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EXHIBIT (p)(2)
MATTHEWS INTERNATIONAL CAPITAL MANAGEMENT, LLC
CODE OF ETHICS
CERTIFICATE OF RECEIPT
I hereby certify that I have received, read and understand this Code of Ethics
of Matthews International Capital Management, llc, that I have had the
opportunity to ask any questions I may have had concerning the meaning and
interpretation of such policies and procedures outlined therein, that I accept
the obligations placed upon me by it and that I agree to abide by and comply
with it.
By: _________________________________
Print Name: _________________________________
Date: ________/________/________
As of October 5, 2000; Individual Officers Referred to Here In:
Chairman and Chief Executive Officer: G. Paul Matthews
President: Mark W. Headley
Head Trader: James E. Walter
Compliance Officer: Joseph M. O'Donnell
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MATTHEWS INTERNATIONAL CAPITAL MANAGEMENT, LLC
CODE OF ETHICS
To avoid any possible conflict of interest in carrying out our
responsibilities to clients and the public, every director, officer and
employee of Matthews International Capital Management, LLC (the "Company") is
bound by this Code of Ethics. The general principles involved are stated in
the following quote from the U.S. Securities and Exchange Commission:
"An investment advisor is a fiduciary. As such he owes his clients
undivided loyalty, should not engage in any activity in conflict with
the interest of any client, and should take the steps reasonably
necessary to fulfill his fiduciary obligations. Thus, an investment
advisor must not only refrain from effecting, on his own behalf,
securities transactions which are inconsistent with his fiduciary
obligation; he should also be reasonably certain that persons
associated with him are not improperly utilizing the information which
they obtain in the conduct of the investment advisory business in such
manner as to adversely affect the interest of clients or limit the
advisor's ability to fulfill his fiduciary obligations."
The goal of this Code of Ethics is the prohibition of any activity
which causes a conflict of interest; in actuality as well as in
appearance. To avoid even the appearance of any conflict of interest
in the dealings of the Company all employees, officers and directors:
1. are prohibited from seeking or accepting any gifts, favors,
preferential treatment or valuable consideration of any kind offered
from any broker/dealer or other company or persons involved in the
securities industry because of their association with the Company. If
you receive any unsolicited gift that has a value in excess of $50.00,
you must immediately report the gift to the Company's Compliance
Officer and thereafter give that unsolicited gift to the charity of
the your choice.
2. are prohibited from releasing any information (except to those
concerned with the transaction) as to any portfolio changes proposed
or in process, until such information shall become publicly available.
No information may be divulged to any outsider concerning wither
proposed or partially completed programs to buy or sell particular
securities.
3. must conduct any personal transactions in such a way as to not
conflict with the interest of any Company client. It is the
responsibility of each employee, officer and director to know who are
the clients of the Company.
4. are prohibited from entering into any transaction based on material
non-public information, or communicating material nonpublic
information to others in violation of the law.
5. must report all personal transactions in securities in which you
have a direct or indirect beneficial ownership within ten days of the
end of each calendar quarter.
What Accounts and Securities are Covered by this Code of Ethics?
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This Code of Ethics relates to any account established, or transactions
contemplated, in which any employee, officer or director of the Company has
discretionary authority, and which is for the benefit of any employee,
officer or director of the Company, their spouse, minor children, any living
relative thereof living therewith or any person receiving support therefrom.
This Code of Ethics does not relate to any account established, or
transactions contemplated, in which any employee, officer or director of the
Company has no direct or indirect influence or control, non-volitional
transactions, automatic dividend reinvestment plan, exercise of rights issued
by an issuer pro rata to all holders of a class of its securities (if the
rights were acquired from the issuer), or to the sale of any such rights
acquired from the issuer.
This Code of Ethics does not relate to any security issued by the United
States Government, or its agencies which are deemed the direct obligations of
the United States Government, bankers' acceptances, certificates of deposit,
commercial paper, variable contracts issued by insurance companies, or
securities of open-end management investment companies registered under the
Investment Company Act of 1940, as amended, (mutual funds).
ALL EMPLOYEES, OFFICERS AND DIRECTORS OF THE COMPANY ARE REQUIRED TO READ,
UNDERSTAND, FOLLOW AND RETAIN THIS CODE OF ETHICS. ALL QUESTIONS ARE TO BE
DIRECTED TO THE COMPLIANCE OFFICER.
POLICY STATEMENT ON INSIDER TRADING
-----------------------------------
The Company forbids all employees, officers and directors from trading,
either personally or on behalf of others, including accounts managed by the
Company, on material non-public information, or communicating material
non-public information to others in violation of any law. This conduct is
frequently referred to as "insider trading." The Company's policy extends to
all trading activities.
The Term "insider Trading" is not defined in the federal securities laws, but
generally is used to refer to the use of material non-public information to
trade in securities, whether or not one is an "insider" or to the
communication of material non-public 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 non-public
information;
2. trading by a non-insider while in possession of material non-public
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 non-public information to others.
Who is an Insider?
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The concept of being an insider is analyzed and determined broadly.
Generally, if there is a valid question as to whether a person is or is not
an insider, it will be presumed that he or she is an insider unless there is
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compelling reasons to decide otherwise. Insiders include any employee,
officer or director of the Company. In addition, any employee, officer or
director of the Company can become a "temporary insider" of another company
if she or he enters into a special confidential relationship in the conduct
of that company's affairs and as a result is given access to information
solely because of that relationship. A temporary insider can include, among
others, a financial analyst, a company's attorneys, accountants, consultants,
bank lending officers, and the employees of such organizations. According to
the United States Supreme Court, such company must expect the outsider to
keep the disclosed non-public information confidential and the relationship
must at least imply such a duty before the outsider will be considered an
insider.
What is Material Information?
----------------------------
Trading on inside information is not illegal unless the information is
material. "Material information" is defined as information for which there is
a substantial likelihood that a reasonable investor would consider it
important in making an investment decision, or information that is reasonably
certain to have a substantial effect on the price of a company's securities.
Examples of material information include (but are not limited to):
dividend changes
earnings estimates
changes in previously released earnings estimates
significant merger or acquisition proposals or agreements
major litigation
liquidation problems
extraordinary management developments
Material information does not have to relate to a company's business. For
example in the court case of CARPENTER v. U.S., 108 U.S. 316 (1987), the
Supreme Court considered as material certain information about the contents
of a forthcoming newspaper column that was expected to affect the market
price of a security. In that case, a Wall Street Journal reporter was found
criminally liable for disclosing to others the dates that reports on various
companies would appear in the Journal and whether those reports would be
favorable or not.
What is Non-Public Information?
-------------------------------
Information is non-public until it has be 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 U.S. Securities and Exchange Commission, or appearing in a
news service would be considered public.
Penalties for Insider Trading
-----------------------------
Penalties for trading on, or communicating material non-public information
are severe, both for individuals involved in such unlawful conduct and their
company. A person can be subject to some or all of the penalties below, even
if that person does not benefit personally from the violation:
Termination from the Company
Civil Injunctions
Treble Damages (multiply any damages by 3, then pay)
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Disgorgement of Profits
Jail
Fines to the Person
Fines to the Company
Procedures to Implement Insider Trading Policy
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The following procedures have been established to aid you in avoiding insider
trading and to aid the Company in preventing, detecting and imposing
sanctions against insider trading and the insider trader. Every employee,
officer or director of the Company must follow these procedures or risk
serious sanctions some of which are listed above. Direct any questions to the
Compliance Officer.
Identifying Inside Information
------------------------------
Before trading for yourself or others, including accounts managed by the
Company, in the securities of a company about which you may have potential
inside information, ask yourself the following questions:
1. Is the information material? That is, would this information be
considered important in making an investment decision? Would this
information substantially affect the market price of the securities if
generally disclosed?
2. Is the information non-public? To whom has this information been
provided? Has the information been effectively communicated to the
market place by being published in Reuters, the Wall Street Journal,
or other publications of general circulation?
If, after consideration of the questions above you believe, or if you have
questions as to whether the information is material and non-public, take the
following steps:
1. Report the matter immediately to the Compliance Officer.
2. Do not purchase or sell the securities on behalf of yourself or
others, including accounts managed by the Company
3. Do not communicate the information inside or outside the Company,
other than to the Compliance Officer
After the 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.
Restricting Access to Material Non-Public Information
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Information in your possession that you identify as material and non-public
may not be communicated to anyone, including persons within the Company,
except as provided above. In addition, you should take care so that such
information is secure. For example, seal files containing material non-public
information and restrict access to computer files containing material
non-public information.
Resolving Issues Concerning Insider Trading
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If, after consideration of the items set forth above, doubt remains as to
whether information is material or non-public, or if there is any unresolved
question as to the applicability or interpretation of the foregoing
procedures, or as to the propriety of any action, it must be discussed with
the Compliance Officer before trading or communicating the information to
anyone.
POLICY STATEMENT ON PERSONAL SECURITIES TRANSACTIONS
----------------------------------------------------
To avoid even the appearance of any conflict of interest between its clients
and its employees, officers and directors, the Company must place
restrictions upon the personal securities transactions of its employees,
officers and directors. Each employee, officer and director of the Company
recognizes and submits to these restrictions as part of their association
with the Company.
Except as set forth below, the Company forbids all employees, officers and
directors (only so long as that director is privy to the investment program
of the Company) from trading, either personally or on behalf of others,
including accounts managed by the Company or in which they have a direct or
indirect beneficial ownership, in any security that is currently trading, or
being considered for trading, in any account managed by the Company until
five (5) business days after the last trade has been effected in any such
managed account. In addition, the Company forbids all employees, officers and
directors (only so long as that director is privy to the investment program
of the Company) from directly, indirectly or beneficially owning any Asian
security unless that ownership is through an investment company registered
under the Investment Company Act of 1940, as amended (a mutual fund).
Consistent with the legal definition of "beneficial ownership" and "personal
account," if a portfolio manager associated with the Company manages a
private account that is deemed to be a personal account due to the family
relationship of the shareholders of that account, that portfolio manager may
trade securities, including Asian securities only for such an account, with
the prior written approval of the Chief Investment Officer or the President
of the Company for each such trade.
Procedures to Implement Personal Securities Transactions Policy
---------------------------------------------------------------
Prior to entering any order for personal securities transactions, each
employee, officer and director (only so long as that director is privy to the
investment program of the Company) must submit a request form (Exhibit C) to
the Head Trader for permission to make any trade. The Head Trader will
determine if any client trades are pending, or if there have been any trades
within the guidelines stated above.
If the security has been traded in any client account during the past five
(5) business days, or is expected to be traded, the transaction will not be
approved.
If the security involved is not currently being traded, has not traded in any
client account during the past five (5) business days, or is not currently
being considered for trading in any client account, the transaction may be
approved.
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The Head Trader will initial the form indicating approval or disapproval of
each transaction. If approval for a specific transaction is given, that
approval is only valid for the day on which it is given. All requests,
whether approved or denied, will be maintained in that employees'
confidential trading file which is maintained by the Compliance Officer.
Any transactions by the Head Trader will be so considered by the Chief
Investment Officer or the President of the Company.
MONITORING COMPLIANCE
---------------------
On implementation of this policy, every officer, director and employee of the
Company is required to sign the certificate accompanying this Code of Ethics
certificating that they have read it, and understand it and agree to comply
with the spirit and letter of it. Thereafter, all new employees will be
required to sign such a certificate as a condition of employment.
In addition, each employee, officer and director of the Company is required
to disclose all accounts in that person's name or for which they have
beneficial ownership thereof with any brokerage firm or other financial
institution through which any securities may be purchased or sold using the
form attached as Exhibit B and forward to the Compliance Officer copies of
the account statement at least quarterly from such accounts. Thereafter, each
employee, officer and director of the company must advise and receive the
permission of the Compliance Officer before opening any new or additional
such account.
Within 10 days after each calendar quarter each employee, officer and
director (only so long as that director is privy to the investment program of
the Company) is required to provide the Company's Compliance Officer with a
report of all trades in any security made by them during that quarter on the
form attached hereto as Exhibit D.
Each January every employee, officer and director is required to sign a
certificate in the form attached as Exhibit A certificating that they are in
compliance with the Code of Ethics.
All confirmations, statements, forms and other information will be reviewed
to monitor compliance with this Code of Ethics. The Company reserves the
right to require an employee, officer or director (only so long as that
director is privy to the investment program of the Company) to take any
action concerning a personal securities transaction which it deems is in the
best interest of the Company and to maintain compliance with this Code of
Ethics. The Company will keep confidential all information concerning
compliance with this Code of Ethics unless required by law to do otherwise.
The Chief Executive Officer of the Company has final interpretive authority
of this Code of Ethics with the advice of the Compliance Officer and counsel
to the Company.
VIOLATION OF THE COMPANY'S PERSONAL TRADING POLICY SUBJECTS AN EMPLOYEE, OFFICER
OR DIRECTOR OF THE COMPANY TO SANCTIONS INCLUDING TERMINATION AND CRIMINAL
PROSECUTION.
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MATTHEWS INTERNATIONAL CAPITAL MANAGEMENT, LLC
CODE OF ETHICS
EXHIBIT A
I hereby certify that, since the date on which I received a copy of the Code of
Ethics of Matthews International Capital Management, LLC, or the date of my last
certification, whichever is later, I have complied in all respects with such
Code.
By: _________________________________
Print Name: _________________________________
Date: ________/________/________
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MATTHEWS INTERNATIONAL CAPITAL MANAGEMENT, LLC
CODE OF ETHICS
EXHIBIT B
Accounts with Brokerage Firms and Financial Institutions
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<TABLE>
<CAPTION>
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BROKER/FINANCIAL INSTITUTION ACCOUNT NUMBER ACCOUNT NAME RELATIONSHIP
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<S> <C> <C> <C>
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</TABLE>
I CERTIFY THAT THE INFORMATION GIVEN ABOVE IS TRUE, ACCURATE AND COMPLETE AS OF
THE DATE BELOW AND WILL MAINTAIN IT THAT WAY BY SUPPLEMENTING THE INFORMATION IN
THE EVENT OF ITS CHANGE.
By: _________________________________
Print Name: _________________________________
Date: ________/________/________
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MATTHEWS INTERNATIONAL CAPITAL MANAGEMENT, LLC
CODE OF ETHICS
EXHIBIT C
PERSONAL SECURITY TRANSACTION AUTHORIZATION
-------------------------------------------
PLEASE COMPLETE ALL INFORMATION BELOW, HAVE AUTHORIZED BY THE APPROPRIATE PERSON
AND DELIVER TO COMPLIANCE OFFICER. KINDLY KEEP A COPY OF THE FULLY EXECUTED FORM
FOR YOUR RECORDS.
EMPLOYEE NAME: ___________________________________________
ACCOUNT TITLE: ___________________________________________
PROPOSED TRADE DATE: ______/______/______
NAME OF SECURITY : ___________________________________________
NUMBER OF SHARES / DOLLAR AMOUNT: ____________________ BUY SELL
AUTHORIZATION
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The undersigned officer of Matthews International Capital Management, LLC hereby
certifies the following information:
The above security (please check one) HAS ____; HAS NOT _____ been
approved for purchase or sale for client accounts within the last five
business days, or is currently being considered for trading in client
accounts.
There (please check one) ARE _____; ARE NOT _____ currently any open
orders for client accounts, or have been any purchases or sales for
client accounts within the past five days.
REQUEST APPROVED: REQUEST DENIED:
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BY: ___________________________________ DATE: _____/_____/_____
COMENTS:________________________________________________________________
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NAME:_____________________ DATE COMPLETED: __//__
DUE DATE: TEN DAYS AFTER END OF CALENDAR QUARTER
MATTHEWS INTERNATIONAL CAPITAL MANAGEMENT, LLC
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CODE OF ETHICS
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EXHIBIT D
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Quarterly Report of Personal Securities Transactions for Calendar Quarter
ended ______/______/______
<TABLE>
<CAPTION>
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Date of Buy/Sell Name of Security Number of Price Broker
Transaction Shares
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<S> <C> <C> <C> <C> <C>
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</TABLE>
Check here if you did not make any reportable transactions.
Check here if a list of all transactions is attached to this form.
By signing below I certify that the information contained herein is accurate and
complete and is made in compliance with the Code of Ethics of Matthews
International Capital Management, LLC.
__________________________________________________________
Name/Signature
Reviewed and received by: _____________________, on __/__/__
Compliance Officer
