CODE OF ETHICS
UNIFIED FUNDS
Unified Investment Advisers, Inc.
Unified Management Corporation
Unified Financial Services, Inc
(Adopted May 16, 2000)
I. Statement of General Principles
This Code of Ethics has been adopted by Unified Funds (the "Trust") for
the purpose of instructing all employees, officers, directors, members and
trustees of the Trust, Unified Investment Advisers, Inc. and Health Financial,
Inc. (collectively, the "Adviser"), and Unified Financial Services, Inc and all
of its other subsidiaries, including Unified Management Corporation (the
"Underwriter") (collectively, "UFS") in their ethical obligations and to provide
rules for their personal securities transactions. All such persons owe a
fiduciary duty to the Trust and its shareholders. A fiduciary duty means a duty
of loyalty, fairness and good faith towards the Trust and its shareholders, and
the obligation to adhere not only to the specific provisions of this Code but to
the general principles that guide the Code. These general principles are:
o The duty at all times to place the interests of the Trust and
its shareholders first;
o The requirement that all personal securities transactions be
conducted in a manner consistent with the Code of Ethics and
in such a manner as to avoid any actual or potential conflict
of interest or any abuse of any individual's position of trust
and responsibility; and
o The fundamental standard that such employees, officers,
directors, members and trustees should not take inappropriate
advantage of their positions, or of their relationship with
the Trust or its shareholders.
It is imperative that the personal trading activities of the employees,
officers, directors, members and trustees of the Trust, the Adviser and UFS,
respectively, be conducted with the highest regard for these general principles
in order to avoid any possible conflict of interest, any appearance of a
conflict, or activities that could lead to disciplinary action. This includes
executing transactions through or for the benefit of a third party when the
transaction is not in keeping with the general principles of this Code.
All personal securities transactions must also comply with the
Securities & Exchange Commission's Rule 17j-1. Under this rule, no Employee may:
o employ any device, scheme or artifice to defraud the Trust or
any of its shareholders;
o make to the Trust or any of its shareholders any untrue
statement of a material fact or omit to state to such client a
material fact necessary in order to make the statements made,
in light of the circumstances under which they are made, not
misleading;
o engage in any act, practice, or course of business which
operates or would operate as a fraud or deceit upon the Trust
or any of its shareholders; or
o engage in any manipulative practice with respect to the Trust
or any of its shareholders.
II. Definitions
A. Advisory Employee: i) any employee of the Trust, the Adviser, or UFS
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 any Fund, or whose functions relate to the making of
any recommendations with respect to the purchase or sale of Securities
by any Fund, and ii) any natural person in a control relationship to
any Fund or the Adviser who obtains information concerning
recommendations made to a Fund with regard to the purchase or sale of a
Security by a Fund.
B. Beneficial Interest: beneficial ownership as defined by Rule 16a-1
under the Securities Act of 1934, including the opportunity to directly
or indirectly profit or otherwise obtain financial benefits from any
interest in a security. Employees should direct questions regarding
Rule 16a-1 or the definition of Beneficial Interest to the Compliance
Officer.
C. Compliance Officer: Carol J. Highsmith, or with respect to Carol J.
Highsmith, Michael E. Durham.
D. Disinterested Trustees, Members and Directors: trustees of the Trust
whose affiliation with the Trust is solely by reason of being a trustee
of the Trust.
E. Employee Account: each account in which an Employee or a member of
his or her family has any direct or indirect Beneficial Interest or
over which such person exercises control or influence, including, but
not limited to, any joint account, partnership, corporation, trust or
estate. An Employee's family members include the Employee's spouse,
minor children, any person living in the home of the Employee and any
relative of the Employee (including in-laws) to whose support an
Employee directly or indirectly contributes.
F. Employees: i) the Advisory Employees, ii) the officers, directors
and trustees of the Trust and the Adviser, and iii) any officer or
director of the Underwriter who, in the ordinary course of business,
makes, participates in or obtains information about the purchase or
sale of Securities by a Fund or whose functions or duties relate to the
making of recommendations to a Fund regarding the purchase or sale of a
Security.
G. Exempt Transactions: transactions which are 1) effected in an amount
or in a manner over which the Employee has no direct or indirect
influence or control, 2) pursuant to a systematic dividend reinvestment
plan, systematic cash purchase plan or systematic withdrawal plan, 3)
in connection with the exercise or sale of rights to purchase
additional securities from an issuer and granted by such issuer
pro-rata to all holders of a class of its securities, 4) in connection
with the call by the issuer of a preferred stock or bond, 5) pursuant
to the exercise by a second party of a put or call option, 6) closing
transactions no more than five business days prior to the expiration of
a related put or call option, and 7) involving shares of a security of
a company with a market capitalization in excess of $10 billion.
H. Funds: any series of the Trust.
I. Related Securities: securities issued by the same issuer or issuer
under common control, or when either security gives the holder any
contractual rights with respect to the other security, including
options, warrants or other convertible securities.
J. Securities: any note, stock, treasury stock, bond, debenture,
evidence of indebtedness, certificate of interest or participation in
any profit-sharing agreement, collateral-trust certificate,
pre-organization certificate or subscription, transferable share,
investment contract, voting-trust certificate, certificate of deposit
for a security, fractional undivided interest in oil, gas or other
mineral rights, or, in general, any interest or instrument commonly
known as a "security," or any certificate or interest or participation
in temporary or interim certificate for, receipt for, guarantee of, or
warrant or right to subscribe to or purchase (including options) any of
the foregoing; except for the following: 1) securities issued by the
government of the United States, 2) bankers' acceptances, 3) bank
certificates of deposit, 4) commercial paper, and 5) shares of
registered open-end investment companies.
K. Securities Transaction: the purchase or sale, or any action to
accomplish the purchase or sale, of a Security for an Employee Account.
The term Securities Transaction does not include transactions executed
by the Adviser or the Underwriter for the benefit of unaffiliated
persons, such as investment advisory and brokerage clients.
III. Personal Investment Guidelines
A. Personal Accounts
1. The Personal Investment Guidelines in this Section
III do not apply to Exempt Transactions. Employees
must remember that regardless of the transaction's
status as exempt or not exempt, the Employee's
fiduciary obligations remain unchanged.
2. While Employees are subject at all times to the
fiduciary obligations described in this Code, the
Personal Investment Guidelines and Compliance
Procedures in Sections III and IV of this Code apply
to Disinterested Trustees, Members and Directors only
if such person knew, or in the ordinary course of
fulfilling the duties of that position, should have
known, that during the fifteen days immediately
preceding or after the date of the such person's
transaction that the same Security or a Related
Security was or was to be purchased or sold for a
Fund or that such purchase or sale for a Fund was
being considered, in which case such Sections apply
only to such transaction.
3. Employees may not execute a Securities Transaction on
a day during which a purchase or sell order in that
same Security or a Related Security is pending for a
Fund. Securities Transactions executed in violation
of this prohibition shall be unwound or, if not
possible or practical, the Employee must disgorge to
the Fund the value received by the Employee due to
any favorable price differential received by the
Employee. For example, if the Employee buys 100
shares at $10 per share, and the Fund buys 1000
shares at $11 per share, the Employee will pay $100
(100 shares x $1 differential) to the Fund.
4. An Advisory Employee may not execute a Securities
Transaction within five (5) calendar days before or
after a transaction in the same Security or a Related
Security has been executed on behalf of a Fund unless
(a) the Advisory Employee sells the same Security
after the Fund sells the Security; or (b) the
Advisory Employee purchases the same Security after
the Fund purchases the Security. If the Compliance
Officer determines that a transaction has violated
this prohibition, the transaction shall be unwound
or, if not possible or practical, the Employee must
disgorge to the Fund the value received by the
Employee due to any favorable price differential
received by the Employee.
5. Notwithstanding Paragraphs 3 and 4 of this Section
III, in the case of any Fund which replicates a
particular securities index ("Index Fund") an
Employee may purchase or sell any of the securities
comprising the relevant index, without prior
approval, provided (a) such Employee has no
information concerning any significant purchase or
redemption activities anticipated by the Index Fund,
and (b) the purchase or sale is not prohibited by
paragraph 3 or 4 of this Section III with respect to
another series of the Trust. "Significant purchase or
redemption activity" shall mean combined purchases
and redemptions within any 5 trading day period
resulting in a change in a Fund's net assets of 10%
or more.
6. Any transactions by an Employee involving a private
placement must be authorized by the Compliance
Officer, in writing, prior to the transaction. In
connection with a private placement acquisition, the
Compliance Officer will take into account, among
other factors, whether the investment opportunity
should be reserved for a Fund, and whether the
opportunity is being offered to the Employee by
virtue of the Employee's position with the Trust, the
Adviser, or UFS. Employees who have been authorized
to acquire securities in a private placement will, in
connection therewith, be required to disclose that
investment if and when the Employee takes part in any
subsequent investment in the same issuer. In such
circumstances, the determination to purchase
Securities of that issuer on behalf of a Fund (except
an Index Fund) will be subject to an independent
review by personnel of the Adviser with no personal
interest in the issuer.
7. Employees are prohibited from acquiring any
Securities in an initial public offering without the
prior written approval of the Compliance Officer.
This restriction is imposed in order to preclude any
possibility of an Employee profiting improperly from
the Employee's position with the Trust, the Adviser,
or UFS.
B. Other Restrictions
1. Employees are prohibited from serving on the boards
of directors of publicly traded companies, absent
prior authorization by the Compliance Officer. The
consideration of prior authorization will be based
upon a determination that the board service will be
consistent with the interests of the Trust and the
Funds' shareholders. In the event that board service
is authorized, Employees serving as directors will be
isolated from other Employees making investment
decisions with respect to the securities of the
company in question.
2. No Employee may accept from a customer or vendor an
amount in excess of $250 per year in the form of
gifts or gratuities, or as compensation for services,
without the Compliance Officer's prior written
approval. If there is a question regarding receipt of
a gift, gratuity or compensation, it is to be
reviewed by the Compliance Officer.
IV. Compliance Procedures
A. Employee Disclosure and Certification
1. Within ten days of becoming an Employee, each
Employee must certify that he or she has read and
understands this Code and recognizes that he or she
is subject to it, and must disclose all personal
Securities holdings (the "Holdings Report").
2. A Holdings Report (with the above described
certification) is also required annually, along with
an additional certification that the Employee has
complied with the requirements of this Code and has
disclosed or reported all personal Securities
Transactions required to be disclosed or reported
pursuant to the requirements of this Code.
B. Compliance
1. The Compliance officer will maintain a list of
current Employees and Advisory Employees.
2. All Employees must provide copies of all broker
confirmations and periodic account statements to the
Compliance Officer. Each Employee must report, no
later than ten (10) days after the close of each
calendar quarter, on the Securities Transaction
Report form provided by the Trust or the Adviser, all
transactions in which the Employee acquired any
direct or indirect Beneficial Interest in a Security,
including Exempt Transactions, and certify that he or
she has reported all transactions required to be
disclosed pursuant to the requirements of this Code.
3. The Compliance Officer will, on a quarterly basis,
check all Securities Transaction Reports, and
randomly check the trading confirmations provided by
brokers, to verify that the Employees have not
violated the Code. The Compliance Officer will also
review all Holdings Reports for possible violations.
4. If an Employee violates this Code, the Compliance
Officer will report the violation to management
personnel of the Trust, and the Adviser or the
Underwriter, for appropriate remedial action which,
in addition to the actions specifically delineated in
other sections of this Code, may include a reprimand
of the Employee, or suspension or termination of the
Employee's relationship with the Trust and/or the
Adviser or the Underwriter.
5. The Adviser and the Underwriter will prepare a joint
annual report to the Trust's board of trustees that
summarizes existing procedures and any changes in the
procedures made during the past year. The report will
identify any violations of this Code, any significant
remedial action during the past year and any
recommended procedural or substantive changes to this
Code based on their experience under this Code,
evolving industry practices or legal developments.
The report will contain a certification as to whether
the Adviser and the Underwriter have adopted
procedures reasonably necessary to prevent violations
of this Code.
