AMENDED AND RESTATED CODE OF ETHICS
THE GROWTH STOCK PORTFOLIO
THE MUTUAL FUND PORTFOLIO
THE BOND PORTFOLIO
THE MONEY MARKET PORTFOLIO
THE UTILITIES STOCK PORTFOLIO
THE GROWTH MUTUAL FUND PORTFOLIO
THE AGGRESSIVE GROWTH MUTUAL FUND PORTFOLIO
THE FLEX-FUNDS
THE FLEX PARTNERS
The Growth Stock Portfolio, The Mutual Fund Portfolio, The Bond Portfolio,
The Money Market Portfolio, The Utilities Stock Portfolio, The Growth Mutual
Fund Portfolio, The Aggressive Growth Mutual Fund Portfolio, The Flex-funds, The
Flex-Partners (each a "Portfolio" and collectively the "Portfolios") have each
determined to adopt this Code of Ethics (the "Code") as of February 3, 1995, as
amended and restated on February 11, 2000, to specify and prohibit certain types
of personal securities transactions deemed to create a conflict of interest and
to establish reporting requirements and preventive procedures pursuant to the
provisions of Rule 17j-1(b)(1) under the Investment Company Act of 1940 (the
"1940 Act").
I. DEFINITIONS
A. An "Access Person" means (i) any Trustee, Director, officer or
Advisory Person (as defined below) of the Portfolio or any investment
adviser thereof, or (ii) any director or officer of any principal
underwriter or placement agent of the Portfolio who, in the ordinary
course of his or her business, makes, participates in or obtains
information regarding the purchase or sale of securities for the
Portfolio for which the principal underwriter or placement agent so
acts or whose functions or duties as part of the ordinary course of
his or her business relate to the making of any recommendation to the
Portfolio regarding the purchase or sale of securities or (iii)
notwithstanding the provisions of clause (i) above, where the
investment adviser is primarily engaged in a business or businesses
other than advising registered investment companies or other advisory
clients, any trustee, director, officer or Advisory Person of the
investment adviser who, with respect to the Portfolio, makes any
recommendation or participates in the determination of which
recommendation shall be made, or whose principal function or duties
relate to the determination of which recommendation shall be made to
the Portfolio or who in connection with his or her duties, obtains any
information concerning securities recommendations being made by such
investment adviser to the Portfolio.
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B. An "Advisory Person" means any employee of the Portfolio or any
investment adviser thereof (or of any company in a control
relationship to the Portfolio or such investment adviser), who, in
connection with his or her regular functions or duties, makes,
participates in or obtains information regarding the purchase or sale
of securities by the Portfolio or whose functions relate to any
recommendations with respect to such purchases or sales and any
natural person in a control relationship with the Portfolio or adviser
who obtains information regarding the purchase or sale of securities.
C. A "Portfolio Manager" means any person or persons with the direct
responsibility and authority to make investment decisions affecting
the Portfolio.
D. "Access Persons," "Advisory Persons" and "Portfolio Managers" shall
not include any individual who is required to and does file quarterly
reports with the Portfolio's investment adviser, any subadviser, the
administrator or the principal underwriter or placement agent
substantially in conformity with Rule 17j-1 of the 1940 Act or Rule
204-2 of the Investment Advisers Act of 1940.
E. "Beneficial Ownership" shall be interpreted subject to the provisions
of Rule 16a-1(a) (exclusive of Section (a)(1) of such Rule) of the
Securities Exchange Act of 1934.
F. "Control" shall have the same meaning as set forth in Section 2(a)9 of
the 1940 Act.
G. "Disinterested Trustee" means a Trustee who is not an "interested
person" within the meaning of Section 2(a)(19) of the 1940 Act. An
"interested person" includes any person who is a trustee, director,
officer, employee or owner of 5% or more of the outstanding stock of
any investment adviser. Affiliates of brokers or dealers are also
"interested persons", except as provided in Rule 2(a)(19)(1) under the
1940 Act.
H. The "Review Officer" is the person designated by the Portfolio's Board
of Trustees to monitor the overall compliance with this Code. In the
absence of any such designation the Review Officer shall be the
Treasurer or any Assistant Treasurer of the Portfolio.
I. The "Preclearance Officer" is the person designated by the Portfolio's
Board of Trustees to provide preclearance of any personal security
transaction as required by this Code of Ethics.
J. "Purchase or sale of a security" includes, among other things, the
writing of an option to purchase or sell a security.
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K. "Security" shall have the meaning as set forth in Section 2(a)(36) of
the 1940 Act (in effect, all securities), except that it shall not
include direct obligations of the U.S. Government (or any other
"government security" as that term is defined in the 1940 Act),
bankers' acceptances, bank certificates of deposit, commercial paper
and high quality short-term debt instruments, including repurchase
agreements; shares of registered open-end investment companies; and
stock index futures.
L. A security is "being considered for purchase or sale" when a
recommendation to purchase or sell the security has been made and
communicated and, with respect to the person making the
recommendation, when such person seriously considers making such a
recommendation.
II. STATEMENT OF GENERAL PRINCIPLES
The following general fiduciary principles shall govern the personal
investment activities of all Access Persons.
Each Access Person shall adhere to the highest ethical standards and
shall:
A. at all times, place the interests of the Portfolio before his personal
interests;
B. conduct all personal securities transactions in a manner consistent
with this Code, so as to avoid any actual or potential conflicts of
interest, or an abuse of position of trust and responsibility; and
C. not take any inappropriate advantage of his position with or on behalf
of the Portfolio.
III. RESTRICTIONS ON PERSONAL INVESTING ACTIVITIES
A. BLACKOUT PERIODS
1. No Access Person shall purchase or sell, directly or indirectly,
any security in which he has, or by reason of such transaction
acquires, any direct or indirect beneficial ownership on a day
during which he knows or should have known the Portfolio has a
pending "buy" and "sell" order in that same security until that
order is executed or withdrawn.
2. No Advisory Person or Portfolio Manager shall purchase or sell,
directly or indirectly, any security in which he has, or by
reason of such transaction acquires, any direct or indirect
beneficial ownership within at least seven calendar days before
and after the Portfolio trades (or has traded) in that security.
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B. INITIAL PUBLIC OFFERINGS
With regard to acquiring any security in an "initial public offering"
(as defined in Rule 17j-1(a)(6) under the 1940 Act) for the personal
account of an Advisory Person, he or she shall
1. obtain express prior written approval from the Review Officer
(who, in making such determination, shall consider, among other
factors, whether the investment opportunity should be reserved
for the Portfolio, and whether such opportunity is being offered
to such Advisory Person by virtue of his position with the
Portfolio) for any acquisition of securities in an initial public
offering; and
2. after authorization to acquire securities in an initial public
offering has been obtained, disclose such personal investment,
with respect to any subsequent consideration by the Portfolio (or
any other investment company for which he acts in a capacity as
an Advisory Person) for investment in that issuer.
C. LIMITED OFFERINGS
With regard to a "limited offering" (as defined in Rule 17j-1(a)(8)
under the 1940 Act), each Advisory Person shall:
1. obtain express prior written approval from the Review Officer
(who, in making such determination, shall consider among other
factors, whether the investment opportunity should be reserved
for the Portfolio, and whether such opportunity is being offered
to such Advisory Person by virtue of his position with the
Portfolio) for any acquisition of securities in a limited
offering; and
2. after authorization to acquire securities in a limited offering
has been obtained, disclose such personal investment with respect
to any subsequent consideration by the Portfolio (or any other
investment company for which he acts in a capacity as an Advisory
Person) for investment in that issuer.
If the Portfolio decides to purchase securities of an issuer the
shares of which have been previously obtained for personal
investment by an Advisory Person, that decision shall be subject
to an independent review by Advisory Persons with no personal
interest in the issuer.
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D. SHORT-TERM TRADING PROFITS
With regard to the purchase and sale, or sale and purchase, within 60
calendar days, of the same (or equivalent) securities of which an Advisory
Person has beneficial ownership, each Advisory Person shall:
1. obtain express prior written approval from the Review Officer
(who, in making such determination, shall consider, among other
factors, whether such opportunity is being offered to such
Advisory Person by virtue of his position with the Portfolio) for
the closing transaction (whether a purchase or sale) which would
result in the short-term profit; and
2. after authorization to purchase or sell such securities has been
obtained, disclose such personal investment with respect to any
subsequent consideration by the Portfolio (or any other
investment company for which he acts in a capacity as an Advisory
Person) for investment in that issuer.
E. GIFTS
No Advisory Person shall receive any gift or other things of more than
DE MINIMIS value from any person or entity that does business with or
on behalf of the Portfolio.
F. SERVICE AS A DIRECTOR
1. No Advisory Person shall serve on a board of directors of a
publicly traded company without prior authorization from the
Board of Trustees of the Portfolio, based upon a determination
that such board service would be consistent with the interests of
the Portfolio and its investors..
2. If board service of an Advisory Person is authorized by the Board
of Trustees of the Portfolio, such Advisory Person shall be
isolated from the investment making decisions of the Portfolio
with respect to the company of which he is a director.
G. EXEMPTED TRANSACTIONS
The prohibition of Section III shall not apply to:
1. purchases or sales effected in any account over which the Access
Person has no direct or indirect influence or control;
2. purchases or sales that are non-volitional on the part of the
Access Person or the Portfolio, including mergers,
recapitalizations or similar transactions;
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3. purchases which are part of an automatic dividend reinvestment
plan;
4. purchases effected upon the exercise of rights issued by an
issuer PRO RATA to all holders of a class of its securities, to
the extent such rights were acquired from such issuer, and sales
of such rights so acquired; and
5. purchases and sales that receive prior approval in writing by the
Preclearance Officer as (a) only remotely potentially harmful to
the Portfolio because they would be very unlikely to affect a
highly institutional market, (b) clearly not economically related
to the securities to be purchased or sold or held by the
Portfolio or client or (c) not representing any danger of the
abuses prescribed by Rule 17j-1, but only if in each case the
prospective purchaser has identified to the Review Officer all
factors of which he or she is aware which are potentially
relevant to a conflict of interest analysis, including the
existence of any substantial economic relationship between his or
her transaction and securities held or to be held by the
Portfolio.
IV. COMPLIANCE PROCEDURES
A. PRE-CLEARANCE
An Access Person (other than a Disinterested Trustee) may not,
directly or indirectly, acquire or dispose of beneficial ownership of
a security except as provided below unless:
1. such purchase or sale has been approved by the Preclearance
Officer or, in the case of persons employed by the Portfolio's
investment adviser, by a supervisory person designated by the
investment adviser.
2. the approved transaction is completed on the same day approval is
received; and
3. the Preclearance Officer has not rescinded such approval prior to
execution of the transaction.
B. REPORTING
1. Coverage:
a. Each Access Person, (other than Disinterested Trustees) shall
file with the Review Officer confidential quarterly reports
containing the information required in Sections IV.B.1.b. and
IV.B.2 of this Code with
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respect to ALL transactions during the preceding quarter in any
securities in which such person has, or by reason of such
transaction acquires, any direct or indirect beneficial
ownership, PROVIDED that (i) no Access Person shall be required
to report transactions effected for any account over which such
Access Person has no direct or indirect influence or control
(except that such an Access Person must file a written
certification stating that he or she has no direct or indirect
influence or control over the account in question), (ii) an
Access Person who is an Access Person of the investment adviser
of the Portfolio shall file such Access Person's reports with the
investment adviser. To the extent such reports would duplicate
information recorded pursuant to Rules 204-2(a)(12) or
204-2(a)(13) of the Investment Advisers Act of 1940, no such
reports need be filed by such Access Person pursuant to this
Code, and (iii) an Access Person who is an Access Person of the
principal underwriter or placement agent of the Portfolio shall
file such Access Person's reports with the principal underwriter.
All such Access Persons shall file reports, even when no
transactions have been effected, representing that no
transactions subject to reporting requirements were effected.
b. If during such preceding quarter an Access Person establishes
any account in which any securities were held during such quarter
for the direct or indirect benefit of the Access Person, the
Access Person must also include the following information in such
quarterly report: (i) the name of the broker, dealer or bank with
whom the Access Person established the account and (ii) the date
the account was established.
2. Filings: Every report shall be made no later than 10 days after
the end of the calendar quarter in which the transaction to which
the report relates was effected, and, in addition to any
information specified in Section IV.B.1.b. above, shall contain
the following information:
a. the date of the transaction, the title and the number of
shares and the principal amount of each security involved;
b. the nature of the transaction (i.e., purchase, sale or any
other type of acquisition or disposition);
c. the price at which the transaction was effected;
d. the name of the broker, dealer or bank with or through whom
the transaction was effected; and
e. the date that the report is submitted.
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3. Any report may contain a statement that it shall not be construed
as an admission by the person making the report that he or she
has any direct or indirect beneficial ownership in the security
to which the report relates.
C. REVIEW
In reviewing transactions, the Review Officer shall take into account
the exemptions allowed under Section III.G. Before making a
determination that a violation has been committed by an Access Person,
the Review Officer shall give such person an opportunity to supply
additional information regarding the transaction in question.
D. DISCLOSURES OF PERSONAL HOLDINGS
1. Initial Holdings Report: Each Access Person shall report to the
Review Officer within 10 days after becoming an Access Person (i)
the title, number of shares and principal amount of each Security
in which such Access Person had any direct or indirect beneficial
ownership when he or she became an Access Person, (ii) the name
of any broker, dealer or bank with whom such Access Person
maintained an account in which securities were held for the
direct or indirect benefit of such Access Person as of the date
he or she became an Access Person, and (iii) the date the report
is submitted by such Access Person .
2. Annual Holdings Report: On or before January 30, 2001, and
annually thereafter, each Access Person (other than Disinterested
Trustees) shall report (i) the title, number of shares and
principal amount of each Security in which such Access Person had
any direct or indirect beneficial ownership, (ii) the name of any
broker, dealer, or bank with whom such Access Person maintains an
account in which any securities are held for the direct or
indirect benefit of such Access Person, and (iii) the date that
the report is submitted. All of the information in such report
must be current as of a date no more than 30 days before the
report is submitted.
E. CERTIFICATION OF COMPLIANCE
Each Access Person is required to certify annually that he or she has
read and understood the Portfolio's Code and recognizes that he or she
is subject to such Code. Further, each Access Person is required to
certify annually that he or she has complied with all the requirements
of the Code and that he or she has disclosed or reported all personal
securities transactions pursuant to the requirements of the Code.
V. REQUIREMENTS FOR DISINTERESTED TRUSTEES
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A. Every Disinterested Trustee shall file with the Review Officer a
quarterly report indicating that he or she had no reportable
transactions or a report containing the information required in
Section IV.B. of this Code with respect to transactions (other than
exempted transactions listed under Section III.G.) in any securities
in which such person has, or by reason of such transactions acquires,
any direct or indirect beneficial ownership, if such Trustee, at the
time of that transaction, knew or should have known, in the ordinary
course of pursuing his or her official duties as Trustee, that during
the 15-day period immediately preceding or after the transaction by
the Trustee:
1. such security was being purchased or sold by the Portfolio; or
2. such security was being considered for purchase or sale by the
Portfolio.
All Disinterested Trustees shall file reports, even when no
transactions have been effected, representing that no transactions
subject to reporting requirements were effected.
B. Notwithstanding the preceding section, any Disinterested Trustee may,
at his or her option, report the information described in section
IV.B.2 with respect to any one or more transactions and may include a
statement that the report shall not be construed as an admission that
the person knew or should have known of portfolio transactions by the
Portfolio in such securities.
VI. REVIEW BY THE BOARD OF TRUSTEES
At least annually, the Review Officer shall report to the Board of Trustees
regarding:
A. All existing procedures concerning Access Persons' personal trading
activities and any procedural changes made during the past year;
B. Any recommended changes to the Portfolios' Code or procedures; and
At least annually, the Review Officer shall furnish the Board of
Trustees a written report that (i) describes any issues arising under
this Code or such procedures, including, but not limited to,
information about any material violations of this Code or such
procedures and any sanctions imposed in response to such violations
and (ii) certifies that the Portfolios have adopted procedures
reasonably necessary to prevent Access Persons from violating this
Code.
VII. SANCTIONS
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A. SANCTIONS FOR VIOLATIONS BY ACCESS PERSONS (EXCEPT DISINTERESTED
TRUSTEES).
If the Review Officer determines that a violation of this Code has
occurred, he or she shall so advise the Board of Trustees and the
Board may impose such sanctions as it deems appropriate, including,
inter alia, disgorgement of profits, censure, suspension or
termination of the employment of the violator. All material violations
of the Code and any sanctions imposed as a result thereto shall be
reported in writing at least annually to the Board of Trustees.
B. SANCTIONS FOR VIOLATIONS BY DISINTERESTED TRUSTEES
If the Review Officer determines that any Disinterested Trustee has
violated this Code, he or she shall so advise the President of the
Portfolio and also a committee consisting of the Disinterested
Trustees (other than the person whose transaction is at issue) and
shall provide the committee with a report, including the record of
pertinent actual or contemplated portfolio transactions of the
Portfolio and any additional information supplied by the person whose
transaction is at issue. The committee, at its option, shall either
impose such sanctions as it deems appropriate or refer the matter to
the full Board of Trustees of the Portfolio, which shall impose such
sanctions as it deems appropriate.
VIII. MISCELLANEOUS
A. ACCESS PERSONS
The Review Officer of the Portfolio will identify all Access Persons
who are under a duty to make reports to the Portfolio and will inform
such persons of such duty. Any failure by the Review Officer to notify
any person of his or her duties under this Code shall not relieve such
person of his or her obligations hereunder.
B. RECORDS
The Portfolio shall maintain records in the manner and to the extent
set forth below, which records may be maintained on microfilm under
the conditions described in Rule 31a-2(f) under the 1940 Act, and
shall be available for examination by representatives of the
Securities and Exchange Commission ("SEC"):
1. a copy of this Code and any other code which is, or at any time
within the past five years has been, in effect shall be preserved
in an easily accessible place;
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2. a record of any violation of this Code and of any action taken as
a result of such violation shall be preserved in an easily
accessible place for a period of not less than five years
following the end of the fiscal year in which the violation
occurs;
3. a copy of each report made pursuant to this Code shall be
preserved for a period of not less than five years from the end
of the fiscal year in which it is made, the first two years in an
easily accessible place;
4. a list of all persons who are required, or within the past five
years have been required, to make reports pursuant to this Code
shall be maintained in an easily accessible place; and
5. a record of any decision, and the reasons supporting the
decision, to approve the acquisition by Advisory Persons of
securities under Sections III.B. and C., for at least five years
after the end of the fiscal year in which it is made, the first
two years in an easily accessible place.
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C. CONFIDENTIALITY
All reports of securities transactions and any other information filed
pursuant to this Code shall be treated as confidential, except to the
extent required by law.
D. INTERPRETATION OF PROVISIONS
The Board of Trustees of the Portfolio may from time to time adopt
such interpretations of this Code as it deems appropriate.
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