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EXHIBIT (p)(10)
CODE OF ETHICS
ADOPTED BY
OAK ASSOCIATES, LTD.
PURSUANT TO RULE 17J-1
UNDER THE INVESTMENT COMPANY ACT OF 1940
(REVISED MAY 2000)
1. PURPOSES
This Code of Ethics ("Code") has been adopted by Oak Associates, ltd.
("Oak"), an Ohio limited liability company, in accordance with Rule 17j-1(b)
under the Investment Company Act of 1940 (the "Act") and in accordance with the
following general principles:
(a) THE DUTY AT ALL TIMES TO PLACE THE INTERESTS OF SHAREHOLDERS FIRST.
Oak investment advisory personnel should scrupulously avoid serving
their own personal interests ahead of the interests of shareholders of mutual
funds advised by Oak in any decision relating to their personal investments.
(b) THE REQUIREMENT THAT ALL PERSONAL SECURITIES TRANSACTIONS BE
CONDUCTED CONSISTENT WITH THE CODE AND IN SUCH A MANNER AS TO AVOID ANY ACTUAL
OR POTENTIAL CONFLICT OF INTEREST OR ANY ABUSE OF AN INDIVIDUAL'S POSITION OF
TRUST AND RESPONSIBILITY.
Oak investment advisory personnel must not only seek to achieve
technical compliance with the Code but should strive to abide by its spirit and
the principles articulated herein.
(c) THE FUNDAMENTAL STANDARD THAT OAK INVESTMENT ADVISORY PERSONNEL
SHOULD NOT TAKE INAPPROPRIATE ADVANTAGE OF THEIR POSITIONS.
Oak investment advisory personnel must avoid any situation that might
compromise, or call into question, their exercise of fully independent judgment
in the interest of Fund shareholders, including, but not limited to the receipt
of unusual investment opportunities, perquisites, or gifts of more than a de
minimis value from persons doing or seeking business with a Fund.
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 advisors to investment companies, if effected by
associated persons of such companies.
The purpose of the Code is to establish procedures consistent with the
Act and Rule 17j-1 to give effect to the following general prohibitions as set
forth in rule 17j-1:
(1) 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
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indirectly, by such person of a security held or to be acquired, as defined in
this section, by such registered investment company.
(i) To employ any device, scheme or artifice to defraud such
registered investment company;
(ii) 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;
(iii) 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
(iv) To engage in any manipulative practice with respect to such
registered investment company.
2. DEFINITIONS
(a) "Access Person" means any director/trustee, officer, general partner
or Advisory Person (including any Investment Personnel, as that term is defined
herein) of Oak.
(b) "Adviser/Subadviser" means Oak in its capacity as the adviser or
subadviser of a Fund, or both, as the context may require.
(c) "Advisory Person" means:
(i) any employee of Oak (or of any company in a control
relationship to any Fund or Oak) who, in connection with his or her
regular functions or duties, makes, participates in, or obtains
information regarding the purchase or sale of a security by a 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 Oak who
obtains information concerning recommendations made to a Fund with
regard to the purchase or sale of a security.
(d) "Beneficial Ownership" will be interpreted in a manner consistent
with Rule 16a-1(a)(2) under the Securities Exchange Act of 1934.
(e) "Code" means this Code of Ethics.
(f) "Compliance Officer" means the person designated by Oak as having
responsibility for compliance with the requirements of the Code.
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(g) "Control" will have the same meaning as that set forth in Section 2
(a) (9) of the Act.
(h) "Disinterested Director/Trustee" means a Director/Trustee of a Fund
who is not an "interested person" of such Fund within the meaning of Section
2(a)(19) of the Act.
(i) "Fund" means each investment company registered the Act as to which
Oak is an Adviser or Subadviser.
(j) "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 the Securities
Exchange Act of 1934.
(k) "Investment Personnel" means Portfolio Managers and other Advisory
Persons who provide investment information and/or advice to the Portfolio
Manager(s) and/or help execute the Portfolio Manager's (s') investment
decisions, including securities analysts and traders.
(l) "Oak" means Oak Associates, ltd.
(m) "Portfolio Manager" means any Advisory Person who has the direct
responsibility and authority to make investment decisions for a Fund.
(n) "Purchase or sale of a Security" includes, inter alia, the writing
of an option to purchase or sell a security.
(o) "Security" will have the meaning set forth in Section 2(a)(36) of
the Act, except that it will not include shares of registered open-end
investment companies, securities issued by the United States Government,
short-term debt securities which are "government securities" within the meaning
of Section 2(a)(16) of the Act, bankers' acceptances, bank certificates of
deposit, commercial paper, high quality short-term debt instruments, including
repurchase agreements, and such other money market instruments as are designated
by the Compliance Officer. For purposes of the Code, an "equivalent Security" is
one that has a substantial economic relationship to another Security. This would
include, among other things,
(i) a Security that is convertible into another Security,
(ii) with respect to an equity Security, a Security having the
same issuer (including a private issue by the same issuer) and any
derivative, option or warrant relating to that Security and
(iii) with respect to a fixed-income Security, a Security having
the same issuer, maturity, coupon and rating.
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3. APPLICABILITY
The prohibitions described below will only apply to a transaction in a
Security in which the designated Access Person has, or by reason of such
transaction acquires, any direct or indirect Beneficial Ownership.
4. PROHIBITED PURCHASES AND SALES
(a) INITIAL PUBLIC OFFERINGS. No Investment Personnel may acquire any
securities in an Initial Public Offering.
(b) PRIVATE PLACEMENTS. No Investment Personnel may acquire any
Securities in a private placement without express prior approval.
(i) Prior approval must be obtained in accordance with the
preclearance procedure described in Section 6 below. Such approval will
take into account, among other factors, whether the investment
opportunity should be reserved for a Fund and its shareholders and
whether the opportunity is being offered to the Investment Personnel by
virtue of his or her position with Oak.
(ii) Investment Personnel who have been authorized to acquire
securities in a private placement must disclose that investment to the
chief investment officer (including his or her designee) of the
Adviser/Subadviser (or of any unit or subdivision thereof) or the
Compliance Officer when they play a part in any subsequent consideration
of an investment by a Fund in the issuer. In such circumstances, a
Fund's decision to purchase securities of the issuer will be subject to
an independent review by appropriate personnel with no personal interest
in the issuer.
(c) BLACKOUT PERIODS.
(i) Except as provided in Section 5 below, Access Persons are
prohibited from executing a securities transaction on a day during which
any Fund has a pending "buy" or "sell" order in the same or an
equivalent Security and until such time as that order is executed or
withdrawn; provided, however, that this prohibition shall not apply to
Disinterested Directors/Trustees except if they have actual knowledge of
trading by any Fund and, in any event, only with respect to those Funds
on whose boards they sit.
This prohibition shall also not apply to Access Persons of Oak
who do not, in the ordinary course of fulfilling his or her official
duties, have access to information regarding the purchase and sale of
securities for a Fund; provided that securities investments effected by
such Access Persons during the proscribed
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period are not effected with knowledge of the purchase or sale of the same or
equivalent securities by any Fund.
A "pending 'buy' or 'sell' order" exists when a decision to
purchase or sell a Security has been made and communicated.
(ii) Portfolio Managers are prohibited from buying or selling a
Security within seven calendar days before or after a Fund trades in the
same or an equivalent Security.
(iii) If trades are effected during the periods proscribed in (i)
or (ii) above, except as provided in (iv) below with respect to (i)
above, any profits realized on such trades will be immediately required
to be disgorged to the applicable Fund.
(iv) A transaction by Access Persons (other than Investment
Personnel) inadvertently effected during the period proscribed in (i)
above will not be considered a violation of the Code an disgorgement
will not be required so long as the transaction was effected in
accordance with the preclearance procedures described in Section 6 below
and without prior knowledge of trading by any Fund in the same or an
equivalent Security.
(d) SHORT-TERM TRADING PROFITS. Except as provided in Section 5 below,
Investment Personnel are prohibited from profiting from a purchase and sale, or
sale and purchase, of the same or an equivalent Security within any 60 calendar
day period. If trades are effected during the proscribed period, any profits
realized on such trades will be immediately required to be disgorged to the
applicable Fund.
5. EXEMPTED TRANSACTIONS
Subject to preclearance in accordance with Section 6 below with respect
to subitems (b), (e), (f), (g), (h) and (i) hereof, the prohibitions of Sections
4 (C) and 4 (D) will not apply to the following:
(a) Purchases or sales of securities effected in any account over which
the Access Person has no direct or indirect influence or control or in any
account of the Access Person which is managed on a discretionary basis by a
person other than such Access Person and with respect to which such Access
Person does not in fact influence or control such transactions.
(b) Purchases or sales of Securities (or their equivalents) which are
not eligible for purchase or sale by any Fund.
(c) Purchases or sales of Securities which are non-volitional on the
part of either the Access Person or any Fund.
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(d) Purchases of securities 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) Any equity securities transaction, or series of related transactions
effected over a 30 calendar day period, involving 500 shares or less in the
aggregate, if:
(i) the Access person has no prior knowledge of activity in
such security by any Fund; and
(ii) the issuer is listed on The New York Stock Exchange or has
a market capitalization (outstanding shares multiplied by the current
price per share) greater than $1 billion (or a corresponding market
capitalization in foreign markets).
(g) Any fixed-income securities transaction, or series of related
transactions effected over a 30 calendar day period, involving 100 units
($100,000 principal amount) or less in the aggregate, if the Access Person has
no prior knowledge of transactions in such securities by any Fund.
(h) Any transaction in index options effected on a broad-based index if
the Access Person has no prior knowledge of activity in such index by any Fund.
(i) Purchases or sales of securities which receive the prior approval of
the Compliance Officer (such person having no personal interest in such
purchases or sales), based on a determination that no abuse is involved and that
such purchases and sales are not likely to have any economic impact on any Fund
or on its ability to purchase or sell securities of the same class or other
securities of the same issuer.
6. PRECLEARANCE
Access Persons (other than Disinterested Directors/Trustees) must
preclear all personal securities investments with the exception of those
identified in subparts (a), (c) and (d) of Section 5 above.
All requests for preclearance must be submitted to the Compliance
Officer for approval. All approved orders must be executed by the close of
business on the day preclearance is granted; provided, however, that approved
orders for securities traded in foreign markets may be executed within two (2)
business days from the date preclearance is granted. If any order is not timely
executed, a request for preclearance must be resubmitted.
7. REPORTING
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(a) Disinterested Directors/Trustees shall report to the Compliance
Officer the information described in Section 7 (b) hereof with respect to
transactions in any Security in which such Disinterested Director/Trustee has,
or by reason of such transaction acquires, any direct or indirect Beneficial
Ownership in the Security only if such Disinterested Director/Trustee, at the
time of that transaction knew or, in the ordinary course of fulfilling his or
her official duties as a Director/Trustee of a Fund, should have known that,
during the 15-day period immediately preceding or subsequent to the date of the
transaction in a Security by such Director/Trustee, such Security is or was
purchased or sold by a Fund or was being considered for purchase or sale by a
Fund; provided, however, that a Disinterested Director/Trustee is not required
to make a report with respect to transactions effected in any account over which
such Director/Trustee does not have any direct or indirect influence or control
or in any account of the Disinterested Director/Trustee which is managed on a
discretionary basis by a person other than such Director/Trustee and with
respect to which such Director/Trustee does not in fact influence or control
such transactions. The Compliance Officer shall maintain such reports and such
other records to the extent required by Rule 17j-1 under the Act.
(b) Every report required by Section 7 (a) hereof shall be made not
later than ten 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 date (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) With respect to any account established by the Access Person
in which any securities were held during the quarter for the direct or
indirect benefit of the Access Person:
(A) the name of the broker; dealer or bank with whom
the Access Person established the account;
(B) the date the account was established; and
(C) the date that the report is submitted by the Access
Person.
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(c) Any such report may contain a statement that the report shall not be
construed as an admission by the person making such report that he or she has
any direct or indirect Beneficial Ownership in the Security to which the report
relates.
8. RECORDS OF SECURITIES TRANSACTIONS AND POST-TRADE REVIEW
Access Persons (other than Disinterested Directors/Trustees) are
required to direct their brokers to supply, on a timely basis, duplicate copies
of confirmations of all personal securities transactions and copies of periodic
statements for all securities accounts in which such Access Persons have a
Beneficial Ownership interest to the Compliance Officer. Compliance with this
Code requirement by Disinterested Directors/Trustees will be deemed to satisfy
the reporting requirements imposed on Access Persons under Rule 17j-1(c)
providing such statements contain all of the information required by the
appropriate report.
The Compliance Officer will review all reports, or information provided
in lieu of reports, on a quarterly basis.
9. DISCLOSURE OF PERSONAL HOLDINGS
(a) INITIAL HOLDING REPORTS. No later than ten days after a person
becomes an Access Person, the following information must be reported to the
Compliance Officer:
(i) the title, number of shares and principal amount of each
Security in which the Access Person had any direct or indirect
Beneficial Ownership when the person became an Access Person;
(ii) the name of any broker, dealer or bank with whom the Access
Person maintained an account in which any securities were held for the
direct or indirect benefit of the Access Person as of the date the
person became an Access Person; and
(iii) the date that the report is submitted by the Access Person.
(b) ANNUAL HOLDINGS REPORTS. Annually the following information (which
information must be current as of a date no more than 30 days before the report
is submitted, shall be reported to the Compliance Officer:
(i) the title, number of shares and principal amount of each
Security in which the Access Person had any direct or indirect
Beneficial Ownership;
(ii) the name of any broker, dealer or bank with 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 that the report is submitted by the Access Person.
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(c) A Disinterested Director/Trustee of a Fund would be required to make
a report solely by reason of being a Fund Director/Trustee, need not make an
initial holdings report or an annual holdings report.
10. GIFTS
Access Persons are prohibited from receiving any gift or other thing of
more than $100 in value from any person or entity that does business with or on
behalf of a Fund. Occasional business meals or entertainment (theatrical or
sporting events, etc.) are permitted so long as they are not excessive in number
or cost.
11. SERVICE AS A DIRECTOR
Investment Personnel are prohibited from serving on the boards of
directors of publicly traded companies, absent prior authorization based upon a
determination that the board service would be consistent with the interests of a
Fund and its shareholders. In the limited instances that such board service is
authorized, Investment Personnel will be isolated from those making investment
decisions affecting transactions in securities issued by any publicly traded
company on whose board such Investment Personnel serves as a director through
the use of "Chinese Wall" or other procedures designed to address potential
conflicts of interest.
12. CERTIFICATION OF COMPLIANCE WITH THE CODE
Access Persons are required to certify annually as follows:
(a) that they have read and understood the Code;
(b) that they recognize that they are subject to the Code;
(c) that they have complied with the requirements of the Code;
and
(d) that they have disclosed or reported all personal securities
transactions required to be disclosed or reported pursuant to the
requirements of the Code.
13. CODE VIOLATIONS
All violations of the Code will be reported to the Board of
Directors/Trustees of a Fund on a quarterly basis. Oak may take such action as
it deems appropriate.
14. REVIEW BY THE BOARD OF DIRECTORS/TRUSTEES
The Board of Directors/Trustees of each Fund will be provided with a
written annual report which at a minimum:
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(a) describe any issues arising under the Code of Ethics or
procedures since the last report to the Board of Directors/Trustees,
including, but not limited to, information about material violations of
the Code or procedures and sanctions imposed in response to the material
violations; and
(b) certifies that Oak has adopted procedures reasonably
necessary to prevent its Access Persons from violating the Code of
Ethics.
15. RECORDKEEPING
Oak shall maintain the following records in the manner and to the extent
set forth below and will make such records available to the Securities and
Exchange Commission, or any representative thereof, at any time and from time to
time for reasonable, periodic special or other examination:
(a) a copy of this Code as currently in effect, or at any time
within the past five years in effect, maintained in an easily accessible
place;
(b) a record of any violation of the Code and of any action
taken as a result of the violation will be maintained in an easily
accessible place for at least five years after the end of the fiscal
year in which the violation occurred;
(c) a copy of each report made by an Access Person, including
any information provided in lieu of reports under this Code or any
predecessor Code, will be maintained for at least five years after the
end of the fiscal year in which the report is made or the information is
provided, the first two years in an easily accessible place;
(d) a record of all persons currently or within the past five
years who are or were required to make reports under this Code or any
predecessor Code, or who are or were responsible for reviewing such
reports, will be maintained in an easily accessible place;
(e) a copy of each Annual Report submitted to the Board of
Directors/Trustees will be maintained for at least five years after the
end of the fiscal year in which it is made, the first two years in an
easily accessible place; and
(f) Oak will maintain a record of any decision and the reasons
supporting the decision to approve the acquisition by Investment
Personnel of securities acquired in an Initial Public Offering or
private placement for at least five years after the end of the fiscal
year in which the approval is granted.
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Dated: April 1, 1995, as amended on June 1, 1995 and May 22, 2000.
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