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Exhibit 99(p)(iv)
ROXBURY CAPITAL MANAGEMENT, LLC
CODE OF ETHICS
100 Wilshire Blvd., Suite 600, Santa Monica, CA 90401
Tel: (310) 917-5600 Rev. 2/15/00
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Code of Ethics
Revised Effective Date: February 15, 2000
I. PREAMBLE
This Code of Ethics is being adopted to effectuate the purposes and
objectives of Sections 204A and Section 206 of the Investment Advisers Act
of 1940 (the "Advisers Act"), Rule 204-2 under the Advisers Act and Rule
17j-1 under the Investment Company Act of 1940 (the "Company Act").
Section 204A of the Advisers Act requires the establishment and
enforcement of policies and procedures reasonably designed to prevent the
misuse of material, nonpublic information by investment advisers,
including Roxbury Capital Management, LLC ("Roxbury"). Rule 204-2 imposes
record keeping requirements with respect to personal securities
transactions of certain persons employed by investment advisers. Section
206 of the Advisers Act makes it unlawful, among other things, for Roxbury
and its employees in connection with the purchase or sale by such person
of a security held or to be acquired by Roxbury for a client:
(1) To employ any device, scheme or artifice to defraud any client or
prospective clients;
(2) To make any untrue statement of a material fact or omit to state to
a client or prospective client 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 transaction, practice or course of business which
operates or would operate as a fraud or deceit upon any client or
prospective client; or
(4) To engage in any act, practice, or course of business which is
fraudulent, deceptive or manipulative.
Rule 17j-1 also requires an adviser to an investment company adopt a
written code of ethics containing provisions reasonably necessary to
prevent persons from violating the above standard and to prevent
violations of its code of ethics. This Code contains provisions reasonably
necessary to prevent persons from engaging in acts in violation of the
above standard and to assure that Roxbury's clients interests are
considered first. This Code also establishes procedures reasonably
necessary to prevent violations of this Code.
It is Roxbury's policy not to permit its officers and/or employees or
their immediate family members to benefit from trading done for its
clients at the expense of clients. However, Roxbury does allow officers
and employees including their family members to own, purchase and/or sell
securities which Roxbury purchases or sells for client accounts subject to
the rules contained herein. Roxbury believes such a policy creates a
commonality of interest between the clients and Roxbury's officers and
employees.
In addition, Roxbury permits employees to invest in Roxbury and in
privately offered, pooled investment vehicles that invest only in publicly
traded securities and are managed or advised by Roxbury because such
investments do not present the conflicts of interest involved in the
purchase of other privately offered securities that Rule 170)-1 was
designed to prevent. Therefore, Roxbury hereby pre-approves the purchase
by an Employee-Related Account or Employee Client Account, as those terms
are defined herein, of an interest in Roxbury or in any privately offered,
pooled investment vehicle that invests only in publicly traded securities
and is managed or advised by Roxbury.
It is the desire of Roxbury that the Code of Ethics be conscientiously
followed and effectively enforced. The prime responsibility for following
it rests with each employee. While Roxbury
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will oversee compliance with the Code of Ethics, a conscientious and
professional attitude on the part of each employee will ensure that
Roxbury fulfills the highest ethical standards.
II. PERSONAL TRADING POLICY
A. DEFINITIONS
1. BENEFICIAL OWNERSHIP ACCOUNT
A Beneficial Ownership Account means an account in which
the employee has a beneficial ownership interest as that
term is defined in Rule 16a-1(a)(2) under the Securities
Exchange Act of 1934. See Appendix A for a copy of Rule
16a-1(a)(2) under the Securities Exchange Act of 1934.
2. CLIENT ACCOUNT
A "Client Account" means an account that meets all of
the following requirements:
a. The client has signed an investment management or
investment advisory agreement with Roxbury; and
b. The account is not owned by a person related to an
employee; provided, however, that any pooled investment
vehicle managed or advised by Roxbury in which any
Roxbury employee has an ownership interest shall,
nevertheless, be considered a "Client Account.
3. EMPLOYEE-RELATED ACCOUNT
An "Employee-Related Account" refers to an account,
except an Employee Client Account, for any of the
following persons:
a. the employee regardless of whether his principal
office is in Santa Monica, California or elsewhere;
b. the employee's spouse;
c. the employee's minor child or children;
d. any other relative of the employee or employee's
spouse, sharing the same home as the employee;
e. any entity or individual for whom/which the employee
acts as trustee, executor or agent; or
f. any other account for which the employee has
discretionary authority to trade except a Client Account
or an Employee Client Account. For example, if an
employee has authority to place a trade for a parent's
account and the account is not an Employee Client
Account, such an account would be an Employee-Related
Account and the Code of Ethics would apply to all
transactions in such an account.
4. EMPLOYEE CLIENT ACCOUNT
"Employee Client Account" means an account that meets
all of the following requirements:
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a. The account is owned by an employee or a person related
to the employee;
b. The account is managed and traded by a Roxbury
employee(s) who is not related to the owner of the
account;
c. The account has signed an investment management
agreement with Roxbury; and
d. The account has been approved as an Employee Client
Account by personnel designated by the Compliance
Committee ("Compliance Designee").
5. SECURITY
"Security" means any interest or instrument commonly known as
a security, including stocks, bonds, notes, options, warrants,
Securities acquired in privately placed offerings, financial
commodities, other derivative products and interest in limited
partnerships, limited liability companies or other business
ventures, except for purposes of this Code of Ethics, the term
"Security" does not include any U.S. government obligation or
the shares of any registered open-end mutual fund.
6. "Trading Program" means the purchase or sale of a Security
across the majority of existing Client Accounts managed in a
particular investment style. In addition, Institutional
Accounts, Private Client Group Accounts and Wrap Accounts
shall each be considered a different investment style for the
purpose of defining a "Trading Program. " A Trading Program
does not include purchases or sales of Securities for new
Client Accounts or as a result of additions to, or withdrawals
from, one or more Client Accounts.
B. PROHIBITED TRANSACTIONS FOR EMPLOYEE RELATED ACCOUNTS.
No Employee Related Account shall:
1. Purchase or sell any publicly traded Security without the
prior written approval of the Compliance Designee on the same
day as the transaction occurs. (See Section II.B.13 below for
the rules regarding private placement transactions.) Prior to
granting approval, the Compliance Designee shall take
necessary steps to be sure that Roxbury is not purchasing or
selling for any Client Account, the Security requested to be
purchased or sold by the Employee-Related Account and that the
proposed transaction is in compliance with the other
provisions of Section II.B of this Code. A Pre-Clearance Form
in the form of Exhibit F attached hereto must be filled out
and signed by the Compliance Designee and will be valid only
for the remainder of the business day on which the approval
was given. If an employee is unable to complete the trade
before the end of the business day, the employee will need to
obtain approval on the next day that the employee wishes to
make the purchase or sale. If an employee places a "limit
order" on the transaction and the order is not completed
during the day on which the approval is given, the remaining
order must be re-approved by the Compliance Designee.
2. Purchase any Security that Roxbury is purchasing for any
Client Accounts pursuant to a Trading Program until all
purchases for Client Accounts pursuant to the Trading Program
have been completed.
3. Purchase any Security that is being sold pursuant to a Trading
Program until five (5) business days after all sales for
Client Accounts pursuant to the Trading Program have been
completed.
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4. Sell any Security that Roxbury is selling for any Client
Accounts pursuant to a Trading Program until all sales for
Client Accounts pursuant to the Trading Program have been
completed.
5. Sell any Security that is being purchased pursuant to a
Trading Program until five (5) business days after all
purchases for Client Accounts pursuant to the Trading Program
have been completed.
6. Purchase or sell any Security that Roxbury is purchasing or
selling for any Client Accounts other than as a result of a
Trading Program, on any given day until all orders for such
purchases or sales have been completed.
7. Purchase or sell any Securities on the "Watch List" even if
Roxbury currently holds the Security for Client Accounts. The
Watch List comprises Securities Roxbury is closely observing
with anticipation of imminent action in on behalf of Client
Accounts.
8. Purchase or sell any options without the prior written
approval of the Compliance Designee except that employees may
receive options to purchase interests in Roxbury Capital
Management.
9. Sell short any Security without the prior written approval of
the Compliance Designee.
10. Sell any Security until at least 30 days after it has been
purchased without the prior written approval of the Compliance
Designee.
11. Purchase any Security in an initial public offering ("IPO")
unless: (a) the reason the Employee-Related Account has access
to the IPO is not related to the employee's position at
Roxbury; and (b) the Compliance Designee has approved the
transaction in writing and given a written justification for
his decision.
12. Purchase any Security in an initial secondary offering unless:
(a) the reason the Employee-Related Account has access to the
secondary offering is not related to the employee's position
at Roxbury; and (b) the Compliance Designee has approved the
transaction in writing.
13. Purchase or sell any Security in a private placement of
Securities unless:
(a) the Security is an option to purchase an interest, or an
interest, in Roxbury Capital Management;
(b) the Security is an interest in a pooled investment
vehicle for which Roxbury acts as investment adviser or
investment manager and which invests only in publicly
traded securities; or
(c) the Compliance Designee has approved the private
placement transaction in writing and given a written
justification for his decision including a written
explanation of why the private placement transaction is
not appropriate for any Client Account or Roxbury's
401(k) plan.
If an Analyst or a member of the Investment Committee has an
Employee-Related Account that owns a Security acquired in a
private placement transaction, such Analyst or Investment
Committee member shall not vote or participate in any
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analysis or decision-making concerning such Security. (See
Section II. F.1 for disclosure obligations.)
14. Purchase or sell any Security in a block trade in which Client
Accounts participate.
The above prohibitions shall apply to all Securities transactions
except the following:
(1) Transactions that result from an automatic dividend
reinvestment plan;
(2) Purchases effected upon the exercise of rights issued by an
issuer pro rated to all holders of a class of its Securities
and sales of such rights so acquired, or
(3) Transactions over which the employee has no control, including
a margin call if the brokerage firm has the authority to
determine, in its sole discretion, the Security(ies) to be
sold.
C. PROHIBITED TRANSACTIONS FOR EMPLOYEE CLIENT ACCOUNTS.
No Employee Client Account shall:
1. Purchase any Security in an IPO; and
2. Purchase or sell any Security in a private placement of
Securities unless the Security is an interest in a pooled
investment vehicle for which Roxbury acts as investment
adviser or investment manager and which invests only in
publicly traded securities.
D. OTHER PROHIBITIONS.
1. No employee shall violate Section 206 of the Advisers Act or
Section 170) of the Investment Company Act of 1940 or the
rules thereunder.
2. No employee may have discretionary authority over trading or
management of a client account that is related to the
employee.
3. No employee may accept gifts of more than de minimis value
from any person or entity that does business with Roxbury. De
minimis value will be considered to be $500. Employees
receiving gifts of over $500 must report them to the
Compliance Designee.
4. No employee shall give or offer to give anything of value to
any person for the purpose of influencing the price of any
Security.
5. No employee shall serve on a Board of Directors of any public
company without the prior written approval of the Compliance
Designee.
E. THE WATCH LIST
The Watch List is comprised of Securities Roxbury is closely
observing and anticipating imminent action in on behalf of clients'
accounts and, therefore, Securities in which Employee-Related
Accounts are generally prohibited from trading.
1. Construction Procedures
- Investment Committee designates a Watch List-control
person charged with creating the weekly Watch List
("Control Person").
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- Prior to the regular weekly Investment Committee
meeting, the Control Person circulates the previous
week's Watch List to all Portfolio Managers and Analysts
asking them each to (a) add the name of each and every
Security for which such person is preparing a formal
recommendation(1) where it is expected that such
recommendation will be presented for Investment
Committee consideration within the next two weeks; and
(b) delete from the Watch List any and all Securities of
which such person is aware that its consideration for
investment purposes has been indefinitely suspended(2)
or terminated for any reason whatsoever. The Control
Person revises the Watch List accordingly.
- Prior to the regular weekly Investment Committee
meeting, the Control Person circulates the previous
week's Watch List to a representative of the Trading
Department asking that person to (a) delete from the
Watch List any and all Securities in which system-wide
trading has been completed for clients' accounts as
directed by the Investment Committee; (b) add to the
Watch List those Securities which are the subject of any
current and open firm-wide re-balancing or other
activity in Client Accounts(3); and (c) delete from the
Watch List any Securities which were the subject of any
firm-wide re-balancing or other activity in Client
Accounts and in which trading has been completed with
respect to such Securities in such accounts over the
past week. The Control Person revises the Watch List
accordingly.
- At the conclusion of the Investment Committee meeting,
the Control Person shall delete from the Watch List any
and all Securities which were presented to the
Investment Committee in the form of a recommendation for
purchase or sale on behalf of Client Accounts and with
respect to which a final decision not to purchase or
sell, respectively, was made by the Investment
Committee. Presumably, the Control Person will not need
to add to the Watch List any of the Securities which the
Investment Committee voted to purchase or sell on behalf
of Client Accounts since these Securities have been on
the Watch List for at least two weeks at this point. All
Securities selected by the Investment Committee for
purchase or sale activity at an Investment Committee
meeting will be placed on the Watch List and will remain
on the Watch List until the Trading Department has
indicated that trading in such Securities has been
completed for clients' accounts.
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(1) The term "formal recommendation" here is shorthand to mean those
activities engaged in by Portfolio Managers and Analysts that are necessary and
proximate to presenting a Security for the Investment Committee's consideration.
At this point in the process we should strive to identify and isolate only those
Securities which WILL or ARE SCHEDULED TO be brought to the Investment
Committee's attention for definite action within the next two weeks. Securities
that are scheduled to be merely reviewed by or discussed with the Investment
Committee but are not in a price range which a Portfolio Manager or Analyst
believes would result in any action by the Investment Committee need not be
included on the Watch List.
(2) Indefinitely suspended, at a minimum, should refer to the case where
any definitive decision regarding the purchase or sale of a Security is unlikely
to occur for more than a two-week period.
(3) "Other activity in Client Accounts" should not be interpreted to mean
purchase or sale activity in connection with account opening transactions on
behalf of new wrap or non-institutional separate account clients to the firm.
The focus here should be on identifying Securities in which purchase or sale
activity was or will be conducted for clients across the board in any given
investment product offered by Roxbury.
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- After the Investment Committee's meeting, the Control
Person updates the Watch List according to the foregoing
and circulates it to appropriate employees of the firm.
2. Special Situations
At any time it is concluded (outside of a regularly scheduled
Investment Committee meeting) that Roxbury will engage in
transactions in a particular Security for Client Accounts, a
voting member of the Investment Committee will instruct the
Control Person to add such Security to the Watch List. Such
Security will remain on the Watch List until the Trading
Department has indicated that trading in such Security has
been completed for Client Accounts.
F. Procedures.
1. Disclosure of Personal Holdings at Investment Committee
Meetings.
If an Employee-Related Account of a person attending an
Investment Committee meeting or if a member of the Investment
Committee holds a Security being considered for purchase or
sale by Client Accounts, or a Security economically related
thereto, such person shall disclose to the Investment
Committee his holdings of the Security at the first occasion
upon which the employee becomes aware that Roxbury is
considering the Security for purchase or sale for Client
Accounts.
2. Employee Reporting Requirements.
The following reports shall be treated confidentially, but are open
to inspection by Roxbury's attorneys, and the staff of the
Securities and Exchange Commission upon request and as required by
law.
a. Initial Holdings Report. Upon employment at Roxbury, employees
are asked to disclose in a written report (1) all Securities
held by Employee-Related Accounts and any Beneficial Ownership
Account, and (2) the names of each broker, dealer and/or bank
at which an Employee-Related Account or a Beneficial Ownership
Account maintains a securities account and the title on each
such account. See Exhibit A for a copy of this report. New
employees are also asked to disclose any outside business
ventures. New Employees will be given ten days to sell any
Securities they wish to sell as a result of a review of this
Personal Trading Policy.
b. Quarterly Transaction Report. Each employee shall complete a
Personal Securities Transaction and Securities Account
quarterly report for each calendar quarter even if the
employee does not have any personal Securities transactions or
new Securities accounts to report and submit the Report to the
Compliance Designee no later than 10 clays after the end of
each calendar quarter. If that day is not a business day, then
the Personal Securities Transaction and Securities Account
quarterly report shall be submitted no later than the first
business day thereafter. See Exhibit B for a copy of this
report. Employees shall report the transactions and any new
Securities accounts for all Employee-Related Accounts,
Employee-Client Accounts and Beneficial Ownership Accounts.
Each employee shall direct each brokerage firm and/or bank
that holds an Employee Related Account to supply the
Compliance Designee, on a timely basis, duplicate copies of
all trade confirmations and account statements.
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c. Annual Holdings Report. Within thirty days of the adoption of
this revised Code of Ethics and within thirty days of the end
of each calendar year thereafter, each employee shall report
in writing to the Compliance Designee (1) all Securities
(including any privately held Securities such as limited
partnership or limited liability company membership interests)
held by Employee-Related Accounts and any Beneficial Ownership
Account, and (2) the names of each broker, dealer and/or bank
at which an Employee-Related Account, an Employee Client
Account or a Beneficial Ownership Account maintains a
Securities account and the name on each such account. See
Exhibit C for a copy of this report.
3. Initial Certification of Compliance.
Upon adoption of this revised Code by Roxbury, each employee
shall certify that: (a) s/he has received this revised Code of
Ethics: (b) s/he has read and understands this revised Code of
Ethics and recognizes s/he is subject thereto; (c) s/he has
reported all personal Securities transactions required to be
reported pursuant to the requirements of the Code of Ethics;
(d) s/he has reported the names of each broker, dealer and/or
bank where the employee, any Employee-Related Account and any
Beneficial Ownership Account has a Securities account; and (e)
other than as disclosed on the initial certification, s/he has
no knowledge of the existence of any personal conflict of
interest which may involve Client Accounts, such as any
economic relationship between his/her transactions and
Securities held or to be acquired by Client Accounts. The
initial certification is included as Exhibit D hereto.
4. Annual Certification of Compliance.
Each employee shall certify annually that: (a) s/he has read
and understands the Code of Ethics and recognizes s/he is
subject thereto; (b) s/he has complied with the requirements
of the Code of Ethics; (c) s/he has reported all personal
Securities transactions required to be reported pursuant to
the requirements of the Code of Ethics; (d) s/he has reported
the names of each broker, dealer and/or bank where the
employee, any Employee-Related Account and any Beneficial
Ownership Account has a Securities account; and (e) other than
as disclosed on the annual certification, s/he has no
knowledge of the existence of any personal conflict of
interest which may involve Client Accounts, such as any
economic relationship between his/her transactions and
Securities held or to be acquired by Client Accounts. The
annual certification is included as Exhibit E hereto.
5. Reporting violations.
Any employee who becomes aware of any apparent violation of
the Code of Ethics shall promptly report such apparent
violation to the Compliance Designee or Roxbury's CEO.
6. Review of reports and pre-clearance forms.
The Compliance Designee shall be responsible for reviewing all
preclearance forms, confirmations of transactions and monthly
brokerage or custodial statements for all Employee-Related
Accounts, Initial Holdings Reports, Annual Holdings Reports,
Initial Certification of Compliance forms, Annual
Certification of Compliance forms, Personal Securities
Transaction and Securities Account Quarterly Reports and any
other documents deemed necessary to assure compliance with
this Code of Ethics. The Compliance Designee shall review
these documents on a prompt basis.
The Compliance Designee shall prepare a written report each
quarter to Roxbury's CEO that describes any issues that arose
during the previous quarter under this Code. The
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Compliance Designee shall prepare a written report to the
governing board of any investment company for which Roxbury
acts as adviser or sub-adviser (or as otherwise directed by
the governing board's representative) that shall include
information about any material violations and sanctions
imposed in response to those violations during the prior
calendar year or other reporting period requested by the
investment company. If appropriate, the Compliance Designee
shall certify to the governing board of any investment company
for which Roxbury acts as adviser or sub-adviser that Roxbury
has adopted procedures reasonably necessary to prevent its
employees from violating its Code of Ethics.
G. Sanctions.
The sanctions for violation of the Code of Ethics may include
any or all of the following: (1) a letter of censure, (2) a
fine, (3) temporary or permanent suspension of trading for any
Employee-Related Accounts, (4) temporary suspension of
employment, (5) termination of employment, (6) disgorgement of
any ill-gotten profits or avoidance of losses, (7) and/or any
other sanction deemed appropriate by Roxbury's Compliance
Committee.
H. Retention of Records.
This Code of Ethics and a copy of each report made by an
employee hereunder shall be maintained by Roxbury.
III. POLICY STATEMENT ON INSIDER TRADING
Roxbury forbids any employee from trading, either personally or on
behalf of others, including client accounts, on material non-public
information or communicating material non-public information to
others in violation of law. This conduct is frequently referred to
as "insider trading." Roxbury's prohibition extends to any
employee's activities within and outside his duties at Roxbury. Any
questions regarding this section should be referred to Roxbury's
Compliance Designee.
A. Definition of Insider Trading
The term "insider trading" is not defined in federal or state
securities laws, but generally refers to the use of non-public
material information to trade in securities (whether or not
one is an insider) or to communications of material non-public
information to others.
While the law concerning insider trading is not static, it is
generally understood that the law prohibits:
(1) trading by an insider, while in possession of material,
non-public information, or
(2) trading by a non-insider, while in possession of
material, non-public information, where the information
either was disclosed to the non-insider in violation of
an insider's duty to keep it confidential or was
misappropriated, or
(3) communicating material non-public information to others.
B. Definition of an Insider
The concept of "insider" is broad. It includes officers,
directors and employees of a company. In addition, a person
can be a "temporary insider" if he or she enters into a
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special confidential relationship in the conduct of a
company's affairs and as a result is given access information
solely for the company's purposes. A temporary insider can
include, among others, a company's attorneys, accountants,
consultants, bank lending officers, and the employees of such
organizations. In addition, Roxbury may become a temporary
insider of a company it advises, or for which it performs
other services. According to the Supreme Court, the company
must expect the outsider to keep the disclosed non-public
information confidential and the relationship at least imply
such a duty before the outsider will be considered an insider.
C. Definition of Material Information
1. Trading on inside information is not a basis for liability
unless the information is material. "Material information"
generally is defined as information for which there is a
substantial likelihood that a reasonable investor would
consider it important in snaking his or her investment
decisions, or information that is reasonably certain to have a
substantial effect on the price of a company's securities.
Information that employees should consider material includes,
but is not limited to: dividend changes, earnings estimates,
changes in previously released earnings estimates, significant
merger or acquisition proposals or agreements, major
litigation, liquidation problems, and extraordinary management
developments.
2. Material information does not have to relate to a company's
business. For example, in Carpenter v. U.S. 108 U.S. 316
(1987), the Supreme Court considered as material certain
information about the contents of a forthcoming newspaper
column that was expected to affect the market price of a
security. In that case, a Wall Street Journal reporter was
found criminally liable for disclosing to others the dates
that reports on various companies would appear in the Journal
and whether those reports would be favorable or not.
D. Definition of Non-public Information
Information is nonpublic until it has been effectively communicated
to the marketplace. One must be able to point to some fact to show
that the information is generally public. For example, information
found in a report filed with the SEC, or appearing in Dow Jones,
Reuters, the Wall Street Journal or other publications of general
circulation would be considered public.
E. Penalties for Insider Trading
Penalties for trading on or communicating material nonpublic
information are severe, both for individuals involved in such
unlawful conduct and their employers. A person can be subject to
some or all of the penalties below even if he or she does not
personally benefit from the violation.
Penalties include:
(1) civil injunctions;
(2) treble damages;
(3) disgorgement of profits;
(4) jail sentences;
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(5) fines for the person who committed the violation of up to
three times the profit gained or loss avoided, whether or not
the person actually benefitted; and
(6) fines for the employer or other controlling person of up to
the greater of $1,000,000 or three times the amount of the
profit gained or loss avoided.
F. Identifying Inside Information
Before recommending or executing any trade for yourself or others,
including client accounts, you must determine whether you have
access to material, nonpublic information. If you think that you
might have access to material, nonpublic information, you should
take the following steps:
(1) Report the information and proposed trade immediately to your
supervisor.
(2) Do not purchase or sell the securities on behalf of yourself
or others;
(3) Do not communicate the information inside or outside Roxbury,
other than to Roxbury's attorneys.
(4) After the Management Committee has reviewed the issue, Roxbury
will determine whether the information is material and
nonpublic and, if so, what action the firm should take.
(5) In addition, until Roxbury determines whether the information
is material, care should be taken so that such information is
secure. For example, files containing potentially material
nonpublic information should be sealed; access to computer
files containing potentially material non-public information
should be restricted.
(6) Security may be put on a "firm-wide" or "departmental
restriction" by memorandum.
G. Contacts with Public Companies
For Roxbury, contacts with public companies represent an important
part of our research efforts. Roxbury may make investment decisions
on the basis of the firm's conclusions formed through such contacts
and analysis of publicly available information. Difficult legal
issues arise, however, when, in the course of these contacts, a
Roxbury employee becomes aware of material, nonpublic information.
This could happen, for example, if a company's Chief Financial
Officer prematurely discloses quarterly results to an analyst or an
investor relations representative makes a selective disclosure of
adverse news to a handful of investors. In such situations, Roxbury
must make a judgment as to its further conduct. To protect yourself,
your clients and Roxbury, you should contact a Senior Managing
Director or the Compliance Designee immediately if you believe that
you may have received material, nonpublic information.
Every time an employee communicates with an official of a public
company, the employee should be sure to identify himself as being
associated with an investment advisory firm.
H. Tender Offers
Tender offers represent a particular concern in the law of insider
trading for two reasons. First, tender offer activity often produces
extraordinary gyrations in the price of the target company's
securities. Trading during this time period is more likely to
attract regulatory
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attention (and produces a disproportionate percentage of insider
trading cases). Second, the SEC has adopted a rule which expressly
forbids trading and "tipping" while in possession of material,
nonpublic information regarding a tender offer received from the
tender offer, the target company or anyone acting on behalf of
either. Roxbury employees should exercise particular caution any
time they become aware of nonpublic information relating to a tender
offer.
I. Procedures to Implement Roxbury's Prohibition Against Insider
Trading
(1) Personal Securities Transaction Reporting. See Section II. F.2
above for procedures for reporting all personal securities
transactions.
(2) High-Risk Trading Activities. Certain high-risk trading
activities, if used by an employee, are risky not only because
of the nature of the securities transactions themselves, but
also because of the potential that action may be necessary to
close out the transactions. Examples of such activities
include short sales of common stock and trading in derivative
instruments such as option contracts to purchase ("call") or
sell ("put") securities at certain predetermined prices.
Roxbury employees should understand that short sales and
trading in derivative instruments involve special risks
derivative instruments, for example, ordinarily have greater
price volatility than the underlying security. The fulfillment
of the obligations owed by each employee to Roxbury may
heighten those risks. For example, if Roxbury becomes aware of
material, nonpublic information about the issuer of the
underlying securities, Roxbury employees may find themselves
"frozen" in a position in a derivative security. Roxbury will
not bear any losses resulting in an account controlled by an
employee through the implementation of Roxbury's policy
prohibiting insider trading.
(3) Restriction on Disclosures. Roxbury employees shall not
disclose any nonpublic information (whether or not it is
material) relating to Roxbury's transactions for its clients
to any person outside Roxbury (unless such disclosure has been
authorized by Roxbury).
J. Supervisory Procedures.
Roxbury has assigned the Compliance Designee the primary
responsibility for the implementation and maintenance of Roxbury's
prohibition against insider trading. Supervisory Procedures can be
divided into two classifications - prevention of insider trading and
detection of insider trading.
1. Prevention of Insider Trading.
To prevent insider trading, the Compliance Designee should:
(a) arrange, on a regular basis, an educational program to
familiarize Roxbury employees with Roxbury's prohibition
against insider trading;
(b) answer questions regarding Roxbury's prohibition against
insider trading;
(c) resolve issues of whether information received by
Roxbury employees is material and nonpublic and
determine what action, if any, should be taken;
(d) review on a regular basis and update as necessary
Roxbury's policy and procedures concerning insider
trading; and
13
<PAGE> 14
(e) when it has been determined that a Roxbury employee has
material, nonpublic information:
(1) implement measures to prevent dissemination of
such information; and
(2) if necessary, restrict employees from trading the
securities.
2. Detection of Insider Trading.
To detect insider trading, the Compliance Designee should:
(a) review the quarterly personal securities transaction
reports filed by each Roxbury employee;
(b) review the trading activity of client accounts managed
by Roxbury; and
(c) promptly investigate all reports of any possible
violations of Roxbury's Code of Ethics.
3. Special Reports to counsel.
Promptly upon learning of a potential violation of Roxbury's
prohibition on insider trading, a written report should be
sent to Roxbury's outside counsel providing full details,
which may include:
(a) the name of particular securities involved, if any;
(b) the date the potential violation was discovered and when
the investigation began.
(c) the accounts and individuals involved;
(d) actions taken as a result of the investigation, if any;
and
(e) recommendations for further action. If an employee has
any questions about whether information is "material" or
"non-public", or if an employee is aware of
circumstances that might suggest that there has been
misuse of inside information, it is important to advise
the Compliance Designee at once.
In addition, any violation of the prohibition on insider trading can be expected
to result in serious sanctions by Roxbury, including dismissal of the persons
involved.
14
<PAGE> 15
APPENDIX A
RULE 16a-1(a)(2) UNDER THE SECURITIES EXCHANGE ACT OF 1934
Other than for purposes of determining whether a person is a beneficial owner of
more than ten percent of any class of equity securities registered under Section
12 of the Act, the term beneficial owner shall mean any person who, directly or
indirectly, through any contract, arrangement, understanding, relationship or
otherwise, has or shares a direct or indirect pecuniary interest in the equity
securities, subject to the following:
(i) The term pecuniary interest in any class of equity securities shall
mean the opportunity, directly or indirectly, to profit or share in
any profit derived from a transaction in the subject securities.
(ii) The term indirect pecuniary interest in any class of equity
securities shall include, but not be limited to:
(A) Securities held by members of a person's immediate family
sharing the same household; provided, however, that the
presumption of such beneficial ownership may be rebutted; see
also Rule 16a-1(a)(4);
(B) A general partner's proportionate interest in the portfolio
securities held by a general or limited partnership. The
general partner's proportionate interest, as evidenced by the
partnership agreement in effect at the time of the transaction
and the partnership's most recent financial statements, shall
be the greater of:
(1) The general partner's share of the partnership's
profits, including profits attributed to any limited
partnership interests held by the general partner and
any other interests in profits that arise from the
purchase and sale of the partnership's portfolio
securities; or
(2) The general partner's share of the partnership capital
account, including the share attributable to any limited
partnership interest held by the general partner.
(C) A performance-related fee, other than an asset-based fee,
received by any broker, dealer, bank, insurance company,
investment company, investment adviser, investment manager,
trustee or person or entity performing a similar function;
provided, however, that no pecuniary interest shall be present
where:
(1) 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
(2) Equity securities of the issuer do not account for more
than ten percent of the market value of the portfolio. A
right to a nonperformance-related fee alone shall not
represent a pecuniary interest in the securities;
(D) A person's right to dividends that is separated or separable
from the underlying securities. Otherwise, a right to
dividends alone shall not represent a pecuniary interest in
the securities;
(E) A person's interest in securities held by a trust, as
specified in Rule 16a-8(b); and
<PAGE> 16
(F) A person's right to acquire equity securities through the
exercise or conversion of any derivative security, whether or
not presently exercisable.
(iii) A shareholder shall not be deemed to have a pecuniary
interest in the portfolio securities held by a
corporation or similar entity in which the person owns
securities if the shareholder is not a controlling
shareholder of the entity and does not have or share
investment control over the entity's portfolio.
<PAGE> 17
EXHIBIT A
Roxbury Capital Management, LLC
CODE OF ETHICS INITIAL HOLDINGS REPORT
To the Compliance Designee of Roxbury Capital Management, LLC:
1. I hereby acknowledge receipt of a copy of the Code of Ethics dated 2/15/00
for Roxbury Capital Management, LLC (the "Code").
2. I have read and understand the Code and recognize that I am subject thereto
as an employee of Roxbury Capital Management, LLC ("Roxbury").
3. I agree that the terms used in this Report shall have the same meaning as
they do in the Code of Ethics dated 2/15/00.
4. 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
Client Accounts, such as any economic relationship between my transactions
and Securities held or to be acquired by Client Accounts.
5. As of the date below, the following are the names of each broker, dealer
and/or bank where I, my Employee-Related Accounts, my Employee Client
Accounts or my Beneficial Ownership Accounts have a Securities account (you
may attach a list instead of completing the information on this form):
Title of Account Name of Broker/Dealer or Bank
[Table]
6. As of the date below, the list below includes all Securities which I, my
Employee-Related Accounts, my Employee Client Accounts and my Beneficial
Ownership Accounts hold (you may attach a list instead of completing the
information on this form):
[Table]
Note: Do not report ownership of U.S. Government obligations and registered
open-end mutual funds.
7. The following is a list of all businesses other than Roxbury for which I work
or from which I receive direct or indirect compensation, including any boards
of directors or trustees on which I serve with or without compensation:
Name and Address of Business Description of My Role Compensation
[Table]
Date:
Signature: Print Name:
<PAGE> 18
EXHIBIT B
Roxbury Capital Management, LLC
PERSONAL SECURITIES TRANSACTION
AND SECURITIES ACCOUNT QUARTERLY REPORT
For the quarter ended _________________________
Rule 204-2(a)(12) under the Investment Advisers Act requires employees of an
investment adviser to report within ten days of the end of every calendar
quarter all personal Securities transactions in which the employee acquires a
direct or indirect beneficial interest as that term is defined under Rule
16a-1(a)(2) of the Securities Exchange Act of 1934. Rule 17j-1 under the
Investment Company requires employees of an investment adviser to an investment
company to report, within ten days of the end of every calendar quarter,
information about any new Securities account for the employee at a broker,
dealer or bank. Roxbury Capital Management, LLC ("Roxbury") also requires
reporting of all personal Securities transactions and all new Securities
accounts at a broker, dealer or bank for Employee-Related Accounts or Employee
Client Accounts as those terms are defined in Roxbury's Code of Ethics. I hereby
certify that this report reflects all personal Securities transactions and all
new securities accounts established at a broker, dealer or bank during the
above-referenced quarter for me and all of my Employee-Related Accounts, my
Employee Client Accounts and my Beneficial Ownership Accounts, as those terms
are defined in Roxbury's Code of Ethics.
The term "Securities" includes any interest or instrument commonly known as a
security, including stocks, bonds, options, warrants, securities acquired in
privately placed offerings, financial commodities, other derivative products and
interests in limited partnerships, limited liability companies, except U. S.
government obligations and registered open end mutual funds.
IF NO REPORTABLE TRANSACTIONS TOOK PLACE DURING THE ABOVE REFERENCED QUARTER,
CHECK THE BOX: [ ]
The following lists all transactions in Securities for me, my Employee-Related
Accounts, my Employee Client Accounts and my Beneficial Ownership Accounts
during the above-referenced quarter (you may attach a list instead of completing
the information on this form):
[Table]
Did you obtain pre-clearance from the Trading Department for each of the
above transactions?
[ ] Yes [ ] No
Note: Instead of listing transactions, an employee may attach confirmations for
each transaction. If you choose to attach confirmations, please list the number
of attached confirmations:
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 a Client Account such as the existence of any economic
relationship between my transactions and Securities held or to be acquired by
Roxbury's client.
IF NO NEW SECURITIES ACCOUNT WAS ESTABLISHED BY ME, AN EMPLOYEE-RELATED ACCOUNT,
AN EMPLOYEE CLIENT ACCOUNT OR A BENEFICIAL OWNERSHIP ACCOUNT DURING THE ABOVE
REFERENCED QUARTER, CHECK THE BOX AND SIGN BELOW. [ ]
The following lists the names of each broker, dealer and/or bank where I, my
Employee-Related Accounts, my Employee Client Accounts and my Beneficial
Ownership Accounts established a securities account during the above-referenced
quarter (you may attach a list instead of completing the information on this
form):
Title of Account Name of Broker/Dealer or Bank
[Table]
Date:
Signature: X
<PAGE> 19
EXHIBIT C
Roxbury Capital Management, LLC
CODE OF ETHICS ANNUAL HOLDINGS REPORT
To the Compliance Designee of Roxbury Capital Management, LLC:
1. I agree that the terms used in this Report shall have the same meaning as
they do in the Code of Ethics dated 2/15/00.
2. As of the date below, the following are the names of each broker, dealer
and/or bank where I, my Employee-Related Accounts, my Employee Client
Accounts and my Beneficial Ownership Accounts in have a Securities account
(you may attach a list instead of completing the information on this form):
Title of Account Name of Broker/Dealer or Bank
[Table]
3. As of the date below, the list below includes all Securities which I, my
Employee-Related Accounts my Employee Client Accounts and my Beneficial
Ownership Accounts hold (you may attach a list instead of completing the
information on this form):
[Table]
Note: Do not report ownership of U.S. Government obligations and registered
open-end mutual funds.
Date:
Signature: Print Name:
<PAGE> 20
EXHIBIT D
Revised Code of Ethics Initial Certification of Compliance
To the Board of Directors of Roxbury Capital Management, LLC:
1. I hereby acknowledge receipt of a copy of the Code of Ethics dated 2/15/00
for Roxbury Capital Management, LLC (the "Code").
2. I hereby certify that I have read and understand the Code and recognize that
I am subject thereto as an employee of Roxbury Capital Management, LLC
("Roxbury").
3. Except as noted below, I hereby certify that I have reported to Roxbury all
Securities transactions required to be reported pursuant to the Code.
4. Except as noted below, I hereby certify that I have reported to Roxbury the
names of each broker, dealer and/or bank required to be reported pursuant to
the Code.
5. 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
Roxbury's clients, such as any economic relationship between my transactions
and Securities held or to be acquired by Roxbury's clients.
Date:
Signature:
Print Name:
<PAGE> 21
EXHIBIT E
Code of Ethics Annual Certification of Compliance
To the Board of Directors of Roxbury Capital Management, LLC:
1. I have read and understand the Code of Ethics dated 2/15/00 for Roxbury
Capital Management, LLC (the "Code") and recognize that I am subject thereto
as an employee of Capital Management, LLC ("Roxbury").
2. I hereby certify that, during the year ended December 31, , I have
complied with the requirements of the Code.
3. I hereby certify that, during the year ended December 31, , I have
reported to Roxbury all Securities transactions required to be reported
pursuant to the Code.
4. Except as noted below, I hereby certify that, during the year ended December
31, , I have reported to Roxbury the names of each broker, dealer and/or
bank required to be reported pursuant to the Code.
5. 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
Client Accounts, such as any economic relationship between my transactions
and Securities held or to be acquired by Client Accounts.
Date:
Signature:
Print Name:
<PAGE> 22
EXHIBIT F
Request for Personal Investment Transaction Approval
Valid only through the business day on which approval was given. Any
transaction, or portion thereof, not so completed will require a new approval.
Please forward a signed copy of this form to: (see bottom of form for copy
distribution).
Reminder: Send copies of statements and confirms to Roxbury Capital
Management, LLC,
100 Wilshire Blvd Suite 600 Santa Monica, CA 90401 Attn: Corporate Compliance
Name: Date:
Department:
Time Stamp:
(Check one) [ ] Buy
[ ] Sell
___ Number of Shares
TRANSACTION
Security: ______________________________
Ticker Symbol: _________________________
Have you held this Security or an economically equivalent Security (such as an
option to purchase or sell the Security, or a bond or other security convertible
into the Security) for at least 30 days? Yes __ No __
Is this Security on Roxbury's watch list? Yes__ No__
(Check appropriate description below)
Equity: [ ] Common Stock Fixed: [ ] Corporate Bond
[ ] ADR [ ] Convertible
[ ] Other [ ] High-yield Bond
Mutual Fund: [ ] [ ] Municipal Bond
(Closed end)
I hereby request permission to effect a transaction in the Security as indicated
above for my account or an Employee-Related Account. I am familiar with and
agree to abide by the requirements set forth in the Code of Ethics and certify
that this request is made in compliance with the Code of Ethics.
Signature of person requesting approval: _____________________________
Transaction Approval
Approved by: Signature: Date:
(Please see reverse side of form)
<PAGE> 23
Request for Personal Investment Transaction Approval
(Employee Copy)
Shortened Version of Personal Trading Restrictions
(See Code of Ethics for definitions and complete version)
Security: "Security" means any interest or instrument commonly known as a
security, including stocks, bonds, notes, options, warrants, securities acquired
in privately placed offerings, financial commodities, other derivative products
and interest in limited partnerships except for purposes of this personal
trading policy the term "security" does not include any U.S. government
obligation or the shares of any open-end mutual fund.
Trading Program: "Trading Program" means the purchase or sale of a Security
across the majority of existing Client Accounts managed in a particular
investment style. In addition, Institutional Accounts, Private Client Group
Accounts and Wrap Accounts shall each be considered a different investment style
for the purpose of defining a "Trading Program." A Trading Program does not
include purchases or sales of Securities for new Client Accounts or as a result
of additions to, or withdrawals from, one or more Client Accounts.
Prohibited Transactions: No Employee-Related account shall:
1. Purchase or sell any publicly traded Security without the prior written
approval of the Compliance Designee on the same day as the transaction
occurs. If an employee is unable to complete the trade before the end of the
business day, the employee will need to obtain approval on the next day that
the employee wishes to make the purchase or sale. If an employee places a
"limit order" on the transaction and the order is not completed during the
day on which the approval is given, the remaining order must be re-approved
by the Compliance Designee.
2. Purchase any Security that Roxbury is purchasing for any Client Accounts
pursuant to a Trading Program until all purchases for Client Accounts
pursuant to the Trading Program have been completed.
3. Purchase any Security that is being sold pursuant to a Trading Program until
five (5) business days after all sales for Client Accounts pursuant to the
Trading Program have been completed.
4. Sell any Security that Roxbury is selling for any Client Accounts pursuant to
a Trading Program until all sales for Client Accounts pursuant to the Trading
Program have been completed.
5. Sell any Security that is being purchased pursuant to a Trading Program until
five (5) business days after all purchases for Client Accounts pursuant to
the Trading Program have been completed.
6. Purchase or sell any Security that Roxbury is purchasing or selling for any
Client Accounts other than as a result of a Trading Program, on any given day
until all orders for such purchases or sales have been completed.
7. Purchase or sell any Securities on the "Watch List" even if Roxbury currently
holds the Security for Client Accounts.
8. Purchase or sell any options without the prior written approval of the
Compliance Designee except that employees may receive options to purchase
interests in Roxbury Capital Management, LLC.
9. Sell short any Security without the prior written approval of the Compliance
Designee.
<PAGE> 24
10. Sell any Security until at least 30 days after it has been purchased without
the prior written approval of the Compliance Designee.
11. Purchase any Security in an initial public offering ("IPO") unless: (a) the
reason the Employee-Related Account has access to the IPO is not related to
the employee's position at Roxbury; and (b) the Compliance Designee has
approved the transaction in writing and given a written justification for
his decision.
12. Purchase any Security in an initial secondary offering unless: (a) the
reason the Employee-Related Account has access to the secondary offering is
not related to the employee's position at Roxbury; and (b) the Compliance
Designee has approved the transaction in writing.
13. Purchase or sell any Security in a private placement of Securities unless:
(a) the Security is an option to purchase an interest, or an interest,
in Roxbury Capital Management, LLC;
(b) the Security is an interest in a pooled investment vehicle for which
Roxbury acts as investment adviser or investment manager and which
invests only in publicly traded securities; or
(c) the Compliance Designee has approved the private placement
transaction in writing and given a written justification for his
decision including a written explanation of why the private
placement transaction is not appropriate for any Client Account or
Roxbury's 401(k) plan.
14. Purchase or sell any Security in a block trade in which Client Accounts
participate. The above prohibitions shall apply to all Securities
transactions except the following:
(1) Transactions that result from an automatic dividend reinvestment
plan;
(2) Purchases effected upon the exercise of rights issued by an issuer
pro rated to all holders of a class of its Securities and sales of
such rights so acquired; or
(3) Transactions over which the employee has no control, including a
margin call if the brokerage firm has the authority to determine, in
its sole discretion, the Security(ies) to be sold.
Sanctions: The sanctions for violation of the Code of Ethics may include any or
all of the following: (1) a letter of censure, (2) a fine, (3) temporary or
permanent suspension of trading for any Employee-Related Accounts, (4) temporary
suspension of employment, (5) termination of employment, (6) disgorgement of any
ill-gotten profits or avoidance of losses, (7) and/or any other sanction deemed
appropriate by Roxbury's Compliance Committee.
