutes unsustainable over consumption. The public has financed this spending binge, first by stock market profits during the bubble years, and more recently, by a huge increase in mortgage debt, and through tax cuts. But these artificial boosts to spending will soon end. This, in turn, suggests a significant slowdown in consumer spending. The economy's one bright spot - the one factor that has kept this economy chugging along, albeit at a reduced growth rate - is consumer spending. Yet, the real drivers to consumer spending will soon fall by the wayside. This creates a looming void . . . what will fill it? Policy makers at the Fed and Bush administration fervently hope that business spending will pick up any slack in consumer spending. Business investment spending may improve enough to make up some of the shortfall. But business spending's portion of the economy isn't that large. So as a practical matter, it is most unlikely that business spending could fill the void of a major slowdown in consumer spending. 2 With this perspective, we can draw several key points: First, even if we assume a resurgence in business spending offsets, dollar for dollar, any slowdown in consumer spending, it will do nothing to boost economic growth back to a higher rate. Instead, growth will remain stuck in the 2 percent range. Second, if economic growth over the next year is to run in the 3.5 percent range, which is the consensus outlook among forecasters, consumers must continue to live and spend well beyond their means AND there must be a large increase in business spending. Third, with short-term interest rates below one percent, and further tax cuts no longer possible, policy makers simply have no more rabbits to pull out of the hat; their hands are tied. For these reasons and more, I expect that the law of economics will soon begin to exert considerable drag on consumers and their ability to sustain current levels of spending. Taken together, these facts suggest that the economy is in a box with no easy way out. It is thus, by definition, suffering from major structural problems - primarily related to excessive levels of debt. Unfortunately, structural problems can only be healed with time, not short-term policy fixes. Moreover, attempts to paper over structural problems with such policy initiatives as tax and interest rate cuts, may, in fact, prolong the problem and put off the day of reckoning. Despite these problems, I expect the economy will continue to muddle through, much as it has in recent years, at a sub-par growth rate. I, however, expect that this is about the best we can hope for. Investors, however, clearly believe we've solved the economy's problems; that we are now entering a period of sustained and vigorous economic growth. This, at least, is the only logical rationale behind this year's run up in stock prices. But for the reasons described, I believe the economy will fall well short of such expectations. This sets the stage for a pending collision between unrealistic investor expectations and the economy's potential to meet such expectations. For both the economy and stock market, risks remain on the downside. If my assessment is correct, the stock market is facing yet another period of heavy selling. What will provide the catalyst for the next sell off? As I mentioned above, due to the latest round of home refinancings and the child tax credit rebate checks, economic growth in this year's just concluded third quarter will be very strong. This latest spending binge, though, should be the economy's last hurrah. With no more tax cuts and no more cash to take out from mortgage refinancings, the easy money pipeline will soon be empty. Very shortly the weekly flow of economic statistics will begin to reflect this fact. As the bad news begins to trickle in, investors will be in denial. But as the evidence mounts, it will become impossible to deny, the economy isn't off to the races. Instead, it's entering yet another slowdown. At that point, if not before, I expect the stock market will come under considerable selling pressure. I'll conclude with one final thought. Excessive debt and an enormous misallocation of capital is what best characterizes the late 1990s stock market bubble and economic boom. It has, unfortunately, taken far longer than almost anyone expected to work off these excesses; it is still a work in progress, in my view. As such, my goal in this unusual economic environment is to opportunistically make money whenever possible, but also to avoid major losses. The returns summarized on page 1 attest to our success in meeting this goal. But if I'm to attain this goal in the year ahead, I must continue to be objective in my assessment; to see the economic glass not as half full, but as it truly is. For the reasons described, I believe that for stock investors, the risks remain on the downside. Better days are ahead, but we're not there yet. Sincerely, /s/ Dewayne Wiggins Dewayne Wiggins President, Lindbergh Funds 3 Lindbergh S&P 500 2/1/00 10,000.00 10,000.00 3/31/00 10,301.72 10,770.52 6/30/00 10,330.57 10,484.91 9/30/00 10,577.15 10,383.49 12/31/00 9,636.98 9,571.77 3/31/01 8,482.25 8,436.55 6/30/01 8,974.90 8,930.57 9/30/01 7,764.79 7,620.51 12/31/01 8,527.57 8,435.30 3/31/02 8,571.01 8,458.23 6/30/02 8,995.21 7,325.32 9/30/02 7,979.54 6,060.18 12/31/02 7,780.15 6,571.30 3/31/03 7,721.88 6,364.28 6/30/03 8,219.17 7,344.56 8/31/03 8,667.47 7,619.56 This graph shows the value of a hypothetical initial investment of $10,000 in the Fund and the S&P 500 Index on February 1, 2000, inception date for performance measurement, and held through August 31, 2003. The S&P 500 Index is an unmanaged group of stocks whose total return includes the reinvestment of any dividends and capital gain distributions, but does not reflect expenses, which have lowered the Fund's return. The returns shown do not reflect deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Fund's return represents past performance and is not a guarantee of future results. Average Annual Total Return For the Periods Ending August 31, 2003 Since Inception One Year (February 1, 2000) Lindbergh Signature Fund 6.52% -3.91% S&P 500 Index 12.06% -7.31% 4 Schedule of Investments - August 31, 2003 COMMON STOCKS - 53.46% Number of Shares Market Value Arrangement Of Transportation Of Freight and Cargo - 1.87% 6,390 Expeditors International Of Washington, Inc. $ 240,967 ---------------- Communication Equipment - 2.64% 7,930 UTStarcom, Inc. * 340,673 ---------------- Crude Petroleum & Natural Gas - 1.81% 3,381 Apache Corp. 233,221 ---------------- Electromedical & Electrotherapeutic Apparatus - 1.85% 4,570 St. Jude Medical, Inc. * 237,960 ---------------- Heavy Construction Other Than Buildings - 1.89% 5,200 Jacobs Engineering Group, Inc. * 243,516 ---------------- In Vitro & In Vivo Diagnostic Substances - 2.09% 6,470 IDEXX Laboratories, Inc. * 269,217 ---------------- Miscellaneous Transportation Equipment - 2.02% 3,360 Polaris Industries, Inc. 259,594 ---------------- Orthopedic, Prosthetic & Surgical Appliances - 1.92% 5,920 Respironics, Inc. * 246,627 ---------------- Pharmaceutical Preparations - 1.85% 5,000 American Pharmaceutical Partners, Inc. * 238,200 ---------------- Real Estate Investment Trusts - 2.19% 6,770 Kimco Realty Corp. 282,174 ---------------- Retail - Apparel & Accessory Stores - 2.23% 8,540 Pacific Sunwear of California, Inc. * 286,517 ---------------- Retail - Eating Places - 2.02% 8,100 Applebee's International, Inc. 260,334 ---------------- Retail - Home Furnishings & Equipment Stores - 1.82% 5,440 Bed Bath & Beyond, Inc. * 234,083 ----------------
See accompanying notes which are an integral part of the financial statements. 5 Schedule of Investments - August 31, 2003 Retail - Women's Clothing Stores - 4.16% 16,500 Chico's Fashions, Inc. * $ 536,085 ---------------- Savings Institution, Federally Chartered - 2.02% 3,010 Golden West Financial Corp. 259,673 ---------------- Services - Computer Integrated Systems Design - 2.01% 5,820 CACI International, Inc. * 259,630 ---------------- Services - Computer Programming Services - 2.25% 8,310 Cognizant Technology Solutions Corp. * 289,437 ---------------- Services - Educational Services - 2.23% 4,990 Corinthian Colleges, Inc. * 287,174 ---------------- Services - Equipment Rental & Leasing - 2.25% 3,630 Rent-A-Center, Inc. * 290,219 ---------------- Services - Personal Services - 2.33% 8,670 Regis Corp. 299,895 ---------------- Services - Pharmacy Services - 1.71% 3,400 Express Scripts, Inc. * 220,354 ---------------- State Commercial Bank - 2.05% 8,000 Pacific Capital Bancorp 264,320 ---------------- Surety Insurance - 2.03% 4,640 MBIA, Inc. 261,974 ---------------- Surgical & Medical Instruments & Apparatus - 1.76% 3,000 Stryker Corp. 227,400 ---------------- Trucking (No Local) - 2.45% 12,252 Heartland Express, Inc. * 313,039 ---------------- TOTAL COMMON STOCKS (Cost $5,574,599) 6,882,283 ---------------- Unit Investment Trusts - 2.00% 31,000 iShares Inc. MSCI Japan (a) 257,300 ---------------- TOTAL UNIT INVESTMENT TRUSTS (Cost $259,086) 257,300 ----------------
See accompanying notes which are an integral part of the financial statements. 6 Schedule of Investments - August 31, 2003 Contracts Options on Futures - 0.82% 25 S&P 500 Index Future / November 2003 @ 950 $ 105,625 ---------------- TOTAL OPTIONS ON FUTURES (Cost $129,575) 105,625 ---------------- SHORT-TERM INVESTMENTS - 43.72% Principal Amount Market Value U.S. Treasury & Agency Obligations - 38.78% 5,000,000 U.S Treasury Bill, 10/16/2003 (a) (Cost $4,993,372) 4,993,372 ---------------- Money Market Securities - 4.94% 635,964 Money Market Fiduciary, 0.27%, (b) (Cost $635,964) 635,964 ---------------- TOTAL INVESTMENTS (Cost $11,592,596) - 100.00% $ 12,874,544 ---------------- Other assets less liabilities - 0.00% 37 ---------------- TOTAL NET ASSETS - 100.00% $ 12,874,581 ================
* Non-income producing. (a) A portion of the security held at broker as collateral for futures trading. (b) Variable rate security; the coupon rate shown represents the rate at August 31, 2003. See accompanying notes which are an integral part of the financial statements. 7 Statement of Assets & Liabilities August 31, 2003 ASSETS Amount Investments in securities, at value (cost $11,592,596) $ 12,874,544 Interest receivable 175 Dividends receivable 516 Variation margin on futures contracts 16,625 ---------------------- Total assets 12,891,860 ---------------------- LIABILITIES Amount Other payables and accrued expenses $ 17,279 ---------------------- Total liabilities 17,279 ---------------------- Net Assets $ 12,874,581 SOURCES OF NET ASSETS Amount Net Assets consist of: Paid in capital $ 15,733,917 Accumulated net investment income (loss) (136,026) Accumulated net realized gain (loss) on investments (4,036,862) Net unrealized appreciation (depreciation) on: Investments 1,305,899 Options (23,951) Futures contracts 31,604 ---------------------- Net Assets $ 12,874,581 ====================== Shares of capital stock outstanding (no par value, unlimited shares authorized) 158,695 Net asset value, offering and redemption price per share ($12,874,581 / 158,695) $ 81.13 ======================
See accompanying notes which are an integral part of the financial statements. 8 Statement of Operations - for the year ended August 31, 2003 INVESTMENT INCOME Amount Dividend income $ 38,711 Interest income 53,848 ---------------- ---------------- Total Income 92,559 ---------------- EXPENSES Amount Investment advisor fee (Note 3) 84,044 Legal expenses 23,482 Administration expenses 18,000 Fund accounting expenses 18,000 Transfer agent expenses 16,008 Auditing expenses 9,023 Custodian expenses 6,636 Registration expenses 5,062 Trustee expenses 4,874 Pricing expenses 3,100 Insurance expenses 1,479 ---------------- Total expenses before waived & reimbursed expenses 189,708 Expenses waived & reimbursed by Adviser (Note 3) (105,573) ---------------- ---------------- Total operating expenses 84,135 ---------------- ---------------- Net Investment Income (Loss) 8,424 ---------------- REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS Amount Net realized gain (loss) on: Investment securities 28,693 Options (38,303) Futures contracts (195,723) Change in net unrealized appreciation (depreciation) on: Investment securities 1,083,480 Options (23,951) Futures contracts 1,397 ---------------- Net realized and unrealized gain (loss) on investment securities 855,593 ---------------- ---------------- Net increase (decrease) in net assets resulting from operations $ 864,017 ================
See accompanying notes which are an integral part of the financial statements. 9 Statement of Changes in Net Assets INCREASE (DECREASE) IN NET ASSETS Year ended Year ended August 31, 2003 August 31, 2002 -------------------------------------- Operations Net investment income (loss) $ 8,424 $ 36,536 Net realized gain (loss) on investment securities, options and futures contracts (205,333) (340,740) Change in net unrealized appreciation (depreciation) 1,060,926 61,612 ------------------ ----------------- ------------------ ----------------- Net increase (decrease) in net assets resulting from operations 864,017 (242,592) ------------------ ----------------- Distributions From net investment income (36,432) (230,003) From net realized gain - - ------------------ ----------------- ------------------ ----------------- Total distributions (36,432) (230,003) ------------------ ----------------- Share Transactions Proceeds from shares sold 1,754,615 240,912 Shares issued in reinvestment of distributions 36,432 230,003 Shares redeemed (39,650) (2,630,922) ------------------ ----------------- Net increase (decrease) in net assets resulting from share transactions 1,751,397 (2,160,007) ------------------ ----------------- ------------------ ----------------- Total Increase (Decrease) in Net Assets 2,578,982 (2,632,602) ------------------ ----------------- Net Assets Beginning of period 10,295,599 12,928,201 ------------------ ----------------- End of period $ 12,874,581 $ 10,295,599 ================== ================= Transactions in Fund Shares: Shares sold 24,027 3,025 Shares reinvested 495 2,896 Shares redeemed (537) (33,373) ------------------ ----------------- Net increase (decrease) in number of shares outstanding 23,985 (27,452) ================== =================
See accompanying notes which are an integral part of the financial statements. 10 Financial Highlights Period Ended Year ended Year ended Year ended August 31, August 31,2003 August 31,2002 August 31,2002 2000 (a) ------------------------------------------------------------- Selected Per Share Data: Net asset value, beginning of period $ 76.43 $ 79.72 $ 111.21 $ 100.00 ---------------- ---------- ---------- ----------- Income from investment operations Net investment income 0.06 0.26 1.52 4.18 Net realized and unrealized gain (loss) 4.90 (2.07) (28.05) 8.75 ---------------- ---------- ---------------- ---------- ---------- ----------- Total from investment operations 4.96 (1.81) (26.53) 12.93 ---------------- ---------- ---------- ----------- Less Distributions: From net investment income (0.26) (1.48) (3.26) (1.71) From net realized gain 0.00 0.00 (1.70) (0.01) ---------------- ---------- ---------------- ---------- ---------- ----------- Total distributions (0.26) (1.48) (4.96) (1.72) ---------------- ---------- ---------- ----------- Net asset value, end of period $ 81.13 $ 76.43 $ 79.72 $ 111.21 ================ ========== ========== =========== Total Return 6.52% (2.34)% (23.28)% 13.07% (b) Ratios and Supplemental Data: Net assets, end of period (000) $ 12,875 $ 10,296 $ 12,928 $ 15,482 Ratio of expenses to average net assets 0.75% 0.75% 0.75% 0.75% (c) Ratio of expenses to average net assets before waiver & reimbursement 1.69% 1.72% 1.57% 2.00% (c) Ratio of net investment income to average net assets 0.08% 0.32% 1.66% 4.33% (c) Ratio of net investment income to average net assets before waiver & reimbursement (0.87)% (0.65)% 0.85% 3.08% (c) Portfolio turnover rate 74.13% 63.69% 62.79% 5.38% (c)
(a) For the period October 1, 1999 (effective date of registration) to August 31, 2000. (b) For periods of less than one full year, total returns are not annualized. (c) Annualized. See accompanying notes which are an integral part of the financial statements. 11 Lindbergh Signature Fund Notes to the Financial Statements August 31, 2003 Note 1 - General The Lindbergh Signature Fund (the "Fund") is organized as a non-diversified series of Lindbergh Funds, a Massachusetts business trust, pursuant to a trust agreement dated June 16, 1999. The Lindbergh Signature Fund's primary objective is to increase the value of your investment over the long-term through capital appreciation and earned income. Capital preservation is an important but secondary objective. The Fund seeks to achieve this objective by investing in common stocks, bonds and money market instruments in proportions consistent with their expected returns and risk as assessed by the Fund's adviser, Lindbergh Capital Management, Inc. (the "Adviser"). In evaluating potential risk and return tradeoffs, the Adviser reviews general macro-economic conditions, Federal Reserve policy and employs various analytical models. When, in the Adviser's judgment, conditions are favorable for stock investments, the fund will normally be fully invested in commons stocks. If however, in the Adviser's view, stock market conditions are less favorable for investors, all or a portion of Fund assets will be shifted out of stocks and into such fixed income investments as bonds and cash. The Fund is permitted to be 100% invested in any one of the three asset classes - stocks, bonds, or cash. The trust agreement permits the Board of Trustees (the "Board") to issue and unlimited number of shares of beneficial interest of separate series without par value. The Fund is the only series of funds currently authorized by the Board. Note 2 - Significant Accounting Policies The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements. A) Portfolio Valuations Securities, which are traded on any exchange are valued at the last quoted sale price. Lacking a last sale price, a security is valued at the mean of its last bid and ask price. NASDAQ over-the counter securities are valued at the average of closing bid and asked prices. Securities are valued as determined in good faith under the general supervision of the Board of Trustees when: market quotations are not readily available; the Adviser determines that the last bid price does not accurately reflect the current value; or restricted securities are being valued. Fixed income securities generally are valued by using market quotations, but may be valued on the basis of prices furnished by a pricing service when the Fund's adviser believes such prices accurately reflect the fair market value of such services. A pricing service utilizes electronic data processing techniques based on yield spreads relating to securities with similar characteristics to determine prices for normal institutional size trading units of debt securities without regard to sale or bid prices. When prices are not readily available from a pricing service, or when restricted or illiquid securities are being valued, securities are valued at fair value as determined in good faith under the general supervision of the Board of Trustees. Short-term investments in fixed-income securities with maturities of less than 60 days when acquired, or which subsequently are within 60 days of maturity, are valued by using the amortized cost method of valuation, which the Board has determined will represent fair value. 12 Lindbergh Signature Fund Notes to the Financial Statements August 31, 2003 - continued Note 2 - Significant Accounting Policies - (continued) B) Futures Contracts The Fund uses index futures contracts, when appropriate, with the objectives of maintaining full exposure to the stock market, enhancing returns, maintaining liquidity, and minimizing transaction costs. The Fund may purchase futures contracts to immediately invest incoming cash in the market, or sell futures in response to cash outflows, thereby simulating a fully invested position in the underlying index while maintaining a cash balance for liquidity. The Fund may seek to enhance returns by using futures contracts instead of the underlying securities when futures are believed to be priced more attractively than the underlying securities. The Fund will not effect a futures or options transaction if the aggregate value of the Fund's securities subject to outstanding futures and options would exceed 100% of the Fund's total assets. The primary risks associated with the use of futures contracts are imperfect correlation between changes in market values of stocks held by the Fund and the prices of futures contracts, the possibility of an illiquid market, or that the counterparty will fail to perform its obligation. Futures contracts are valued at their quoted daily settlement prices. The aggregate principal amounts of the contracts are not recorded in the financial statements. Fluctuations in the value of the contracts are recorded in the Statement of Assets and Liabilities as an asset (liability) and in the Statement of Operations as unrealized appreciation (depreciation) until the contracts are closed, when they are recorded as realized gains (losses) on futures contracts. C) Portfolio Transactions and Related Income Investment transactions are recorded on a trade date basis. Realized gains and losses from investment transactions are recorded on the identified cost basis. Interest income is recorded on the accrual basis and dividend income is recorded on the ex-dividend date. Discounts and premiums on securities purchased are amortized over the life of the respective securities. D) Dividends and Distributions to Shareholders The Fund intends to comply with federal tax rules regarding the distribution of substantially all of its net investment income as dividends to its shareholders on an annual basis, and to distribute its net long-term capital gains and its short-term capital gains at least once a year. However, to the extent that net realized gains of the Fund could be reduced by any capital loss carryovers, such gains will not be distributed. E) Federal Income Taxes The Fund endeavors to qualify each year as a "regulated investment company" under the Internal Revenue Code of 1986, as amended. By so qualifying, the Fund will not be subject to federal income taxes to the extent that it distributes substantially all of its net investment income and any realized capital gains. 13 Lindbergh Signature Fund Notes to the Financial Statements August 31, 2003 - continued Note 2 - Significant Accounting Policies - (continued) F) Other Generally accepted accounting principles require that permanent financial reporting/tax differences relating to shareholder distributions be reclassified to paid-in capital. G) Estimates Preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Note 3 - Agreements and Other Transactions with Affiliates The Fund retains Lindbergh Capital Management, Inc., (the "Adviser") to manage the Fund's investments. The Adviser will be paid an advisory fee equal to 0.75% of the average annual net assets of the Fund. Actual total expenses, including advisory fees, will not exceed 0.75% because the Adviser's contract with the Fund requires it to reimburse fund expenses to maintain total annual fund operating expenses at 0.75% through August 31, 2004, and to inform the Fund prior to that date, if the commitment is to continue. For the year ended August 31, 2003, the Adviser earned fees of $84,044, and waived all fees earned and reimbursed expenses to the Fund of $21,529. Certain members of management of the Adviser are also members of management of the trust. The Fund retains Unified Financial Securities, Inc. (the "Distributor") to act as the principal distributor of the Fund's shares. The Fund has adopted a plan, pursuant to Rule 12b-1 under the Investment Company Act of 1940, which permits the Fund to pay directly, or reimburse the Fund's Adviser and Distributor, for certain distribution and promotion expenses related to marketing its shares, in an amount not to exceed 0.25% of the average daily net assets of the Fund. As of August 31, 2003 the distribution plan has not been activated. Note 4- Securities Transactions For the year ended August 31, 2003, purchases and sales proceeds from investment securities, excluding short-term investments were as follows: Purchases Sales Lindbergh Signature Fund $4,562,364 $4,376,495 14 Lindbergh Signature Fund Notes to the Financial Statements August 31, 2003 - continued Note 5 - Unrealized Appreciation (Depreciation) At August 31, 2003, the cost for federal income tax purposes is $11,712,686 and the composition of gross unrealized appreciation (depreciation) of investment securities is as follows: Appreciation Depreciation Net Appreciation Lindbergh Signature Fund $1,311,760 $(149,902) $1,161,858 The difference between book cost and tax cost represents post-October loss deferrals in the amount of $120,090. At August 31, 2003, the aggregate settlement value of open futures contracts expiring in September 2003 and the related unrealized appreciation (depreciation) were: NASDAQ 100 Index 5 $671,000 $5,210 S&P 500 Index 7 $1,763,475 $26,394 Note 6 - Related Party Transactions The beneficial ownership, either directly or indirectly, of more than 25% of the voting securities of a Fund creates a presumption of control of the Fund, under Section 2(a)(9) of the Investment Company Act of 1940. As of August 31, 2003 Charles Schwab & Co. holds 97.89% of outstanding Fund shares in an omnibus account for the benefit of others. Note 7 - Capital Loss Carryforwards At August 31, 2003, the Fund has capital loss carryforwards of $4,158,638 of which $3,823,359 expires in 2009, $119,627 expires in 2010, and $215,652 expires in 2011. The Fund also has elected to defer post-October losses totaling $120,090. Note 8 - Distributions To Shareholders The tax character of distributions paid during 2003 and 2002 was as follows: Distributions paid from: 2003 2002 ------------ -------------- Ordinary Income $ 36,432 $230,003 Short-term gain - - Long-term gain - - ------------ -------------- $ 36,432 $230,003 ============ ============== 15 Lindbergh Signature Fund Notes to the Financial Statements August 31, 2003 - continued Note 8 - Distributions To Shareholders - (continued) As of August 31, 2003, the components of distributable earnings (accumulated losses) on a tax basis were as follows: Undistributed ordinary income (loss) $ (136,026) Undistributed long-term gain (loss) (3,916,772) Unrealized appreciation (depreciation) 1,197,121 ------------------- ------------------- $(2,855,677) =================== The difference between book basis and tax basis unrealized appreciation is attributable to the tax deferral of post-October losses. 16 INDEPENDENT AUDITOR'S REPORT To The Shareholders and Board of Trustees Lindbergh Signature Fund: We have audited the accompanying statement of assets and liabilities of the Lindbergh Signature Fund, including the schedule of portfolio investments, as of August 31, 2003, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended and financial highlights for the each of the three years and for the period from October 1, 1999 (commencement of operations) to August 31, 2000 in the period then ended. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of investments and cash held as of August 31, 2003 by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Lindbergh Signature Fund as of August 31, 2003, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended and the financial highlights for each of the three years and for the period from October 1, 1999 (commencement of operations) to August 31, 2000 in the period then ended, in conformity with accounting principles generally accepted in the United States of America. McCurdy & Associates CPA's, Inc. Westlake, Ohio September 24, 2003 17 Trustees and Officers of the Trust (Unaudited) Trustees and officers of the Trust, together with information as to their principal business occupations during at least the last five years, are shown below. The officers of the Trust listed below are affiliated persons of the Trust and the Adviser. (1) (2) (3) (4) (5) (6) Name, Address, Positions Held Term of Principal Occupation(s) Port-folios Other and Age with Fund Office and During Past 5 Years Over-seen Director-ships Length of Held by Time Served Director INTERESTED TRUSTEES # Dewayne L. Wiggins* (54) Trustee and Unlimited President of Adviser since One None 5520 Telegraph Rd. #204 President term of office 1988 St. Louis, MO 63129 Served since June 1999 Susan Wiggins* Trustee Unlimited Secretary of the Adviser One None (47) term of office since 1992 2668 Cripple Creek Served since St. Louis, MO 63129 June 1999 DISINTERESTED TRUSTEES Brian D. Fitzpatrick (50) Trustee* Unlimited Associate Professor of One None 18135 Canterbury term of office Finance, Rockhurst Stillwell, KS 66085 Served since University, since 1989; June 1999 Management Assessor, Sprint, Inc. since 1992 Roger J. Levy Trustee* Unlimited President, The Illtex Agency, One None (64) term of office Inc. since 1994; Director and 4302B Laclede Ave. Served since Chief Financial Officer of St. Louis, MO 63108 June 1999 Access Control Technologies, Inc. 1990-1998; registered representative of Park Avenue Life of the Guardian Life Insurance Co. To January 2002 David M. Weinbaum (54) Trustee* Unlimited Author since 1995; President, One None 1106 Kingshighway term of office Melrose Properties since Rolla, MO 65401 Served since 1994: owner/operator of eight June 1999 McDonalds restaurants through Davaron Corp., Aarmy Corp. and sole proprietorships since 1975
# Interested Trustee as defined in the 1940 Act. * Dewayne L. Wiggins and Susan Wiggins are husband and wife 18 OTHER OFFICERS Name, Address and Age Position Held Occupation During Past 5 Years With Fund Sandra J. Britton (50) Secretary Administrative Assistant for Adviser since August 1998; 5520 Telegraph Road #204 Accounting for Family Fare 1992 to June 1998. St. Louis, MO 63129 Carol Highsmith (39) Vice President Assistant Secretary of the Ameriprime Funds and 431 N. Pennsylvania St. and Assistant Ameriprime Advisors Trust since October 2002; Assistant Indianapolis, IN 46204 Secretary Secretary of the Unified Series Trust since December 2002; employed by Unified Fund Services, Inc. (November 1994 to present). Ismael Lopez (55) Principal Vice President, Fund Accounting and Fund 431 N. Pennsyvania St. Accounting Administration, Unified Fund Services (September 2003 Indianapolis, IN 46204 Officer to present), Private Consultant (August 2002-August 2003), Director of Fund Administration, Orbitex Fund Services (January 2000-July 2002), Assistant Controller of The Reserve Funds (1997 - September 1999)
ADDITIONAL INFORMATION - TRUSTEES AND PROXY VOTING Part B of the Trust's Registration Statement on Form N-1A, the Statement of Additional Information ("SAI"), includes additional information about the Trustees. The SAI also includes a description of the policies and procedures that the Trust uses to determine how to vote proxies relating to portfolio securities. You may obtain a copy of the SAI, without charge, by calling (888) 505-6361, Monday through Friday, 7 a.m. to 4 p.m. ET; and on the Securities and Exchange Commission ("SEC") website at www.sec.gov. Beginning in August 2004, the Trust will, without charge, provide a copy of its proxy voting record to shareholders requesting same by calling (888) 505-6361. The proxy voting record will also be available on the SEC website at www.sec.gov. 19 NOTICE OF PRIVACY POLICIES AND PROCEDURES We collect non-public personal information about you from the following sources: (i) information we receive from you on applications or other forms; and (ii) information about your transactions with us. Our policies prohibit disclosure of non-public personal information about present or former individual shareholders to anyone, except as permitted or required by law and except as necessary for entities providing services to us, performing functions for us or maintaining records on our behalf, to perform the applicable function. All services provided to you are through our service providers. All records containing your non-public personal information are at our service providers. These entities include our transfer agent, administrative service provider, and investment adviser. Contracts with these entities prohibit them from disclosing non-public personal information about you, require them to restrict access to the information to those employees who need to know that information, and, require them to maintain physical, electronic, and procedural safeguards that comply with federal standards to guard your non-public personal information. We restrict access to non-public personal information about you to the entities described above. 20 Item 2. Code of Ethics. (a) As of the end of the period covered by this report, the registrant has adopted a code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party. (b) For purposes of this item, "code of ethics" means written standards that are reasonably designed to deter wrongdoing and to promote: (1) Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships; (2) Full, fair, accurate, timely, and understandable disclosure in reports and documents that a registrant files with, or submits to, the Commission and in other public communications made by the registrant; (3) Compliance with applicable governmental laws, rules, and regulations; (4) The prompt internal reporting of violations of the code to an appropriate person or persons identified in the code; and (5) Accountability for adherence to the code. (c) Amendments: During the period covered by the report, there have not been any amendments to the provisions of the code of ethics. (d) Waivers: During the period covered by the report, the registrant has not granted any express or implicit waivers from the provisions of the code of ethics. Item 3. Audit Committee Financial Expert. The registrant's board of trustees has determined that the registrant does not have an audit committee financial expert. The audit committee is made up of individuals who have extensive financial and business experience, but do not have the accounting experience necessary to come within the definition of "audit committee financial expert." Due to the size of the fund, the board of trustees has concluded that it would not be cost effective to commence a search for an individual willing to serve on the board who has a background to come within the definition of "audit committee financial expert" and to expand the number of independent trustees. Item 4. Principal Accountant Fees and Services. (a) Audit Fees The aggregate fees billed for each of the last two fiscal years for professional services rendered by McCurdy & Associates, CPA's, Inc. (the "principal accountant") for the audit of the registrant's annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years: FY 2003 $ 8,850 ------- FY 2002 $ 8,400 ----- (b) Audit-Related Fees There were no fees billed in each of the last two fiscal years for assurance and related services by the principal accountant that are reasonably related to the performance of the audit of the registrant's financial statements and are not reported under paragraph (a) of this Item. (c) Tax Fees Set forth below are the aggregate fees billed in each of the last two fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning. Registrant [Adviser] FY 2003 $ 650 $ 0 ------ -------- FY 2002 $ 600 $ 0 ------ ------- The fees were for preparation of 1120RIC and Form 8613 (excise tax). (d) All Other Fees There were no fees billed in each of the last two fiscal years for products and services provided by the principal accountant, other than the services reported in paragraphs (a) through (c) of this Item. (e) (1) Audit Committee's Pre-Approval Policies In January 2001 registrant adopted an audit committee charter to provide the audit committee with guidance. The audit committee consisted (and consists) of three independent members of the board of trustees. The charter [in parts 3, 4, 5, 13 and 23] called for receipt and review of the principal accountant's written statement concerning independence; dialogue concerning relationships or services to others [which involved all service providers including registrant's custodian, investment adviser, transfer agent, fund accountants and administrator]; and, prior to the board of trustees selecting registrant's auditor, review and assess services provided, fees charged and to be charged, and other relevant data. For the current fiscal year, 2003, the audit committee addressed separate approval of non-audit services. In October 2003 registrant revised its audit committee charter to contain, among other things, express provision for selecting registrant's auditor [part IV. 1 and 15] and for pre-approving all permitted non-audit services [part IV. 16]. With respect to auditor selection, the revised charter expressly states that the audit committee is to consider [part IV. 1]: (a) the audit scope and plan to assure completeness and effective use of resources; (b) the auditor's formal written statement delineating relationships with the Trust; (c) the auditors relationships or service to others which may impact objectivity or independence; (d) rotation of audit partners; and (e) fees or other compensation paid to the auditor (2) Percentages of Services Approved by the Audit Committee Registrant [Adviser] Audit-Related Fees: 100 % N.A. % --------- -------- Tax Fees: 100 % N.A. % --------- -------- All Other Fees: N.A. % N.A. % --------- -------- All services to registrant's principal accountant were pre-approved by registrant's board of trustees as recommended by its audit committee. Item 5. Audit Committee of Listed Companies. Not applicable. Item 6. Reserved. Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Funds. Not applicable. Item 8. Reserved. Item 9. Controls and Procedures. (a) Based on an evaluation of the registrant's disclosure controls and procedures as of October 16, 2003, the disclosure controls and procedures are reasonably designed to ensure that the information required in filings on Forms N-CSR is recorded, processed, summarized, and reported on a timely basis. (b) There were no significant changes in the registrant's internal control over financial reporting that occurred during the registrant's last fiscal half-year that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting. Item 10. Exhibits. (a)(1) Code is filed herewith (a)(2) Certifications required by Item 10(a)(2) of Form N-CSR are filed herewith. (b) Certification required by Item 10(b) of Form N-CSR is 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) Lindbergh Funds By Dewayne Wiggins --------------------------------------------- Dewayne Wiggins, President Date October 28, 2003 ------------------------------------------ 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 Dewayne Wiggins --------------------------------------------- Dewayne Wiggins, President Date October 28, 2003 ------------------------------------------ By Ismael Lopez --------------------------------------------- Ismael Lopez, Principal Accounting Officer Date October 30, 2003 ------------------------------------------ EX-31 3 ex99cert.txt LINDBERGH FUNDS Exhibit 99.CERT CERTIFICATIONS I, Dewayne Wiggins, certify that: 1. I have reviewed this report on Form N-CSR of Lindbergh Funds; 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, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) 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) 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) 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; c) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual 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:October 28, 2003 ------------------------------- /s/ Dewayne Wiggins ---------------------------- Dewayne Wiggins, President I, Ismael Lopez, certify that: 1. I have reviewed this report on Form N-CSR of Lindbergh Funds; 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, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) 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) 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) 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; c) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual 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: October 30, 2003 ------------------------------- /s/ Ismael Lopez ------------------------- Ismael Lopez, Principal Accounting Officer EX-32 4 ex906cert.txt LINDBERGH FUNDS EX-99.906CERT Certification Dewayne Wiggins, President, and Ismael Lopez, Principal Accounting Officer of Lindbergh Funds (the "Registrant"), each certify to the best of his or her knowledge that: 1. The Registrant's periodic report on Form N-CSR for the period ended August 31, 2003 (the "Form N-CSR") fully complies with the requirements of Sections 15(d) of the Securities Exchange Act of 1934, as amended; and 2. The information contained in the Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Registrant. President Principal Accounting Officer Lindbergh Funds Lindbergh Funds /s/ Dewayne Wiggins /s/ Ismael Lopez ----------------------- -------------------------------- Dewayne Wiggins Ismael Lopez Date: October 28, 2003 Date: October 30, 2003 --------------------- ------------------------------ A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to Lindbergh Funds and will be retained by Lindbergh Funds and furnished to the Securities and Exchange Commission (the "Commission") or its staff upon request. This certification is being furnished to the Commission solely pursuant to 18 U.S.C. ss. 1350 and is not being filed as part of the Form N-CSR filed with the Commission. EX-99 5 ex99codeeth.txt LINDBERGH FUNDS LINDBERGH FUNDS CODE OF ETHICS FOR PRINICIPAL EXECUTIVE AND SENIOR FINANCIAL OFFICERS I. Covered Officers/Purpose of Code Lindbergh Funds, a Massachusetts business trust (the "Trust") is an open-end management investment company registered under the Investment Company Act of 1940, as amended (the "Investment Company Act"). This Code of Ethics ("Code") for the Trust and its series funds (collectively, the "Funds" and each a "Fund") applies to the Trust's Principal Executive Officer and Principal Financial Officer (the "Covered Officers" each of whom are set forth in Exhibit A) for the purpose of promoting: o Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships; o Full, fair, accurate, timely and understandable disclosure in reports and documents that the Trust files with, or submits to, the Securities and Exchange Commission ("SEC") and in other public communications made by or on behalf of the Funds; o Compliance with applicable laws and governmental rules and regulations; o The prompt internal reporting of violations of the Code to an appropriate person or persons identified in the Code; and o Accountability for adherence to the Code. Each Covered Officer should adhere to a high standard of business ethics and should be sensitive to situations that may give rise to actual as well as apparent conflicts of interest. II. Covered Officers Should Ethically Handle Actual and Apparent Conflicts of Interest A "conflict of interest" occurs when a Covered Officer's private interests interfere with the interests of, or his service to, the Trust. For example, a conflict of interest would arise if a Covered Officer, or a member of his family, receives improper personal benefits as a result of his position with the Trust. Certain conflicts of interest arise out of the relationships between Covered Officers and the Trust and are already subject to conflict of interest provisions in the Investment Company Act and the Investment Advisers Act of 1940, as amended (the "Investment Advisers Act"). For example, Covered Officers may not individually engage in certain transactions (such as the purchase or sale of securities or other property) with the Funds because of their status as "affiliated persons". Compliance programs and procedures of the Trust and the Trust's investment adviser, transfer agent, fund accounting service provider, administrative service provider, and principal underwriter (each a "Service Provider") are designed to prevent, or identify and correct, violations of these provisions. This Code does not, and is not intended to, repeat or replace these programs and procedures, and such conflicts fall outside of the parameters of this Code. Although typically not presenting an opportunity for improper personal benefit, conflicts may arise from, or as a result of, the contractual relationship between the Trust and a Service Provider. As a result, this Code recognizes that Covered Officers will, in the normal course of their duties (whether formally for the Trust or for a Service Provider, or for both), be involved in establishing policies and implementing decisions which will have different effects on a Service Provider and the Trust. The participation of the Covered Officers in such activities is inherent in the contractual relationship between the Trust and a Service Provider and is consistent with the performance by the Covered Officers of their duties as officers of the Trust. Thus, if performed in conformity with the provisions of the Investment Company Act and the Investment Advisers Act, such activities will be deemed to have been handled ethically. Other conflicts of interest are covered by the Code, even if such conflicts of interest are not subject to provisions in the Investment Company Act and the Investment Advisers Act. The following list provides examples of conflicts of interest under the Code, but Covered Officers should keep in mind that these examples are not exhaustive. The overarching principle is that the personal interest of the Covered Officer should not be placed improperly before the interests of the Trust. Each Covered Officer must: o Not use his personal influence or personal relationships to improperly influence investment decisions or financial reporting by the Funds whereby the Covered Officer would benefit personally to the detriment of the Funds; o Not cause the Trust to take action, or fail to take action, for the individual personal benefit of the Covered Officer rather than the benefit of the Funds; and o Not use material non-public knowledge of portfolio transactions made or contemplated for a Fund to trade personally or cause others to trade personally in contemplation of the market effect of such transactions o Disclose any ownership interest in, or any consulting or employment relationship with, any of the Trust's service providers or any affiliated person thereof. Certain material conflict of interest situations require written pre-approval from the Trust's Audit Committee or its designated representative. Examples of material conflict of interest situations requiring pre-approval include: o Service as a director on the board of any public company; o The receipt of any non-nominal gifts; o The receipt of any entertainment from any company with which the Trust has current or prospective business dealings unless such entertainment is business-related, reasonable in cost, appropriate as to time and place, and not so frequent as to raise any question of impropriety; and o A direct or indirect financial interest in commissions, transaction charges or spreads paid by a Fund for effecting portfolio transactions or for selling or redeeming shares other than an interest arising from the Covered Officer's employment, such as compensation or equity ownership. The Trust's Independent Trustees will be provided a list of any such written pre-approvals in connection with the next regularly scheduled Board meeting. III. Disclosure and Compliance o Each Covered Officer should familiarize himself with the disclosure requirements generally applicable to the Trust; o Each Covered Officer should not knowingly misrepresent, or cause others to misrepresent, facts about the Funds to others, whether within or outside the Trust, including to the Trust's Board of Trustees ("Board") and auditors, and to governmental regulators and self-regulatory organizations; o Each Covered Officer should, to the extent appropriate within his area of responsibility, consult with other officers of the Trust and officers and employees of the Service Providers with the goal of promoting full, fair, accurate, timely and understandable disclosure in the reports and documents the Trust files with, or submits to, the SEC and in other public communications made by or on behalf of the Funds; and o It is the responsibility of each Covered Officer to promote compliance with the standards and restrictions imposed by applicable laws, rules and regulations. IV. Reporting and Accountability Each Covered Officer must: o Upon adoption of the Code (or thereafter as applicable, upon becoming a Covered Officer), affirm in writing to the Board that he has received, read and understands the Code; o Annually thereafter affirm to the Board that he has complied with the requirements of the Code; o Not retaliate against any other Covered Officer, other officer of the Trust, any employee of a Service Provider or any of their affiliated persons for reports of potential violations that are made in good faith; and o Notify the Trust's Audit Committee or its designated representative promptly if he knows of any violation of this Code. Failure to do so is itself a violation of this Code. The Trust's Audit Committee, directly or through its designated representative, is responsible for applying this Code to specific situations in which questions are presented under it and has the authority to interpret this Code in any particular situation. However, any waivers of any provision of this Code will be considered by the Independent Trustees. The Trust will follow the following procedures in investigating and enforcing this Code: o The Trust's Audit Committee will take all appropriate action to investigate any reported potential violations; o If, after such investigation, the Audit Committee believes that no violation has occurred, the Audit Committee is not required to take any further action; o Any matter that the Audit Committee believes is a violation will be reported to the Independent Trustees; o If the Independent Trustees concur that a violation has occurred, they will inform the Covered Officer and consider appropriate action, which may include review of, and appropriate modifications to, applicable policies and procedures; notification to appropriate personnel of a Service Provider or its board; or a recommendation to dismiss the Covered Officer; o The Independent Trustees will be responsible for granting waivers, as appropriate; and o Any changes to or waivers of this Code will, to the extent required, be disclosed as provided by SEC rules. V. Other Policies and Procedures This Code shall be the sole code of ethics adopted by the Trust for purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to registered investment companies thereunder. Insofar as other policies or procedures of the Trust, a Service Provider, or other service providers govern or purport to govern the behavior or activities of Covered Officers, they are superceded by this Code to the extent that they overlap or conflict with the provisions of this Code. The Code of Ethics under Rule 17j-1 under the Investment Company Act is a separate requirement applying to the Covered Officers and others, and is not part of this Code. VI. Amendments Except as to Exhibit A, this Code may not be amended except in written form, which is specifically approved or ratified by a majority vote of the Board, including a majority of Independent Trustees. VII. Confidentiality All reports and records prepared or maintained pursuant to this Code will be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than the Board, officers of the Trust, Trust counsel and counsel for a Service Provider. VIII. Internal Use The Code is intended solely for the internal use by the Trust and does not constitute an admission, by or on behalf of any Trust, as to any fact, circumstance, or legal conclusion. Date: July 11, 2003 EXHIBIT A Persons Covered by this Code of Ethics Dewayne L. Wiggins, Principal Executive Officer of Lindbergh Funds Ismael Lopez, Chief Financial Officer of Lindbergh Funds Date: July 11, 2003 -----END PRIVACY-ENHANCED MESSAGE-----