Exhibit 16(a)
FLEMING MUTUAL FUND GROUP, INC.
CODE OF ETHICS
Adopted Under Rule 17j-1
While affirming its confidence in the integrity and good faith of all of
its officers and directors, Fleming Mutual Fund Group, Inc. (the "Fund")
recognizes that the knowledge of present or future portfolio transactions and,
in certain instances, the power to influence portfolio transactions which may be
possessed by certain of its officers and directors could place such individuals,
if they engage in personal transactions in securities which are eligible for
investment by the Fund, in a position where their personal interest may conflict
with that of the Fund.
In view of the foregoing and the provisions of Rule 17j-1 under the
Investment Company Act of 1940 (the "1940 Act"), the Fund has determined to
adopt this Code of Ethics to specify and prohibit certain types of transactions
deemed to create conflicts of interest (or at least the potential for or the
appearance of such a conflict), and to establish reporting requirements and
enforcement procedures.
I. STATEMENT OF GENERAL PRINCIPLES
In recognition of the trust and confidence placed in the Fund by its
shareholders, and to give effect to the Fund's belief that its operations should
be directed to the benefit of its shareholders, the Fund hereby adopts the
following general principles to guide the actions of its directors and officers.
A. The interests of the Fund's shareholders are paramount, and all Fund
officers and directors must conduct themselves and their operations to
give maximum effect to this tenet by assiduously placing the interests
of the shareholders before their own.
B. All personal transactions in securities by Fund officers and directors
must be accomplished so as to avoid even the appearance of a conflict
of interest on the part of such personnel with the interests of the
Fund and its shareholders.
C. All Fund officers and directors must avoid actions or activities that
allow a person to profit or benefit from his or her position with
respect to the Fund, or that otherwise bring into question the
person's independence or judgment.
II. DEFINITIONS
A. "Access Person" shall mean (i) each director or officer of the Fund;
(ii) each employee of the Fund (or of any company in a control
relationship to the Fund) who, in connection with his or her regular
functions or duties, makes, participates in, or obtains information
regarding the purchase or sale of a Security by the Fund or any series
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thereof (herein a "portfolio"), or whose functions relate to the
making of any recommendations with respect to such purchases or sales
(THE FUND DOES NOT CURRENTLY HAVE ANY EMPLOYEES); and (iii) any
natural person in a control relationship to the Fund who obtains
information concerning recommendations made to or by the Fund with
respect to the purchase or sale of a Security by the Fund (THE FUND
DOES NOT CURRENTLY HAVE ANY NATURAL CONTROL PERSONS).
B. "Beneficial ownership" of a security is to be determined in the same
manner as it is for purposes of Section 16 of the Securities Exchange
Act of 1934 and Rule 16a-1(a)(2) thereunder. This means that a person
should generally consider himself the beneficial owner of any
securities in which he has a direct or indirect pecuniary interest. In
addition, a person should consider himself the beneficial owner of
securities held by his spouse, his minor children, a relative who
shares his home, or other persons by reason of any contract,
arrangement, understanding or relationship that provides him with sole
or shared voting or investment power.
C. The "Compliance Officer" is Larry A. Kimmel.
D. "Control" shall have the same meaning as that set forth in Section
2(a)(9) of the 1940 Act. Section 2(a)(9) provides that "control" means
the power to exercise a controlling influence over the management or
policies of a company, unless such power is solely the result of an
official position with such company. Ownership of more than 25% of a
company's outstanding voting securities is presumed to give the holder
of such securities control over the company. The facts and
circumstances of a given situation may counter this presumption.
E. "High quality short-term debt instrument" means any instrument that
has a maturity at issuance of less than 366 days and that is rated in
one of the two highest ratings categories by a nationally recognized
statistical rating organization.
F. "Independent Director" means a Director of the Fund who is not an
"interested person" of the Fund within the meaning of Section 2(a)(19)
of the 1940 Act.
G. "Investment Personnel" means: (i) any employee of the Fund who, in
connection with his or her regular functions or duties, makes or
participates in making recommendations regarding the purchase or sale
of securities by the Fund (or a portfolio); and (ii) any natural
person who "controls" the Fund and who obtains information about
recommendations made to the Fund regarding the purchase or sale of
securities by the Fund (or a portfolio).
H. "IPO" (I.E., initial public offering) means an offering of securities
registered under the Securities Act of 1933, the issuer of which,
immediately before registration, was not subject to the reporting
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requirements of Section 13 or Section 15(d) of the Securities Exchange
Act of 1934.
I. "Limited offering" means an offering that is exempt from registration
under the Securities Act of 1933 pursuant to Section 4(2), Section
4(6), Rule 504, Rule 505 or Rule 506 (E.G., private placements).
J. "Purchase or sale of a Security" includes, among other things, the
writing of an option to purchase or sell a Security.
K. "Security" shall have the same meaning as that set forth in Section
2(a)(36) of the 1940 Act, except that it shall not include direct
obligations of the U.S. Government; bankers' acceptances, bank
certificates of deposit, commercial paper, high quality short-term
debt instruments, including repurchase agreements; and shares of
registered, open-end mutual funds.
L. A "Security held or to be acquired" by the Fund (or any portfolio)
means: (i) any Security which, within the most recent 15 days, (a) is
or has been held by the Fund or any portfolio thereof; or (b) is being
or has been considered by the Fund's investment adviser for purchase
by the Fund; and (ii) any option to purchase or sell, and any Security
convertible into or exchangeable for, a Security described in (i) of
this definition.
M. A security is "being purchased or sold" by the Fund (or any portfolio)
from the time when a purchase or sale program has been communicated to
the person who places the buy and sell orders for the Fund until the
time when such program has been fully completed or terminated.
III. PROHIBITIONS AND RESTRICTIONS
A. General Prohibitions. No Access Person shall, in connection with the
purchase or sale, directly or indirectly, by such person of a Security
held or to be acquired by any portfolio of the Fund:
1. Employ any device, scheme or artifice to defraud the Fund;
2. Make to the Fund any untrue statement of a material fact or omit
to state to such Fund a material fact necessary in order to make
the statements made, in light of the circumstances under which
they are made, not misleading;
3. Engage in any act, practice or course of business which would
operate as a fraud or deceit upon the Fund; or
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4. Engage in any manipulative practice with respect to the Fund.
B. Gifts. During any calendar year, no Access Person shall accept or
receive any gift(s) of more than $100 in aggregate value from any
person or entity that does business with or on behalf of the Fund.
C. Pre-Approval of IPOs and Limited Offerings. Investment Personnel must
obtain approval from the Compliance Officer before purchasing or
acquiring any security in an IPO or limited offering. The Compliance
Officer will document any such approval, including the rationale for
granting the approval. The Fund will maintain a record of every
decision, and the reasons supporting the decision, to approve the
acquisition of securities offered in connection with an IPO or limited
offering for a period of five years from the date which the approval
is granted. The Fund currently does not have any Investment Personnel.
IV. INITIAL AND ANNUAL HOLDINGS REPORTS
A. Each Access Person (other than the Fund's Independent Directors) must
provide to the Compliance Officer a complete listing of all such
Securities the person beneficially owns and all accounts in which any
securities are held for the direct or indirect benefit of the person.
The listing need not include transactions effected for, or Securities
in, accounts over which the person has no direct or indirect influence
or control.
The initial listing must be submitted to the Compliance Officer within
10 days of the date upon which such person first becomes an Access
Person of the Fund. Each update thereafter must be provided no later
than 30 days after the start of the subsequent year, and current as of
a date no more than 30 days before the report is submitted. An Initial
Holdings Report Form and an Annual Holdings Report Form are attached
as Appendix I and Appendix II, respectively.
B. The report may contain a statement that the report shall not be
construed as an admission by the person making such report that he has
any direct or indirect beneficial ownership in the Security to which
the report relates.
V. QUARTERLY REPORTING
A. Each Access Person shall report all transactions in Securities in
which the person has, or by reason of such transaction acquires, any
direct or indirect beneficial ownership. Each Access Person must also
report any securities accounts established during the quarter. The
Compliance Officer shall submit confidential quarterly reports with
respect to his or her own personal Securities transactions and
accounts established to an officer designated by the President of the
Fund to receive his or her reports, who shall act in all respects in
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the manner prescribed herein for the Compliance Officer. The reports
need not include transactions effected for, or Securities in, accounts
over which the person has no direct or indirect influence or control.
The report may contain a statement that the report shall not be
construed as an admission by the person making such report that he has
any direct or indirect beneficial ownership in the Security to which
the report relates.
B. Every report shall be submitted to the Compliance Officer NO LATER
THAN 10 days after the end of each calendar quarter, and shall contain
the following information (a Quarterly Report Form is included as
Appendix III):
1. The date of the transaction, the title, the interest rate and
maturity date (if applicable), the number of shares and the
principal amount of each Security involved;
2. The nature of the transaction (I.E., purchase, sale or any other
type of acquisition or disposition);
3. The price of the Security at which the transaction was effected;
4. The name of the broker, dealer or bank with or through which the
transaction was effected;
5. The date the report is submitted by the Access Person; and
6. With respect to any account established by the Access Person
during the quarter in which any securities are held for the
direct or indirect benefit of the Access Person, the broker,
dealer or bank with whom the Access Person established the
account and the date the account was established.
C. In the event the Access Person has no reportable items during the
quarter, the report should be so noted and returned signed and dated.
D. An Access Person need not submit a quarterly report if the report
would duplicate information in broker trade confirmations or account
statements received by the Fund, provided that all required
information is contained in the broker trade confirmations or account
statements and is received by the Compliance Officer NO LATER THAN 10
days after the end of the calendar quarter. Please see the Compliance
Officer for more information about this reporting mechanism.
E. An Independent Director shall report transactions in Securities only
if the Director knew at the time of the transaction or, in the
ordinary course of fulfilling his or her official duties as a
Director, should have known, that during the 15-day period immediately
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preceding or following the date of the transaction, such Security was
purchased or sold, or was being considered for purchase or sale, by
the Fund. The "should have known" standard implies no duty of inquiry,
does not presume there should have been any deduction or extrapolation
from discussions or memoranda dealing with tactics to be employed
meeting the Fund's investment objectives, or that any knowledge is to
be imputed because of prior knowledge of the Fund's portfolio
holdings, market considerations, or the Fund's investment policies,
objectives and restrictions.
VI. REVIEW AND ENFORCEMENT OF THE CODE
A. The Compliance Officer will be appointed by the Fund's President to
perform the duties described herein.
B. The Compliance Officer shall notify each person who becomes an Access
Person of the Fund and who is required under this Code of Ethics of
their reporting requirements NO LATER THAN 10 days before the first
quarter in which such person is required to begin reporting. The
Compliance Officer shall create and thereafter maintain a list of all
Access Persons of the Fund.
C. The Compliance Officer will, on a quarterly basis, compare all
reported personal Securities transactions with completed portfolio
transactions of the Fund and a list of Securities being considered for
purchase or sale by the Fund's investment adviser(s) to determine
whether a violation of this Code may have occurred. Before determining
that a person has violated the Code, the Compliance Officer shall give
such person an opportunity to supply explanatory material.
D. If the Compliance Officer determines that a violation has occurred, or
believes that a Code violation may have occurred, the Compliance
Officer must submit a written report regarding the possible violation,
together with any relevant transaction reports and any explanatory
material provided by the individual, to the President and legal
counsel for the Fund, who shall make an independent determination as
to whether a violation has occurred. Outside counsel may be consulted
for assistance in making this determination.
E. If the President finds that a violation has occurred, the President
shall impose upon the individual such sanctions as he or she deems
appropriate and shall report the violation and the sanction imposed to
the Board of Directors of the Fund.
F. No person shall participate in a determination of whether he has
committed a violation of the Code or of the imposition of any sanction
against himself. If a securities transaction of the President is under
consideration, any Vice President shall act in all respects in the
manner prescribed herein for the President.
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VII. INVESTMENT ADVISER'S, PRINCIPAL UNDERWRITER'S AND ADMINISTRATOR'S CODE OF
ETHICS
A. General Principle: Overlapping Responsibilities. A person who is both
an Access Person of the Fund and an Access Person of an investment
adviser to or principal underwriter for the Fund is only required to
report under and otherwise comply with the investment adviser's or
principal underwriter's code of ethics, provided that such code has
been adopted pursuant to and in compliance with Rule 17j-1. Similarly,
a person who is an Access Person of the Fund and is subject to a Fund
administrator's code of ethics that complies with Rule 17j-1 is only
required to report under and otherwise comply with the administrator's
code of ethics. These Access Persons, however, remain subject to the
principles and prohibitions in Section III.A hereof.
B. Procedures. Each such investment adviser, principal underwriter and
administrator of the Fund must:
(1) Submit to the Board of Trustees of the Fund a copy of its code of
ethics adopted pursuant to or in compliance with Rule 17j-1;
(2) Promptly furnish to the Fund, upon request, copies of any reports
made under its code of ethics by any person who is also covered
by the Fund's Code; and
(3) Promptly report to the Fund in writing any material amendments to
its code of ethics, along with the certification described under
Section VIII.B below.
VIII. ANNUAL WRITTEN REPORTS TO THE BOARD
At least annually, the Compliance Officer, on behalf of the Fund,
investment adviser, principal underwriter, and administrator will provide
written reports to the Board of Directors as follows:
A. Issues Arising Under the Code. The reports must describe any issue(s)
that arose during the previous year under the codes or procedures
thereto, including any material code or procedural violations, and any
resulting sanction(s). The Compliance Officer, investment adviser,
principal underwriter, and the administrator may report to the Board
more frequently as they deem necessary or appropriate and shall do so
as requested by the Board.
B. Certification. Each report must be accompanied by a certification to
the Board that the Fund, investment adviser, principal underwriter,
and administrator have adopted procedures reasonably necessary to
prevent their Access Persons from violating their code of ethics.
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IX. RECORDKEEPING
The Fund will maintain the records set forth below. These records will be
maintained in accordance with Rule 31a-2 under the 1940 Act and the following
requirements. They will be available for examination by representatives of the
Securities and Exchange Commission and other regulatory agencies.
A. A copy of this Code and any other code adopted by the Fund, which is,
or at any time within the past five years has been, in effect will be
preserved in an easily accessible place.
B. A record of any Code violation and of any sanctions taken will be
preserved in an easily accessible place for a period of at least five
years following the end of the fiscal year in which the violation
occurred.
C. A copy of each Quarterly Report, Initial Holdings Report, and Annual
Holdings Report submitted under this Code, including any information
provided in lieu of any such reports made under the Code, will be
preserved for a period of at least five years from the end of the
fiscal year in which it is made, for the first two years in an easily
accessible place.
D. A record of all persons, currently or within the past five years, who
are or were required to submit reports under this Code, or who are or
were responsible for reviewing these reports, will be maintained in an
easily accessible place.
E. A copy of each annual report required by Section VIII of this Code
must be maintained for at least five years from the end of the fiscal
year in which it is made, for the first two years in any easily
accessible place.
X. MISCELLANEOUS
A. Confidentiality. All reports and other information submitted to the
Fund pursuant to this Code shall be treated as confidential, provided
such reports and information may be produced to the Securities and
Exchange Commission and other regulatory agencies.
B. Interpretation of Provisions. The Board of Directors may from time to
time adopt such interpretations of this Code as it deems appropriate.
C. Compliance Certification. Within 10 days of becoming an Access Person
of the Fund, and each year thereafter, each such person must complete
the Compliance certification, attached as Appendix IV.
Adopted September 25, 1997; amended May __ , 2000
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APPENDIX I
INITIAL HOLDINGS REPORT
FOR FLEMING MUTUAL FUND GROUP, INC.
Name of Reporting Person: ___________________________________________
Date Person Became Subject to the
Code's Reporting Requirements: ___________________________________
Information in Report Dated as of: __________________________________
[NOTE: Date person became subject and as of date should be the same.]
Date Report Due: ____________________________________________________
Date Report Submitted: ______________________________________________
SECURITIES HOLDINGS
Principal Amount, Maturity
Name of Issuer and No. of Shares Date and Interest Rate
Title of Security (if applicable) (if applicable)
----------------- --------------- ---------------
--------------------------------------------------------------------------------
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If you have no securities holdings to report, please check here. [ ]
If you do not want this report to be construed as an admission that you have
beneficial ownership of one or more securities reported above, please describe
below and indicate which securities are at issue.
SECURITIES ACCOUNTS
Name of Broker, Dealer or Bank Name(s) on and Type of Account
------------------------------ ------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
If you have no securities accounts to report, please check here. [ ]
I CERTIFY THAT I HAVE INCLUDED ON THIS REPORT ALL SECURITIES HOLDINGS AND
ACCOUNTS REQUIRED TO BE REPORTED PURSUANT TO THE CODE OF ETHICS.
----------------------------------------------------- ------------------------
Signature Date
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APPENDIX II
ANNUAL HOLDINGS REPORT
FOR FLEMING MUTUAL FUND GROUP, INC.
Name of Reporting Person: _______________________________________
Information in Report Dated as of: ______________________________
Date Report Submitted: __________________________________________
Calendar Year Ended: December 31, ____
[NOTE: Information should be dated no Date Report Due: more than 30 days before
report is submitted.]
SECURITIES HOLDINGS
Principal Amount, Maturity
Name of Issuer and No. of Shares Date and Interest Rate
Title of Security (if applicable) (if applicable)
----------------- --------------- ---------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
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If you have no securities holdings to report for the year, please check here.[ ]
If you do not want this report to be construed as an admission that you have
beneficial ownership of one or more securities reported above, please describe
below and indicate which securities are at issue.
SECURITIES ACCOUNTS
Date Account Was Name(s) on and
Name of Broker, Dealer or Bank Established Type of Account
------------------------------ ----------- ---------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
If you have no securities accounts to report for the year, please check here.[ ]
I CERTIFY THAT I HAVE INCLUDED ON THIS REPORT ALL SECURITIES TRANSACTIONS AND
ACCOUNTS REQUIRED TO BE REPORTED PURSUANT TO THE CODE OF ETHICS.
----------------------------------------------------- ------------------------
Signature Date
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APPENDIX III
QUARTERLY REPORT
FOR FLEMING MUTUAL FUND GROUP, INC.
Name of Reporting Person: ________________________________________
Calendar Quarter Ended: ________________________________________
Date Report Due: _______________________________ 10, ____
Date Report Submitted: ________________________________________
SECURITIES TRANSACTIONS
<TABLE>
<CAPTION>
Name of Principal Amount, Name of Broker,
Issuer and Maturity Date and Dealer or Bank
Date of Title of No. of Shares Interest Rate Type of Effecting
Transaction Security (if applicable) (if applicable) Transaction Price Transaction
----------- -------- --------------- --------------- ----------- ----- -----------
<S> <C> <C> <C> <C> <C> <C>
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
</TABLE>
If you have no securities transactions to report for the quarter, please check
here. [ ]
If you do not want this report to be construed as an admission that you have
beneficial ownership of one or more securities reported above, please describe
below and indicate which securities are at issue.
SECURITIES ACCOUNTS. If you established a securities account during the quarter,
please provide the following information:
Date Account Name(s) on and
Name of Broker, Dealer or Bank was Established Type of Account
------------------------------ --------------- ---------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
If you did not establish a securities account during the quarter, please check
here. [ ]
I CERTIFY THAT I HAVE INCLUDED ON THIS REPORT ALL SECURITIES TRANSACTIONS AND
ACCOUNTS REQUIRED TO BE REPORTED PURSUANT TO THE CODE OF ETHICS.
----------------------------------------------------- ------------------------
Signature Date
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APPENDIX IV
COMPLIANCE CERTIFICATION
FOR FLEMING MUTUAL FUND GROUP, INC.
INITIAL CERTIFICATION
I CERTIFY THAT I:
(i) HAVE RECEIVED, READ AND REVIEWED THE FUND'S CODE OF ETHICS;
(ii) UNDERSTAND THE POLICIES AND PROCEDURES IN THE CODE;
(iii) RECOGNIZE THAT I AM SUBJECT TO SUCH POLICIES AND PROCEDURES;
(iv) UNDERSTAND THE PENALTIES FOR NON-COMPLIANCE;
(v) WILL FULLY COMPLY WITH THE FUND'S CODE OF ETHICS; AND
(vi) HAVE FULLY AND ACCURATELY COMPLETED THIS CERTIFICATE.
Signature: _____________________________________________________________________
Name: __________________________________________________________________________
(Please print)
Date Submitted: ________________________________________________________________
Date Due: _________________________
--------------------------------------------------------------------------------
ANNUAL CERTIFICATION
I CERTIFY THAT I:
(i) HAVE RECEIVED, READ AND REVIEWED THE FUND'S CODE OF ETHICS;
(ii) UNDERSTAND THE POLICIES AND PROCEDURES IN THE CODE;
(iii) RECOGNIZE THAT I AM SUBJECT TO SUCH POLICIES AND PROCEDURES;
(iv) UNDERSTAND THE PENALTIES FOR NON-COMPLIANCE;
(v) HAVE COMPLIED WITH THE FUND'S CODE OF ETHICS AND ANY APPLICABLE REPORTING
REQUIREMENTS DURING THIS PAST YEAR;
(vi) HAVE FULLY DISCLOSED ANY EXCEPTIONS TO MY COMPLIANCE WITH THE CODE BELOW;
(vii) WILL FULLY COMPLY WITH THE FUND'S CODE OF ETHICS; AND (VI) HAVE FULLY AND
ACCURATELY COMPLETED THIS CERTIFICATE.
EXCEPTION(S):
Signature: _____________________________________________________________________
Name: __________________________________________________________________________
(Please print)
Date Submitted: ________________________________________________________________
Date Due: ______________________
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