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GALAXY FUND II
CODE OF ETHICS
I. LEGAL REQUIREMENT.
Rule 17j-1(b) under the Investment Company Act of 1940, as amended (the
"1940 Act"), makes it unlawful for any trustee or officer of Galaxy Fund II (the
"Trust"), in connection with the purchase or sale by such person of a security
"held or to be acquired" by the Trust:
1. To employ any device, scheme or artifice to defraud the Trust;
2. To make to the Trust any untrue statement of a material fact or
omit to state to the Trust a material fact necessary in order to
make the statements made, in light of the circumstances under
which they are made, not misleading;
3. To engage in any act, practice, or course of business which
operates or would operate as a fraud or deceit upon the Trust; or
4. To engage in any manipulative practice with respect to the
Trust's investment portfolios.
II. PURPOSE OF THE CODE OF ETHICS.
The Trust expects that its trustees and officers will conduct their
personal investment activities in accordance with (1) the duty at all times to
place the interests of the Trust's shareholders first, (2) the requirement that
all personal securities transactions 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 an individual's position of trust and responsibility,
and (3) the fundamental standard that investment company personnel should not
take inappropriate advantage of their positions.
In view of the foregoing, the provisions of Section 17(j) of the 1940 Act,
the Securities and Exchange Commission's 1940 Act Release No. 23958 "Personal
Investment Activities of Investment Company Personnel" (August 24, 1999), the
"Report of the Advisory Group on Personal Investing" issued by the Investment
Company Institute on May 9, 1994 and the Securities and Exchange Commission's
September 1994 Report on "Personal Investment Activities of Investment Company
Personnel," the Trust has determined to adopt this Code of Ethics on behalf of
the Trust to specify a code of conduct for certain types of personal securities
transactions which might involve conflicts of interest or an appearance of
impropriety, and to establish reporting requirements and enforcement procedures.
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III. DEFINITIONS.
A. An "Access Person" means: (1) each trustee or officer of the
Trust; (2) each employee (if any) of the Trust (or of any company
in a control relationship to the Trust) 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 the Trust or whose functions relate to the making of
any recommendations with respect to such purchases or sales; and
(3) any natural person in a control relationship to the Trust who
obtains information concerning recommendations made to the Trust
with regard to the purchase or sale of a security.
For purposes of this Code of Ethics, an "Access Person" does not
include any person who is subject to the securities transaction
pre-clearance requirements and securities transaction reporting
requirements of the Code of Ethics adopted by the Trust's
investment adviser or principal underwriter in compliance with
Rule 17j-1 of the 1940 Act and Rule 204-2(a)(12) of the
Investment Advisers Act of 1940 or Section 15(f) of the
Securities Exchange Act of 1934, as applicable.
B. "Restricted Trustee" or "Restricted Officer" means each trustee
or officer of the Trust who is not also a director, officer,
partner, employee or controlling person of the Trust's investment
adviser, administrator, custodian, transfer agent, or
distributor.
C. An Access Person's "immediate family" includes a spouse, minor
children and adults living in the same household as the Access
Person.
D. A security is "held or to be acquired" if within the most recent
15 days it (1) is or has been held by the Trust, or (2) is being
or has been considered by the Trust or its investment adviser for
purchase by the Trust. A purchase or sale includes the writing of
an option to purchase or sell and any security that is
exchangeable for or convertible into, any security that is held
or to be acquired by a fund.
E. An "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.
F. "Investment Personnel" of the Trust means:
(i) Any employee of the Trust (or of any company in a
control relationship to the Trust) who, in connection with his or
her regular
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functions or duties, makes or participates in making
recommendations regarding the purchase or sale of securities by
the Trust.
(ii) Any natural person who controls the Trust and who
obtains information concerning recommendations made to the Trust
regarding the purchase or sale of securities by the Trust.
G. A "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 under the Securities Act of 1933.
H. "Non-Reportable Security" means:
1. Direct obligations of the Government of the United States;
banker's acceptances; bank certificates of deposit;
commercial paper; high quality short-term debt instruments
(any instrument having a maturity at issuance of less than
366 days and that is rated in one of the two highest rating
categories by a nationally recognized statistical rating
organization), including repurchase agreements; and shares
of registered open-end investment companies.
2. Securities purchased or sold in any account over which the
Access Person has no direct or indirect influence or
control.
I. "Exempt Security" means:
1. Securities purchased or sold in a transaction which is
non-volitional on the part of either the Access Person or
the Trust.
2. Securities acquired as a part of an automatic dividend
reinvestment plan.
3. Securities acquired 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.
4. Securities which the Trust's investment portfolios are not
permitted to purchase under the investment objectives and
policies set forth in the Trust's then current
prospectus(es) under the Securities Act of 1933 or the
Trust's registration statement on Form N-1A.
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IV. POLICIES OF THE TRUST REGARDING PERSONAL SECURITIES TRANSACTIONS.
A. GENERAL POLICY.
No Access Person of the Trust shall engage in any act, practice or
course of business that would violate the provisions of Rule 17j-1(b)
set forth above, or in connection with any personal investment
activity, engage in conduct inconsistent with this Code of Ethics.
B. SPECIFIC POLICIES.
1. RESTRICTIONS ON PERSONAL SECURITIES TRANSACTIONS BY ACCESS
PERSONS OTHER THAN RESTRICTED TRUSTEES AND RESTRICTED OFFICERS.
a. No Access Person who is not a Restricted Trustee or
Restricted Officer may buy or sell securities other than
Non-Reportable Securities and Exempt Securities for his or
her personal portfolio or the portfolio of a member of his
or her immediate family without obtaining oral authorization
from the Compliance Officer of the Trust's administrator
PRIOR to effecting such security transaction.
A written authorization for such security transaction will
be provided by the administrator's Compliance Officer to the
person receiving the authorization (if granted) and to the
Trust's administrator to memorialize the oral authorization
that was granted.
NOTE: If an Access Person has questions as to
whether purchasing or selling a security for his
or her personal portfolio or the portfolio of a
member of his or her immediate family requires
prior oral authorization, the Access Person
should consult the administrator's Compliance
Officer for clearance or denial of clearance to
trade PRIOR to effecting any securities
transactions.
b. Pre-clearance approval under paragraph (a) will expire
at the close of business on the trading day after the
date on which oral authorization is received, and the
Access Person is required to renew clearance for the
transaction if the trade is not completed before the
authority expires.
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c. No clearance will be given to an Access Person other
than a Restricted Trustee or Restricted Officer to
purchase or sell any security (1) on a day when any
portfolio of the Trust has a pending "buy" or "sell"
order in that same security until that order is
executed or withdrawn or (2) when the Compliance
Officer has been advised by the investment adviser that
the same security is being considered for purchase or
sale for any portfolio of the Trust.
d. The pre-clearance requirement contained in paragraph
IV.B.1.a, above, shall apply to ALL purchases of a
beneficial interest in any security through an Initial
Public Offering or a Limited Offering by any Access
Person who is also classified as Investment Personnel.
A record of any decision and the reason supporting such
decision to approve the acquisition by Investment
Personnel of Initial Public Offerings or Limited
Offerings shall be made by the Compliance Officer.
2. RESTRICTIONS ON PERSONAL SECURITIES TRANSACTIONS BY RESTRICTED
TRUSTEES AND RESTRICTED OFFICERS.
The Trust recognizes that a Restricted Trustee and a Restricted
Officer do not have on-going, day-to-day involvement with the
operations of the Trust. In addition, it has been the practice of
the Trust to give information about securities purchased or sold
by the Trust or considered for purchase or sale by the Trust to
Restricted Trustees and Restricted Officers in materials
circulated more than 15 days after such securities are purchased
or sold by the Trust or are considered for purchase or sale by
the Trust. Accordingly, the Trust believes that less stringent
controls are appropriate for Restricted Trustees and Restricted
Officers, as follows:
a. The securities pre-clearance requirement contained in
paragraph IV.B.1.a. above shall apply to a Restricted
Trustee or Restricted Officer only if he or she knew or, in
the ordinary course of fulfilling his or her official duties
as a trustee or officer, should have known, that during the
fifteen day period before the transaction in a security
(other than a Non-Reportable Security or an Exempt Security)
or at the time of the transaction that the security
purchased or sold by him or her (other than a Non-Reportable
Security or an Exempt Security) was also purchased or sold
by the Trust or considered for purchase or sale by the
Trust.
b. If the pre-clearance provisions of the preceding paragraph
apply, no clearance will be given to a Restricted Trustee or
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Restricted Officer to purchase or sell any security (1) on a
day when any portfolio of the Trust has a pending "buy" or
"sell" order in that same security until that order is
executed or withdrawn or (2) when the Compliance Officer has
been advised by the investment adviser that the same
security is being considered for purchase or sale for any
portfolio of the Trust.
V. PROCEDURES.
A. In order to provide the Trust with information to enable it to
determine with reasonable assurance whether the provisions of this
Code are being observed by its Access Persons:
1. Each Access Person of the Trust other than a trustee who is not
an "interested person" of the Trust (as defined in the 1940 Act)
will submit to the Trust's administrator an Initial Holdings
Report in the form attached hereto as Exhibit A that lists ALL
securities other than Non-Reportable Securities beneficially
owned (1) by the Access Person. This report must be submitted
within ten days of becoming an Access Person (or for persons
already designated as Access Persons, by January 30, 2001), and
must include the title of each security, the number of shares
held, and the principal amount of the security. The Report must
also include a list of any securities accounts maintained with
any broker, dealer or bank.
2. Each Access Person of the Trust other than a trustee who is not
an "interested person" of the Trust (as defined in the 1940 Act)
will also submit to the Trust's administrator an Annual Holdings
Report attached hereto as Exhibit A no later than thirty days
after the end of the calendar year. The Annual Holdings Report
must list ALL securities other than Non-Reportable Securities
beneficially owned
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1. You will be treated as the "beneficial owner of a security under this policy
only if you have a direct or indirect pecuniary interest in the security.
(a) A direct pecuniary interest is the opportunity, directly or
indirectly, to profit, or to share the profit, from the transaction.
(b) An indirect pecuniary interest is any nondirect financial interest,
but is specifically defined in the rules to include securities held by
members of your immediate family sharing the same household;
securities held by a partnership of which you are a general partner;
securities held by a trust of which you are the settlor if you can
revoke the trust without the consent of another person, or a
beneficiary if you have or share investment control with the trustee;
and equity securities which may be acquired upon exercise of an option
or other right, or through conversion.
For interpretive guidance on this test, you should consult counsel.
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by the Access Person, the title of each security, the number of
shares held, and the principal amount of the security, as well as
a list of any securities accounts maintained with any broker,
dealer or bank.
3. Each Access Person of the Trust other than a Restricted Trustee
or Restricted Officer shall direct his or her broker to supply to
the Compliance Officer of the Trust's administrator, on a timely
basis, duplicate copies of confirmations of all securities
transactions in which the person has, or by reason of such
transaction acquires any direct or indirect beneficial ownership
and copies of periodic statements for all securities accounts.
4. Each Access Person of the Trust, other than a trustee who is not
an "interested person" (as defined in the 1940 Act), shall submit
reports in the form attached hereto as Exhibit B to the Trust's
administrator, showing all transactions in securities other than
Non-Reportable Securities in which the person has, or by reason
of such transaction acquires, any direct or indirect beneficial
ownership, as well as all accounts established with brokers,
dealers or banks during the quarter in which any securities were
held for the direct or indirect beneficial interest of the Access
Person.(2) Such reports shall be filed no later than 10 days
after the end of each calendar quarter. An Access Person of the
Trust need not make a quarterly transaction report under this
paragraph if all of the information required by this paragraph 4
is contained in the brokerage confirmations or account statements
required to be submitted under paragraph 3.
5. Each trustee who is not an "interested person" of the Trust need
not make an initial or annual holdings report but shall submit
the same quarterly report as required under paragraph 4 to the
Trust's administrator, but only for a transaction in a security
other than a Non-Reportable Security where he or she knew at the
time of the transaction or, in the ordinary course of fulfilling
his or her official duties as a trustee, 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, or
considered for purchase or sale, by the Trust.
6. The administrator of the Trust shall notify each Access Person of
the Trust who may be subject to the pre-clearance requirement or
required to make reports pursuant to this Code that such person
is
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2. See footnote (1) above.
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subject to the pre-clearance or reporting requirements and shall
deliver a copy of this Code to each such person.
7. The administrator of the Trust shall review the initial holdings
reports, annual holdings reports, and quarterly transaction
reports received and, as appropriate, compare the reports with
the pre-clearance authorization received, and report to the
Trust's Board of Trustees:
a. with respect to any transaction that appears to evidence a
possible violation of this Code; and
b. apparent violations of the reporting requirement stated
herein.
8. The Board shall consider reports made to it hereunder and shall
determine whether the policies established in Sections IV and V
of this Code of Ethics have been violated, and what sanctions, if
any, should be imposed on the violator, including but not limited
to a letter of censure, suspension or termination of the
employment of the violator, or the unwinding of the transaction
and the disgorgement of any profits to the Trust. The Board shall
review the operation of this Code of Ethics at least once a year.
9. The Trust's investment adviser(s) shall adopt, maintain and
enforce separate codes of ethics with respect to their personnel
in compliance with Rule 17j-1 and Rule 204-2(a)(12) of the
Investment Advisers Act of 1940 or Section 15(f) of the
Securities Exchange Act of 1934, as applicable, and shall forward
to the Trust's administrator and the Trust's counsel copies of
such codes and all future amendments and modifications thereto.
The Board shall review and approve such codes at least once a
year. Furthermore, any material changes to an investment
adviser's code will be approved by the Board at the next
scheduled quarterly board meeting and in no case more than six
months after such change.
10. At each quarterly Board of Trustees' meeting, the administrator
and investment adviser(s) of the Trust shall provide a written
report to the Trust's Board of Trustees stating:
a. any reported securities transaction that occurred during the
prior quarter that may have been inconsistent with the
provisions of the code(s) of ethics adopted by the Trust's
investment adviser(s); and
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b. all disciplinary actions(3) taken in response to such
violations.
11. At least once a year, the Trust's investment adviser(s) shall
provide to the Board a written report which contains: (a) a
summary of existing procedures concerning personal investing by
advisory persons and any changes in the procedures during the
past year; (b) an evaluation of current compliance procedures and
a report on any recommended changes in existing restrictions or
procedures based upon the Trust's experience under this Code of
Ethics, industry practices, or developments in applicable laws
and regulations; (c) describes any issues arising under the code
of ethics or procedures since the last report, including but not
limited to, information about material violations of the code or
procedures and sanctions imposed in response to material
violations; and (d) a certification that the procedures which
have been adopted are those reasonably necessary to prevent
Access Persons from violating the respective Codes of Ethics.
12. This Code, the Codes of the investment adviser(s), a copy of each
report by an Access Person, any record of any violation of this
Code and any action taken as a result thereof, any written report
hereunder by the Trust's administrator, investment adviser(s),
records of approvals relating to Initial Public Offerings and
Limited Offerings, lists of all persons required to make reports
and a list of all persons responsible for reviewing such reports
shall be preserved with the Trust's records for the period
required by Rule 17j-1.
VI. CERTIFICATION.
Each Access Person will be required to certify annually that he or she has
read and understood this Code of Ethics, and will abide by it. Each Access
Person will further certify that he or she has disclosed or reported all
personal securities transactions required to be disclosed or reported under the
Code of Ethics. A form of such certification is attached hereto as Exhibit C.
The Board of Trustees of Galaxy Fund II
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3. Disciplinary action includes but is not limited to any action that has a
material financial effect upon the employee, such as fining, suspending, or
demoting the employee, imposing a substantial fine or requiring the disgorgement
of profits.
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Exhibit A
GALAXY FUND II
(the "Trust")
HOLDINGS REPORT
For the Year/Period Ended _______________________
(month/day/year)
[ ] Check Here if this is an Initial Holdings Report
To: PFPC Inc., as Administrator of the Trust
As of the calendar year/period referred to above, I have a direct or
indirect beneficial ownership interest in the securities listed below which are
required to be reported pursuant to the Code of Ethics of the Trust:
Title of Number Principal
Security of Shares Amount
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The name of any broker, dealer or bank with whom I maintain an account
in which my securities are held for my direct or indirect benefit are as
follows:
THIS REPORT (I) EXCLUDES TRANSACTIONS WITH RESPECT TO WHICH I HAD NO
DIRECT OR INDIRECT INFLUENCE OR CONTROL, (II) EXCLUDES OTHER TRANSACTIONS NOT
REQUIRED TO BE REPORTED, AND (III) IS NOT AN ADMISSION THAT I HAVE OR HAD ANY
DIRECT OR INDIRECT BENEFICIAL OWNERSHIP IN THE SECURITIES LISTED ABOVE.
Date: Signature:
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Print Name:
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Exhibit B
GALAXY FUND II
(the "Trust")
QUARTERLY TRANSACTION REPORT
For the Calendar Quarter Ended _______________________
(month/day/year)
To: PFPC Inc. as Administrator of the Trust
A. SECURITIES TRANSACTIONS. During the quarter referred to above, the
following transactions were effected in securities of which I had, or by reason
of such transactions acquired, direct or indirect beneficial ownership, and
which are required to be reported pursuant to the Code of Ethics of the Trust:
Number of
Interest Rate Shares or Dollar
Title of and Maturity Date Date of Principal Amount of
Security (If Applicable) Transaction Amount Transaction
-------- ----------------- ----------- --------- -----------
Broker/Dealer
Nature of Or Bank
Transaction Through Which
(Purchase, Transaction
Sale, Other) Price Effected
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* Transactions that are asterisked indicate transactions in a security where I
knew at the time of the transaction or, in the ordinary course of fulfilling my
official duties as a trustee or officer, should have known that during the
15-day period immediately preceding or after the date of the transaction, such
security was purchased or sold, or such security was being considered for
purchase or sale, by the Trust.
B. NEW BROKERAGE ACCOUNTS. During the quarter referred to above, I
established the following accounts in which securities were held during the
quarter for my direct or indirect benefit:
NAME OF BROKER, DEALER OR BANK DATE ACCOUNT WAS ESTABLISHED
C. OTHER MATTERS. This report (i) excludes transactions with respect
to which I had no direct or indirect influence or control, (ii) excludes other
transactions not required to be reported, and (iii) is not an admission that I
have or had any direct or indirect beneficial ownership in the securities listed
above.
Date: ____________________ Signature:
Print Name:
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Exhibit C
GALAXY FUND II
(the "Trust")
ANNUAL CERTIFICATE
Pursuant to the requirements of the Code of Ethics of the Trust, the
undersigned hereby certifies as follows:
1. I have read the Trust's Code of Ethics.
2. I understand the Code of Ethics and acknowledge that I am subject
to it.
3. Since the date of the last Annual Certificate (if any) given
pursuant to the Code of Ethics, I have reported all personal
securities transactions and provided any securities holding
reports required to be reported under the requirements of the
Code of Ethics.
Date: ------------------------------------
Print Name
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Signature
