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INVESTMENT CODE OF ETHICS
EQUITRUST MUTUAL FUNDS
EQUITRUST INVESTMENT MANAGEMENT SERVICES, INC.
EQUITRUST MARKETING SERVICES, LLC
OCTOBER 17, 2000
STATEMENT OF GENERAL POLICY
The basic principle which should govern all Persons is that their functions and
those of the above companies should be carried on with loyalty to the interest
of the companies and their shareholders and clients of such companies. An
investment company must be operated exclusively for the benefit of its
shareholders.
In adhering to the foregoing basic principle of loyalty, a Person must not
profit, directly or indirectly, from his or her position or capacity in any such
company to the detriment or at the expense of shareholders or clients. No Person
shall take for personal benefit any corporate opportunity for profit which that
Person learns about because of his or her position.
1. DEFINITION OF TERMS USED
As used herein, unless the context otherwise requires,
a. ADVISORY PERSON - of any Client or the Adviser means
(1) any employee of the Fund or Adviser (or of any company in a
control relationship to the Fund or Adviser) who in the regular
course of his or her duties makes, participates in or obtains
information regarding the purchase or sale of securities by a
Client or whose functions relate to the making of any
recommendation with respect to such purchases or sales; and
(2) any natural person in a control relationship to the Fund or
Adviser who obtains information concerning recommendations made
to the Fund with regard to the purchase or sale of a security.
b. BENEFICIAL OWNERSHIP - includes any Covered Security held in the name
of a spouse, minor child or relative or relative of a spouse sharing
the same household, and any Security in which, by reason of any
contract, understanding, relationship, agreement or other arrangement
a Person obtains present or future benefits substantially equivalent
to an ownership interest in a security.
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c. CLIENT - means any investment company ("Fund"), any other company or
investment client for which EquiTrust Investment Management Services,
Inc. ("Adviser") acts as investment adviser or principal underwriter.
d. CONTROL - has the same meaning as that set forth in Section 2(a)(9) of
the Investment Company Act of 1940.
e. COVERED SECURITY - includes without limitation any and all stocks,
bonds, notes, bills, debentures, and any interest commonly known as
a security including any interests which might be selected for, or
be included in, a Client's portfolio including puts, calls and other
options or rights in such securities and securities based futures
contracts, but does not include direct obligations of the Government
of the United States, short-term debt securities which are
"government securities" within the meaning of Section 2(a)(16) of
the Investment Company Act of 1940 ("1940 Act"), bankers'
acceptances, bank certificates of deposit, commercial paper, high
quality short-term debt instruments, including repurchase
agreements, or shares of registered open-end investment companies.
f. ETHICS COMMITTEE - shall consist of members appointed by the Adviser's
Board of Directors.
g. INVESTMENT DEPARTMENT PERSONNEL - means Fund portfolio managers
entrusted with the direct responsibility and authority to make
investment decisions affecting the Funds and securities analysts,
trading personnel, and members of the Adviser's investment committee.
h. INDEPENDENT DIRECTOR - means any director or trustee of a Fund who is
not an "interested person" of the Fund within the meaning of Section
2(a)(19) of the 1940 Act.
i. PERSON - means
(1) with respect to any Fund or the Adviser, any officer, director,
trustee or Advisory Person of the Fund or the Adviser; and
(2) with respect to EquiTrust Marketing Services, LLC ("Marketing
Services"), any officer or director of Marketing Services who in
the ordinary course of his or her business makes, participates in
or obtains information regarding the purchase or sale of
securities for any Fund or whose functions or duties as part of
the ordinary course of his or her business relate to the making
of any recommendation regarding the purchase or sale of
securities for a Client.
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j. PERSONAL BENEFIT - includes any intended benefit for oneself or any
other individual, company, group or organization of any kind
whatsoever except a benefit for a Client or any other company that
adopts this Code of Ethics, as appropriate.
k. PORTFOLIO MANAGER - means Investment Department Personnel who are
identified as Portfolio Managers in the Adviser's current Authorities
and Titles Memorandum.
l. RESTRICTED LIST - means any security currently held by a Client, any
security under consideration for purchase or sale and any security on
the open order list.
2. DISCLOSURE OF INFORMATION
a. No Person shall discuss with or otherwise inform others of any actual
or contemplated Covered Security transaction by a Client or the
Adviser except in the performance of that Person's duties of
employment or in an official capacity and then only for the benefit of
the Clients or the Adviser, as appropriate, and in no event for
personal benefit.
b. No Person shall release information to dealers or brokers or otherwise
(except to those concerned with the transaction) as to any investment
portfolio changes, proposed or in process, except (i) upon the
completion of such changes, or (ii) when the disclosure results from
the publication of a prospectus, or (iii) in connection with a regular
report to shareholders or to any governmental authority resulting in
such information becoming public knowledge, or (iv) in connection with
any report to which shareholders are entitled by reason of provisions
of the articles of incorporation, by-laws, or similar documents
governing the operation of the Client's accounts.
3. PREFERENTIAL TREATMENT, GIFTS AND ENTERTAINMENT
No Person shall seek or accept favors, preferential treatment, or any other
personal benefit because of his or her association with a Client or the
Adviser, except those usual and normal benefits directly provided by such
Client or the Adviser.
No Person shall accept any entertainment, gift or other personal benefit
that may create or appear to create a conflict between the interests of
such Person and any Client or the Adviser. In addition, Investment
Department Personnel are prohibited from receiving any gift or other thing
of more than de minimis value from any person or entity that does business
with or on behalf of any Client or the Adviser. For purposes of this
paragraph, a de minimis gift shall include an occasional meal, a ticket to
a sporting event or the theater, or comparable entertainment, or an
unconditional gift amounting in value to not more than $100 per person per
year.
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4. CONFLICTS OF INTEREST
If any Person is aware of personal interests that are, or might be, in
conflict with those of a Client, that Person should disclose the situation
or transaction and the nature of the conflict to the Ethics Committee for
appropriate consideration.
Any Portfolio Manager who specifically recommends to a Client the purchase
or sale of a Covered Security must disclose any Beneficial Ownership in the
Covered Security and whether he or she has or expects to acquire or sell
within a reasonable period of time.
5. SERVICE AS A DIRECTOR
Investment Department Personnel are prohibited from serving on the boards
of directors of publicly traded companies, absent prior authorization by
the Ethics Committee based upon a determination that the board service
would be consistent with the interests of the Clients and that adequate
procedures exist to ensure isolation from those making investment decisions
regarding such companies.
6. INSIDE INFORMATION
Securities laws and regulations prohibit the misuse of "inside" or
"material non-public" information when trading or recommending securities.
Inside information obtained by any Person from any source must be kept
strictly confidential. All inside information should be kept secure, and
access to files and computer files containing such information should be
restricted. Persons shall not act upon or disclose material non-public or
insider information except as may be necessary for legitimate business
purposes on behalf of a Client or the Adviser as appropriate. Questions and
requests for assistance regarding insider information should be promptly
directed to the Ethics Committee
Inside information may include, but is not limited to, knowledge of pending
orders or research recommendations, corporate finance activity, mergers or
acquisitions, and other material non-public information that could affect
the price of a security.
Client and Client account information is also confidential and must not be
discussed with any individual whose responsibilities do not require
knowledge of such information.
7. PERSONAL SECURITY TRANSACTIONS
It is in the best interest of the Adviser and its Clients that no Person
knowingly takes advantage of a corporate opportunity for Personal Benefit
or takes action inconsistent with such Person's obligations to the Clients.
To that end, therefore:
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a. ALL PERSONS:
No Person, other than an Independent Director, shall purchase or sell,
for Personal Benefit, any Covered Security while that security is on
the Restricted List, except as provided elsewhere in this code. See
8.a. Preclearance.
b. INVESTMENT DEPARTMENT PERSONNEL: In addition to a. above, Investment
Department Personnel are subject to these rules:
(1) No Investment Department Personnel shall purchase Covered
Securities in an initial public offering.
(2) No Investment Department Personnel shall purchase any Covered
Security in a private placement of that Covered Security without
the prior approval of the Ethics Committee. Investment Department
Personnel who have been authorized to acquire a Covered Security
pursuant to this paragraph 7.b.(2) must disclose that investment
if they participate in any subsequent consideration by the
Adviser of an investment in the issuer of that Covered Security.
The Adviser's decision to invest in the issuer of that Covered
Security should be independently reviewed by Investment
Department Personnel with no personal interest in the issuer of
the Covered Security.
c. PORTFOLIO MANAGERS: In addition to 7.a. and b. above, Fund Portfolio
Managers are subject to these rules:
(1) No Portfolio Manager may buy or sell a Covered Security within
seven days before or after a trade in that Covered Security by a
portfolio that he or she manages.
(2) Portfolio Managers may not profit from the purchase and sale, or
sale and purchase, of the same (or equivalent) Securities within
60 calendar days if such Covered Securities are on the Restricted
List.
d. RELATED INSTRUMENTS: When anything in this paragraph 7 prohibits the
purchase or sale of a Covered Security, it also prohibits the purchase
or sale of any related Covered Securities, such as puts, calls, other
options or rights in such Covered Securities and Securities based
future contracts.
e. DISGORGEMENT: Any Person who trades in violation of this paragraph 8
must unwind the trade or disgorge the profits.
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f. EXCEPTIONS:
(1) Under unusual circumstances, such as a personal financial
emergency, application for an exception may be made to the Ethics
Committee, which application may be granted or denied.
(2) This paragraph 8 shall not apply to non-volitional purchases and
sales, such as dividend reinvestment programs or calls
(redemptions) of Covered Securities.
8. PROCEDURES
a. PRECLEARANCE:
(1) No Person, other than an Independent Director, may acquire or
dispose of any Covered Security on the Restricted List without
first obtaining Preclearance from the person or persons
designated by the Ethics Committee. Such Preclearance shall be
valid for two calendar days from the date when it is granted.
Preclearance will not be given while a Covered Security is on the
open order list.
(A.) This subsection relates to purchases under an automatic
share purchase program or dividend reinvestment plan of a
publicly held company that may aggregate orders for the open
market purchase of its shares, with the result that the
execution date of such a purchase may or may not be certain.
Any Person wanting to utilize such a plan must obtain
Preclearance but only at the time of initially establishing
an account in the plan and at any time of changing the
amount of the person's ongoing automatic investment in the
plan.
(B.) This subsection relates to purchases or sales of FBL
Financial Group, Inc. stock (including options, 401(k)
transactions, brokerage account transactions, transferring
or gifting stock to a charitable organization, tender
offers, dividend reinvestment plan transactions, etc.). Such
purchases and sales are exempt from the Preclearance
procedures.
(2) Even if a trade is precleared, it is still a Person's
responsibility to ensure that such Person's trading activity is
in compliance with this Code of Ethics and all securities laws.
(3) The placement of a limit order (a request that your broker buy or
sell at a given price) must be done in conjunction with
Preclearance procedures. When a Person has a limit order
outstanding, that Person must continue to preclear the trade.
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b. REPORTS - ALL PERSONS
Each Person, other than an Independent Director, shall disclose all
Covered Securities holdings (including dividend reinvestment plans and
401(k) FBL Financial Group, Inc. stock holdings) no later than 10 days
after becoming a Person and thereafter on an annual basis. The
holdings report shall set forth the title of the Covered Security
including the interest rate and maturity date (if applicable), the
number or amount of each Covered Security in which the Person has any
direct or indirect beneficial ownership and the broker/dealer or bank
through whom the Covered Securities are held.
Each Person is to file a report for each quarter, whether or not he or
she had reportable transactions in that quarter. To ensure that the
required records are maintained to implement the policies set forth
herein:
(1) Each Person shall report to the Ethics Committee the ownership,
purchase or sale of any Covered Security in which he or she has
or thereby acquires a Beneficial Ownership of 1/2 of 1% or more
of the amount of such Covered Security outstanding.
(2) Each Person shall report to the Ethics Committee all purchases or
sales of any Covered security in which he or she has, or by
virtue of such transaction acquires, any Beneficial Ownership;
provided, that an Independent Director of a Fund need not report
Covered Security purchases and sales, except where such
Independent Director knew or should have known at the time of his
or her transaction that, during a 15-day period immediately
preceding or after the date of a transaction in a Covered
Security by the Independent Director, such Covered Security is to
be, or was, purchased or sold by such Fund or such purchase or
sale is or was considered by the Fund or the Adviser for
inclusion in the Fund's portfolio. This 8.b.(2) shall not apply
to non-volitional purchases and sales, such as dividend
reinvestment programs or calls (redemptions).
(3) All such reports shall be in writing, shall be made within ten
days after the close of the calendar quarter in which such
purchase or sale was effected, and shall set forth the title of
the Covered Security, the date and nature of the transaction, the
interest rate and maturity date (if applicable), the number or
amount of Covered Securities involved, the purchase or sale
price, the broker/dealer or bank through whom the transaction was
effected and the extent of such Person's interest in the
transaction. Any new accounts established with an outside
brokerage firm during a calendar quarter must also be reported
and shall set forth the name of the brokerage firm and date the
account was established.
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(4) The Ethics Committee will take whatever action it deems necessary
with respect to any Person, other than an Independent Director,
who violates any provision of this Code of Ethics; and the
Committee will inform the board of directors (trustees) of any
Fund with respect to which such a violation occurs as to the
nature of such violation and the action taken by the Committee.
Any information received by the Ethics Committee relating to
questionable practices or transactions by an Independent Director
of a Fund shall immediately be forwarded to the board of
directors (trustees) of such Fund for consideration and such
action as that board, in its sole judgment, shall deem warranted.
c. REPORTS - INVESTMENT DEPARTMENT PERSONNEL
In addition to the reporting requirements set forth in b. above, all
Investment Department Personnel shall direct their brokers to supply
to the Ethics Committee duplicate copies of confirmations or monthly
brokerage statements.
9. RESEARCH REPORTS
The fact that a Covered Security has been the subject of a formal or
informal research report shall not, in and of itself, indicate that the
Covered Security is under consideration for purchase or sale. No Person
shall be considered, for purposes herein, of knowing, or being in a
position that he or she should have known, that a Covered Security was
under consideration for purchase or sale or that such Covered Security had
been purchased or sold solely on the basis of receipt of a research report
thereon.
10. CONDITION OF EMPLOYMENT OR SERVICE
All Persons shall conduct themselves at all times in the best interests of
the Clients. Compliance with the foregoing rules shall be a condition of
employment or continued affiliation with the Clients and the Adviser and
Marketing Services, and conduct which is not in accordance therewith shall
constitute grounds for actions including termination of employment or
removal from office.
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INVESTMENT CODE OF ETHICS CERTIFICATION
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I acknowledge that I have read the EquiTrust Investment Code of Ethics (a
copy of which has been supplied to me, which I will retain for future reference)
and agree to comply in all respects with the terms and provisions thereof. I
have disclosed or reported all personal securities transactions required to be
disclosed or reported by this Code of Ethics and understand the implications
involved in violating any part of the Code.
_____________________________________________
Print Name
_____________________________________________
Signature
_____________________________________________
Date
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