CODE OF ETHICS
OF
THE OLSTEIN FUNDS
&
OLSTEIN & ASSOCIATES, L.P.
PREAMBLE
--------
This Code of Ethics is being adopted in compliance with the
requirements of Rule 17j-1 (the "Rule") adopted by the United States Securities
and Exchange Commission under the Investment Company Act of 1940 (the "Act") to
effectuate the purposes and objectives of that Rule. The Rule makes it unlawful
for certain persons, in connection with purchase or sale by such person of a
security held or to be acquired by any series of The Olstein Funds (the
"Trust"):1<F5>
(1) To employ a device, scheme or artifice to defraud the Trust;
(2) To make to the Trust any untrue statement of a material fact or
omit to state to the Trust a material fact necessary in order to
make the statements made, in light of the circumstances in which
they are made, not misleading;
(3) To engage in any act, practice or course of business which
operates or would operate as a fraud or deceit upon the Trust; or
(4) To engage in a manipulative practice with respect to the Trust.
The Rule also requires that the Trust, its investment adviser and its principal
underwriter, shall each adopt a written Code of Ethics containing provisions
reasonably necessary to prevent persons from engaging in acts in violation of
the above standard and shall use reasonable diligence and institute procedures
reasonably necessary, to prevent violations of the Code.
Set forth below is the Code of Ethics adopted by the Board of Trustees
of the Trust, and the general partner of Olstein & Associates, L.P. (the
"Adviser") in compliance with the Rule. This Code of Ethics is based upon the
principle that the trustees and officers of the Trust, and certain affiliated
persons of the Trust and its investment adviser, owe a fiduciary duty to, among
others, the shareholders of the Trust to conduct their affairs, including their
personal securities transactions, in such manner to avoid (i) serving their own
personal interests ahead of shareholders; (ii) taking inappropriate advantage of
their position with the Trust; and (iii) any actual or potential conflicts of
interest or any abuse of their position of trust and responsibility.
1<F5> A security is deemed to be "held or to be acquired" if within the most
recent fifteen (15) days it (i) is or has been held by the Fund, or (ii) is
being or has been considered by the Fund or its investment adviser for purchase
by the Fund.
GENERAL POLICY REGARDING PERSONAL INVESTING
-------------------------------------------
As a matter of general policy of the Trust and the Adviser, all
---
employees of the Trust and the Adviser shall limit their personal investments to
investments in the shares of the series of The Olstein Funds. This policy is
designed to promote the business of the Trust, and to prevent conflicts of
interest and violations of the fiduciary duty owed to the Trust's shareholders,
and to the Adviser's customers.
If an employee desires to make investments in securities which are not
available through investments in the Trust, such investments may only be made
after obtaining written approval from the compliance officer of the employer.
The compliance officers shall monitor the personal investing of employees of the
Trust and the Adviser to detect violations of this policy. Any non-Trust
investments authorized by the compliance officer under this policy, are subject
to this Code of Ethics. Trading by persons associated with the Adviser is also
governed by the Adviser's Policy Statement on Insider Trading.
1. DEFINITIONS
-----------
(a) "Access person" means any trustee, officer, general partner or
advisory person (defined immediately below) of the Trust, or the families of
such persons (including the spouse, minor children, and adults living in the
same household as such persons).
(b) "Advisory person" means (i) any employee of the Trust or the
Adviser who, in connection with his regular functions or duties, normally makes,
participates in, or obtains current information regarding the purchase or sale
of a security by the Trust, or whose functions relate to the making of any
recommendations with respect to such purchases or sales; and (ii) any natural
person in a control relationship to the Trust or the Adviser who regularly
obtains current information concerning recommendations made to the Trust with
regard to the purchase or sale of a security by the Trust.
(c) A security is "being considered for purchase or sale" or is
"being purchased or sold" when a recommendation to purchase or sell the security
has been made and communicated to the Trading Desk, which includes when the
Trust has a pending "buy" or "sell" order with respect to a security, and, with
respect to the person making the recommendation, when such person seriously
considers making such a recommendation.
(d) "Beneficial ownership" shall be as defined in, and interpreted in
the same manner as it would be in determining whether a person is subject to the
provisions of, Section 16 of the Securities Exchange Act of 1934 and the rules
and regulations thereunder which, generally speaking, encompasses those
situations where the beneficial owner has the right to enjoy some economic
benefit from the ownership of the security. A person is normally regarded as
the beneficial owner of securities held in the name of his or her spouse or
minor children living in his or her household.
(e) "Control" shall have the same meaning as that set forth in
Section 2(a)(9) of the Act.
(f) "Disinterested Trustee" means a Trustee of the Trust who is not
an "interested person" of the Trust within the meaning of Section 2(a)(19) of
the Act.
(g) "Investment Personnel" means (i) any portfolio manager of the
Trust as defined in (h) below; and (ii) securities analysts, traders and other
personnel who provide information and advice to the portfolio manager or who
help execute the portfolio manager's decisions.
(h) "Portfolio Manager" means an employee of the investment adviser
of the Trust entrusted with the direct responsibility and authority to make
investment decisions affecting an investment company.
(i) "Purchase or sale of a security" includes the writing of an
option to purchase or sell a security.
(j) "Security" shall have the meaning set forth in Section 2(a)(36)
of the Act, except that it shall not include securities issued by the government
of the United States or by federal agencies and which are direct obligations of
the United States, bankers' acceptances, bank certificates of deposit,
commercial paper and shares of registered open-end investment companies.
2. PROHIBITED TRANSACTIONS
-----------------------
(a) No access person shall engage in any act, practice or course of
conduct, which would violate the provisions of Rule 17j-1 set forth above.
(b) No access person shall:
(i) 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 and which to his or
her actual knowledge at the time of such purchase or sale:
----------------
(A) is being considered for purchase or sale by the Trust,
or
(B) is being purchased or sold by the Trust;
(ii) disclose to other persons the securities activities
engaged in or contemplated for the various portfolios of
the Trust;
(iii) seek or accept anything of value, either directly or
indirectly, from broker-dealers or other persons providing
services to the Trust because of such person's association
with the Trust. For the purposes of this provision, the
following gifts from broker-dealers or other persons
providing services to the Trust will not be considered to
be in violation of this section:
(A) an occasional meal;
(B) an occasional ticket to a sporting event, the theater
or comparable entertainment;
(C) a holiday gift of fruit or other foods, or other
comparable gift.
(c) No investment personnel shall:
(i) acquire any securities in an initial public offering, in
order to preclude any possibility of such person profiting
from his or her position with the Trust.
(ii) purchase any securities in a private placement, without
prior approval of the Compliance Officer or other officer
designated by the Board of Trustees. Any person
authorized to purchase securities in a private placement
shall disclose that investment when they play a part in
any Trust's subsequent consideration of an investment in
the issuer. In such circumstances, the Trust's decision
to purchase securities of the issuer shall be subject to
independent review by the Trust's officers with no
personal interest in the issuer.
(iii) profit in the purchase and sale, or sale and purchase, of
the same (or equivalent) securities within sixty (60)
calendar days. Any profits realized on such short-term
trades shall be subject to disgorgement.
(iv) serve on the board of directors of any publicly traded
company without prior authorization of the Chairman and/or
President of the Trust. Any such authorization shall be
based upon a determination that the board service would be
consistent with the interests of the Trust and its
shareholders.
(d) No portfolio manager shall:
(i) buy or sell a security within at least seven (7) calendar
days before and after any portfolio of the Trust that he or
she manages trades in that security. Any profits realized
on trades within the proscribed period is required to be
disgorged.
3. EXEMPTED TRANSACTIONS
---------------------
The prohibitions of Sections 2(b), 2(c) and 2(d) shall not apply to:
(a) purchases or sales effected in any account over which the access
person has no direct or indirect influence or control;
(b) purchases or sales which are non-volitional on the part of either
the access person or the Trust;
(c) purchases which are part of an automatic dividend reinvestment
plan;
(d) 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
(e) purchases or sales of shares of any series of the Trust.
4. COMPLIANCE PROCEDURES
---------------------
(a) Pre-clearance
-------------
With the exception of the Disinterested Trustees, all access persons
shall receive prior approval from the Compliance Officer or other officer
designated by the Board of Trustees before purchasing or selling securities.
(b) Disclosure of Personal Holdings (Initial and Annual Reports)
------------------------------------------------------------
All investment personnel shall disclose to the Compliance Officer all
personal securities holdings upon commencement of employment and thereafter on
an annual basis as of December 31. This initial report shall be made on the
form attached as Exhibit A, and the annual report shall be made on the form
attached as Exhibit B.
(c) Reporting Requirements (Quarterly Reports)
------------------------------------------
(i) Every access person shall report to the Compliance Officer
the information described in, Sub-paragraph (d)(iii) of this
Section with respect to transactions in any security in
which such person has, or by reason of such transaction
acquires, any direct or indirect beneficial ownership in the
security; provided, however, that an access person shall not
be required to make a report with respect to transactions
effected for any account over which such person does not
have any direct or indirect influence.
(ii) Each trustee who is not an "interested person" of the
Trust as defined in the Act need only report a transaction
in a security if such trustee, at the time of that
transaction knew, or, in the ordinary course of fulfilling
his official duties as a trustee, should have known that,
during the 15-day period immediately preceding or after
the date of the transaction by the trustee, such security
was purchased or sold by the Trust or was being considered
for purchase by the Trust or by its investment adviser.
Such reports will include the information described in
Sub-paragraph (d)(iii) of this Section.
(iii) Reports required to be made under this Paragraph (d) shall
be made not later than ten (10) days after the end of the
calendar quarter in which the transaction to which the
report relates was effected. Every access person shall be
required to submit a report for all periods, including
those periods in which no securities transactions were
effected. A report shall be made on the form attached
hereto as Exhibit D or on any other form containing 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; and
(D) the name of the broker, dealer or bank with or through
whom the transaction was effected.
(iv) Any such report may contain a statement that the report
shall not be construed as an admission by the person
making such report that he or she has any direct or
indirect beneficial ownership in the security to which the
report relates.
(v) With the exception of the Disinterested Trustees, every
access person shall direct their brokers to supply to the
Compliance Officer, on a timely basis, duplicate copies of
the confirmation of all personal securities transactions and
copies of all periodic statements for all securities
accounts.
(vi) The Compliance officer shall notify each access person
that he or she is subject to these reporting requirements,
and shall deliver a copy of this Code of Ethics to each
such person upon request.
(d) Certification of Compliance with Code of Ethics
-----------------------------------------------
(i) With the exception of the Disinterested Trustees, every
access person shall certify in their annual report that:
(A) they have read and understand the Code of Ethics and
recognize that they are subject thereto;
(B) they have complied with the requirements of the Code of
Ethics; and
(C) they have reported all personal securities transactions
required to be reported pursuant to the requirements of
the Code of Ethics.
(e) Conflict of Interest
--------------------
Every access person shall notify the Compliance Officer of any
personal conflict of interest relationship which may involve the Trust, such as
the existence of any economic relationship between their transactions and
securities held or to be acquired by any series of the Trust. Such notification
shall occur in the pre-clearance process.
5. REPORTING OF VIOLATIONS TO THE BOARD OF TRUSTEES
------------------------------------------------
(a) The Compliance Officer shall promptly report to the Board of
Trustees:
(i) all apparent violations of this Code of Ethics and the
reporting requirements thereunder; and
(ii) any reported transaction in a security which was purchased
or sold by the Trust within fifteen (15) days before or
after the date of the reported transactions.
(b) When the Compliance Officer finds that a transaction otherwise
reportable to the Board of Trustees under Paragraph (a) of this Section could
not reasonably be found to have resulted in a fraud, deceit or manipulative
practice in violation of Rule 17j-1(a), it may, in its discretion, lodge a
written memorandum of such finding and the reasons therefor with the reports
made pursuant to this Code of Ethics, in lieu of reporting the transaction to
the Board of Trustees.
(c) The Board of Trustees, or a Committee of Trustees created by the
Board of Trustees for that purpose, shall consider reports made to the Board of
Trustees hereunder and shall determine whether or not this Code of Ethics has
been violated and what sanctions, if any, should be imposed.
6. ANNUAL REPORTING TO THE BOARD OF TRUSTEES
-----------------------------------------
(a) The Compliance Officer shall prepare an annual report relating to
this Code of Ethics to the Board of Trustees. Such annual report shall:
(i) summarize existing procedures concerning personal investing
and any changes in the procedures made during the past year;
(ii) identify any violations requiring significant remedial
action during the past year; and
(iii) identify any recommended changes in the existing
restrictions or procedures based upon the Trust's
experience under its Code of Ethics, evolving industry
practices or developments in applicable laws or
regulations.
7. SANCTIONS
---------
Upon discovering a violation of this Code, the Board of Trustees may
impose such sanctions as they deem appropriate, including, among other things, a
letter of censure or suspension or termination of the employment of the
violator.
8. RETENTION OF RECORDS
--------------------
This Code of Ethics, a list of all persons required to make reports
hereunder from time to time, a copy of each report made by an access person
hereunder, each memorandum made by the Compliance Officer hereunder and a record
of any violation hereof and any action taken as a result of such violation,
shall be maintained by the Trust as required under Rule 17j-1.
Dated: March 31, 1995.
ADDENDUM
--------
"Security" means any note, stock, treasury stock, bond, debenture, evidence
of indebtedness, certificate of interest or participation in any profit-sharing
agreement, collateral-trust certificate, preorganization certificate or
subscription, transferable share, investment contract, voting-trust certificate,
certificate of deposit for a securities, fractional undivided interest in oil,
gas, or other mineral rights, any put, call, straddle, option, or privilege on
any security (including a certificate of deposit) or on any group or index of
securities (including any interest therein or based on the value thereof), or
any put, call, straddle, option, or privilege entered into in a national
securities exchange relating to foreign currency, or, in general, any interest
or instrument commonly known as a "security," or any certificate of interest or
participation in, temporary or interim certificate for, receipt for, guarantee
of, or warrant or right to subscribe to or purchase, any of the foregoing.
Exhibit B
THE OLSTEIN FUNDS
&
OLSTEIN & ASSOCIATES, L.P.
CODE OF ETHICS
INITIAL REPORT
To the Compliance Officer of THE OLSTEIN FUNDS or OLSTEIN &
ASSOCIATES, L.P.:
1. I hereby acknowledge receipt of a copy of the Code of Ethics for THE
OLSTEIN FUNDS (the "Trust") or OLSTEIN & ASSOCIATES, L.P. ( the "Adviser").
2. I have read and understand the Code and recognize that I am subject
thereto in the capacity of an "Access Person."
3. Except as noted below, I hereby certify that I have no knowledge of
the existence of any personal conflict of interest relationship which may
involve the Trust, such as any economic relationship between my transactions and
securities held or to be acquired by the Trust or any of its Series.
4. As of the date below I had a direct or indirect beneficial ownership
in the following securities:
Type of Interest
Name of Securities Number of Shares (Direct or Indirect)
------------------ ---------------- ------------------
Date:------------------------- Signature:---------------------------------
Print Name:--------------------------------
Title:-------------------------------------
Employer's Name:---------------------------
Exhibit C
THE OLSTEIN FUNDS
&
OLSTEIN & ASSOCIATES, L.P.
CODE OF ETHICS
ANNUAL REPORT
To the Compliance Officer of THE OLSTEIN FUNDS or OLSTEIN & ASSOCIATES, L.P.:
1. I have read and understand the Code and recognize that I am subject
thereto in the capacity of an "Access Person."
2. I hereby certify that, during the year ended December 31, 19--, I
have complied with the requirements of the Code and I have reported all
securities transactions required to be reported pursuant to the Code.
3. Except as noted below, I hereby certify that I have no knowledge of
the existence of any personal conflict of interest relationship which may
involve the Trust, such as any economic relationship between my transactions and
securities held or to be acquired by the Trust or any of its Series.
4. As of December 31, 19--, I had a direct or indirect beneficial
ownership in the following securities:
Type of Interest
Name of Securities Number of Shares (Direct or Indirect)
------------------ ---------------- ------------------
Date:------------------------ Signature:---------------------------------
Print Name:--------------------------------
Title:-------------------------------------
Employer's Name:---------------------------
Exhibit D
THE OLSTEIN FUNDS
&
OLSTEIN & ASSOCIATES, L.P.
Securities Transactions Report
For the Calendar Quarter Ended: ---------------
To the Compliance Officer of THE OLSTEIN FUNDS or OLSTEIN & ASSOCIATES, L.P.:
During the quarter referred to above, the following transactions were
effected in securities of which I had, or by reason of such transaction
acquired, direct or indirect beneficial ownership, and which are required to be
reported pursuant to the Code of Ethics adopted by the Trust.
NATURE OF
DOLLAR TRANSACTION BROKER/DEALER OR
DATE OF NO. OF AMOUNT OF (Purchase, BANK THROUGH
SECURITY TRANSACTION SHARES TRANSACTION Sale, Other) PRICE WHOM EFFECTED
-------- ----------- ------ ----------- ------------ ----- -------------
This report (i) excludes transactions with respect to which I had no direct
or indirect influence or control, (ii) other transactions not required to be
reported, and (iii) is not an admission that I have or had any direct or
indirect beneficial ownership in the securities listed above.
Except as noted on the reverse side of this report, I hereby certify that I
have no knowledge of the existence of any personal conflict of interest
relationship which may involve the Trust, such as the existence of any economic
relationship between my transactions and securities held or to be acquired by
the Trust or any of its Series.
Date:------------------------ Signature:---------------------------------
Print Name:--------------------------------
Title:-------------------------------------
Employer's Name:---------------------------
