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CODE OF ETHICS
1. Statement of General Principles
This Code of Ethics ("Code") expresses the policy and procedures of
Arnhold and S. Bleichroeder, Inc. ("A&SB") and Arnhold and S. Bleichroeder
Advisers, Inc. ("A&SB Advisers") (collectively, the "Adviser"), First Eagle
Funds, First Eagle SoGen Funds, Inc. and First Eagle Sogen Variable Funds, Inc.
and any other registered investment company for which the Adviser may act as
adviser or subadviser (the "Funds"). The Code is enforced to insure that no one
is taking advantage of his or her position, or even giving the appearance of
placing his or her own interests above those of the Funds. Investment company
personnel must at all levels act as fiduciaries, and as such must place the
interests of the shareholders of the Funds before their own.
Rule 17j-1 under the Investment Company Act of 1940, as amended (the
"Act"), makes it unlawful for certain persons, in connection with the purchase
or sale of securities, to, among other things, engage in any act, practice or
course of business which operates or would operate as a fraud or deceit upon a
registered investment company. In compliance with Rule 17j-1, this Code contains
provisions that are reasonably necessary to eliminate the possibility of any
such conduct.
2. Definitions
"Access Person" shall mean any director, trustee, officer, general
partner, or Advisory Person of the Funds or of the Adviser, who in the ordinary
course of his or her business makes, participates in or obtains information
regarding the purchase or sale of securities for the Funds or whose functions or
duties as part of the ordinary course of his or her business relate to the
making of any recommendation to the Funds regarding the purchase or sale of
securities.
"Advisory Person" of the Funds means any employee of the Funds or the
Adviser who, in connection with his regular functions or duties, makes,
participates in, or obtains information regarding the purchase or sale of a
security by the Funds, or whose functions relate to the making of any
recommendations with respect to such purchases or sales, and shall include any
natural person in a control relationship with the Funds or the Adviser who
obtains information concerning recommendations made to the Funds with regard to
the purchase or sale of a security.
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The term "beneficial ownership" 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. "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, an
interest in a Security held by members of your immediate family who share your
household, including your spouse, children and stepchildren, parents,
grandparents, brothers and sisters, and in-laws.
"Board" shall mean the board of directors or board of trustees of the
Funds.
"Compliance Officer" shall mean the compliance officer appointed by
the Board of the Funds.
"Control" shall have the same meaning as that set forth in Section
2(a)(9) of the Act.
The term "Covered Security" shall mean a security defined in Section
2(a)(36) of the Act and shall include options, but shall not include direct
obligations of the United States, bankers' acceptances, bank certificates of
deposit, commercial paper, other money market instruments including repurchase
agreements, and shares of registered open-end investment companies.
"Disinterested Director" of the Funds shall mean a director or trustee
thereof who is not an "interested person" of the Funds within the meaning of
Section 2(a)(19) of the Act.
"Fund" shall mean the Funds or any other registered investment company
to which the Adviser acts as adviser or subadviser.
"Initial Public Offering" means an offering of securities registered
under the Securities Act of 1933, as amended, by or for an issuer of such
securities which, immediately before the registration, was not subject to the
reporting requirements of Section 13 or 15d of the 1934 Act.
"Investment Compliance Committee" shall mean the committee appointed
by the management of A&SB.
"Investment Personnel" of the Funds or the Adviser includes Portfolio
Managers and those persons who provide information and advice to the Portfolio
Managers or who help execute the Portfolio Managers' decisions (e.g. securities
analysts and traders).
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"Portfolio Managers" shall mean those persons who have direct
responsibility and authority to make investment decisions for a Fund.
"Principal Underwriter" shall mean A&SB.
The "purchase or sale of a security" includes, among other things, the
writing of an option to purchase or sell a security.
3. Prohibited Securities Transactions
The prohibitions described below will only apply to a transaction in a
Covered Security in which the designated person has, or by reason of such
transaction acquires or disposes, any direct or indirect beneficial ownership in
such Covered Security ("Securities Transaction").
A. Blackout Trading Periods - Access Persons
No Access Person shall execute a Securities Transaction on a day
during which the Funds have a pending buy or sell order in that same Covered
Security until that order is executed or withdrawn. Any profits realized on
trades within the proscribed periods are required to be disgorged to a charity
selected by the Adviser.
B. Blackout Trading Periods - Portfolio Managers
No Portfolio Manager shall buy or sell a Covered Security within seven
calendar days before and after the Fund that he or she manages trades in that
Covered Security. Any profits realized on trades within the proscribed periods
are required to be disgorged to a charity selected by the Adviser.
C. Ban on Short-Term Trading Profits - Investment Personnel
Investment Personnel may not profit in the purchase and sale, or sale
and purchase, of the same (or equivalent) securities within 60 calendar days.
Any profits realized on such short-term trades are required to be disgorged to a
charity selected by the Adviser.
D. Ban on Securities Purchases of an Initial Public Offering - Investment
Personnel
Investment Personnel may not acquire any securities in an Initial
Public Offering.
E. Securities Offered in a Private Offering - Investment Personnel
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Investment Personnel may not acquire any securities in a private
offering without the prior written consent of the Compliance Officer.
Furthermore, should written consent be given, Investment Personnel are required
to disclose such investment when participating in the Fund's subsequent
consideration of an investment in such issuer. In such circumstances, the Fund's
decision to purchase securities of such issuer should be subject to an
independent review by the Investment Compliance Committee.
4. Exempted Transactions
A. Subject to compliance with preclearance procedures in accordance with
Section 5 below, the prohibitions of Sections 3A, 3B and 3C of this Code shall
not apply to:
(i) Purchases or sales effected in any account over which the Access Person
has no direct or indirect influence or control, or in any account of the
Access Person which is managed on a discretionary basis by a person other
than such Access Person and with respect to which such Access Person does
not in fact influence or control such transactions.
(ii) Purchases or sales of securities which are not eligible for purchase
or sale by the Funds.
(iii) Purchases or sales which are non-volitional on the part of either the
Access Person or the Funds.
(iv) Purchases which are part of an automatic dividend reinvestment plan.
(v) Purchases effected upon the exercise of rights issued by an issuer pro
rata to all holders of a class of its securities, to the extent such rights
were acquired from such issuer, and sales of such rights so acquired.
(vi) Any equity securities transaction, or series of related transactions,
involving 500 shares or less or amounting to $10,000 or less, in the
aggregate if i) the Access Person has no prior knowledge of transactions in
such Covered Security by the Funds and (ii) if the issuer has a market
capitalization (outstanding shares multiplied by the current price per
share) greater than $1 billion.
(vii) Any fixed income securities transaction involving $50,000 principal
amount or less if the Access Person has no prior knowledge of transactions
in such securities by the Funds.
(viii) All other transactions contemplated by an Access Person which
receive the prior approval of the Investment Compliance Committee in
accordance with the preclearance procedures described in Section 5 below.
Purchases or sales of a specific Covered
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Security may receive the prior approval of the Investment Compliance
Committee because the Committee has determined that no abuse is involved
and that such purchases and sales would be very unlikely to have any
economic impact on the Funds or on the Fund's ability to purchase or sell
such Covered Securities.
B. The prohibition in Section 3A shall not apply to Disinterested
Directors of the Funds, unless a Disinterested Director, at the time of a
transaction, knew or, in the ordinary course of fulfilling his or her official
duties as a Disinterested Director of the Funds, should have known that the
Funds had a pending buy or sell order in that same Covered Security, which order
had not yet been executed or withdrawn.
C. A transaction by Access Persons (other than Investment Personnel)
inadvertently effected during the period proscribed in Section 3A will not be
considered a violation of the Code and disgorgement will not be required so long
as the transaction was effected in accordance with the preclearance procedures
described in Section 5 and without prior knowledge of any Securities Transaction
by the Funds.
D. The prohibition in Section 3C shall not apply to profits earned from a
Securities Transactions in which securities are not the same (or equivalent) to
those owned, shorted or in any way traded by the Funds during the 60 day period;
provided, however, that if the Investment Compliance Committee determines that a
review of the Access Person's reported personal securities transactions
indicates an abusive pattern of short-term trading, the Committee may prohibit
such Access Person from profiting in the purchase and sale, or sale and
purchase, of the same (or equivalent) securities within 60 calendar days whether
or not such Covered Security is the same (or equivalent) to that owned, shorted
or in any way traded by the Funds.
5. Preclearance
Access Persons (other than Disinterested Directors) must preclear all
Securities Transactions. All requests for preclearance must be submitted to the
Investment Compliance Committee. Such requests shall be made by submitting a
Personal Investment Request Form, in the form annexed hereto as Appendix A. All
approved orders must be executed by the close of business on the day
preclearance is granted. If any order is not timely executed, a request for
preclearance must be resubmitted.
Disinterested Directors need not preclear their personal investments
in securities unless a Disinterested Director knows, or in the course of
fulfilling his or her official duties as a Disinterested Director should know,
that, within the most recent 15 days, any of the Funds have purchased or sold,
or considered for purchase or sale, such Covered Security or is proposing to
purchase or sell, directly or indirectly, any Covered Security in which the
Disinterested Director has, or by reason of such Securities Transaction would
acquire, any direct or indirect beneficial ownership.
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6. Reporting
A. The Compliance Officer shall periodically identify all Access Persons
and Inform such Access Persons of their reporting and compliance obligations
under this Code of Ethics.
B. Access Persons (other than Disinterested Directors) are required to
direct their broker(s) to supply to the Compliance Officer on a timely basis
duplicate copies of confirmations of all personal Securities Transactions and
copies of periodic statements for all securities accounts, whether existing
currently or to be established in the future. A sample letter for this purpose
is attached as Appendix B. The Securities Transaction reports and/or duplicates
should be addressed "Personal and Confidential." Compliance with this Code
requirement will be deemed to satisfy the reporting requirements imposed on
Access Persons under Rule 17j-1.
C. A Disinterested Director shall report to the Compliance Officer, no
later than ten days after the end of the calendar quarter in which the
transaction to which the report relates was effected, the information required
in Appendix C hereto with respect to any Securities Transaction in which such
Disinterested Director has, or by reason of such transaction acquires, any
direct or indirect beneficial ownership in a Covered Security that such
Disinterested Director knew, or in the course of fulfilling his or her official
duties as a director should have known, during the 15-day period immediately
preceding or after the date of the Securities Transaction by the Disinterested
Director, to have been purchased or sold by the Funds or considered for purchase
or sale by the Funds. With respect to those transactions executed through a
broker, a Disinterested Director of the Funds may fulfill this requirement by
directing the broker(s) to transmit to the Legal Compliance Officer a duplicate
of confirmations of such transactions, and copies of the statements of such
brokerage accounts, whether existing currently or to be established in the
future. The transaction reports and/or duplicates should be addressed "Personal
and Confidential" and submitted to the Compliance Officer and may contain a
statement that the report shall not be construed as an admission by the person
making such report that he or she has any direct or indirect beneficial
ownership in the Covered Security to which the report relates. Securities
Transactions effected for any account over which a Disinterested Director does
not have any direct or indirect influence or control, or which is managed on a
discretionary basis by a person other than the Disinterested Director and with
respect to which such Disinterested Director does not in fact influence or
control such transactions, need not be reported.
D. Whenever a person designated as Investment Personnel recommends that the
Funds purchase or sell a Covered Security, he or she shall disclose to the
person to whom the recommendation is made, as well as to the Compliance Officer,
whether he or she presently owns such Covered Security, or whether he or she is
considering the purchase or sale of such Covered Security.
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E. Not later than ten days after a person becomes an Access Person, and
thereafter on an annual basis Access Persons (other than Disinterested
Directors) will disclose all personal securities holdings and all their accounts
with any broker or dealer. On an annual basis Access Persons (other than
Disinterested Directors) will be sent a copy of the list of such Access Person's
securities accounts in which he or she has a beneficial ownership interest to
verify its accuracy and make any necessary additions or deletions. The Access
Person shall immediately notify the Compliance Officer upon establishing any
account with a securities or derivatives broker or dealer.
F. All personal matters discussed with the Compliance Officer, or members
of the Investment Compliance Committee, and all confirmations, account
statements and personal investment reports shall be kept in confidence, but will
be available for inspection by the Boards of the Funds and the Adviser and by
the appropriate regulatory agencies.
7. Annual Certification
On an annual basis Access Persons will be sent a copy of this Code for
their review. Access Persons will be asked to certify that they have read and
understand this Code and recognize that they are subject hereto. Access Persons
will be further asked to certify annually that they have complied with the
requirements of this Code and that they have disclosed or reported all personal
securities transactions required to be disclosed or reported pursuant to this
Code. A sample of the certification is attached as Appendix D.
8. Confidential Status of the Fund's Portfolio
The current portfolio positions of the Funds managed, advised and/or
administered by the Adviser and current portfolio transactions, programs and
analyses must be kept confidential.
If non-public information regarding the Fund's portfolio should become
known to any Access Person, whether in the line of duty or otherwise, he or she
should not reveal it to anyone unless it is properly part of his or her work to
do so.
9. Non-Public Material Information
No Access Person may purchase or sell any Covered Security, or be
involved in any way in the purchase or sale of a Covered Security, while in
possession of material non-public information about the Covered Security or its
issuer, regardless of the manner in which such information was obtained. This
prohibition covers transactions for clients, as well as transactions for
personal accounts.
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Furthermore, no Access Person possessing material non-public
information may disclose such information to any person other than the
Compliance Officer, except to the extent authorized by the Compliance Officer.
Disclosing non-public material information to others is known as "tipping" and
is prohibited.
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 information which an investor would consider important in making an
investment decision and which would substantially affect the market price of a
security if disclosed.
10. Gifts - Investment Personnel
Investment Personnel shall not receive any gift or other thing of more
than de minimis value from any person or entity that does business with or on
behalf of the Funds. For purposes of this Code, "more than de minimis value"
shall mean any gift in excess of a value of $100 per year.
11. Services as a Director in a Publicly Traded Company - Investment
Personnel
Investment Personnel shall not serve on the boards of directors of
publicly traded companies, absent prior authorization by the Board of the Funds,
based upon a determination that the board service would be consistent with the
interests of the Funds and its shareholders. When such authorization is
provided, the Investment Personnel serving as a director will be isolated from
making investment decisions with respect to the pertinent company through
"Chinese Wall" or other procedures.
12. Outside Employment
No Access Person may render investment advice to persons other than
the Adviser's clients, unless the advisory relationship, including the identity
of those involved and any fee arrangements, has been disclosed to and approved
by the Adviser. All transactions for such outside advisory clients of the Access
Person are subject to the reporting requirements of Section 6 above.
13. Compliance Review
The Compliance Officer shall compare the reported personal Securities
Transactions with completed and contemplated portfolio transactions of the Funds
to determine whether a violation of this Code may have occurred. The Compliance
Officer shall bring any questionable transactions to the attention of the
Investment Compliance Committee. Before
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making any determination that a violation has been committed by any person, the
Investment Compliance Committee shall give such person an opportunity to supply
additional information regarding the Securities Transaction in question.
14. Sanctions
The Board of the Funds and the Board of Directors of the Adviser will
be informed of Code violations of this Code on a quarterly basis and the
relevant Board may impose such sanctions as they deem appropriate, including
inter alia, a letter of censure or suspension or termination of employment of
the Access Person or a request for disgorgement of any profits received from a
Securities Transaction done in violation of this Code.
15. Board Review
The Board of the Funds shall annually receive a copy of the existing
Code, along with a list of recommendations, if any, to change the existing Code
based upon experience, evolving industry practices or developments in applicable
laws or regulations. No less frequently than annually, the Compliance Officer
shall submit to the Board of the Funds a written report that:
(A) Describes any issues arising under this Code or its procedures since
the last report to the Board, including, but not limited to, information about
material violations of this Code or its procedures and sanctions imposed in
response to the material violations; and,
(B) Certifies that the Funds, and the Adviser have adopted procedures
reasonably necessary to prevent Access Persons from violating this Code.
16. Recordkeeping
The Compliance Officer shall maintain, at the Funds' and the Adviser's
principal place of business, the following record and shall make these records
available to the Securities and Exchange Commission and its representatives:
A. A copy of each Code in effect during the past five years.
B. A record of any violation and the action taken during the past five
years.
C. A copy of each Access Person's reports.
D. A record of all Access Persons.
E. A copy of the written reports to the Board.
F. A record of the reasons for preapproving Initial Public Offerings
or Private Offerings of Covered Securities.
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Appendix A
This trade approval request is the form used on A&SB's intranet website.
All Securities Transactions should receive preclearance through the
intranet site.
TRADE APPROVAL REQUEST
To: Investment Compliance Committee
From: ____________________________
Date: ____________________________
Permission is requested to (BUY)/(SELL) __________________________ shares
of _______________________________________________________________.
The trade is to be executed at (ASB) / (Other Firm: ________________)
I HAVE NO MATERIAL, NON-PUBLIC INFORMATION REGARDING THE ABOVE
REFERENCED SECURITY. I HAVE CHECKED OUR TRADING DESK TO ENSURE THAT
THERE ARE NO PENDING CUSTOMER ORDERS.
EMPLOYEE SIGNATURE: _____________________________
Note: This form WILL NOT BE APPROVED without the employee first signing.
Filling out this form is the responsibility of the person requesting
approval, not the person granting approval!
Approved By: _______________________________ Date: ____________________
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Appendix B
Date
XYZ Broker Dealer
Re:
Dear Sir/Madam:
Please accept this letter as permission, pursuant to NYSE Rule 407, to allow
___________, an employee of our firm , to maintain an account(s) with your firm.
In regards to the above, please send duplicate confirmations and statements on
all transactions to the following:
Arnhold and S. Bleichroeder, Inc.
Ms. Tracy L. Saltwick
Senior Vice President
1345 Avenue of the Americas
New York, New York 10105-4300
Thank you for your prompt attention to this matter.
Sincerely,
ARNHOLD AND S. BLEICHROEDER, INC.
By:
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Appendix C
Information required to be reported:
(1) The date of the transaction, the title, the interest rate and
maturity date (if applicable), the number of shares and the
principal amount of each Covered Security involved;
(2) The nature of the transaction (i.e., purchase, sale or any other
type of acquisition or disposition);
(3) The price of the Covered Security at which the transaction was
effected;
(4) The name of the broker, dealer or bank with or through which the
transaction was effected; and
(5) The date that the report is submitted by the Access Person.
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Appendix D
Certification
I hereby certify that:
I have received a current copy of the Code of Ethics, and have read and
understand the Code.
I recognize that I am subject to the Code and certify that have
complied with the requirements of the Code.
I have disclosed or reported all my personal securities transactions
required to be disclosed or reported pursuant to this Code.
_____________________
Name
Date:________________
