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EXHIBIT (p)
J.J.B. HILLIARD, W.L. LYONS, INC.
HILLIARD LYONS RESEARCH TRUST
SENBANC FUND SERIES
FEBRUARY 7, 2000
CODE OF ETHICS
1. DEFINITIONS
(a) "Access person" means (i) with respect to the Fund, any trustee,
officer or advisory person of the Fund and (ii) with respect to Hilliard, any
director or officer of Hilliard who, with respect to the Fund, makes any
recommendation, participates in the determination of which recommendation shall
be made or whose functions or duties relate to the determination of which
recommendation shall be made to the Fund, or who, in connection with his duties,
obtains any information concerning securities recommendations being made by
Hilliard to the Fund.
(b) "Advisory person" means (i) any employee of the Fund or Hilliard (or
of any company in a control relationship to the Fund or Hilliard), who, in
connection with his regular functions or duties, makes, participates in, or
obtains information regarding the purchase or sale of a security by the Fund, or
whose functions relate to the making of any recommendations with respect to such
purchases or sales; and (ii) any natural person in a control relationship to the
Fund or Hilliard who obtains information concerning recommendations made to the
Fund with regard to the purchase or sale of a security.
(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 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 Investment Company Act of 1940.
(e) "Covered Security" shall have the meaning set forth in Section
2(a)(36) of the Investment Company Act of 1940, except that it shall not include
shares of registered open-end investment companies, direct obligations of the
Government of the United States, bankers' acceptances, bank certificates of
deposit, commercial paper, and high quality short-term debt securities
(including repurchase agreements).
(f) "Disinterested trustee" means a trustee of the Fund who is not an
"interested person" of the Fund within the meaning of Section 2(a)(19) of the
Investment Company Act of 1940.
(g) "Fund" means Hilliard Lyons Research Trust.
(h) "Hilliard" means J.J.B. Hilliard, W.L. Lyons, Inc.
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(i) "Initial public offering" means an offering of securities registered
under the Securities Act of 1933, the issuer of which, immediately before the
registration, was not subject to the reporting requirements of sections 13 or
15(d) of the Securities Exchange Act of 1934.
(j) "Investment person" means (i) any portfolio manager; (ii) any
employee of the Fund or Hilliard who provides information and advice to a
portfolio manager or who helps execute a portfolio manager's decisions; and
(iii) any natural person who controls the Fund or Hilliard and who obtains
information regarding the purchase or sale of securities of the Fund.
(k) "Limited offering" means an offering that is exempt from registration
under the Securities Act of 1933 pursuant to section 4(2) or section 4(6) or
pursuant to rule 504, rule 505 or rule 506 thereunder.
(l) "Portfolio manager" means any person who has the direct
responsibility and authority to make decisions about investments made by the
Fund.
(m) "Purchase or sale of a security" includes, inter alia, the buying or
writing of an option to purchase or sell a security.
(n) "Security held or to be acquired" by the Fund shall mean any security
which, within the most recent 15 days (i) is or has been held by the Fund, or
(ii) is being or has been considered by the Fund or Hilliard for purchase by the
Fund, and (iii) any option to purchase or sell, and any security convertible
into or exchangeable for any such security.
2. STATEMENT OF GENERAL FIDUCIARY PRINCIPLES
The following general fiduciary principles shall govern all personal
investment activities: (1) access persons shall have a duty at all times to
place the interests of shareholders of the Fund first;(2) all personal
securities transactions shall be conducted consistent with this Code of Ethics
and in such a manner as to avoid any actual or potential conflict of interest or
any abuse of the individual's position of trust and responsibility; and (3)
access persons should not take inappropriate advantage of their positions.
3. PROHIBITED PURCHASES AND SALES
(a) No portfolio manager shall:
(i) purchase or sell, directly or indirectly, any covered security
within seven calendar days before the Fund trades in that security.
(ii) purchase, directly or indirectly, any covered security within
seven calendar days after the Fund sells that security.
(iii) sell, directly or indirectly, any covered security within
seven calendar days after the Fund purchases that security.
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(b) No investment person shall:
(i) purchase, directly or indirectly, any securities in an initial
public offering.
(ii) acquire, directly or indirectly, any securities in a limited
offering without the express prior approval of the Chairman of the Fund.
Such prior approval should take into account, among other factors,
whether the investment opportunity should be reserved for the Fund and
its shareholders, and whether the opportunity is being offered toan
individual by virtue of his position with the Fund. Advisory persons who
are authorized to acquire securities in a limited offering or who
otherwise hold securities previously acquired in a limited offering must
disclose that investment if they play a part in the Fund's subsequent
consideration of an investment in the issuer. In such circumstances, the
Fund's decision to purchase securities of the issuer shall be subject to
an independent review by advisory persons with no personal interest in
the issuer.
(iii) profit in the purchase and sale, or sale and purchase, of
the same (or equivalent) covered securities within 60 calendar days
unless (A) the market capitalization of the issuer at the time of the
purchase or sale exceeds $150,000,000 and the average daily trading
volume of the security during the four-week period preceding the purchase
or sale exceeds 3,000 shares, or (B) the Fund neither purchases nor sells
the same (or equivalent)securities within 60 calendar days of the
purchase or sale by such investment person.
(c) No access person shall:
(i) purchase or sell, directly or indirectly, any covered security
in which he has, or by reason of such transaction acquires, any direct or
indirect beneficial ownership and which to his actual knowledge at the
time of such purchase or sale: (A) is being considered for purchase or
sale by the Fund; or (B) is being purchased or sold by the Fund.
(ii) execute a transaction in a covered security on a day during
which the Fund has a pending "buy" or "sell" order in that same security
until that order is executed or withdrawn unless the market
capitalization of the issuer at the time of the transaction exceeds
$150,000,000 and the average daily trading volume of the security during
the four-week period preceding the transaction exceeds 3,000 shares.
4. EXEMPTED TRANSACTIONS
The prohibitions of Section 3 of this Code of Ethics shall not apply to:
(a) Purchases or sales effected in any account over which the access
person has no direct or indirect influence or control.
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(b) Purchases or sales of securities which are not eligible for purchase
or sale by the Fund.
(c) Purchases or sales which are non-volitional on the part of either the
access person or the Fund.
(d) Purchases which are part of an automatic dividend reinvestment plan.
(e) Purchases effected upon the exercise of rights issued by an issuer
pro rata to all holders of a class of its securities, to the extent such rights
were acquired from such issuer, and sales of such rights so acquired.
(f) Purchases or sales determined by the Chairman of the Fund to be only
remotely potentially harmful to the Fund because they would be very unlikely to
affect a highly institutional market, or because they clearly are not related
economically to the securities to be purchased, sold or held by the Fund.
5. REPORTING
(a) Each access person other than disinterested trustees shall disclose
to the Fund or Hilliard all of his personal holdings in covered securities at
the time his employment commences(or upon becoming an access person) and
annually thereafter. Each such holdings report shall be made within 10 days
after the commencement of employment (or becoming an access person).Annual
reports shall be made within 10 days after the end of the calendar year
beginning with the calendar year ending December 31, 2000. Holdings reports
shall include the following information, which must be current as of a date
within 30 days of the date of submission:
(i) The title, number of shares and principal amount of each
covered security in which such access person has any direct beneficial
ownership when the person becomes an access person;
(ii) The name of any broker, dealer or bank with whom the access
person maintains an account in which any securities are held for the
direct benefit of such person as of the date the person became an access
person; and
(iii) The date the report is submitted by the access person.
(b) Every access person shall report to the Fund and Hilliard the
information described in Section 5(c) of this Code of Ethics with respect to
transactions in any covered security in which such access person has, or by
reason of such transaction acquires, any direct or indirect beneficial ownership
in the security including securities acquired in exempt transactions pursuant to
Section 4; provided, however, that (i) an access person shall not be required to
make a report with respect to transactions effected for any account over which
such person does not have any direct or indirect influence or control and (ii) a
disinterested trustee shall not be required to report
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any transaction by the trustee involving a security, except where such trustee
knew, or in the ordinary course of fulfilling his official duties as a trustee
of the Fund, should have known during the 15-day period immediately preceding or
after the date of the transaction, the security is or was purchased or sold by
the Fund or such purchase or sale by the Fund is or was considered by the Fund
or Hilliard, on behalf of the Fund.
(c) Every transaction report shall be made not later than 10 days after
the end of the calendar quarter in which the transaction to which the report
relates was effected, and shall contain the following information:
(i) The date of the transaction, the title, the interest rate and
maturity (if applicable), the number of shares, and the principal amount
of each security involved;
(ii) The nature of the transaction (i.e., purchase, sale or any
other type of acquisition or disposition);
(iii) The price at which the transaction was effected;
(iv) The name of the broker, dealer or bank with or through whom
the transaction was effected; and
(v) The date the report is filed.
(d) Every access person other than disinterested trustees shall direct
his broker to supply to the Chairman of the Fund or the Chairman of Hilliard, on
a timely basis, duplicate copies of periodic statements for all securities
accounts.
(e) Any reports made pursuant to this Section 5 may contain a statement
that the report shall not be construed as an admission by the person making such
report that he has any direct or indirect beneficial ownership in the security
to which the report relates.
(f) The Chairman of the Fund and the Chairman of Hilliard or their
designees shall identify all access persons who are under a duty to make reports
to such entities pursuant to this Section 5 and shall inform such persons of
such duty.
(g) The Chairman of the Fund and the Chairman of Hilliard or their
designees shall be responsible for implementing compliance procedures and
designating appropriate personnel to review reports made pursuant to this
Section. No person who regularly reviews such reports shall be permitted to
review his own reports and such reports shall be reviewed by a management or
compliance person senior to the reviewer.
6. GIFTS
Investment persons are prohibited from receiving any gift or other item
of more than DEMINIMIS value from any person or entity that does business with
or on behalf of the Fund;
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provided, however, that attendance and the receipt of complimentary meals at
investment conferences shall not be prohibited by this Section 6.
7. SERVICE AS A TRUSTEE
Investment persons shall be prohibited from serving on the boards of
trustees of publicly traded companies, absent prior authorization from the Board
of Trustees of the Fund based upon a determination that the board service would
be consistent with the interests of the Fund and its shareholders. If such board
service is authorized, "Chinese Wall" or other procedures shall be established
to isolate the advisory person serving as a trustee from those making investment
decisions with respect to the securities of such publicly traded company.
8. CERTIFICATION OF COMPLIANCE WITH CODES OF ETHICS
All access persons shall certify annually that they have read and
understand this Code of Ethics and recognize that they are subject thereto.
Further, access persons shall certify annually that they have complied with the
requirements of this Code of Ethics and that they have disclosed or reported all
personal securities transactions and holdings required to be disclosed or
reported pursuant to the requirements of this Code of Ethics.
9. SANCTIONS
Any profits realized on trades prohibited by Section 3(a) or Section
3(b)(iii) of this Code of Ethics shall be disgorged to the Fund. The Board of
Trustees of the Fund and Hilliard may also impose such other sanctions as it
deems appropriate upon discovering a violation of this Code of Ethics,
including, INTER ALIA, a letter of censure or suspension or termination of the
employment of the violator.
10. TRUSTEE APPROVAL AND REPORTS
(a) The Fund and Hilliard will prepare an annual report to the Board of
Trustees of the Fund that summarizes existing codes and procedures concerning
personal investing and any additional procedures adopted during the year;
describes any material issues arising under the Code or such procedures since
the last report, including but not limited to any material violations of the
Code or such procedures and any sanctions imposed in response thereto;
identifies material conflicts that arose during the year; and identifies any
recommended changes in existing restrictions or procedures based upon the
parties' experience under this Code of Ethics, evolving industry practices, or
developments inapplicable laws or regulations. Such report shall include any
certifications required by Rule 17j-1.
(b) The Fund and Hilliard shall submit this Code to the Board of Trustees
of the Fund for approval within the time frames required by Rule 17j-1. Any
material changes to this Code shall be submitted to such Board within six months
of such change.
11. RECORDKEEPING.
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Hilliard shall maintain the following records, on its own behalf and on
behalf of the Fund, in the manner specified:
(a) A copy of this Code, or any amendment thereof, which is or at any
time within the past five years has been in effect shall be preserved in an
easily accessible place.
(b) A record of any violation of this Code, or any amendment thereof, and
of any action taken as a result of such violation, shall be preserved in an
easily accessible place for a period of not less than five years following the
end of the fiscal year in which the violation occurs.
(c) A copy of each transaction and holding report made by an access
person pursuant to this Code shall be preserved for a period of not less than
five years from the end of the fiscal year in which it is made, the first two
years in an easily accessible place.
(d) A list of all persons who are, or within the past five years have
been, required to make reports pursuant to this Code shall be maintained in an
easily accessible place.
(e) A list of the names of all persons who are, or within the past five
years have been, responsible for reviewing the reports filed pursuant to Section
5 of this Code shall be maintained in an easily accessible place.
(f) A record of any approvals granted pursuant to Section 3(b) of this
Code shall be preserved for a period of five years from the end of the fiscal
year in which such approval is given.
(g) A copy of each report made pursuant to Section 10 of this Code must
be maintained for at least five years after the end of the fiscal year in which
it was made, the first two years in an easily accessible place.
