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Exhibit p(11)
MAS FUNDS
(THE "FUND")
AND
MILLER ANDERSON & SHERRERD, LLP
("MAS")
AND
MAS FUND DISTRIBUTION, INC.
("MASDI")
CODE OF ETHICS
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1. Purposes
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This Code of Ethics has been adopted by the Fund, MAS and MASDI, the
principal underwriter of the Funds, in accordance with Rule 17j-1 under the
Investment Company Act of 1940, as amended (the "Act"). Rule 17j-1 under the Act
generally proscribes fraudulent or manipulative practices with respect to
purchases or sales of securities held or to be acquired by investment companies,
if effected by affiliated persons (as defined under the Act) of such companies.
Specifically, Rule 17j-1 provides that it is unlawful for any affiliated person
of or principal underwriter for a registered investment company, or any
affiliated person of an investment adviser of or principal underwriter for a
registered investment company, in connection with the purchase or sale, directly
or indirectly, by such person of a security held or to be acquired by such
registered investment company:
(a) To employ any device, scheme or artifice to defraud such
registered investment company;
(b) To make to such registered investment company any untrue
statement of a material fact or omit to state to such
registered investment company a material fact necessary in
order to make the statements made, in light of the
circumstances under which they are made, not misleading;
(c) To engage in any act, practice, or course of business which
operates or would operate as a fraud or deceit upon any such
registered investment company; or
(d) To engage in any manipulative practice with respect to such
registered investment company.
While Rule 17j-1 is designed to protect only the interests of the Fund
and its stockholders, MAS applies the policies and procedures described in this
Code of Ethics to all employees of MAS to protect the interests of its non-Fund
clients as well (hereinafter, where appropriate, non-Fund clients of MAS are
referred to as "Advisory Clients" and any reference to an Advisory Client(s)
relates only to the activities of employees of MAS).
The purpose of this Code of Ethics is to (i) ensure that Access Persons
conduct their personal securities transactions in a manner which does not (a)
create an actual or potential conflict of interest with the Fund's or an
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Advisory Client's portfolio transactions, (b) place their personal interests
before the interests of the Fund and its stockholders or an Advisory Client or
(c) take unfair advantage of their relationship to the Fund or an Advisory
Client and (ii) provide policies and procedures consistent with the Act and Rule
17j-1 designed to give effect to the general prohibitions set forth in Rule
17j-l.
Among other things, the procedures set forth in this Code of Ethics
require that all (i) Access Persons review this Code of Ethics at least
annually, (ii) Access Persons, unless excepted by Sections 8(d) or (e) of this
Code of Ethics, report transactions in Covered Securities, (iii) Access Persons
refrain from engaging in certain transactions, and (iv) employees of MAS
pre-clear with the appropriate trading desk any transactions in Covered
Securities.
2. Definitions
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(a) "Access Person" means any director, officer or Advisory Person
of the Fund or of MAS, and any director or officer of MASDI,
who, in the ordinary course of business, makes, participates
in or obtains information regarding the purchase or sale of
Covered Securities by the Fund.
(b) "Advisory Person" means any employee of the Fund, or of MAS
(or of any company in a control relationship to the Fund or
MAS), who, in connection with his or her regular functions or
duties, makes, participates in, or obtains information
regarding the purchase or sale of Covered Securities by the
Fund or an Advisory Client, or whose functions relate to the
making of any recommendations with respect to such purchases
or sales.
(c) "Beneficial ownership" shall be 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, as amended, and the rules and regulations thereunder,
except that the determination of direct or indirect beneficial
ownership shall apply to all securities which an Access Person
has or acquires.
(d) "Control" shall have the same meaning as that set forth in
Section 2(a)(9) of the Act.
(e) "Compliance Department" means the MAS Compliance Department.
(f) "Covered Security" means a security as defined in Section
2(a)(36) of the Act, except that it does not include: (i)
shares of registered open-end investment companies, (ii)
direct obligations of the Government of the United States, and
(iii) bankers' acceptances, bank certificates of deposit,
commercial paper, and high quality short-term debt
instruments, including repurchase agreements.
(g) "Disinterested Director" means a director of the Fund who is
not an "interested person" of the Fund within the meaning of
Section 2(a)(19) of the Act.
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(h) "Purchase or sale (or sell)" with respect to a Covered
Security means any acquisition or disposition of a direct or
indirect beneficial interest in a Covered Security, including,
INTER ALIA, the writing or buying of an option to purchase or
sell a Covered Security.
(i) "Security held or to be acquired" means (i) any Covered
Security which, within the most recent 15 days, is or has been
held by the Fund or an Advisory Client, or is being or has
been considered by the Fund or an Advisory Client or MAS for
purchase by the Fund or an Advisory Client; and (ii) any
option to purchase or sell, and any security convertible into
or exchangeable for, a Covered Security described in this
paragraph.
3. Prohibited Transactions
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(a) No Access Person or employee of MAS shall purchase or sell any
Covered Security which to his or her actual knowledge at the
time of such purchase or sale:
(i) is being considered for purchase or sale by the Fund
or an Advisory Client; or
(ii) is being purchased or sold by the Fund or an Advisory
Client.
(b) No employee of MAS shall purchase or sell a Covered Security
while there is a pending "buy" or "sell" order in the same or
a related security for a Fund or an Advisory Client until that
order is executed or withdrawn.
(c) No Advisory Person shall purchase or sell a Covered Security
within seven calendar days before or after any portfolio(s) of
the Fund over which such Advisory Person exercises investment
discretion or an Advisory Client over which the Advisory
Person exercises investment discretion purchases or sells the
same or a related Covered Security. Any profits realized or
unrealized by the Advisory Person on a prohibited purchase or
sale within the proscribed period shall be disgorged to a
charity.
(d) No employee of MAS shall profit from the purchase and sale or
sale and purchase of the same (or equivalent) Covered Security
within 60 calendar days. Any profits realized on such purchase
or sale shall be disgorged to a charity.
(e) No Access Person or employee of MAS shall purchase any
securities in an initial public offering.
(f) No employee of MAS shall purchase privately-placed securities
unless such purchase is pre-approved by the Compliance
Department. Any such person who has previously purchased
privately-placed securities must disclose such purchases to
the Compliance Department before such person participates in a
Fund's or an Advisory Client's subsequent consideration of an
investment in the securities of the same or a related issuer.
Upon such disclosure, the Compliance Department
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shall appoint another person with no personal interest in the
issuer, to conduct an independent review of such Fund's or
such Advisory Client's decision to purchase securities of the
same or a related issuer.
(g) No Access Person or employee of MAS shall recommend the
purchase or sale of any Covered Securities to a Fund or to an
Advisory Client without having disclosed to the Compliance
Department his or her interest, if any, in such Covered
Securities or the issuer thereof, including without limitation
(i) his or her direct or indirect beneficial ownership of any
securities of such issuer, (ii) any contemplated purchase or
sale by such person of such securities, (iii) any position
with such issuer or its affiliates, and (iv) any present or
proposed business relationship between such issuer or its
affiliates, on the one hand, and such person or any party in
which such person has a significant interest, on the other;
provided, however, that in the event the interest of such
person in such securities or the issuer thereof is not
material to his or her personal net worth and any contemplated
purchase or sale by such person in such securities cannot
reasonably be expected to have a material adverse effect on
any such purchase or sale by a Fund or an Advisory Client or
on the market for the securities generally, such person shall
not be required to disclose his or her interest in the
securities or the issuer thereof in connection with any such
recommendation.
(h) No Access Person or employee of MAS shall reveal to any other
person (except in the normal course of his or her duties on
behalf of a Fund or an Advisory Client) any information
regarding the purchase or sale of any Covered Security by a
Fund or an Advisory Client or consideration of the purchase or
sale by a Fund or an Advisory Client of any such Covered
Security.
4. Pre-Clearance of Covered Securities Transactions and Permitted
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Brokerage Accounts
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No employee of MAS shall purchase or sell Covered Securities without
prior written authorization from the appropriate trading desk. Pre-clearance of
a purchase or sale shall be valid and in effect only for the business day in
which such pre-clearance is given; provided, however, that the approval of an
unexecuted purchase or sale is deemed to be revoked when the employee becomes
aware of facts or circumstances that would have resulted in the denial of
approval of the approved purchase or sale were such facts or circumstances made
known to the MAS trading desk at the time the proposed purchase or sale was
originally presented for approval. MAS requires all of its employees to maintain
their personal brokerage accounts at a broker/dealer affiliated with Morgan
Stanley Dean Witter (hereinafter, a "Morgan Stanley Account"). Outside personal
brokerage accounts are permitted only under very limited circumstances and only
with express written approval by the Compliance Department. The Compliance
Department has implemented procedures reasonably designed to monitor purchases
and sales effected pursuant to the aforementioned pre-clearance procedures.
5. Exempted Transactions
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(a) The prohibitions of Section 3 and Section 4 of this Code of
Ethics shall not apply to:
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(i) Purchases or sales effected in any account over which
an Access Person or an employee of MAS has no direct
or indirect influence or control;
(ii) Purchases or sales which are non-volitional;
(iii) Purchases which are part of an automatic dividend
reinvestment plan; or
(iv) Purchases effected upon the exercise of rights issued
by an issuer PRO RATA to all holders of a class of
its securities and sales of such rights so acquired,
but only to the extent such rights were acquired from
such issuer.
(b) Notwithstanding the prohibitions of Sections 3(a), (b) and (c)
of this Code of Ethics, the Compliance Department or MAS
trading desk, as appropriate, may approve a purchase or sale
of a Covered Security by employees of MAS which would appear
to be in contravention of the prohibitions in Sections 3(a),
(b) and (c) if it is determined that (i) the facts and
circumstances applicable at the time of such purchase or sale
do not conflict with the interests of the Fund or an Advisory
Client, or (ii) such purchase or sale is only remotely
potentially harmful to the Fund or an Advisory Client because
it would be very unlikely to affect a highly institutional
market, or because it is clearly not related economically to
the securities to be purchased, sold or held by the Fund or
Advisory Client, and (iii) the - spirit and intent of this
Code of Ethics is met.
6. Restrictions on Receiving Gifts
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No employee of MAS shall receive any gift or other consideration in
merchandise, service or otherwise of more than DE MINIMIS value from any person,
firm, corporation, association or other entity that does business with or on
behalf of the Fund or an Advisory Client.
7. Service as a Director
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No employee of MAS shall serve on the board of directors of a
publicly-traded company without prior written authorization from the Compliance
Department. Approval will be based upon a determination that the board service
would not conflict with the interests of the Fund and its stockholders or an
Advisory Client.
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8. Reporting
(a) Unless excepted by Section 8(d) or (e) of this Code of Ethics,
each Access Person must disclose all personal holdings in
Covered Securities to the Compliance Department for its review
no later than 10 days after becoming an Access Person and
annually thereafter. The initial and annual holdings reports
must contain the following information:
(i) The title, number of shares and principal amount of
each Covered Security in which the Access Person has
any direct or indirect beneficial ownership;
(ii) The name of any broker, dealer or bank with or
through whom the Access Person maintained an account
in which any securities were held for the direct or
indirect benefit of the Access Person; and
(iii) The date the report was submitted to the Compliance
Department by the Access Person.
(b) Unless excepted by Section 8(d) or (e) of this Code of Ethics,
each Access Person and each employee of MAS must report to the
Compliance Department for its review within 10 days of the end
of a calendar quarter the information described below with
respect to transactions in Covered Securities in which such
person has, or by reason of such transactions acquires any
direct or indirect beneficial interest:
(i) The date of the transaction, the title, the interest
rate and maturity date (if applicable), the number of
shares and the principal amount of each Covered
Security involved;
(ii) The nature of the transaction (i.e., purchase, sale
or any other type of acquisition or disposition);
(iii) The price of the Covered Security at which the
purchase or sale was effected;
(iv) The name of the broker, dealer or bank with or
through which the purchase or sale was effected; and
(v) The date the report was submitted to the Compliance
Department by such person.
(c) Unless excepted by Section 8(d) or (e) of this Code of Ethics,
each Access Person and each employee of MAS must report to the
Compliance Department for its review within 10 days of the end
of a calendar quarter the information described below with
respect to any account established by such person in which any
securities were held during the quarter for the direct or
indirect benefit of such person:
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(i) The name of the broker, dealer or bank with whom the
account was established;
(ii) The date the account was established; and
(iii) The date the report was submitted to the Compliance
Department by such person.
(d) An Access Person will not be required to make any reports
described in Sections 8(a), (b) or (c) above for any account
over which the Access Person has no direct or indirect
influence or control. An Access Person or an employee of MAS
will not be required to make the annual holdings report under
Section 8(a) and the quarterly transactions report under
Section 8(b) with respect to purchases or sales effected for,
and Covered Securities held in: (i) a Morgan Stanley Account,
(ii) an account in which the Covered Securities were purchased
pursuant to a dividend reinvestment plan (up to an amount
equal to the cash value of a regularly declared dividend, but
not in excess of this amount), or (iii) an account for which
the Compliance Department receives duplicate trade
confirmations and quarterly statements.
(e) A Disinterested Director of the Fund, who would be required to
make a report solely by reason of being a Fund director, is
not required to make initial and annual holdings reports.
Additionally, such Disinterested Director need only make a
quarterly transactions report for a purchase or sale of
Covered Securities if he or she, at the time of that
transaction, knew or, in the ordinary course of fulfilling his
or her official duties as a Disinterested Director of the
Fund, should have known that, during the 15-day period
immediately preceding or following the date of the Covered
Securities transaction by him or her, such Covered Security is
or was purchased or sold by the Fund or was being considered
for purchase or sale by the Fund.
(f) The reports described in Sections 8(a), (b) and (c) above may
contain a statement that the reports shall not be construed as
an admission by the person making such reports that he or she
has any direct or indirect beneficial ownership in the Covered
Securities to which the reports relate.
9. Annual Certifications
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All Access Persons and employees of MAS must certify annually that they
have read, understood and complied with the requirements of this Code of Ethics
and recognize that they are subject to this Code of Ethics by signing the
certification attached hereto as Exhibit A.
10. Board Review
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The management of the Fund and representatives or officers of MAS and,
with respect to the Fund, MASDI, shall each provide the Fund's Board of
Directors, at least annually, with the following:
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(a) a summary of existing procedures concerning personal investing
and any changes in the procedures made during the past year;
(b) a description of any issues arising under this Code of Ethics
or procedures since the last such report, including, but not
limited to, information about material violations of this Code
of Ethics or procedures and sanctions imposed in response to
material violations;
(c) any recommended changes in the existing restrictions or
procedures based upon the Fund's or MAS's experience under
this Code of Ethics, evolving industry practices or
developments in applicable laws and regulations; and
(d) a certification (attached hereto as Exhibits B and C, as
appropriate) that each has adopted procedures reasonably
necessary to prevent its Access Persons from violating this
Code of Ethics.
11. Sanctions
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Upon discovering a violation of this Code of Ethics, the Board of
Directors of the Fund or the Executive Committee of MAS, as the case may be, may
impose such sanctions as it deems appropriate.
12. Recordkeeping Requirements
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The management of the Fund and representatives or officers of MAS and,
with respect to the Funds, MASDI, each shall maintain, as appropriate, the
following records for a period of five years, the first two years in an easily
accessible place, and shall make these records available to the Securities and
Exchange Commission or any representative of such during an examination of the
Fund or of MAS:
(a) a copy of this Code of Ethics or any other Code of Ethics
which was in effect at any time within the previous five
years;
(b) a record of any violation of this Code of Ethics during the
previous five years, and of any action taken as a result of
the violation;
(c) a copy of each report required by Section 8 of this Code of
Ethics, including any information provided in lieu of each
such report;
(d) a record of all persons, currently or within the past five
years, who are or were subject to this Code of Ethics and who
are or were required to make reports under Section 8 of this
Code of Ethics;
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(e) a record of all persons, currently or within the past five
years, who are or were responsible for reviewing the reports
required under Section 8 of this Code of Ethics; and
(f) a record of any decision, and the reasons supporting the
decision, to approve the acquisition of securities described
in Sections 3(e) and (f) of this Code of Ethics.
The effective date of this Code of Ethics is FEBRUARY 24, 2000.
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