CODE OF ETHICS
for
The Aquila Group of Companies
January 1, 2000
Effective: January 1, 2000
(as amended June, 2000)
CODE OF ETHICS
FOR
THE AQUILA GROUP OF COMPANIES
INTRODUCTION
It is one of the fundamental policies of the investment company
business to avoid any conflict of interest or even the appearance
of such a conflict in connection with the performance of general
management, investment advisory, distribution and portfolio
management services for those we serve. This code of ethics (the
"Code of Ethics"or the "Code"), has been adopted by each member
of the Aquila Group of Companies to implement this policy. In
the Code, "Aquila Entity" or "Aquila Entities" shall mean (1)
all members of the Aquila Group of Companies, including Aquila
Management Corporation, Aquila Distributors, Inc. and STCM
Management Company, Inc.; (2) all funds for which a member of
the Aquila Group of Companies provides administrative,
distribution or investment advisory services (the "Funds"); and
(3) any other advisory clients of the Aquila Group of Companies.
A code of ethics substantially identical to this Code except for
the entity covered has been adopted by each Fund. This code
covers every officer, director and employee of each of the Aquila
Group of Companies who is involved in providing such services to
any Aquila Entity whether by way of security analysis or
recommendation, placement of trading orders, portfolio
management, distribution or otherwise. In this Code, provisions
that apply only to the Funds or Fund Trustees are present solely
for convenience of administration.
One of the practices that raises a potential conflict of interest
is that of trading in the same securities (or related securities)
that are being purchased or sold, or considered for purchase or
sale, for our clients' portfolios by persons affiliated with the
Aquila Entities for accounts in which the affiliated persons have
a beneficial ownership interest or which they control. The
Investment Advisers Act of 1940 ("Advisers Act"), the Investment
Company Act of 1940 ("1940 Act"), and other federal and state
securities laws and rules generally prohibit fraudulent,
deceptive or manipulative trading by persons affiliated with
investment advisers with respect to securities held, to be
acquired or under consideration for purchase or sale by fund or
other advisory clients. This prohibition extends to trading in
furtherance of personal interests to the detriment of the Aquila
Entities as well as any attempt to benefit from the market impact
of their anticipated or actual transactions. The Securities and
Exchange Commission ("SEC") regulations require the adoption of
procedures designed to prevent such fraudulent conduct.
Please read the specifics of this Code of Ethics carefully. If
you have any questions, discuss them with Robert Anderson, the
Compliance Officer ("C.O.") for the Aquila Group of Companies,
or his successor. Be sure that you understand the Code. Then
sign and date the attached certification and return it to the
C.O. Keep a copy of the Code for your reference. The C.O. is
responsible for enforcing and interpreting this Code, and is
always available to answer any questions you may have. As an
officer, trustee, director, employee, or control person of any
Aquila Entity, you are subject to all applicable provisions of
this Code.
ADOPTION OF THIS CODE
This Code has been adopted by each company in the Aquila Group of
Companies, in compliance with Section 17(j) of the 1940 Act and
Rule 17j-1 (the "Rule"), Sections 204 and 204A of the Advisers
Act and the rules thereunder, and Section 15(f) of the Securities
Exchange Act of 1934.
PURPOSE OF THIS CODE
This Code seeks to maintain the highest standards of ethical
conduct for the Aquila Entities and their personnel. In so
doing, this Code addresses three areas of concern:
1. Observance of the general anti-fraud provisions of the
Federal securities laws.
2. Avoidance of conflicts with the interests of our
clients or the appearance of such conflicts.
3. Avoidance of trading securities on the basis of
material non-public information or
information about securities transactions made or
being considered for clients of the Aquila Entities.
1. GENERAL DEFINITIONS
Listed below are definitions for some of the terms used in this
Code, many of which are defined by law.
"Access Person"shall mean any director, trustee, officer or
Advisory Person of any Aquila Entity.
"Advisory Person"shall mean any employee of an Aquila Entity (or
of any company in a "Control" relationship to an Aquila Entity)
who, in connection with his or her regular functions or duties,
makes, participates in, or obtains any information regarding the
purchase or sale of securities by advisory clients, including
mutual funds, or whose functions relate to the making of any
recommendations with respect to such purchases or sales of
securities. Also included within the definition of "Advisory
Person" is any natural person in a "Control" relationship to any
Aquila Entity that is a registered investment company or an
investment adviser who obtains information concerning
recommendations made to advisory clients, including mutual funds,
with respect to the purchase or sale of securities.
"Beneficial Ownership/Beneficial Owner" shall mean any person who
has or shares, directly or indirectly, through any contract,
arrangement, understanding, relationship, or otherwise, a direct
or indirect pecuniary interest in a security, within the meaning
of the Securities Exchange Act Rule 16a-1(a)(2). "Pecuniary
interest" means the opportunity, directly or indirectly, to
profit or share in any profit derived from a transaction in the
security. "Indirect pecuniary interest" includes, but is not
limited to, securities held by members of your immediate family
who share your household, including your spouse, children and
stepchildren, parents, grandparents, brothers and sisters, and
any of your in-laws.
If you need help in determining whether you have beneficial
ownership of any security for purposes of this Code, you should
consult the C.O.
"Chairman" shall mean the current Chairman of Aquila Management
Corporation.
"Control" shall mean the power to exercise a controlling interest
over the management or policies of a company, unless such power
is solely the result of an official position. Any person is
presumed to "Control" a company if that person owns, directly or
indirectly through one or more controlled companies, more than
25% of the voting securities of a company. Despite this
presumption, a person may not be a Control Person if facts, other
than security ownership, demonstrate that such person does not
have a controlling interest. Similarly, persons owning less than
25% of the voting securities of a company may be deemed to have
"Control" depending upon the facts and circumstances.
"Independent Trustee" shall mean, with respect to any Fund, a
Trustee who is not an interested person of the Fund.
"Personal Trading" shall mean the purchase or sale of securities
by an individual for his or her own account, any other account in
which he or she has a "Beneficial Ownership" interest, or any
account (other than an account of an advisory client of an Aquila
Entity) for which the Aquila employee decides what securities
transactions will be effected for the account, either by making
recommendations to the account owner or by entering orders
directly with the broker handling the account.
"President" shall mean the current President of Aquila Management
Corporation.
"Purchase or Sale of a Security" includes, among other things,
the writing of an option to purchase or sell a security.
"Security" shall mean any note, stock, treasury stock, bond,
debenture, evidence of indebtedness, certificate of interest or
participation in any profit-sharing agreement, collateral-trust
certificate, preorganization certificate or subscription,
transferable share, investment contract, voting-trust
certificate, certificate of deposit for a security, fractional
undivided interest in oil, gas, or other mineral rights, any put,
call, straddle, option, or privilege on any security or on any
group or index of securities (including any interest therein
based on the value thereof), or any put, call, straddle, option,
or privilege entered into on a national securities exchange
relating to foreign currency, or generally any interest or
instrument commonly known as a "security" or any certificate of
interest or participation in, temporary or interim certificate
for, receipt for guarantee of, or warrant or right to subscribe
to or purchase any of the foregoing.
For purposes of the provisions of this Code governing personal
securities trading and pre-clearance, and reporting of
transactions and holdings, "Security" does not include direct
obligations of the U.S. Government, shares of registered open-end
investment companies (mutual funds), bankers' acceptances, bank
certificates of deposit, commercial paper and high quality short-
term debt instruments, including repurchase agreements (i.e., any
instrument that has a maturity at issuance of less than 366 days
and that is rated in one of the two highest rating categories by
a NRSRO).
"Security Held or to be Acquired" means (A) any Security that
within the most recent 15 days is being or has been: (i) held by
a Fund or other advisory client or (ii) "considered for purchase
or sale" by or on behalf of a Fund or other advisory client and
(B) any option to purchase or sell, and any Security convertible
into or exchangeable for, a Security described in (A) above. A
Security is "being considered" for purchase or sale if:
(a) there is an outstanding order (this includes orders
that are in the process of being
executed) to purchase or sell that Security for the Aquila
Entity's account or portfolio;
(b) there is an outstanding oral or written recommendation
with respect to that Security that has not been acted upon
or rejected; or
(c) the person responsible for a portfolio intends to
purchase or sell (i.e., has decided to but has not yet
purchased or sold) that Security for an Aquila Entity's
account or portfolio.
2. PROHIBITED TRANSACTIONS AND ACTIVITIES
As a general matter, it is a violation of the policies of the
Aquila Entities for any personnel to engage in any act, practice,
or course of business in connection with the purchase or sale of
any security in violation of any provision of the Federal
securities laws or the SEC's rules designed to prevent
fraudulent, deceptive, or manipulative acts, practices or
business conduct.
A. General Prohibition Against "Front-Running"
The practice of trading on the basis of the anticipated market
effect of trades for Aquila Entity accounts, which is known as
"front-running" or "scalping," constitutes a violation of the
Federal securities laws.
Therefore, it is absolutely prohibited for any Access Person to
engage in Personal Trading in a Security that the Access Person
knows or should know is a "Security Held or to be Acquired" by
any Fund or any other Aquila Entity.
B. Prohibited Personal Trading by Advisory Persons
In addition to the above general prohibitions, Advisory Persons
are prohibited from engaging in Personal Trading in any Security,
except as specifically permitted in Section 3 of this Code. In
no event are Advisory Persons permitted to
(a) acquire Beneficial Ownership in any Securities in an
initial public offering, unless there is prior approval
in writing by the President or C.O.;
(b) acquire Beneficial Ownership in Securities in a private
placement, unless there is prior approval in writing by the
President or C.O.; or
(c) effect short sales or acquire short positions in any
"Security Held" by a Fund or other Aquila Entity.
A record of all written approvals of, and rationale supporting,
any direct or indirect acquisition by Advisory Persons of an
investment in an initial public offering or private placement
will be made and retained by the C.O. in accordance with Section
14 herein.
Aquila Advisory Persons who have acquired private placement
Securities pursuant to prior written approval from the President
or the C.O. must immediately disclose that investment to the C.O.
before they participate at any level in any Aquila Entity's
subsequent consideration of an investment in the issuer. In such
circumstance, the Aquila Entity's decision to purchase Securities
of the issuer will be subject to independent review by other
Aquila investment personnel with no personal interest in the
issuer.
Access Persons who are not Advisory Persons of an Aquila Entity
are not subject to the above restrictions on personal trading or
the pre-clearance requirements of this Code provided that, in the
ordinary course of performing their duties or otherwise, they do
not have access to or have information concerning the Securities
trades that are being executed, under consideration, or
recommended for Aquila Entities.
C. Dealings with Persons Who Do Business With Aquila Entities
No Advisory Person may seek or accept from any person that does
business with any Aquila Entity any item of material value or
preferential treatment that is or appears to be connected with an
Aquila Entity directing business to that person.
For purposes of this prohibition, "items of material value"
include but are not limited to:
(a) gifts amounting in value to more than $100 per person
per year; and
(b) payment or reimbursement of travel expenses, including
overnight lodging, in excess of $100 per person per year.
"Items of material value" do not include:
(a) an occasional meal, a ticket to a sporting event or the
theater or comparable entertainment, which is not
conditioned on directing business to the firm that provided
such meal or entertainment and is neither so frequent nor so
extensive as to raise any question of propriety; or
(b) an unconditional gift of a typical item of reminder
advertising such as a ball-point pen with the name of the
advertiser inscribed, a calendar pad, or other gifts amounting in
value to not more than $100 per person per year.
Any invitations involving travel for more than one day must have
advance approval from the C.O.
3. EXEMPTED TRANSACTIONS
The following types of Personal Trading are exempted from the
restrictions in Section 2.B above:
(a) trading in Securities in an account over which a person
does not have direct or indirect Control or influence (e.g., a
blind trust);
(b) purchases of Securities pursuant to an automatic
dividend reinvestment plan;
(c) purchases of Securities effected upon the exercise of
rights issued by an issuer pro rata to all holders of a
class of its securities, to the extent such rights were
acquired from such issuer;
(d) transactions which have been pre-cleared in writing by
the President or the C.O., by use of the Personal Trading
Authorization Form based on the information and
representations set forth in the Form and such other
information as the President or the C.O. determines is
appropriate to consider. In the case of requests for pre-
clearance of Personal Trading in a Security Held or to be
Acquired for any Fund or other advisory client which is
advised by an investment adviser that is not subject to this
Code ("external investment adviser"), the President or C.O.
generally shall grant authorization to trade if the person
seeking pre-clearance does not have access to or knowledge
of current investment decisions or recommendations of such
external investment adviser; and
(e) transactions in circumstances where the President or
the C.O. finds that permitting the transaction is necessary
or appropriate to alleviate hardship or to deal with
unforeseen circumstances, and is otherwise appropriate, is
consistent with the purposes and policies of this Code, is
not in conflict with the interests of the Aquila Entities,
and is in compliance with applicable law. Any such finding
will be documented in writing and maintained in accordance
with Section 13 herein.
4. CONFIDENTIALITY OF SECURITIES RECOMMENDATIONS AND INVESTMENT
DECISIONS
From the time that an Advisory Person anticipates making a
recommendation to purchase or sell a Security for an Aquila
Entity or the time that he or she decides to purchase or sell a
Security for an Aquila Entity or learns of such a recommendation
or decision, through the time that all trades based on that
recommendation have been consummated, the subject and content of
that recommendation or investment decision are considered to be
proprietary information that may only be used for the benefit of
the Aquila Entities and their clients. Such information also may
be considered to constitute "material non-public information" by
the SEC and other regulatory authorities. Accordingly, Advisory
Persons must maintain the utmost confidentiality with respect to
their recommendations and investment decisions during this period
and may not discuss a contemplated recommendation with anyone --
inside or outside of the Aquila Entities -- other than the
Chairman, the President, the C.O., the portfolio manager for the
Aquila Entity, or the broker-dealer or issuer executing the
order. In addition, this confidentiality obligation extends to
all Access Persons and other Aquila personnel who may obtain
access to such information.
This prohibition is not intended to inhibit exchanges of
information among Advisory Persons concerning the Securities in
their respective areas of coverage. Rather, this policy is a
recognition of general fiduciary principles, including but not
limited to the duty to place the interest of our clients,
including their shareholders, first at all times. Any questions
concerning the distinction between an appropriate informational
exchange and a prohibited communication should be discussed with
the C.O.
5. APPROVALS OF TRANSACTIONS OR REQUESTS FOR WAIVERS OF
RESTRICTIONS BY THE C.O., THE CHAIRMAN OR THE PRESIDENT
In the event that the C.O., the Chairman or the President seeks
to engage in a transaction for which approval is required under
this Code or seeks a waiver pursuant to Section 3 of this Code,
the approval or waiver shall, in the case of the C.O., be granted
or denied by the Chairman or the President and, in the case of
the Chairman or the President, the approval or waiver shall be
granted or denied by Fund Counsel. A written record of the
action taken and the reasons for it shall be made by the person
making the determination and the original record retained in
accordance with Section 13 hereof.
6. REPORTING OF PERSONAL SECURITIES HOLDINGS AND TRADING
ACCOUNTS
A. Initial Reports
All Access Persons of Aquila Entities (other than Independent
Trustees) must, upon commencement of employment (but in any case
no later than 10 days after the person becomes an Access Person),
disclose all personal securities holdings in writing to the C.O.
This report must include the title, number of shares and
principal amount of each Security in which the Access Person had
any Beneficial Ownership when the person became an Access Person.
Each Access Person (other than Independent Trustees) also must,
upon commencement of employment but in any case no later than 10
days after the person becomes an Access Person, notify the C.O.
in writing of any securities or commodities account in which he
or she has a Beneficial Ownership interest or over which he or
she exercises Control as of the date the person became an Access
Person. Such notification must identify the brokerage firm or
other financial institution at which the account is maintained,
the account executive, the title of the account, the account
number, and the names and addresses of all individuals with a
Beneficial Ownership interest in the account. Subsequent to
employment, each such Access Person shall notify the C.O.
immediately and in writing of any new securities or commodities
accounts.
B. Quarterly Reports
Each Access Person (other than Independent Trustees) must report
to the C.O. the information described below with respect to
transactions in any Securities in which such Access Person had,
or by reason of such transaction acquires, any direct or indirect
Beneficial Ownership in a Security. Such reports must be made no
later than 10 days after the end of the calendar quarter in which
the transaction(s) were effected.
C. Annual Reports
Annually, each Access Person (other than Independent Trustees)
must submit a report that includes the following information:
title, number of shares and principal amount of each Security in
which the Access Person had any Beneficial Ownership; the name of
any broker, dealer or bank with whom the Access Person maintains
an account in which any securities are held for the direct or
indirect benefit of the Access Person; and the date that the
report is submitted by the Access Person. The report must be
current as of a date no more than 30 days before the report is
submitted.
D. General Reporting Information.
Access Persons are not required to report Securities trades in
accounts over which they do not have influence or Control over
investment decisions (e.g., a blind trust). No report required
by this Section shall be construed as an admission by the Access
Person that he or she has any Beneficial Ownership of any
Security on the report, nor shall the making of a report be
construed as an admission of a violation of this Code by the
Access Person.
The C.O. will identify all Access Persons who are required to
submit these reports and will inform those Access Persons of
these reporting requirements. In addition to the reports
required under this section, each Advisory Person is responsible
for "pre-clearing" before a securities transaction is executed,
through the Personal Trading Authorization Form (Exhibit A).
7. INFORMATION REQUIRED IN PERSONAL TRADING REPORTS
Quarterly reports required under Section 6.B must include the
following information:
(a) the date of the transaction, the title, the interest
rate and maturity (if applicable), and number of shares, and
the principal amount of each Security involved;
(b) the nature of the transaction (e.g., purchase, sale, or
any other type of acquisition or disposition);
(c) the price at which the transaction was effected;
(d) the name of the broker, dealer, or bank with or through
which the transaction was effected; and
(e) the date that the report is submitted by the Access
Person.
These quarterly reports also must include the following
information with respect to any account established by an Access
Person in which he or she has a Beneficial Ownership interest or
over which he or she exercises control:
(a) the name of the broker, dealer or bank with whom the
Access Person established the account;
(b) the date the account was established; and
(c) the date that the report is submitted by the Access
Person.
One way to achieve this is for you to instruct the brokerage firm
or bank, at which you maintain accounts in which you have a
Beneficial Ownership interest or over which you have Control, to
automatically send copies of broker trade confirmations or
monthly or quarterly account statements to the C.O. no later than
10 days after the end of each calendar quarter. To use
confirmations or account statements to satisfy the quarterly
reporting requirement, the confirmations and statements must
include all of the information listed above. The C.O. will be
responsible for reviewing such records.
Such reports must be made with respect to all Personal Trading,
including transactions exempted by Section 3. However, Access
Persons are not required to report Securities trades in accounts
over which they do not have influence or Control over investment
decisions (e.g., a blind trust).
8. REPORTING OF PERSONAL TRADING BY INDEPENDENT TRUSTEES OF THE
FUNDS
Under the Code of Ethics of each Fund, persons whose only
relationship to the Aquila Entities is that of an Independent
Trustee of one or more Funds, are not required to submit reports
of their Personal Trading, unless the person knew or, in the
ordinary course of fulfilling his or her duties as an Independent
Trustee, should have known, that during the 15-day period before
or after his or her transaction in a Security, the Security was
purchased or sold, or considered for purchase or sale, by or on
behalf of any Fund. Required reports must be submitted no later
than 10 days after the end of the calendar quarter in which the
transaction(s) were effected and must include the information
described under Section 7 above.
Independent Trustees also are not required to report Securities
trades in accounts for which they do not have influence or
Control over investment decisions (e.g., a blind trust). No such
report shall be construed as an admission by an Independent
Trustee that he or she has any Beneficial Ownership of any
Security on the report, nor shall the making of a report be
construed as an admission of a violation of this Code by the
Independent Trustee.
The C.O. will inform the Independent Trustees of each Fund of the
applicable reporting requirements under each Fund's Code of
Ethics. Copies of any Personal Trading reports received by the
C.O. from an Independent Trustee of a Fund will be referred to
that Fund's counsel and the originals maintained by the C.O. as
part of the Fund's records.
9. ADVISING NON-AQUILA ENTITIES
Advisory Persons may not render investment advice to persons
other than Aquila Entities, unless the advisory relationship,
including the identity of those involved and any fee
arrangements, has been disclosed to and approved by the
President. Once cleared with the President, all transactions for
such outside advisory clients are subject to the reporting
requirements of Section 6 above. This prohibition precludes
Advisory Persons from providing investment advice to members of
such person's immediate family without the prior approval of the
President.
10. EXTERNAL INVESTMENT ADVISERS
Because certain investment advisers of the Aquila Entities
maintain their own codes of ethics, this Code does not extend to
such investment advisers.
11. TRADING WITH MATERIAL NON-PUBLIC INFORMATION
THIS PROVISION OF THE CODE APPLIES TO ALL PERSONNEL
No officer, trustee, director, employee, or control person of any
Aquila Entity may purchase or sell any security, or be involved
in any way in the purchase or sale of a security, while in
possession of material non-public information about the security
or its issuer, regardless of the manner in which such information
was obtained. Furthermore, no person possessing material non-
public information may disclose such information to any person
other than the C.O. or Fund Counsel, in the case of an
Independent Trustee, except to the extent authorized by the C.O.
or Fund Counsel. This prohibition covers transactions for the
Funds and other advisory clients made in the course of your
employment with an Aquila Entity, as well as transactions for
your personal accounts and accounts of persons in privity with
you.
Material non-public information includes corporate information,
such as undisclosed financial information about a corporation,
and market information, such as a soon-to-be-published article
about a corporation. Material information is defined as
information which an investor would consider important in making
an investment decision, or which would substantially affect the
market price of a security if generally disclosed. Non-public
information is defined as information which has not been
effectively made available to the marketplace. Any questions as
to whether certain information is material non-public information
should be directed to the C.O. or, in the case of an Independent
Trustee, Fund Counsel.
12. ADVISORY PERSONS SERVING AS DIRECTORS OF PUBLICLY-TRADED
COMPANIES
Advisory Persons who serve as directors of publicly-traded
companies may be seen as having an inherent conflict of interest
between the fiduciary duty owed to the Aquila Entities' clients
and that owed to the shareholders of such publicly-traded
companies. To avoid such potential conflicts of interest, all
Advisory Persons must receive the prior written approval of the
President before serving as director of any publicly-traded
company, which approval may be withheld in the President's sole
discretion. If you are an Advisory Person and currently serve as
a director of a publicly-traded company, you should notify the
C.O. immediately. Prior to commencement of employment with any
Aquila Entity and annually thereafter, each Advisory Person shall
provide the C.O. with a written list of all positions held by the
Advisory Person with any publicly-traded company.
Advisory Persons who receive permission to serve as directors of
publicly-traded companies will be isolated through "Chinese
Walls" or other procedures from making decisions regarding the
securities of those companies for which they serve as directors.
An especially sensitive situation involves representation on a
creditors' committee. Particular care will be taken to create a
"Chinese Wall" between portfolio management and creditors'
committee representation.
13 RECORD KEEPING
The C.O. shall maintain the following records in the manner and
for the time periods described under the Advisers Act and Rule
17j-1(f) under the 1940 Act:
(a) a copy of this Code and any other Code which is, or at
any time within the past five years has been in effect;
(b) records of any violations of this Code and any actions
taken as a result of such violations;
(c) each report, record or finding made under this Code
(i.e., those required by Sections 2, 3, 5, 6, 8, and 9),
including any information provided in lieu of these reports
(e.g., confirmations, account statements);
(d) a list of all persons who currently are or within the
past 5 years have been required to make reports pursuant to
the Code;
(e) a list of all persons who currently are or within the
past 5 years have been responsible for reviewing reports
submitted pursuant to the Code; and
(f) a copy of each report submitted to the Fund's Board
of Trustees in connection
with the Board's approval of a code of ethics or
material changes to such a code.
14. VIOLATIONS OF THIS CODE
Violations of this Code may result in the imposition of criminal
penalties or sanctions by the SEC, other regulatory authorities,
or the Aquila Entities, including forfeiture of any profit from a
transaction, and forfeiture of future discretionary salary
increases or bonuses and suspension or termination of employment.
Determinations as to whether a violation has occurred, and the
appropriate sanctions, if any, shall be made by the directors,
Trustees or the President of the relevant Aquila Entity or
Entities; provided however, that no person believed to have
violated this Code shall participate in such determinations made
with respect to his or her own conduct.
15 BOARD APPROVAL
A. Initial Approval of Codes of Ethics
The Board of each Fund, including a majority of Independent Trustees,
shall approve any code of ethics required by the Rule of any new
adviser or principal underwriter to such Fund before retaining
its services. Before the Board meeting at which a code is
scheduled for approval, the affected adviser or principal
underwriter shall provide the Board with a copy of the code, a
written certification that it has adopted procedures reasonably
necessary to prevent its Access Persons from violating the code
and any other information requested by the Board.
B. Material Changes to Codes of Ethics
The Board of each Fund, including a majority of Independent
Trustees, will approve any material changes to this Code, as well
as to the codes of ethics of each such fund and any external
adviser to such fund within six months following the adoption of
the change. The appropriate officers of the Fund or other Aquila
Entities or external adviser will, on a timely basis, provide
notice to the Board of the changes and provide the Board with the
following information regarding the changes for which Board
approval is sought: (a) a written description of the change and
the reasons therefor; (b) a copy of the revised code of ethics,
marked to show the changes; (c) a written certification that the
entity has adopted procedures reasonably necessary to prevent the
adviser's Access Persons from violating the code; and (d) any
other information requested by the Board.
C. Annual Reports to Fund Boards
At least annually, the appropriate officers of the Aquila
Entities and any external investment adviser to a Fund shall
provide each Fund's Board with (i) a written certification that
the Aquila Entities or external adviser have adopted procedures
reasonably necessary to prevent their respective Access Persons
from violating their codes of ethics; (ii) a written report that
describes any issues arising under such codes of ethics or
related procedures since the last report to the Board; and (iii)
any other information requested by the Board. The report referred
to in (ii) above shall include, but not be limited to,
information about: material violations of the code or related
procedures; immaterial, individual violations (such as late
filings of quarterly transactions reports) if such violations are
material in the aggregate; and sanctions imposed in response to
such violations; significant conflicts of interest that arose
involving personal trading, even if the conflicts did not result
in a code violation (e.g., where an Advisory Person is a director
of a company whose securities are held by a Fund. See Section
12 herein.). Further, each Fund's Board will be provided with
more frequent reports when there have been significant violations
of a code or related procedures, or significant conflicts of
interest arising under the code or procedures.
Certification
I have read the Code of Ethics of the Aquila Group of
Companies in its entirety, and I understand it. I agree to
comply fully with all of its provisions. Further, I agree to
certify, in writing and each year, that I have complied with the
terms of this Code, as amended from time to time.
Dated: Signed:
EXHIBIT A
AQUILA GROUP OF COMPANIES
PERSONAL TRADING AUTHORIZATION FORM
In connection with the contemplated
(purchase or sale)*
by of
(name of employee) (number of shares)
of on
:
(name of security) (date)
I confirm that to my knowledge (a) there presently is no outstanding
order to purchase or sell the above-listed security for an Aquila
Entity's account or portfolio; (b) there is no outstanding oral
or written communication with respect to that security that has
not been acted upon or rejected; (c) I have no present intention
to purchase or sell that security for an Aquila Entity and am not
aware that such security is "being considered" by anyone with
discretionary authority over trading on behalf of an Aquila
Entity and (d) I am not in possession of material non-public
information with respect to the security described above nor am I
making the transaction described above on the basis of material
non-public information. I further confirm that the above
conditions have existed during this entire business day.
Finally, I confirm that I have no access to or knowledge of
current recommendations or investment decisions relating to this
security that may be being made or considered for any Aquila
Entity by an investment adviser not subject to the Aquila Code of
Ethics.
Dated: Signed:
Approved: Dated:
Compliance
* If other than market order, described proposed limits.
