SELIGMAN HENDERSON CO.
HENDERSON INVESTMENT MANAGEMENT LIMITED
HENDERSON INVESTORS NORTH AMERICA INC.
COMPLIANCE AND PROCEDURES MANUAL
(Relevant Sections Only)
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1. Introduction and General Principles
1.1. Introduction
This document comprises the Compliance Manual for the operation of the
subsidiaries of H PLC.
It is the responsibility of each member of staff to ensure that they are
familiar with the section of the manual applicable to their duties.
The Compliance Representative and Compliance Manager assigned to each cost
centre are available to provide clarification and to assist generally to ensure
compliance with applicable regulations. Appendix 1 details the Compliance
Representatives and Compliance Managers for each cost centre.
All rule references are to IMRO rules unless otherwise stated.
1.2. Compliance Policy
The Board of H PLC has adopted a statement of Policy with regard to Compliance
as follows:
1.2.1. Policy
The Group will comply with all applicable laws and regulations affecting its
operations.
The Group's adherence to the Principles and Rules of SIB, IMRO and PIA are an
essential prerequisite to its future. Adherence to non-UK laws and regulations
are equally essential to the development of the business in foreign
jurisdictions.
The general attitude throughout the organisation should be one of acceptance of
the standards of conduct set out in the Principles and of the necessity to
comply with the Rules of the regulatory bodies with which the Group is
registered.
1.2.2. Scope
This policy covers compliance with all UK and foreign laws and regulations,
including, in particular, the FSA and the regulatory framework associated
therewith, US securities legislation and the laws governing the Group's
operations in Luxembourg, HOLLAND, Japan, Singapore and ITALY.
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1.2.3. Objectives and Responsibilities
The directors of the Group and each of the regulated subsidiaries have
responsibility for preserving their companies' fit and proper status to carry
out investment business and for compliance with the laws and regulations
governing the conduct of their business.
In order to fulfil this responsibility, the directors will ensure that the Group
has a compliance function which is adequately staffed and resourced to provide a
support and monitoring role for the Group's activities. The Compliance Officer
will be a senior member of the Group's staff and will have direct access as
necessary to the Chairman and Group Managing Director, the Audit Committee and
the directors of H PLC and the regulated entities. The staff of the Compliance
Department will have unrestricted access to all parts of the organisation.
The Group will conduct its relationship with IMRO and PIA on the basis of full
and frank disclosure of all matters which should properly be disclosed to the
regulatory bodies.
The Group must have adequate and effective operational arrangements to achieve
compliance with the Rules of regulatory bodies, particularly those of IMRO, PIA
and the SEC in the USA. The Group must therefore have operating procedures which
are well documented, clearly expressed and kept up-to-date.
There must be effective control and supervision procedures to ensure that the
Board's policy is observed.
There must be effective training and recruitment procedures, including the
taking up of references, so as to ensure that staff are competent to carry out
their responsibilities. Remuneration policies must avoid conflicts of interest
between the interests of the customer and that of the employee.
There must be adequate training of staff in relation to the applicable laws and
regulations.
The Group will issue a Code of Conduct to all employees covering personal
account dealings, confidential information and conflicts of interest.
The Group will operate procedures for disciplinary action in respect of breaches
of the Rules or Code of Conduct.
The Group's regulated entities will at all times maintain adequate financial
resources to enable them to continue to conduct investment business. The
directors of those entities are responsible for monitoring their compliance on a
regular basis.
The Group's regulated entities will ensure that their Appointed Representatives
are competent and comply with the Principles and the Rules. This cannot be
delegated to the Appointed Representative and is the responsibility of the board
of directors of the regulated entity.
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1.3. SIB Principles
1.3.1. Integrity
A firm should observe high standards of integrity and fair dealing.
1.3.2. Skill, Care and Diligence
A firm should act with due skill, care and diligence.
1.3.3. Market Practice
A firm should observe high standards of market conduct. It should also, to the
extent endorsed for the purpose of this principle, comply with any code or
standard as in force from time to time and as it applies to the firm either
according to its terms or by rulings made under it.
1.3.4. Information about Customers
A firm should seek from customers it advises or for whom it exercises discretion
any information about their circumstances and investment objectives which might
reasonably be expected to be relevant in enabling it to fulfil its
responsibility to them.
1.3.5. Information for Customers
A firm should take reasonable steps to give a customer it advises, in a
comprehensible and timely way, any information needed to enable him/her to make
a balanced and informed decision. A firm should similarly be ready to provide a
customer with a full and fair account of the fulfilment of its responsibilities
to him/her.
1.3.6. Conflicts of Interest
A firm should either avoid any conflict of interest arising, or, where conflicts
arise, should ensure fair treatment to all its customers by disclosure, internal
rules of confidentiality, declining to act, or otherwise. A firm should not
unfairly place its interests above those of its customers, and, where a properly
informed customer would reasonably expect that the firm would place his/her
interests above its own, the firm should live up to that expectation.
1.3.7. Customer Assets
Where a firm has control of, or is otherwise responsible for, assets belonging
to a customer which it is required to safeguard, it should arrange proper
protection for them, by way of segregation and identification of those assets or
otherwise, in accordance with the responsibility it has accepted.
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1.3.8. Financial Resources
A firm should ensure that it maintains adequate financial resources to meet its
investment business commitments and to withstand the risks to which its business
is subject.
1.3.9. Internal Organisation
A firm should organise and control its internal affairs in a responsible manner,
keeping proper records, and where the firm employs staff or is responsible for
the conduct of investment business by others, should have adequate arrangements
to ensure that they are suitable, adequately trained and properly supervised and
that it has well-defined compliance procedures.
1.3.10. Relations with Regulators
A firm should deal with its regulator in an open and co-operative manner and
keep the regulator promptly informed of anything concerning the firm which might
reasonably be expected to be disclosed to it.
1.4. Breaches of Regulations
Error reporting and rectification procedures are set out in the Business Control
Manual. The definition of an error includes any act of commission or omission
that results in a breach of regulations. Any breaches of the requirements set
out in this Manual must be reported and rectified in accordance with the error
reporting and rectification procedures.
2. Code of Ethics
2.1. Introduction
The Code of Ethics provides a general statement of the standard of conduct
expected of directors and staff employed by companies within the Group.
Ultimately, the Group's continued authorisation to conduct investment business
is conditional on group companies' being adjudged fit and proper to do so.
Observance of the code will contribute to ensuring that this is the case.
2.2. The customer's interest comes first
The interests of the customer must come before those of the Group and individual
members of staff.
All customers must be treated fairly and the interests of one customer must not
be placed above the interests of another.
The highest possible standards of skill, care and diligence must be applied when
acting on behalf of customers.
2.3. Fair dealing
Investment transactions must be allocated promptly, taking into account the best
interest of all customers.
In making investment decisions on behalf of customers, any conflicts of interest
that may exist must be disregarded. Such conflicts may arise if:
o a director or member of staff is a director of, holds or deals in
securities of, or is otherwise interested in, any company whose
securities are held or dealt in on behalf of the customer;
o a transaction is in relation to an investment in respect of which
a Group company may benefit from a management fee, commission or
mark up/down;
o a director or member of staff receives remuneration based on
performance of funds managed for certain customers but not
others.
2.4. Personal dealing
Directors and staff and their connected parties are prohibited from dealing
personally in any security in which they are carrying out a transaction on
behalf of a customer or are likely to do so in the near future.
Directors and staff and their connected parties may not deal in an investment at
any time if they are in possession of unpublished price sensitive information.
Directors and staff and their connected parties may not deal in an investment
with a customer whose portfolio is under the discretionary management of a Group
company.
Directors and staff and their connected parties may not deal in an investment if
to do so would involve them in a conflict between their own interest and that of
any customer or their duty to any customer.
All personal dealings must be approved in writing in advance by a designated
director or other authorised individual.
2.5. Accepting and giving gifts
A director or member of staff must not accept any gift which is of sufficient
value to conflict with his/her duties.
A director or member of staff must not give any gift which is of sufficient
value to conflict with the duties of the recipient
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HENDERSON INVESTORS
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PERSONAL ACCOUNT DEALING RULES
("the Rules")
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(Relevant Sections Only)
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1. INTRODUCTION
1.1 The investment activities of Henderson PLC (HPLC) and Henderson Fund
Management plc (HFM), its subsidiaries (including overseas subsidiaries)
and joint ventures (HENDERSON INVESTORS) are regulated by the Investment
Management Regulatory Organisation (IMRO). Henderson Investors Limited
and Henderson Investment Funds Limited are also regulated by the Personal
Investment Authority (PIA). In order to comply with IMRO and PIA rules
about personal dealing as well as the rules of overseas regulators who
have jurisdiction over other aspects of Henderson Investors' business,
all employees of Henderson Investors are required to comply with the
Henderson Personal Account Dealing Rules as set out below and as they may
be amended from time to time (the Rules).
1.2 In addition to the requirements of IMRO and PIA, there should be
appropriate staff dealing rules as a matter of best industry practice and
to assure the clients of Henderson Investors that their interests are
fully safeguarded.
1.3 All staff will be asked on an annual basis to confirm their understanding
of this policy and their compliance with it.
1.4 The Rules apply to all dealings by or on behalf of Group Employees and
connected persons.
1.5 The Compliance Officer should be consulted as to the applicability of the
Rules to particular circumstances. Doubt as to such applicability is not
good cause to fail either to sign the undertaking to comply with the
Rules or to comply with them.
2. UNDERTAKING
2.1 CONDITION OF EMPLOYMENT
Compliance with the Rules is a condition of employment and forms part of
all Group Employees' contracts of employment. Failure to sign the
Undertaking (see Schedule 4) to comply with the Rules and/or to comply
with them are grounds for summary dismissal.
2.2 SIGNING OF UNDERTAKING
To indicate acceptance of the Rules, the Undertaking at the back of this
document must be signed.
You will be asked to renew this undertaking on an annual basis by the
Compliance Department.
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3. PERSONS TO WHOM AND CIRCUMSTANCES IN WHICH THE RULES APPLY
3.1 GROUP EMPLOYEES
A PERSON INCLUDING A CONNECTED PERSON (SEE 3.2 BELOW), TO WHOM THE RULES APPLY,
IS REFERRED TO IN THE RULES AS A "GROUP EMPLOYEE". The Rules governing dealing
in investments apply to ALL EMPLOYEES, INCLUDING DIRECTORS, OF HENDERSON
INVESTORS AND TO EMPLOYEES OF APPOINTED REPRESENTATIVES OF GROUP COMPANIES. This
includes secondees, temporary employees and consultants (ON CONTRACTS EXCEEDING
THREE MONTHS) unless specific permission for their exemption has been obtained
from the Compliance Officer.
3.2 CONNECTED PERSONS
The Rules also apply to dealings by anyone connected with an employee (a
connected person). A person is connected for the purpose of these rules if by
reason of a domestic, business or other relationship (other than one which
arises because that person is a client of Henderson Investors) a Group Employee
has influence over that person's judgement as to how to invest his property or
exercise any rights attaching to his investments. Connected persons INCLUDE
EMPLOYEES' SPOUSES AND PARTNERS (UNLESS OTHERWISE SPECIFICALLY AGREED WITH THE
COMPLIANCE OFFICER) AND INFANT CHILDREN. Connected persons will also cover
individuals, including parents, who may be living with you and/or you have a
degree of influence over their investment decisions and investment clubs, again
where employees who are members have a degree of influence over the clubs'
investment decisions. If there is any doubt as to whether a person is a
connected person, the Compliance Officer should be consulted.
3.3 DISCRETIONARY MANAGEMENT BY THIRD PARTIES
The Rules apply to transactions carried out on behalf of a Group Employee by a
fund manager or other person acting under a discretionary management agreement,
unless otherwise specifically agreed with the Compliance Officer.
3.4 AS TRUSTEE, EXECUTOR OR ADMINISTRATOR
A Group Employee who is a trustee, executor or administrator must also comply
with the provisions of Schedule 3.
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4 INVESTMENTS AND TRANSACTIONS TO WHICH THE RULES APPLY
4.1 INVESTMENTS
Investments for the purposes of these rules are financial instruments,
including:-
o shares and stock in the share capital of a company;
o debentures including debenture stock, loan stock, bonds, CDs and other
instruments creating or acknowledging indebtedness;
o warrants and other instruments entitling the holder to subscribe for
investments;
o certificates representing securities (e.g. ADRs, GDRs)
o futures and options;
o contracts for differences (including dealing with, for example, City
Index)
4.2 TRANSACTIONS
The Rules apply to:
o buying and selling shares on or off-exchange (THIS INCLUDES IPOS); o
taking up rights on a RIGHTS ISSUE (INCLUDING TAKING UP OPEN OFFERS);
o exercising CONVERSION or SUBSCRIPTION RIGHTS; o exercising an
OPTION; o dealing in an investment subject to a TAKE-OVER OR TENDER
OFFER (but excluding acceptance of the offer);
o transactions under ISA/PEP schemes; and
o commencement, termination and increases or decreases of direct debits
to INVESTMENT TRUST SAVINGS schemes and the sale of holdings built up
under such schemes.
4.3 EXCEPTIONS
The Rules do not extend to any transaction in a unit trust, an open ended
investment company, a life insurance policy, or Central Government or Public
Authority Debt (eg. Gilts).
...
6. PERSONAL TRADING RULES
6.1 GENERAL
Group employees generally have the option as to whether to deal through the
Central Dealing Desk (via a Staff Account) or use their own broker. The only
time when dealing must take place through the Central Dealing desk, or through
Henderson product administration, is when you are carrying out transactions in
Henderson managed investment trusts (see Rule 6.4 below).
6.2 PERMISSION REQUIRED FOR DEALING
A Group Employee may not buy or sell ANY investment (as set out in Rule 4 above)
without having first obtained SPECIFIC PERMISSION, in the form set out below,
from an authorised signatory. The authorised signatories are as follows:
NAME TEL NO.
BOB PARKER 4361
Head of Centralised Dealing
PAUL MORTIMER 5696
Assistant Head of Centralised Dealing
ANDREW MUNRO 4313
Dealer
DAVID COLLARD 4355
Dealer
Dealing Desk Fax No.: (44) 20 7410 4793
In order to gain permission to deal, a completed Application for Permission To
Deal Form (the Form), which can be obtained from the Compliance Department or
the Central Dealing Desk, must be signed by one of the above authorised
signatories as appropriate. After a completed Form has been approved, the
transaction may be effected either internally through the Central Dealing Desk
or through an external broker (other than Henderson Investors' investment trusts
- see Rule 6.4). Transaction orders must be placed by the close of business on
the day permission to deal is granted.
6.3 THE USE OF BROKERS
Staff are permitted to use external brokers (THIS INCLUDES DEALING THROUGH THE
INTERNET) except when buying Henderson investment trusts. Each employee should
restrict their securities trading dealings to no more than one or two brokers,
preferably one.
If a Group Employee intends to effect a personal account transaction through the
agency of another firm (including share shops) he/she must, BEFORE GIVING
INSTRUCTIONS TO DEAL:
o inform that other firm that he/she is a Group Employee; AND
o have made arrangements for the transacting broker to send a copy of
the contract note or other advice in respect of the transaction,
within 24 hours, to Henderson Investors Limited, addressed for the
attention of the Compliance Officer (IN THE CASE OF DEALING THROUGH
THE INTERNET, A SCREEN PRINT OF THE TRADE CONFIRMATION); AND
o obtain due authorisation on an Application for Permission to Deal Form
(see Rule 6.2 above).
In the case of any transaction, for which a contract note or other advice is not
issued, the Compliance Officer must be informed in writing within 24 hours, with
full details of the transaction.
A Group Employee must not request or accept any credit or special dealing
facilities in connection with a transaction, from the firm through which that
transaction is to be effected, unless prior permission, in writing, has been
received from the Compliance Officer.
6.4 DEALINGS IN INVESTMENT TRUSTS MANAGED BY HENDERSON INVESTORS
Dealings in investment trusts managed by Henderson Investors MUST BE MADE
THROUGH A SEPARATE FULL STAFF ACCOUNT or through a Henderson retail product
(e.g. ISA/PEP, Share Plan; see Rule 6.6) in order to enable Henderson Investors
to monitor concert party holdings. Furthermore shares in investment trusts
managed by Henderson Investors may be in closed periods (e.g. because of results
pending) or embargoed (e.g. because of insider information within Henderson
Investors) and it is imperative that you do not deal in these periods. The full
account service is, for these reasons, provided free of charge. A list of the
current group investment trusts is set out in Schedule 2. Such securities must
be held in the Henderson nominee name, unless otherwise agreed by Compliance.
Furthermore a Group Employee must comply with the following rules in relation to
dealings in shares of the investment trusts managed and/or administered by
Henderson Investors:
o such shares must not be dealt in on considerations of a short term
nature;
o such shares must not be dealt in during close periods preceding the
preliminary announcement of the company's annual results and
interim/quarterly results. A full list of closed periods for the
investment trusts are available on the Intranet, Notice Boards, from
the Dealing Desk or Compliance;
o such shares must not be dealt in at any other time by a Group Employee
if he/she is in possession of unpublished price-sensitive information
in relation to the issuer.
Investment trusts to which this Rule applies, are set out in Schedule 2 .
Changes to the list will be notified as they occur.
A Group Employee who is a director of one or more of these companies must also
comply with the rules issued by the relevant company or companies.
6.5 THE USE OF STAFF ACCOUNTS
Before any purchases may be executed through the Central Dealing Desk, a Staff
Full Account must be opened and sufficient cleared funds credited to that
account. Overdrafts caused by Personal Dealings are a SERIOUS BREACH OF THE
RULES AND DISCIPLINARY ACTION WILL BE TAKEN AS CONSIDERED APPROPRIATE In
addition, late settlement penalties and/or other costs incurred by Henderson
will be charged.
FOR ANY SALES TO BE EXECUTED THROUGH THE CENTRAL DEALING DESK, THE INVESTMENTS
MUST HAVE BEEN REGISTERED IN THE NAME OF HENDERSON NOMINEES.
STAFF ACCOUNTS WILL BE CLOSED IMMEDIATELY UPON NOTICE OF TERMINATION OF AN
EMPLOYEE'S EMPLOYMENT WITH HENDERSON INVESTORS and arrangements must be made for
the sale or transfer of any holdings in such an account. Any securities, not so
sold or transferred within 28 days of Henderson Investors Employee's employment
ceasing, will be sold and the proceeds of sale remitted to the last known home
address of the former employee.
6.6 SAVINGS SCHEMES
Staff may also invest in investment trusts managed by both Henderson Investors
and other fund management firms, and other forms of investments to which the
rules apply, through some form of savings vehicle (i.e. Investment Trust Savings
Schemes, Portfolio Management Services, ISAs, PEPs etc.). PERMISSION TO DEAL IS
REQUIRED WHENEVER AN EMPLOYEE STARTS, INCREASES, DECREASES OR STOPS A DIRECT
DEBIT/STANDING ORDER INTO THE SAVINGS VEHICLE. In the same way lump sum
investments into, or withdrawals from, a savings vehicle require permission to
deal before investing. When investing through a savings plan offered by another
fund management house the procedures for EXTERNAL DEALINGS (see Rule 6.3) must
also be followed.
6.7 THE PROHIBITION ON INSIDER DEALING
A Group Employee must not deal in an investment at any time when he/she knows,
or would reasonably be expected to know, that this would contravene the insider
dealing provisions contained in Part V of the Criminal Justice Act 1993 (a
summary of the insider dealing provisions is provided in Schedule 1 of the
Rules).
6.8 CONFLICT OF INTEREST
A Group Employee must not knowingly deal in an investment with a client whose
portfolio is managed by Henderson Investors.
A Group Employee must not deal if to do so would involve him/her in a conflict
between his/her own interest and that of any client or his/her duty to any
client.
Where the applicant, for permission to deal, intends to deal in stock which
could be dealt in on behalf of one or more of his/her clients, he/she is
required to provide a WRITTEN EXPLANATION as to why he/she is not dealing at the
same time for clients.
If the explanation provided above, for not dealing on behalf of clients at the
same time as personally, is not considered satisfactory by Compliance,
Compliance may require the transaction to be unwound at the individual's
expense.
6.9 FRONT RUNNING
If a decision has been, or is likely to be, made to deal for a discretionary
client, a Group Employee must not deal and the dealing desk must not execute a
deal the same way in advance of that client's order.
Where personal account dealing in a security takes place within seven days of a
deal on behalf of a client (either before or after) in the same security, the
person who carries out the personal account deal may be required to provide an
explanation to Compliance, evidencing to the satisfaction of Compliance that:-
i) there has been no front running;
ii) no client has been prejudiced as a result of the personal account
dealing.
(N.B. FOR PORTFOLIO MANAGERS, THIS SHOULD BE READ IN CONJUNCTION WITH RULE 6.8)
In the case of FTSE 100 stocks, it is unlikely that Compliance would consider
that either of the two possibilities set out above would have occurred where
more than two days had elapsed between deals. The longer the delay between the
personal dealing and the client dealing, the less likely it is that there will
be a material issue.
If, however, Compliance determine that there has been either front running or
client prejudice, Compliance may require the transaction to be unwound at the
individual's expense.
In the event that Compliance determine that a transaction should be unwound and
the individual is dissatisfied with that determination, the matter will be
referred to Henderson Investors' Director of Asset Management for his opinion.
The final decision as to whether the transaction should be unwound, nevertheless
remains with Compliance.
THESE PROHIBITIONS ARE NOT OVERRULED BY ANY AUTHORISATION THAT IS OBTAINED UNDER
RULE 6.2 ABOVE.
6.10 SPREADBETTING
Equity/Fixed Interest spread bets are allowed for staff but the
following criteria must be adhered to, in addition to gaining permission from
the centralised dealing desk:
1. Deals must be with an SFA regulated firm.
2. All deals must be fully covered - credit facilities with spread betting
firms must not be opened without the prior approval of the Compliance
Department.
For clarification purposes this includes all equity and non-Central
Government/Public Authority Debt bets. Central Government Debt, Public Authority
Debt, index, currency or sporting bets are exempt and do not require prior
approval.
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Compliance Manual Appendix 12
(RELEVANT SECTIONS ONLY)
1 GENERAL
1.1 STATEMENT OF POLICY
It is the policy of Seligman Henderson Co, Henderson Investment Management
Limited and Henderson Investors North America Inc. hereinafter referred to as
`HENDERSON'that that investment advisory services of the firm and all related
activities comply fully with the provisions of the Investment Advisers Act of
1940 and the rules and regulations thereunder, as well as all other federal and
state statutes and regulations pertaining to its services and with the highest
principles of fiduciary responsibility as set forth in this manual.
In a business such as ours, it is of paramount importance that our clients never
have reason to doubt their decision to place their faith and confidence in us.
Any action that can cause that decision to be questioned jeopardises the future
of Henderson and everyone that is employed by it. If you are aware of any
activities that you believe may be in violation of the law or the policies
contained in this manual, it is your responsibility to pass this information on
to the Compliance Department. Requests for anonymity will be honoured to the
maximum extent possible.
1.2 CODE OF ETHICS
The purpose of this Code of Ethics ("Code") is to set forth the policies of
Henderson the matter of conflicts of interest and to provide a formal record of
them for each individual's reference and guidance. This Code is also designed to
prevent any act, practice or course of business prohibited by Rule 17j-1 (a)
under the Investment Company Act of 1940 (the "Act"), and to conform with the
provisions of Rule 204-2 under the Investment Advisers Act of 1940 which
requires registered investment advisers to maintain records of the securities
transactions of its personnel. Compliance with the Henderson Compliance Manual
will ensure you remain compliant with the Code of Ethics.
Each director, officer and employee of Henderson is a fiduciary with respect to
the firm's clients (including the shareholders of investment companies managed
by Henderson). In simple terms, this means that the interest of clients come
first, ahead of the interest of any person within the organisation. Accordingly,
each director, officer and employee must conduct personal securities
transactions in a manner that does not interfere with the transactions of the
firm's clients or otherwise take unfair advantage of the relationship to the
firm's clients. Each director, officer and employee must adhere to this general
principle, as well as comply with the Code's specific provisions. Technical
compliance with the Code will not insulate from scrutiny transactions that show
a pattern of abuse of an individual's fiduciary duties. It is imperative that
each of Henderson's directors, officers and employees avoid any situation that
might compromise, or call into question, the exercise of fully dependent
judgement in the interests of the firm's clients.
...
2.6 MAINTENANCE AND RETENTION OF BOOKS AND RECORDS
The Advisers Act requires that certain records be prepared and maintained by all
advisers, with additional records specified if the adviser provides portfolio
management services or if it maintains custody of or has access to its clients'
cash and securities. These records are required to be maintained on a "current"
basis, which means for journals, order tickets and other records of original
entry, that they be created concurrently with the transaction or other event
they are recording. Summary records, such as ledgers, need only be created as
the needs of the individual adviser's dictate, but usually no less frequently
than monthly.
The accuracy and integrity of Henderson's records, are not only required by the
laws and regulations to which it is subject, but by the ethical standard by
which Henderson conducts its affairs.
In addition to the records required by the Advisers Act, advisers to registered
investment companies are required to prepare certain additional records specific
by the Investment Company Act of 1940. The records required to be kept by the
Advisers Act and the Investment Company Act are summarised below.
...
2.6.8 PERSONAL SECURITIES TRANSACTIONS
A record of every transaction in any security in which the firm or any of its
"advisory representatives" acquires a direct or indirect beneficial interest,
excluding accounts over which the firm or its advisory representatives have no
control or "exempt" transactions; for example, U.S. Government securities. This
requirement is satisfied by Henderson for its advisory representatives through
the insider trading monitoring system, maintained by the Compliance Department.
...
2.8 FORM AND DURATION OF RECORD MAINTENANCE
The Advisers Act requires that all records be retained for at least five years,
the first two of which should be in the offices of the adviser. They may be
maintained on microfilm or computerised records, as appropriate, but only if
there is adequate provision for the prompt access and hard-copy reproduction of
the records so maintained.
2.9 ADDITIONAL RECORDS REQUIRED BY THE INVESTMENT COMPANY ACT
In addition to the records described above, advisers providing investment advice
to investment companies must maintain specific records including the following :
...
2.9.3 LIST OF ACCESS PERSONS
The Investment Company Act ("IC Act") requires every investment company to adopt
a code of ethics. Every person deemed to be an access person should receive a
copy of the code of ethics and adhere to it. (Generally, compliance with the
adviser's securities trading monitoring system meets the requirements of the
investment company's code of ethics.) The adviser must maintain a record of all
access persons of the investment company. (With respect to an investment
adviser, an access person is an officer, director or other employee of the firm
who, as part of his regular duties, makes, participates in, or obtains
information regarding the purchase or sale of a security by a registered
investment company, or whose functions relate to the making of any
recommendations with respect to such purchase or sales.)
...
11 COMPLIANCE MONITORING
In order to ensure that Henderson and affiliated entities conducts its business
activities in conformity with established federal and state laws, a
comprehensive regulatory program will be administered by the Compliance Officer.
By adhering to the terms of the program. the Firm will be in a better position
to respond to regulatory audits and examinations and, most importantly, will
continue to develop sound business practices.
