Exhibit p
CODE OF ETHICS
Effective: July 3, 2000
The following Code of Ethics (the "Code") is designed to comply with
Section 17(j) of the Investment Company Act of 1940 (the "1940 Act") and the
Insider Trading and Securities Fraud Enforcement Act of 1988 and has been
adopted by Columbia Management Co., Columbia Funds Management Company, Columbia
Trust Company, Columbia Financial Center Incorporated, and CMC Fund Trust and
each investment company managed by Columbia Funds Management Company
(collectively, "Columbia"). Each portfolio of CMC Fund Trust and each investment
company managed by Columbia Funds Management Company are referred to in this
Code as a "Columbia Fund."
1. Statement of General Principles
The specific standards and guidelines set forth in the Code must be
applied and followed in the context of the following general fiduciary
principles that govern personal investment activities. The Code is based on the
principle that officers, directors and employees of Columbia owe a fiduciary
duty to conduct their personal securities transactions in a manner that does not
interfere with portfolio transactions or take unfair advantage of their
relationship with Columbia. This fiduciary duty is owed to both Columbia
advisory clients and shareholders of the Columbia Funds. Columbia personnel must
adhere to this general principle as well as the specific requirements set forth
in this Code. Columbia officers, directors and employees should understand,
however, that technical compliance with the specific requirements of the Code
does not automatically insulate them from liability or a review of trades that
show a pattern of a breach of an individual's fiduciary duty.
Personnel should avoid situations that present actual as well as
potential conflicts of interest. As a general principle, it is imperative that
Columbia's officers, directors and employees also avoid any situation that might
compromise or call into question their exercise of independent judgment in the
interest of Columbia Fund shareholders and Columbia advisory clients. Areas of
concerns relating to independent judgment include, among others, unusual
investment opportunities, perks, and gifts of more than "de minimus" value from
persons doing or seeking to do business with Columbia.
Purchases or sales of securities shall be made only in accordance with
this Code and Columbia's Policy and Procedures Designed to Detect and Prevent
Insider Trading (the "Insider Trading Policy"). Although all employees and
disinterested directors/trustees of Columbia are covered by this Code and the
Insider Trading Policy, certain employees deemed under the Code to be "access
persons" are subject to greater trading restrictions and reporting obligations.
Disinterested directors/trustees, however, are generally subject to fewer
trading restrictions and reporting obligations because of their limited access
to current investment information.
2. Definitions
(a) "Access person" means (i) any director or officer of Columbia, (ii)
any employee of Columbia 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 Columbia or whose
functions relate to the making of any
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recommendations with respect to such purchases or sales; and (iii) any
natural person in a control relationship to Columbia who obtains
information concerning recommendations made to Columbia with regard to
the purchase or sale of a security. The Ethics Committee shall maintain
a list of employees deemed to be access persons for purposes of this
Code. "Access person" does not include a disinterested director/trustee
of a Columbia Fund.
(b) A security is "being considered for purchase or sale" when a
recommendation to purchase or sell a security has been made and
communicated or, with respect to the person making the recommendation,
when such person seriously considers making such a recommendation.
(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, which states that the term
"beneficial owner" means "any person who, directly or indirectly,
through any contract, arrangement, understanding, relationship or
otherwise, has or shares a direct or indirect pecuniary interest in" a
security. The term "pecuniary interest" is further defined to mean "the
opportunity, directly or indirectly, to profit or share in any profit
derived from a transaction in the subject securities." "Beneficial
ownership" includes accounts of a spouse, minor children and relatives
resident in the home of the access person, as well as accounts of
another person if the employee obtains therefrom benefits substantially
equivalent to those of ownership. For additional information, see
appendix A.
(d) "Control" shall have the same meaning as that set forth in Section
2(a)(9) of the 1940 Act.
(e) "Disinterested director/trustee" means a director/trustee of a
Columbia Fund who is not an "interested person" of the Columbia Fund
within the meaning of Section 2(a)(19) of the 1940 Act.
(f) "Employee" means any employee or officer of Columbia or any
Columbia Fund. Employee does not include a disinterested
director/trustee of a Columbia Fund.
(g) "Purchase or sale of a security" includes, among other things, the
writing of an option to purchase or sell a security.
(h) "Security" shall have the meaning set forth in Section 2(a)(36) of
the Investment Company Act, except that it shall not include shares of
registered open-end investment companies, securities issued by the U.S.
Government or an instrumentality thereof, short-term debt securities
that are government securities within the meaning of Section 2(a)(16)
of the 1940 Act, bankers' acceptances, bank certificates of deposit,
commercial paper and other money market instruments. Any prohibition or
reporting obligation relating to a security shall also apply to any
option, warrant or right to purchase or sell such security and to any
security convertible or exchangeable for such security.
3. Pre-Clearance of Transactions
All access persons shall have all purchases or sales of any security in
which they have, or by reason of such purchase acquire, any direct or indirect
beneficial ownership
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approved in writing by the Columbia Trading Department or a member of the Ethics
Committee prior to effecting the transaction. Members of the Ethics Committee
are attached hereto as Appendix B.
NOTE: See the definition of security in Section 2(h) and the exemptions
in Section 5 to determine whether a transaction is subject to the pre-clearance
requirement. For example, transactions in an account over which an employee does
not have direct or indirect influence or control are exempt from this
pre-clearance requirement.
4. Prohibited Transactions
(a) General Restrictions:
(i) Prohibited Purchases and Sales. No employee or
disinterested director/trustee shall purchase or
sell, directly or indirectly, any security in which
he or she has, or by reason of such transactions
acquires, any direct or indirect beneficial ownership
and which to his or her knowledge at the time of such
purchase or sale (i) is being considered for purchase
or sale by Columbia or (ii) is being purchased or
sold by Columbia. In addition, all employees and
disinterested directors/trustees shall comply with
the Insider Trading Policy, which prohibits any
person from purchasing or selling a security while in
possession of material non-public information or
communicating such information in connection with a
transaction.
(ii) Initial Public Offerings. No employee shall purchase
or sell directly or indirectly, any equity security
issued in an initial public offering without the
written approval by the Columbia Trading Department
or a member of the Ethics Committee prior to the
transaction. A transaction by an access person in an
initial public offering will not be approved in any
circumstances.
(b) Restrictions Applicable only to Access Persons:
(i) Private Placements. No access person shall purchase any
securities issued in a private placement (as that term is generally
recognized as an exempt transaction from registration under the federal
securities laws) except pursuant to the prior written approval of the
Ethics Committee, which approval shall take into consideration, among
other factors, whether the investment opportunity should be reserved
for a Columbia Fund or Columbia advisory client and whether the
opportunity is being offered to the access person by virtue of his or
her position with Columbia. In addition, any access person who owns or
has been authorized to acquire securities in a private placement is
required to disclose that ownership if he or she plays a material role
in Columbia's subsequent investment decision regarding the same issuer
of the security. In that circumstance, Columbia's decision to purchase
such securities must be subject to an independent review by members of
the Columbia Investment Team with no personal interest in the issuer.
(ii) 7-Day Blackout Period. No access person shall purchase or
sell, directly or indirectly, any security in which he or she has, or
by reason of the transaction acquires, any direct or indirect
beneficial ownership within a period
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of seven calendar days before and after a purchase or sale by a
Columbia Fund or advisory client over which the access person exercises
investment discretion. For example, if a Columbia Fund trades a
security on day one (e.g., on Monday), the access person may not trade
until day nine (e.g., the following Tuesday). Any profits realized on
trades within the proscribed periods shall be disgorged to Columbia for
the benefit of the appropriate Columbia Fund or advisory client or,
alternatively, to a charitable organization (qualified under Section
501(c) of the Internal Revenue Code) of the access person's choice.
The black-out period restriction under this Section 4(b)(ii)
should not operate to the detriment of any Columbia Fund or advisory
client. Therefore, if an access person has executed a transaction in a
security for his or her account and within seven days thereafter
desires to purchase or sell that security for a Columbia Fund or
advisory client over which he or she exercises investment discretion,
the access person shall submit a written explanation to the Trading
Desk or Ethics Committee describing the circumstances relating to the
decision to trade the security for the Fund or client account. Based on
the specific circumstances and a determination that the access person
has not otherwise violated the Code of Ethics, including the Statement
of General Principles in Section 1, the Trading Desk or Ethics
Committee may approve the trade by the Fund or advisory client and, in
that case, the prior personal transaction by the access person shall
not be considered a violation of the seven day black-out period
restriction. A written record of the approval by the Trading Desk or
the Ethics Committee, as the case may be, shall be maintained by the
Ethics Committee.
(iii) Short-Term Trading. For the purpose of preventing the
unfair use of information that may be obtained by an access person, any
profit realized by an access person from any purchase and sale, or any
sale and purchase, of any security in which he or she has, or by reason
of the transaction acquires, any direct or indirect beneficial
ownership (other than an exempted security under this Code), within any
period of less than 60 days shall inure to and be recoverable by
Columbia for the benefit of a charitable organization (qualified under
Section 501(c) of the Internal Revenue Code) of his or her choice. This
prohibition shall not apply unless such access person was the
beneficial owner of the security or of an interest in the security both
at the time of the purchase and sale, or sale and purchase.
Exceptions to the short-term trading ban may be approved in
advance by the Ethics Committee where it is determined that no abuse is
involved and the equities of the situation strongly support an
exception to the ban. Circumstances that could provide the basis for an
exception under this paragraph may include for example, among other
things, an involuntary transaction that is the result of unforeseen
corporate activity, the disclosure of a previously nonpublic, material
corporate, economic or political event or activity that could cause a
reasonable person in like circumstances to sell a security even if
originally purchased as a long term investment, or the access person's
economic circumstances materially change in such a manner that
enforcement of the short-term trading ban would cause an extreme
hardship on the access person.
(iv) Exemption for Large Cap Trades. The prohibitions in
subsections 4(b)(ii) and (iii) shall not apply to the purchase or sale
by the access person of a security issued by a company with a market
capitalization greater
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than $10 billion if the number of shares in the transaction is less
than 1% of the average daily trading volume for the security for the
20-day trading period immediately prior to the transaction. This
exception to the black-out period and short-term trading prohibitions
recognizes that transactions by the access person or Columbia involving
securities of companies with high market capitalizations and high
average daily trading volumes are not likely to materially affect the
price of the security involved.
5. Exempted Transactions
In addition to any other exemptions in this Code and except as
otherwise noted below, the prohibitions of Section 4 and the pre-clearance
required by Section 3 of this Code shall not apply to:
(a) Purchases or sales effected in any account over which the employee
has no direct or indirect influence or control. Pre-approval of these
accounts may, at times, be required by the Ethics Committee. For
additional information see appendix A.
(b) Purchases or sales of securities that are not eligible for purchase
or sale by Columbia.
(c) Purchases or sales which are non-volitional on the part of either
the employee, or Columbia.
(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 and sales of financial futures or option contracts on
securities indexes traded on a national securities or commodities
exchange.
(g) Purchases and sales approved by the Ethics Committee if it is
determined after appropriate inquiry that the transaction is not
potentially harmful to a Columbia Fund or advisory client because it
would be very unlikely to affect a highly institutional market, or
because it clearly is not related economically to the securities to be
purchased, sold or held by Columbia, and that the purchase or sale does
not violate the Insider Trading and Securities Fraud Enforcement Act of
1988.
6. Prohibited Activities by Employees and Access Persons
(a) Gifts. Employees are prohibited from receiving, either directly or
indirectly, anything of value in excess of a "de minimus" amount from
any person or any employee of an entity that does or seeks to do
business with Columbia.
(b) Service as a Director. Access persons are prohibited from serving
on the boards of directors of publicly traded companies, absent a prior
authorization from the Ethics Committee based on a determination that
the board service would not be inconsistent with the interests of
Columbia or Columbia's
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advisory clients. This restriction shall not apply to access persons
serving on the board of directors or as a trustee of any Columbia Fund.
7. Reporting
(a) Duplicate Confirmations and Account Statements. All employees shall
cause every broker with whom he or she maintains an account to provide
duplicate confirmations to Columbia for all securities transactions by
the employee. The Trading Department shall compile summaries of all
trades entered and all transactions completed. Such reports shall
include the name of the security, date of transaction, quantity, price
and the broker-dealer through which the transaction was effected. The
obligation to provide duplicate confirmations and account statements
applies to all brokerage accounts even if a transaction is exempt from
the prohibitions under this Code. In addition, all access persons
(excluding disinterested directors/trustees) shall cause every such
broker to send all monthly, quarterly and annual statements of their
accounts to Columbia. The quarterly statements must be provided no
later than 10 days after the end of a calendar quarter. The quarterly
statements must contain with respect to any transaction during the
calendar quarter in a security beneficially owned by the access person
(1) 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; (2) the nature of the transaction
(i.e., purchase, sale or any other type of acquisition or disposition);
(3) the price of the security at which the transaction was effected;
(4) the name of the broker, dealer or bank with or through which the
transaction was effected; and (5) the date that the report is submitted
by the access person.
(b) Disclosure of All Personal Holdings. Within 10 days of commencement
of employment or becoming an access person and on an annual basis
thereafter (which information must be current as of a date no more than
30 days before the report is submitted), each access person shall
provide or cause its broker(s) to provide Columbia the following
information: (1) the title, number of shares and principal amount of
each security beneficially owned by the access person; (2) the name of
any broker, dealer or bank from whom the access person maintains an
account in which any securities were beneficially owned by the access
person; and (3) the date the report is submitted by the access person.
(c) Disinterested Director/Trustee. A disinterested director/trustee is
required to report a purchase or sale transaction in a security only if
the disinterested director/trustee, at the time of the transaction,
knew or, in the ordinary course of fulfilling his or her duties as a
director/trustee of a Columbia Fund, should have known that, during the
15-day period immediately preceding or after the date of the
transaction, such security is or was purchased or sold by the Columbia
Fund or is or was being considered for purchase or sale.
(d) Review of Securities Transactions and Holding Reports. Columbia
shall maintain procedures to ensure that all securities transactions
and holdings reports submitted by employees and access persons are
reviewed by appropriate management or compliance personnel.
8. Certification of Compliance
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All employees and disinterested directors/trustees shall certify
annually, and access persons shall certify on a quarterly basis, that they have
read and understood the Code and are subject thereto, have complied with the
requirements of the Code and have disclosed or reported all personal securities
transactions as required by the Code.
9. Sanctions
Upon discovering a violation of this Code, Columbia may impose such
sanctions as it deems appropriate, including, among other things, a letter of
censure or suspension or termination of the employment of the violator.
10. Report to the Board of Directors.
On an annual basis, the Ethics Committee shall prepare a written report
to the management of Columbia and the Boards of Directors/Trustees of the
Columbia Funds and the other Columbia companies that (1) describes any issues
arising under the Code since the last report including, but not limited to,
information about material violations of the Code and sanctions imposed in
response to the material violations; and (2) certifies that Columbia has adopted
procedures reasonably necessary to prevent violations of the Code. Columbia
shall present any material change to the Code to the Board of Directors/Trustees
no later than six months after adoption of the material change.
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APPENDIX A - Beneficial Ownership
For purposes of the Code of Ethics, the term "beneficial ownership"
shall be interpreted in accordance with the definition of "beneficial owner" set
forth in Rule 16a-l(a)(2) under the Securities Exchange Act of 1934, as amended,
which states that the term "beneficial owner" means "any person who, directly or
indirectly, through any contract, arrangement, understanding, relationship or
otherwise, has or shares a direct or indirect pecuniary interest in" a security.
The term "pecuniary interest" is further defined to mean "the opportunity,
directly or indirectly, to profit or share in any profit derived from a
transaction in the subject securities."
The pecuniary interest standard looks beyond the record owner of
securities. As a result, the definition of beneficial ownership is extremely
broad and encompasses many situations which might not ordinarily be thought to
confer a "pecuniary interest" in or "beneficial ownership" of securities.
Securities Deemed to be "Beneficially Owned"
Securities owned "beneficially" would include not only securities held
by you for your own benefit, but also securities held (regardless of whether or
how they are registered) by others for your benefit in an account over which you
have influence or control, such as, for example, securities held for you by
custodians, brokers, relatives, executors, administrators, or trustees. The term
also includes securities held for your account by pledgees, securities owned by
a partnership in which you are a general partner, and securities owned by any
corporation that you control.
Set forth below are some examples of how beneficial ownership may arise
in different contexts.
Family Holdings. Securities held by members of your immediate family
sharing the same household are presumed to be beneficially owned by you. Your
"immediate family" includes any child, step-child, grandchild, parent,
step-parent, grandparent, spouse, significant other, sibling, mother-in-law,
father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law
(but does not include aunts and uncles, or nieces and nephews). The definition
also includes adoptive relationships. You may also be deemed to be the
beneficial owner of securities held by an immediate family member not living in
your household if the family member is economically dependent upon you.
Partnership and Corporate Holdings. A general partner of a general or
limited partnership will generally be deemed to beneficially own securities held
by the partnership, as long as the partner has direct or indirect influence or
control over the management and affairs of the partnership. A limited partner
will generally not be deemed to beneficially own securities held by a limited
partnership, provided he or she does not own a controlling voting interest in
the partnership. If a corporation is your "alter ego" or "personal holding
company", the corporation's holdings of securities are attributable to you.
Trusts. Securities held by a trust of which you are a beneficiary and
over which you have any direct or indirect influence or control would be deemed
to be beneficially owned by you. An example would be where you as settlor have
the power to revoke the trust without the consent of another person, or have or
share investment control over the trust.
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Estates. Ordinarily, the term "beneficial ownership" would not include
securities held by executors or administrators in estates in which you are a
legatee or beneficiary unless there is a specific bequest to you of such
securities, or you are the sole legatee or beneficiary and there are other
assets in the estate sufficient to pay debts ranking ahead of such bequest.
Securities Deemed Not to be "Beneficially Owned"
For purposes of the Code of Ethics, the term "beneficial ownership"
excludes securities or securities accounts held by you for the benefit of
someone else if you do not have a pecuniary interest in such securities or
accounts. For example, securities held by a trust would not be considered
beneficially owned by you if neither you nor an immediate family member is a
beneficiary of the trust. Another example illustrating the absence of pecuniary
interest, and therefore also of beneficial ownership, would be securities held
by an immediate family member not living in the same household with you, and who
is not economically dependent upon you.
"Influence or Control"
Transactions over which you have "no direct or indirect influence or
control" are not subject to the pre-clearance requirements or prohibited
transaction rules in Sections 3 and 4 of the Code of Ethics. See Section 5(a).
To have "influence or control", you must have an ability to prompt, induce or
otherwise affect transactions in the account. Like "beneficial ownership, the
concept of influence or control encompasses a wide variety of factual
situations. An example of where influence or control exists would be where you,
as a beneficiary of a revocable trust, have significant ongoing business and
social relationships with the trustee of the trust. Examples of where influence
or control does not exist would be a true blind trust, or securities held by a
limited partnership in which your only participation is as a non-controlling
limited partner. The determining factor in each case will be whether you have
any direct or indirect influence or control over the securities account.
Employees with such blind trust or third party discretionary accounts shall have
their account agreement and/or governing documents forwarded to Ethics Committee
for review prior to trading pursuant to this exemption. The account will only be
exempt if the employee initially, and on an annual basis thereafter, certifies
that he or she maintains no control or influence over the account.
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APPENDIX B - Members of Ethics Committee
Thomas L. Thomsen
Alexander S. Macmillan
Jeff B. Curtis
Mark A. Wentzien
Rich S. Mettler
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