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Exhibit P9
CODE OF ETHICS
for
STERLING CAPITAL MANAGEMENT COMPANY
AND
STERLING CAPITAL DISTRIBUTORS, INC.
Revised August 1, 2000
PREAMBLE
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This Code of Ethics is being adopted in compliance with the requirements of
Rule 17j-1 (the "Rule") adopted by the United States Securities and Exchange
Commission under the Investment Company Act of 1940 (the "Act"), and Sections
204A and 206 of the Investment Advisers Act of 1940 (the "Advisers Act"),
specifically Rule 204-2 thereunder, to effectuate the purposes and objectives of
those provisions. Section 204A of the Advisers Act requires the establishment
and enforcement of policies and procedures reasonably designed to prevent the
misuse of material, nonpublic information by investment advisers. Rule 204-2
imposes recordkeeping requirements with respect to personal securities
transactions of advisory representatives (defined below). Rule 17j-1 of the
Investment Company Act and Section 206 of the Advisers Act make the following
activities unlawful for certain persons, including any employee of Sterling
Capital Management Company or Sterling Capital Distributors, Inc. (collectively
referred to as the "Firm") in connection with the purchase or sale by such
person of a security held or to be acquired by any Portfolio or any Fund managed
by the Firm:
1. To employ a device, scheme or artifice to defraud a Portfolio, a
Fund, any client or prospective client;
2. To make to a Portfolio, a Fund, any client or prospective client,
any untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements made, in light of
the circumstances in 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 a Portfolio, a Fund, any
client or prospective client; or
4. Acting as principal for his/her own account, knowingly to sell any
security to or purchase any security from a client, or acting as a
broker for a person other than such client, knowingly to effect any
sale or purchase of any security for the account of such client,
without disclosing to such client in writing before the completion
of such transaction the capacity in which he/she is acting and
obtaining the consent of the client to such transaction. The
prohibitions of this paragraph (4) shall not apply to any
transaction with a customer of a bank broker or dealer if such
broker or dealer is not acting as an investment adviser in relation
to such transaction; or
5. To engage in any act, practice, or course of business which is
fraudulent, deceptive or manipulative.
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This Code contains provisions reasonably necessary to prevent persons from
engaging in acts in violation of the above standard and procedures reasonably
necessary to prevent violations of the Code.
The Board of Directors of the Firm adopts this Code of Ethics. This Code is
based upon the principle that the directors and officers of the Firm, and
certain affiliated persons of the Firm, owe a fiduciary duty to, among others,
the clients of the Firm to conduct their affairs, including their personal
securities transactions, in such a manner as to avoid (i) serving their own
personal interests ahead of clients; (ii) taking inappropriate advantage of
their position with the Firm; and (iii) any actual or potential conflicts of
interest or any abuse of their position of trust and responsibility. This
fiduciary duty includes the duty of the Compliance Officer of the Firm to report
violations of this Code of Ethics to the Firm's Board of Directors and to the
Board of Directors of any Fund of advised or subadvised by the Firm.
POLICY STATEMENT ON INSIDER TRADING
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The Firm forbids any officer, director or employee from trading,
either personally or on behalf of others, including accounts managed by the
Firm, on material nonpublic information or communicating material nonpublic
information to others in violation of the law. This conduct is frequently
referred to as "insider trading." The Firm's policy applies to every officer,
director and employee and extends to activities within and outside their duties
at the Firm. Any questions regarding the Firm's policy and procedures should be
referred to the Compliance Officer.
The term "insider trading" is not defined in the federal securities
laws, but generally is used to refer to the use of material nonpublic
information to trade in securities (whether or not one is an "insider") or to
communications of material nonpublic information to others.
While the law concerning insider trading is not static, it is
generally understood that the law prohibits:
1) trading by an insider, while in possession of material nonpublic
information, or
2) trading by a non-insider, while in possession of material
nonpublic information, where the information either was
disclosed to the non-insider in violation of an insider's duty
to keep it confidential or was misappropriated, or
3) communicating material nonpublic information to others.
The concept of "insider" is broad. It includes officers, directors and
employees of a company. In addition, a person can be a "temporary insider" if he
or she enters into a special confidential relationship in the conduct of a
company's affairs and as a result is given access to information solely for the
company's purposes. A temporary insider can include, among others, a company's
attorneys, accountants, consultants, bank lending officers, and the employees of
such organizations. In addition, the Firm may become a temporary insider of a
company it advises or for which it performs other services. For that to occur
the company must expect the Firm to keep the disclosed nonpublic information
confidential and the relationship must at least imply such a duty before the
Firm will be considered an insider.
Trading on inside information is not a basis for liability unless the
information is material. "Material information" generally is defined as
information for which there is a substantial likelihood that a reasonable
investor would consider it important in making his or her investment
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decisions, or information that is reasonably certain to have a substantial
effect on the price of a company's securities. Information that officers,
directors and employees should consider material includes, but is not limited
to: dividend changes, earnings estimates, changes in previously released
earnings estimates, significant merger or acquisition proposals or agreements,
major litigation, liquidation problems, and extraordinary management
developments.
Information is nonpublic until it has been effectively communicated to
the market place. One must be able to point to some fact to show that the
information is generally public. For example, information found in a report
filed with the SEC, or appearing in Dow Jones, Reuters Economic Services, The
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Wall Street Journal or other publications of general circulation would be
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considered public.
Before trading for yourself or others in the securities of a company
about which you may have potential inside information, ask yourself the
following questions:
i. Is the information material? Is this information that an
investor would consider important in making his or her
investment decisions? Is this information that would
substantially effect the market price of the securities if
generally disclosed?
ii. Is the information nonpublic? To whom has this information been
provided? Has the information been effectively communicated to
the marketplace?
If, after consideration of the above, you believe that the information
is material and nonpublic, or if you have questions as to whether the
information is material and nonpublic, you should take the following steps.
i. Report the matter immediately to the Firm's Compliance Officer.
ii. Do not purchase or sell the securities on behalf of yourself or
others.
iii. Do not communicate the information inside or outside the Firm,
other than to the Firm's Compliance Officer.
iv. After the Firm's Compliance Officer has reviewed the issue, you
will be instructed to continue the prohibitions against trading
and communication, or you will be allowed to trade and
communicate the information.
Information in your possession that you identify as material and
nonpublic may not be communicated to anyone, including persons within the Firm,
except as provided above. In addition, care should be taken so that such
information is secure. For example, files containing material nonpublic
information should be sealed; access to computer files containing material
nonpublic information should be restricted.
The role of the Firm's Compliance Officer is critical to the
implementation and maintenance of the Firm's policy and procedures against
insider trading. The Firm's Supervisory Procedures can be divided into two
classifications - prevention of insider trading and detection of insider
trading.
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To prevent insider trading, the Firm will:
i. provide, on a regular basis, an educational program to
familiarize officers, directors and employees with the Firm's
policy and procedures, and
ii. when it has been determined that an officer, director or
employee of the Firm has material nonpublic information,
1. implement measures to prevent dissemination of such
information, and
2. if necessary, restrict officers, directors and employees
from trading the securities.
To detect insider trading, the Compliance Officer will:
i. review the trading activity reports filed by each officer,
director and employee, and
ii. review the trading activity of accounts managed by the Firm.
A. DEFINITIONS
1. "Access person" means any director, officer, general partner or
advisory representative of the Firm.
2. "Advisory representative" means any employee, who in connection with
his or her regular functions or duties, normally makes, participates
in, or otherwise obtains current information regarding the purchase or
sale of a security by the Firm, or whose functions relate to the
making of any recommendations with respect to such purchases or sales;
and any natural person in a control relationship to the Firm who
obtains information concerning recommendations made concerning a
purchase or sale of a Security. This definition includes but is not
limited to the following: partner, officer, director, "Investment
Person", "Portfolio Manager" and any other employee of the Adviser
designated as an "Advisory Representative" from time to time by the
Compliance Officer.
3. "Non-Advisory Representative" means any individual who has no contact
with information regarding the purchases or sales of Securities made
by the Firm in his or her regular functions or duties. However, such
individuals are subject to the Preamble and Policy Statement on
Insider Trading contained in this Code.
4. "Affiliated company" means a company which is an affiliated person, as
defined in the 1940 Act.
5. "Affiliated person" of another person means (a) any person directly or
indirectly owning, controlling, or holding with power to vote, five
(5%) percent or more of the outstanding voting securities of such
other person; (b) any person five (5%) percent or more of whose
outstanding voting securities are directly or indirectly owned,
controlled, or held with power to vote, by such other person; (c) any
person directly or indirectly controlling, controlled by, or under
common control with, such other person; (d) any officer, director,
partner, copartner, or employee of such other person; (e) if such
other person is an investment company, any investment adviser thereof
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or any member of an advisory board thereof; and (f) if such other
person is an unincorporated investment company not having a board of
directors, the depositor thereof.
6. "Beneficial ownership" shall be interpreted in the same manner as it
would be under Rule 16a-1(a)(2) of the Securities Exchange Act of
1934, as amended (the "1934 Act") in determining whether a person is
the beneficial owner of a security for purposes of Section 16 of the
1934 Act and the rules and regulations thereunder, that, generally
speaking, encompasses those situations where the beneficial owner has
the right to enjoy a direct or indirect economic benefit from the
ownership of the security. A person is normally regarded as the
beneficial owner of securities held in (i) the name of his or her
spouse, domestic partner, minor children, or other relatives living in
his or her household; (ii) a trust, estate or other account in which
he/she has a present or future interest in the income, principal or
right to obtain title to the securities; or (iii) the name of another
person or entity by reason of any contract, understanding,
relationship, agreement or other arrangement whereby he or she obtains
benefits substantially equivalent to those of ownership.
7. "Control" means the power to exercise a controlling influence over the
management or policies of a company, unless such power is solely the
result of an official position with such company. Any person who owns
beneficially, either directly or through one or more controlled
companies, more than twenty-five (25%) percent of the voting
securities of a company shall be presumed to control such company. Any
person who does not so own more than twenty-five (25%) percent of the
voting securities of any company shall be presumed not to control such
company. A natural person shall be presumed not to be a controlled
person.
8. "Disclosable transaction" means any transaction in a security pursuant
to which an access person would have a beneficial ownership.
9. "Firm" means the investment adviser registered with the Securities and
Exchange Commission under the Investment Advisers Act of 1940, subject
to this Code of Ethics.
10. "Fund" means any investment vehicle registered under the Investment
Company Act of 1940 for which the Firm acts as manager, adviser or
subadviser.
11. "Non-interested" Director means a director or trustee who is not an
interested person.
12. "Interested Person" of another person, when used with respect to a
Fund, means (i) any affiliated person of the Fund; (ii) any member of
the immediate family of any natural person who is an affiliated person
of the Fund; (iii) any interested person of any investment adviser of
or principal underwriter for the Fund; (iv) any person or partner or
employee of any person who at any time since the beginning of the last
two completed fiscal years of the Fund has acted as legal counsel for
the Fund; (v) any broker or dealer registered under the Securities
Exchange Act of 1934 or any affiliated person of such a broker or
dealer; or (vi) any natural person whom the Commission by order shall
have determined to be an interested person by reason of having had, at
any time since the beginning of the last two completed fiscal years of
the Fund, a material business or professional relationship with the
Fund or with the principal executive officer of such company or with
any other investment company having the same investment adviser or
principal underwriter or with the principal executive officer of such
other investment company, provided, that no person shall be deemed to
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be an interested person of an investment company solely by reason of
(aa) his being a member of its Board of Directors or advisory board or
an owner of its securities, or (bb) his membership in the immediate
family of any person specified in clause (aa) of this proviso.
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13. "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 1934 Act.
14. "Investment Personnel" means (a) any Portfolio Manager of the Firm;
(b) any employee of the Firm (or of any company in a control
relationship to a Fund or the Firm) who, in connection with his
regular functions or duties, makes or participates in making
recommendations regarding the purchase or sale of securities by the
Firm, including securities analysts and traders; or (c) any person who
controls a Fund or the Firm and who obtains information concerning
recommendations made to any Fund or Portfolio regarding the purchase
or sale of securities by the Fund or Portfolio.
15. "Limited Offering" means an offering that is exempt from registration
under the Securities Act of 1933, as amended (the "Securities Act")
pursuant to Section 4(2) or Section 4(6) or Rules 504, 505 or 506
under the Securities Act. Limited offerings are commonly referred to
as private placements.
16. "Person" means a natural person or a company.
17. "Portfolio" means any account, trust or other investment vehicle
(except "Fund") over which the Firm has investment management
discretion.
18. "Portfolio Manager" means an employee of the Firm entrusted with the
direct responsibility and authority to make investment decisions
affecting the Portfolios or Funds managed by the Firm.
19. "Purchase or sale of a security" includes, among other things, the
writing of an option to purchase or sell a Security.
20. "Security Held or to be Acquired" means (i) any security which, within
the most recent 15 days, is or has been held by a Fund or Portfolio,
or is being or has been considered for purchase by a Fund or
Portfolio, or (ii) any option to purchase or sell and any security
convertible into or exchangeable for a Security.
21. "Security" shall have the meaning set forth in Section 202(a)(18) of
the Advisers Act and Section 2(a)(36) of the 1940 Investment Company
Act. Further, for purposes of this Code, "Security" shall include any
commodities contracts as defined in Section 2(a)(1)(A) of the
Commodity Exchange Act. This definition includes but is not limited to
futures contracts on equity indices.
"Security" shall NOT include direct obligations of the Government of
the United States, , bankers' acceptances, bank certificates of deposit,
high quality short-term debt instruments (maturity of less than 366 days at
issuance and rated in one of the two highest rating categories by a
Nationally Recognized Statistical Rating Organization), including
repurchase agreements, commercial paper and shares of money market funds
that limit their investments to the exempted securities enumerated above.
Also excluded from the definition are any registered open-end investment
companies (e.g. open-end mutual funds). Any question as to whether a
particular investment constitutes a "Security" should be referred to the
Compliance Officer of the Firm.
B. PROHIBITED TRANSACTIONS
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No access person or advisory representative shall engage in any act,
practice or course of conduct, which would violate the provisions of Rule 17j-1
of the Investment Company Act or Section 206 of the Investment Advisers Act as
set forth above.
Note: Portfolios of the UAM Funds, Inc., UAM Funds, Inc. II and UAM
Trust, Inc. (collectively, the "UAM Portfolios") are managed by
investment advisers that are subsidiaries of or organizations
otherwise affiliated with United Asset Management Corporation (the
"Management Companies"). Under the organizational structure of the
Management Companies, the entities maintain separate offices,
independent operations and autonomy when making investment decisions.
In view of these circumstances, advisory personnel of the Management
Companies who are defined as "access persons" under the 1940 Act,
under normal circumstances would have no knowledge of proposed
securities transactions, pending "buy" or "sell" orders in a security,
or the execution or withdrawal of an order for any other UAM Portfolio
for which a different Management Company serves as investment adviser.
To restrict the flow of investment information related to the UAM
Portfolios, the access persons at a Management Company are prohibited
from disclosing pending "buy" or "sell" orders for a UAM Portfolio to
any employees of any other Management Company until the order is
executed or withdrawn. The Management Companies shall implement
procedures designed to achieve employee awareness of this prohibition.
1. Access Persons
Except as provided in Section C below, no access person shall:
(a) purchase or sell, directly or indirectly, any security in
which he/she has or by reason of such transaction acquires,
any direct or indirect beneficial ownership and which to
his/her actual knowledge at the time of such purchase or
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sale:
(1) is being considered for purchase or sale by any
Portfolio or Fund managed by the Firm, or
(2) is being purchased or sold by any Portfolio or
Fund managed by the Firm; or
(b) disclose to other persons the securities activities engaged
in or contemplated for the various Portfolios or Funds
managed by the Firm.
2. Investment Personnel
In addition to the prohibitions listed in Section B(1) above, no investment
personnel shall engage in any of the following:
(a) accept any gift or other thing of more than de minimus value from any
person or entity that does business with or on behalf of the Firm. For
purposes of this Code, "de minimus" shall be considered to be the
annual receipt of gifts from the same source valued at $500 or less
per individual recipient, when the gifts are in relation to the Firm's
business.
(b) acquire a beneficial interest in any securities in an initial public
offering ("IPO") or other limited offerings commonly referred to as
private placements, without prior written approval of the compliance
officer of the Firm. The compliance officer must maintain a record of
any decision, and the reasons supporting the decision, to approve the
investment personnel's acquisition of an IPO or private placement for
at least five years after the end of the fiscal year in which the
approval was granted.
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Before granting such approval the compliance officer (or other
designee) should carefully evaluate such investment to determine that
the investment could create no material conflict between the investment
personnel and a Fund or Portfolio. The compliance officer may make such
determination by looking at, among other things, the nature of the
offering and the particular facts surrounding the purchase. For
example, the compliance officer may consider approving the transaction
if the compliance officer (or designee) can determine that: (i) the
investment did not result from directing Fund, Portfolio or Firm
business to the underwriter or issuer of the security; (ii) the
Investment Personnel is not misappropriating an opportunity that should
have been offered to the Fund or Portfolio; and (iii) an Investment
Person's investment decisions for the Fund or Portfolio will not be
unduly influenced by his or her personal holdings and investment
decisions are based solely on the best interests of Fund or Portfolio.
Any person authorized to purchase securities in an IPO or private
placement shall disclose that investment when they play a part in a
Fund's or Portfolio's subsequent consideration of an investment in that
issuer. In such circumstances, a Fund's or Portfolio's decision to
purchase securities of the issuer shall be subject to independent
review by investment personnel with no personal interest in the issuer.
(c) profit in the purchase and sale, or sale and purchase, of the same
(or equivalent) securities within sixty (60) calendar days. Trades
made in violation of this prohibition should be unwound, if
possible. Otherwise, any profits realized on such short-term
trades shall be subject to disgorgement to the appropriate
Portfolio(s) or Fund(s) of the Firm.
EXCEPTION: The compliance officer of the Firm may allow exceptions
to this policy on a case-by-case basis when the abusive practices
that the policy is designed to prevent, such as front running or
conflicts of interest, are not present and the equity of the
situation strongly supports an exemption. An example is the
involuntary sale of securities due to unforeseen corporate
activity such as a merger. [See Pre-Clearance Procedures below].
The ban on short-term trading profits is specifically designed to
deter potential conflicts of interest and front running
transactions, which typically involve a quick trading pattern to
capitalize on a short-lived market impact of a trade by one of the
Funds or Portfolios. The respective compliance officer shall
consider the policy reasons for the ban on short-term trades, as
stated herein, in determining when an exception to the prohibition
is permissible. The compliance officer may consider granting an
exception to this prohibition if the securities involved in the
transaction are not (i) being considered for purchase or sale by a
Fund or Portfolio that serves as the basis of the individual's
"investment personnel" status or (ii) being purchased or sold by a
Fund or Portfolio that serves as the basis of the individual's
"investment personnel" status and, are not economically related to
such securities. In order for a proposed transaction to be
considered for exemption from the short-term trading prohibitions,
the investment personnel must complete, sign and submit to the
compliance officer a completed Securities Transactions Report
Relating to Short-Term Trading (EXHIBIT D), certifying that the
proposed transaction is in compliance with this Code of Ethics.
The compliance officer shall retain a record of exceptions granted
and the reasons supporting the decision.
(d) serve on the Board of Directors of any publicly traded company
without prior authorization of the compliance officer of the Firm.
Any such authorization shall be based upon a determination that
the board service would be consistent with the interests of the
Firm, any Portfolios or Funds. Authorization of board service
shall be subject to the implementation by the Firm of "Chinese
Wall" or other procedures to isolate such investment personnel
from making decisions about trading in that company's
securitiesNotification of such directorships shall be made to the
compliance officer of the Funds.
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3. Portfolio Managers
In addition to the prohibitions listed in Sections B(1) and (2) above, no
portfolio manager shall:
(a) buy or sell a security within seven (7) calendar days before or
two (2) calendar days after any portfolio of the Firm trades in
that security. Any trades made within the proscribed period shall
be unwound, if possible. Otherwise, any profits realized on trades
within the proscribed period shall be disgorged to the appropriate
client portfolio.
C. EXEMPTED TRANSACTIONS
Transactions described in Sections B(1), B(2)(c) and B(3) above, which
appear upon reasonable inquiry and investigation to present no reasonable
likelihood of harm to a Fund or Portfolio and which are otherwise
transacted in accordance with Investment Company Act Rule 17j-1 and Section
206 of the Investment Company Act may be permitted within the discretion of
the compliance officer of the Firm on a case-by-case basis. Such exempted
transactions may include:
1. purchases or sales of securities which are not eligible for purchase by
a Fund or Portfolio and which are not related economically to
securities purchased, sold or held by the Fund or a Portfolio.
2. securities of companies with a market capitalization in excess of $1
billion.
3. purchases or sales of a de minimus amount of securities. A de minimus
amount of securities shall be defined in this section of the Code of
Ethics as:
(a) up to an aggregate $25,000 principal amount of a fixed income
security within any three-consecutive month period;
(b) up to an aggregate 100 shares of an equity security within any
three-consecutive month period; or
(c) any amount of securities if the proposed acquisition or
disposition by a Fund or Portfolio is in the amount of 1,000
shares or less and the security is listed on a national securities
exchange or the National Association of Securities Dealers
Automated Quotation System.
4. Securities which the access person, Fund and/or Portfolio has no
influence or control, including:
(a) purchases or sales effected in any account over which the access
person has no direct or indirect influence or control;
(b) purchases or sales which are non-volitional on the part of either
the access person or the Fund and/or Portfolio;
(c) purchases which are part of an automatic dividend reinvestment plan
or direct stock plan (pending preclearance of the original
purchase); and
(d) securities acquired by the exercise of rights issued pro rata by an
issuer 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.
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5. Holdings in direct obligations of the U.S. government, bankers'
acceptances, bank certificates of deposit, commercial paper, high
quality short-term debt instruments and registered open-end investment
companies.
6. From time to time, the Equity Department will execute investment
programs for a limited number of clients that are known as "rebalance"
programs. One example of a rebalance is when a new portfolio is funded
with cash, and it is modeled against the model portfolio. The result is
that all stocks owned in the model would be purchased on behalf of that
one client. Another example is where a client has equity and fixed
income portfolios under management, and the overall equity allocation
exceeds the proscribed target. A rebalance program may be initiated to
sell a small portion of some or all stocks in the portfolio to reduce
exposure to stocks. Rebalance programs typically do not generate high
quantities of shares being traded in particular securities and as such
the firm deems that when a rebalance program is underway, employees are
considered free to personally trade in those stocks that are part of
the rebalance program. Such personal transactions shall be considered
exempt transactions as it pertains to transactions described in
Sections B(1), B(2)(c) and B(3) above.
D. COMPLIANCE PROCEDURES
With respect to the pre-clearance and reporting requirements contained
herein, access persons shall pre-clear through and report to the compliance
officer of the Firm.
1. PRE-CLEARANCE PROCEDURES
All access persons must receive prior written approval from the Firm's
compliance officer, or other officer designated by the Board of
Directors, before purchasing or selling securities in an account that
such access person has beneficial ownership. The access person should
request pre-clearance by completing, signing and submitting Personal
Securities Transactions Pre-Clearance Form (EXHIBIT E) to the
compliance officer.
Pre-clearance approval will expire at the close of business on the
trading date two (2) business days after the date on which
authorization is received. For example, preclearance received Friday at
9:00 a.m. would expire as of the close of business Monday. If the trade
is not completed before such pre-clearance expires, the access person
is required to again obtain pre-clearance for the trade. In addition,
if an access person becomes aware of any additional information with
respect to a transaction that was precleared, such person is obligated
to disclose such information to the appropriate compliance officer
prior to executing the precleared transaction.
Access persons are excluded from preclearing securities purchased, sold
or acquired in the following transactions:
(a) purchases or sales effected in any account over which the access
person has no direct or indirect influence or control.
(b) purchases or sales which are non-volitional on the part of either
the access person or a Fund or Portfolio.
(c) purchases which are part of an automatic dividend reinvestment
plan or direct stock plan (pending preclearance of the original
purchase).
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(d) securities acquired by the exercise of rights issued pro rata by
an issuer 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.
(e) holdings in direct obligations of the U.S. government, bankers'
acceptances, bank certificates of deposit, commercial paper, high
quality short-term debt instruments and registered open-end
investment companies are not disclosable transactions.
2. DISCLOSURE OF PERSONAL HOLDINGS
All access persons shall disclose to the compliance officer:
(a) all personal securities holdings (including securities acquired
before the person became an access person) within ten (10) days
upon the later of commencement of employment or adoption of this
Code of Ethics; and
(b) The name of any broker, dealer or bank with whom the access person
maintains an account in which any securities were held for the
direct or indirect benefit of the access person must also be
reported.
Holdings in direct obligations of the U.S. government, bankers'
acceptances, bank certificates of deposit, commercial paper, high
quality short-term debt instruments and registered open-end investment
companies are not disclosable transactions.
The compliance officer of the Firm may, at its discretion, request
access persons to provide duplicate copies of confirmation of each
disclosable transaction in the accounts and account statements.
In addition to reporting securities holdings, every access person shall
certify in their initial report that:
(a) they have received, read and understand the Code of Ethics and
recognize that they are subject thereto; and
(b) they have no knowledge of the existence of any personal
conflict of interest relationship which may involve a Fund or
Portfolio, such as any economic relationship between their
transactions and securities held or to be acquired by a Fund
or a Portfolio.
This initial report shall be made on the form attached as Initial
Report of Access Person (EXHIBIT A) and shall be delivered to the
compliance officer of the Firm.
3. QUARTERLY REPORTING REQUIREMENTS
All access persons shall disclose to the Firm's compliance officer all
personal securities transactions conducted during the period as of the
calendar quarter ended within ten (10) days after quarter end.
Transactions in direct obligations of the U.S. government, bankers'
acceptances, bank certificates of deposit, commercial paper, high
quality short-term debt instruments and registered open-end investment
companies are not disclosable transactions.
In addition to reporting securities holdings, every access person shall
disclose quarterly the:
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(a) date of the transaction, title of the security, interest
rate and maturity date (if applicable), trade date, number
of shares, and principal amount of each security involved;
(b) the nature of the transaction (i.e., purchase, sale or any
other type of acquisition or disposition);
(c) the name of the broker, dealer or bank with or through whom
the transaction was effected; and
(d) the date the report is submitted to the compliance officer.
In addition, with respect to any account established by an access
person in which any securities were held during the quarter for the
direct or indirect benefit of the access person, the access person must
provide:
(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 the report is submitted by the access person.
This quarterly report shall be made on the form attached as Securities
Transactions for the Calendar Quarter Ended (EXHIBIT C) and shall be
delivered to the compliance officer of the Firm. In lieu of manually
filling out all of the information required by the form, access persons
may attach confirms and/or account statements to a signed form.
4. ANNUAL CERTIFICATION OF COMPLIANCE WITH CODE OF ETHICS
All access persons shall disclose to the compliance officer of the Firm
all personal securities holdings as of the calendar year ended within
thirty (30) days after year end. Holdings in direct obligations of the
U.S. government, bankers' acceptances, bank certificates of deposit,
commercial paper, high quality short-term debt instruments and
registered open-end investment companies are not disclosable holdings.
In addition to reporting securities holdings, every access person shall
certify annually that:
(a) they have read and understand the Code of Ethics and
recognize that they are subject thereto;
(b) they have complied with the requirements of the Code of
Ethics; and that they have reported all personal securities
transactions required to be reported pursuant to the
requirements of the Code of Ethics;
(c) they have not disclosed pending "buy" or "sell" orders for a
Portfolio or Fund to any employees of any other Management
Company, except where the disclosure occurred subsequent to
the execution or withdrawal of an order; and
(d) they have no knowledge of the existence of any personal
conflict of interest relationship which may involve any
Portfolio or Fund, such as any economic relationship between
their transactions and securities held or to be acquired by
a Fund or Portfolio.
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This annual report shall be made on the form attached as Annual Report
of Access Person (Exhibit B) and shall be delivered to the compliance
officer of the Firm.
5. REPORTS TO COMPLIANCE OFFICER
The compliance officer of the Firm shall provide, by the twelfth (12)
day after each quarter end, certification to the compliance officer of
a Fund that, as of the prior quarter end:
(a) the compliance officer of the Firm has collected all
documentation required by the Code of Ethics and Rule 17j-1
and is retaining such documentation on behalf of the Fund;
(b) there have been no violations to the Fund's Code of Ethics
and, if there have been violations to the Fund's Code of
Ethics, the violation has been documented and reported to
the Fund's compliance officer; and
(c) the Firm has appointed appropriate management or compliance
personnel, such as the compliance officer, to review
transactions and reports filed by access persons under the
Code of Ethics, and adopted procedures reasonably necessary
to prevent Access Persons from violating the Firm's Code of
Ethics.
Each quarter the compliance officer of the Firm shall also provide to
the compliance officer of each Fund a list of access persons who are
subject to the Fund's Code of Ethics and the name of the compliance
officer of the Firm responsible for preclearing and reviewing personal
securities transactions.
The compliance officer of the Firm shall provide such information,
including, but not limited to, initial, quarterly and annual reports
for all access persons, preclearance reports and approval for short
term transactions, IPO and private placement securities, as is
requested by the Fund's compliance officer.
6. GENERAL REPORTING REQUIREMENTS
The compliance officer of the Firm shall notify each access person that
he or she is subject to this Code of Ethics and the reporting
requirements contained herein, and shall deliver a copy of this Code of
Ethics to each such person when they become an access person, or upon
request.
Reports submitted pursuant to this Code of Ethics shall be confidential
and shall be provided only to the officers and Directors of the Firm
and each Fund, counsel and/or regulatory authorities upon appropriate
request.
7. EXCESSIVE TRADING
The Firm understands that it is appropriate for access persons to
participate in the public securities markets as part of their overall
personal investment programs. As in other areas, however, this should
be done in a way that creates no potential conflicts with the interests
of any Fund or Portfolio. Further, it is important to recognize that
otherwise appropriate trading, if excessive (measured in terms of
frequency, complexity of trading programs, numbers of trades or other
measure as deemed appropriate by the Fund's compliance officer,
compliance officer of the Firm, or senior management at the Firm), may
compromise the best interests of any Funds or Portfolios if such
excessive trading is conducted during work-time or using Fund/Portfolio
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resources. Accordingly, if personal trading rising to such dimension as
to create an environment that is not consistent with the Code of
Ethics, such personal transactions may not be approved or may be
limited by the compliance officer of the Firm.
8. CONFLICT OF INTEREST
Every access person, shall notify the compliance officer of the Firm of
any personal conflict of interest relationship which may involve a Fund
or Portfolio, such as the existence of any economic relationship
between their transactions and securities held or to be acquired by any
Portfolio or Fund. The Firm's compliance officer shall notify the
compliance officer of a Fund of any personal conflict of interest
relationship which may involve the Fund. Such notification shall occur
in the pre-clearance process.
E. REPORTING OF VIOLATIONS TO THE BOARD OF DIRECTORS
The compliance officer of the Firm shall promptly report to the compliance
officer of the Fund and the Board of Directors of the Firm all apparent
violations of this Code of Ethics and the reporting requirements
thereunder.
When the compliance officer of the Firm finds that a transaction otherwise
reportable to the Board of Directors pursuant to the Code could not
reasonably be found to have resulted in a fraud, deceit or manipulative
practice in violation of Rule 17j-1(a), he/she may, in his/her discretion,
lodge a written memorandum of such finding and the reasons therefor with
the reports made pursuant to this Code of Ethics, in lieu of reporting the
transaction to the Board of Directors. Such findings shall, however, be
reported to the compliance officer of any respective Funds.
The Board of Directors of the Firm or any Fund, or a Committee of Directors
created by such Board of Directors for thatpurpose, shall consider reports
made to the Board of Directors hereunder and shall determine whether or not
this Code of Ethics has been violated and what sanctions, if any, should be
imposed.
F. ANNUAL REPORTING TO THE BOARD OF DIRECTORS
The compliance officer of the Firm shall prepare an annual report relating
to this Code of Ethics to the Board of Directors of the Firm and the Funds.
Such annual report shall:
(a) summarize existing procedures concerning personal investing and
any changes in the procedures made during the past year;
(b) identify any violations requiring significant remedial action
during the past year; and
(c) identify any recommended changes in the existing restrictions or
procedures based upon the Firm's experience under its Code of
Ethics, evolving industry practices or developments in applicable
laws or regulations; and
(d) state that the Firm had adopted procedures reasonably necessary to
prevent access persons from violating the Code.
G. SANCTIONS
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Upon discovering a violation of this Code, the Board of Directors of the
Firm or a Fund may impose such sanctions as they deem appropriate,
including, among other things, a letter of censure or suspension or
termination of the employment of the violator.
There are now sanctions to penalize employees for non-compliance with the
personal securities transaction portion of the Code concerning adherence to
pre-clearance procedures and prohibited transactions:
1st offense $50 fine
2nd offense $250 fine
3rd offense $250 fine and 5 day ban on all personal trading in
accounts where employee has a beneficial interest
4th offense $500 fine and 30 ban on all personal trading in
accounts where employee has a beneficial interest
5th offense $500 fine and revocation of all personal trading
privileges on accounts where employee has a beneficial
interest
H. RETENTION OF RECORDS
The Firm shall maintain the following records as required under Rule 17j-1:
(a) a copy of any Code of Ethics in effect within the most recent five
years;
(b) a list of all persons required to make reports hereunder within
the most recent five years and a list of all persons who were
responsible for reviewing the reports, as shall be updated by the
compliance officer of the Firm;
(c) a copy of each report made by an access person hereunder and
submitted to the Firm's compliance officer for a period of five
years from the end of the fiscal year in which it was made;
(d) each memorandum made by the compliance officer of the Firm
hereunder, for a period of five years from the end of the fiscal
year in which it was made;
(e) a record of any violation hereof and any action taken as a result
of such violation, for a period of five years following the end of
the fiscal year in which the violation occurred; and
(f) a copy of every report provided to the Firm's Board of Directorsor
a Fund's compliance officer which describes any issues arising
under the Code of Ethics and certifies that the Firm has adopted
procedures reasonably necessary to prevent access persons from
violating the Code of Ethics.
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