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EXHIBIT (p)(ii)
May 1, 1999
UNIBANK SECURITIES, INC.
INVESTMENT MANAGEMENT DIVISION
CODE OF ETHICS
(PERSONAL SECURITIES TRANSACTIONS)
SECTION I STATEMENT OF GENERAL PRINCIPLES
This Code has been adopted by Unibank Securities Inc., Investment Management
Division ("IMD") to satisfy the requirements of Rule 17j-1 under the Investment
Company Act of 1940 (the "1940 Act").
All investment professionals located in Unibank Investment Management in
Copenhagen who are covered by the Personnel Sharing Agreement between Unibank
Securities, Inc. and Unibank A/S are subject to this Code as regards to all
clients of IMD ("Clients").
Since IMD has Investment Company clients, it is necessary to comply with Rule
17j-1 of the 1940 Act.
As it relates to Rule 17j-1 of the 1940 Act, the purpose of the Code is to
establish standards and procedures that are reasonably designed for the
detection and prevention of activities by which persons having knowledge of the
investments and investment intentions of an Investment Company may abuse their
fiduciary duties to the Investment Company and otherwise to deal with the types
of conflict of interest situations to which Rule 17j-1 is addressed.
The Code is based on the principle that the employees of IMD ("Employees") who
provide services to the Clients or who in the course of their duties obtain
information regarding the Clients investment transactions, owe a fiduciary duty
to the Clients to conduct their personal securities transactions in a manner
that does not interfere with the Client's transactions or otherwise take unfair
advantage of their position. All employees are expected to adhere to this
general principle as well as to comply with all of the specific provisions of
this Code that are applicable to them.
All Employees shall place the interests of the Clients before their own personal
interests. Technical compliance with the Code will not automatically insulate
any Employee from scrutiny of transactions that show a pattern of compromise or
abuse of the individual's fiduciary duties to the Clients. Accordingly, all
Employees must seek to avoid any actual or potential conflicts between their
personal interests and the interests of the Clients.
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Every Employee must read and retain this Code, and should recognize that he or
she is subject to the provisions hereof.
SECTION II DEFINITIONS
(A) "Access Person" means IMD and any director, Manager, officer or
Advisory Person (as defined below) of IMD
(B) An "Advisory Person" of IMD means:
(i) any employee who in connection with his or her regular functions or
duties makes, participates in, or obtains information regarding the
purchase or sale of any Security by the Clients, 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 IMD who obtains
information concerning recommendations made to the Clients with regard
to the purchase or sale of any Security.
(C) "Beneficial Ownership" has the meaning set forth in paragraph
(a)(2) of Rule 16a-1 under the Securities Exchange Act of 1934, and for
purposes of this Code should be deemed to include, but not be limited
to, any interest by which an Access Person or any Immediate Family
Member of an Access Person can directly or indirectly derive a monetary
or other economic benefit from the purchase, sale (or other acquisition
or disposition) or ownership of a Security, including for this purpose
any such interest which arises as a result of:
a general partnership interest in a general or limited partnership;
an interest in a trust;
a right to dividends which is separated or separable from the
underlying Security;
a right to acquire equity Securities through the exercise or
conversion of any derivative Security (whether or not presently
exercisable);
or a performance related advisory fee (other than an asset based fee)
unless
(i) the performance related fee, regardless of when payable, is
calculated based upon net capital gains and/or net capital appreciation
generated from the portfolio or from the fiduciary's overall
performance over a period of one year or more and (ii) equity
securities of the issuer do not account for more than 10% of the market
value of the portfolio.
(D) "Compliance Officer" means the person designated by IMD to serve as
the chief compliance officer.
(E) "Control" shall have the same meaning as that set forth in Section
2(a)(9) of the 1940 Act, and includes 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 the
company. Control shall be presumed to exist where a person owns
beneficially, either directly or through one or more companies, more
than 25% of the voting Securities of a company.
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(F) "Immediate Family Member of an Access Person" means a person who
shares the same household as the Access Person and is related to the
Access Person by blood, marriage and/or adoption.
(G) "Security" shall have the meaning set forth in Section 2(a)(36) of
the 1940 Act and should be deemed to include any and all stock, debt
obligations, and similar instruments of whatever kind, including any
right or warrant to purchase a security, or option to acquire or sell a
security, a group or index of securities or a foreign currency.
References to a Security in this Code (e.g., a prohibition or
requirement applicable to the purchase or sale of a Security) shall be
deemed to refer to and to include any warrant for, option in, or
Security immediately convertible into that Security, and shall also
include any financial instrument which has an investment return or
value that is based, in whole or part, on that Security (collectively,
"Derivatives"). Therefore, except as otherwise specifically provided by
this Code: (i) any prohibition or requirement of this Code applicable
to the purchase or sale of a Security shall also be applicable to the
purchase or sale of a Derivative relating to that Security; and (ii)
any prohibition or requirement of this Code applicable to the purchase
or sale of a Derivative shall also be applicable to the purchase or
sale of a Security relating to that Derivative.
(H) A Security is "being considered for purchase or sale" when a
recommendation to purchase or sell that Security has been made or
communicated and, with respect to the person making the recommendation,
when such person seriously considers making such a recommendation.
SECTION III OBJECTIVE AND GENERAL PROHIBITIONS
Although certain provisions of this Code apply only to Access Persons, all
Employees must recognize that they are expected to conduct their personal
activities in accordance with the standards set forth in Sections I and III.
Therefore, an Employee may not engage in any personal investment transaction
under circumstances where the Employee benefits from or interferes with the
purchase or sale of investments by the Clients. In addition, Employees may not
use information concerning the investments or investment intentions of the
Clients, or their ability to influence such investment intentions, for personal
gain or in a manner detrimental to the interests of the Clients (or any other
participant in the market for that security).
Employees may not engage in conduct which is deceitful, fraudulent, or
manipulative, or which involves false or misleading statements, in connection
with the purchase or sale of investments by the Clients. In this regard,
Employees should recognize that Rule 17j-1 makes it unlawful for any affiliated
person or principal underwriter of the Clients, or any affiliated person of such
a person, directly or indirectly, in connection with the purchase or sale of a
Security held or to be acquired by the Client to:
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(i) employ any device, scheme or artifice to defraud the Client;
(ii) make any untrue statement of a material fact to the Client or omit
to state to the Client a material fact necessary in order to make the
statements made, in light of the circumstances under which they are
made, not misleading;
(iii) engage in any act, practice, or course of business which operates
or would operate as a fraud or deceit upon the Client; or
(iv) engage in any manipulative practice with respect to the Client.
Employees should also recognize that a violation of this Code or of Rule 17j-1
may result in the imposition of: (1) sanctions as provided by Section VIII
below; or (2) administrative, civil and, in certain cases, criminal fines,
sanctions or penalties.
SECTION IV PROHIBITED TRANSACTIONS
The following prohibitions apply to Access Persons:
(A) An Access Person may not purchase or otherwise acquire direct or
indirect Beneficial Ownership of any Security, and may not sell or
otherwise dispose of any Security in which he or she has direct or
indirect Beneficial Ownership, if he or she knows or should know at the
time of entering into the transaction that a Client has purchased or
sold the Security within the last 7 calendar days, or is purchasing or
selling or is going to purchase or sell the Security in the next 7
calendar days, or the Security is being considered for purchase of sale
by a Client, unless the Access Person obtains advance clearance of such
transaction pursuant to Section V.
The Compliance Officer will conduct an appropriate review of all
reported trades of Access Persons that suggest the possibility of a
violation of this prohibition.
(B) The prohibitions of this Section IV do not apply to:
(1) Purchases that are made by reinvesting cash dividends
pursuant to an automatic dividend reinvestment program ("DRIP")
(however, this exception does not apply to optional cash
purchases pursuant to a DRIP);
(2) Purchases and redemptions of shares of registered, open-end
mutual funds (but not shares of or interests in closed-end
funds);
(3) Bank certificates of deposit and bankers' acceptances;
(4) Money market instruments (including repurchase agreements)
with a stated maturity of 12 months or less;
(5) Government Bonds, e.g. U.S. Treasury obligations;
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(6) Purchases of rights issued by an issuer pro rata to all
holders of a class of its Securities, if such rights are acquired
from such issuer, and the exercise of any such rights;
(7) Involuntary (i.e., non-volitional) purchases and sales of
Securities;
(8) Transactions in an account over which the Access Person does
not exercise, directly or indirectly, any influence or control;
provided, however, that such influence or control shall be
presumed to exist in the case of the account of an Immediate
Family Member of the Access Person, absent an advance written
determination by the Compliance Officer to the contrary; and
(9) Transactions in a Security (which shall for the purpose of
this exemption be deemed to include a series of related
transactions in a Security) involving shares for USD 10,000 or
less of the stock of an issuer that has a market capitalization
(i.e., outstanding shares multiplied by the current price per
share) of $1 billion or more.
SECTION V PRE-CLEARANCE PROCEDURES
Access Persons have to pre-clear all personal securities transactions,
except Transactions listed in Section IV, B.
.
(A) FROM WHOM OBTAINED
Pre-clearance of a personal transaction in a Security may be
obtained only from the Compliance Officer or a person who has been
designated by the Compliance Officer to pre-clear transactions. The
Compliance Officer and these designated persons are each referred to as
a "Clearing Officer." A Clearing Officer seeking pre-clearance with
respect to his or her own transaction shall obtain such clearance from
another Clearing Officer.
(B) TIME OF CLEARANCE
(1) Access Persons may pre-clear trades only in cases where they
have a present intention to effect a transaction in the Security
for which pre-clearance is sought. It is not appropriate for an
Access Person to obtain a general or open-ended pre-clearance to
cover the eventuality that he or she may buy or sell a Security
at some future time depending upon market developments.
Consistent with the foregoing, an Access Person may not
simultaneously request pre-clearance to buy and sell the same
Security.
(2) Pre-clearance of a trade shall be valid and in effect only
for a period of two trading days, including the day pre-clearance
is given; provided, however, that a pre-clearance expires upon
the person becoming
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aware of facts or circumstances that would prevent a proposed
trade from being pre-cleared were such facts or circumstances
made known to a Clearing Officer. Accordingly, if an Access
Person becomes aware of new or changed facts or circumstances
which give rise to a question as to whether pre-clearance could
be obtained if a Clearing Officer was aware of such facts or
circumstances, the person shall be required to so advise a
Clearing Officer before proceeding with such transaction.
(C) FORM
Pre-clearance must be obtained in writing by completing and
signing the form provided for that purpose by IMD, which form shall
set forth the details of the proposed transaction, and by obtaining
the signature of a Clearing Officer. The form to be used in seeking
pre-clearance is annexed hereto as Schedule A.
(D) FILING
A copy of all completed clearance forms, with the required
signatures, shall be retained by the Compliance Officer.
(E) FACTORS CONSIDERED IN CLEARANCE OF PERSONAL TRANSACTIONS
A Clearing Officer may refuse to grant clearance of a personal
transaction in his or her sole discretion without being required
to specify any reason for the refusal. Generally, a Clearing
Officer will consider the following factors in determining whether
or not to clear a proposed transaction:
(1) Whether the amount or nature of the transaction or person
making it is likely to affect the price or market for the
Security;
(2) Whether the person making the proposed purchase or sale is
likely to benefit from purchases or sales being made or being
considered on behalf of a Client;
(3) Whether the chance of a conflict of interest is remote;
and
(4) Whether the transaction is likely to affect a Client
adversely.
(F) MONITORING OF PERSONAL TRANSACTIONS AFTER CLEARANCE
After clearance is given to an Access Person, the Compliance
Officer shall monitor the Access Persons's transactions to ascertain
whether the cleared transaction was executed within the prescribed
time period and in the specified amount.
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SECTION VI REPORTS
(A) Access Persons are required to notify the Compliance Officer
of all brokerage accounts through which Securities in which
they have Beneficial Ownership are held, purchased or sold
("Personal Securities Accounts"), and shall promptly notify
the Compliance Officer any time a new Personal Securities
Account is opened. In addition, Access Persons shall make
arrangements so that duplicate confirmations and statements
relating to all Personal Securities Accounts are sent to the
Compliance Officer, unless an exemption from this requirement
is granted in writing by the Compliance Officer. As regards
to all transactions executed through the "Medarbejderbanken"
(the Danish branch dedicated to the employees working in
Denmark) for accounts owned by Access Persons arrangements
has been made for automatic transaction reporting to the
Compliance Officer.
(B) Within ten (10) days after the end of each calendar quarter,
each Access Person shall make a written report to the
Compliance Officer of all transactions occurring in the
quarter by which he or she acquired or disposed of Beneficial
Ownership of any Security, except that the report need not
set forth information regarding the following types of
transactions:
(1) Purchases and redemptions of shares of registered,
open-end mutual funds (but not shares of or interests in
closed-end funds);
(2) Bank certificates of deposit and bankers' acceptances;
(3) Money market instruments (including repurchase
agreements) with a stated maturity of 12 months or less;
(4) Government Bonds, e.g. U.S. Treasury obligations; and
(5) Transactions in an account, over which the Access Person
does not exercise, directly or indirectly, any influence or
control.(1)
Such report is hereinafter called a "Quarterly Securities
Transaction Report."
(C) A Quarterly Securities Transaction Report shall be on the form
annexed hereto as Schedule B and must contain the following
information with respect to each reportable transaction:
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1 The reporting requirements of this Section VI apply to Securities
acquired or disposed of in all types of transactions, including
non-brokered transactions, such as purchases and sales of privately
placed Securities and Securities acquired directly from an issuer,
except to the extent that one of the exemptions from the reporting
requirements applies.
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(1) Date and nature of the transaction (purchase, sale or any
other type of acquisition or disposition);
(2) Title, number of shares or principal amount of each
Security and the price at which the transaction was effected;
and
(3) Name of the broker, dealer or bank with or through whom
the transaction was effected.
Transactions effected in Personal Securities Accounts as to which the
Compliance Officer is being furnished with confirmations and statements
need not be included in the Quarterly Securities Transaction Report,
provided that the report includes a certification that there are no
reportable transactions other than those set forth in the Quarterly
Securities Transaction Report and in confirmations and statements for
such accounts. Alternatively, the Compliance Officer may approve an
abbreviated version of Schedule B that omits such information for use
by Access Persons who furnish confirmations and statements to the
Compliance Officer.
(D) A Quarterly Securities Transaction Report may contain a statement
that the report is not to be construed as an admission that the person
making it has or had any direct or indirect Beneficial Ownership in any
Security to which the report relates.
(E) It is the responsibility of each Access Person to take the
initiative to comply with the requirements of this Section VI. Any
effort by IMD to facilitate the reporting process does not change or
alter that responsibility.
SECTION VII CERTIFICATION BY ACCESS PERSONS
Access Persons shall be required to certify not more than 30 days after they
become Access Persons, and annually thereafter, that they have read and
understand this Code and recognize that they are subject to it. Access Persons
shall also be required to certify annually that they have complied with the
requirements of this Code. The form of certification is annexed hereto as
Schedule C.
SECTION VIII SANCTIONS
Any violation of this Code shall be subject to the imposition of such sanctions
by IMD as may be deemed appropriate under the circumstances to achieve the
purposes of Rule 17j-1 and this Code. Any sanctions to be imposed shall be
determined by the Management of IMD. Sanctions may include, but are not limited
to, suspension or termination of employment, a letter of censure and/or
restitution of an amount equal to the difference between the price paid or
received by the Client and the more advantageous price paid or received by the
offending person.
SECTION IX ADMINISTRATION AND CONSTRUCTION
(A) The administration of this Code shall be the responsibility of the
Compliance Officer.
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(B) The duties of the Compliance Officer are as follows:
(1) Continuous maintenance of current lists of the names of
all Employees and Access Persons, with an appropriate
description in each case of the titles or employments of such
persons, including a notation of any directorships held by
Access Persons;
(2) On an annual basis, providing each Employee with a copy
of this Code and informing such persons of their duties and
obligations hereunder;
(3) Maintaining or supervising the maintenance of all records
and reports required to be kept by IMD pursuant to this Code;
(4) Preparing listings of all transactions effected by Access
Persons who are subject to the requirement of Section V of
this Code to file Quarterly Transaction Reports and reviewing
such transactions against a listing of all transactions
effected by the Clients;
(5) Issuance, either personally or with the assistance of
counsel as may be appropriate, of any interpretation of this
Code which may appear consistent with the objectives of Rule
17j-1 and this Code;
(6) Conducting such inspections or investigations as shall
reasonably be required to detect and report, with
recommendations, any apparent violations of this Code to the
Management of IMD;
(7) Submission of a quarterly report to the Management of IMD
containing a description of any violation of this Code by an
Employee, noting in each case any sanction imposed; any
transactions which suggest the possibility of a violation of
interpretations issued by the Compliance Officer; and any
other significant information concerning the appropriateness
of and actions taken under this Code; and
(8) Such other duties as are set forth in this Code.
(C) The Compliance Officer shall maintain and cause to be maintained in
an easily accessible place, the following records:
(1) Copies of all Personal Transactions Policies of IMD and
schedules thereto which have been in effect at any time
during the past five (5) years.
(2) A record of each violation of this Code and of any action
taken as a result of such violation for a period of not less
than five (5) years following the end of the fiscal year of
IMD in which the violation occurred;
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(3) A copy of each report made by an Access Person or the
Compliance Officer pursuant to this Code, for a period of not
less than five (5) years from the end of the fiscal year of
IMD in which such report is made or issued, the last three
(3) years in a place that need not be easily accessible; and
(4) A list of all persons who are, or within the past five
(5) years have been, required to make reports pursuant to
Rule 17j-1 and this Code.
(D) On an annual basis, and at such other times as deemed to be
necessary or appropriate by the Management of IMD, the Management of
IMD shall review operation of this Code and shall adopt such amendments
thereto as may be necessary to assure that the provisions of the Code
establish standards and procedures that are reasonably designed to
detect and prevent activities that would constitute violations of Rule
17j-1.
(E) This Code may not be amended or modified except in a written form
which is specifically approved by Management of IMD. Also, if this Code
has been approved by any Client, the Client has to approve in writing
the new version of the Code.
(F) The Compliance Officer may delegate to one or more other officers
or employees of IMD such responsibilities of the Compliance Officer as
he or she may deem appropriate; provided, that:
(i) any such delegation shall be set forth in writing and retained as
part of the records of IMD; and
(ii) it shall be the responsibility of the Compliance Officer to
supervise the performance by such persons of the responsibilities which
have been delegated to them.
SECTION X COORDINATION WITH OTHER RULES FOR PERSONAL TRANSACTIONS
Certain Employees may also be subject to other policies for personal
securities transactions. However, no other Code can supercede this Code in any
way. Employees working in Copenhagen (including certain expatriated employees
working in branches or subsidiaries of Unibank A/S) are all subject to the rules
and policies as regards to personal securities transaction, insider trading,
etc.
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SCHEDULE A
UNIBANK SECURITIES, INC.
INVESTMENT MANAGEMENT DIVISION
REQUEST FOR PERMISSION TO ENGAGE IN PERSONAL TRANSACTION
I hereby request permission to effect the following
transaction(s) in Securities in which I have or will acquire Beneficial
Ownership:
<TABLE>
<CAPTION>
PURCHASES AND ACQUISITIONS
--------------------------
No. of Shares
or Principal Name of Current Market Price Name of
Date Amount Security Per Share or Unit Broker
---- ------------- -------- -------------------- -------
<S> <C> <C> <C> <C>
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SALES AND OTHER DISPOSITIONS
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</TABLE>
Date: Signature:
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Permission Granted Permission Denied
------- ---------
Date and Time: Signature:
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(Clearing Officer)
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SCHEDULE B
UNIBANK SECURITIES, INC.
INVESTMENT MANAGEMENT DIVISION
QUARTERLY SECURITIES TRANSACTION REPORT
I certify that this report, together with the confirmations and statements for
any Personal Securities Account(s) as to which I have arranged for the
Compliance Officer to receive duplicate confirmations and statements, identifies
all transactions during the calendar quarter in which I acquired or disposed of
any Security in which I had or have any direct or indirect Beneficial Ownership
that are required to be reported by me pursuant to Section VII(B) of the Code.
(If no such transactions took place write "NONE".) Please sign and date this
report and return it to the Compliance Officer no later than the 10th day of the
month following the end of the quarter. Use reverse side if additional space is
needed.
<TABLE>
<CAPTION>
PURCHASES AND ACQUISITIONS
--------------------------
No. of Shares
Trade or Principal Name of Unit Total
Date Amount Security Price Price Broker
---- ------------- -------- ----- ------ ------
<S> <C> <C> <C> <C> <C>
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SALES AND OTHER DISPOSITIONS
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</TABLE>
Date Completed: Signature:
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SCHEDULE C
UNIBANK SECURITIES, INC.
INVESTMENT MANAGEMENT DIVISION
ACKNOWLEDGMENT OF COMPLIANCE WITH CODE OF ETHICS
I have read and understand the Personal Securities Transaction Code of IMD (the
"Code"). I recognize that the provisions of the Code apply to me and agree to
comply in all respects with the procedures described therein. Furthermore, if
during the past calendar year I was subject to the Code, I certify that I
complied in all respects with the requirements of the Code as in effect during
that year.
I certify that my Personal Securities Accounts are as follows:
Title of Account Name of Broker Account Number
I am a director of the following public and private companies:
Date Completed: Signature:
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Print Name:
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