Fred Alger Management, Inc. (“FAM”)
Fred Alger & Company, Incorporated (“FAC”)
Code of Ethics
Effective as of
July 1, 2016
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| |
| Table of Contents | |
| OVERVIEW | 3 |
| Purpose and Construction | 3 |
| Definitions | 3 |
| GENERAL PRINCIPLES OF CONDUCT | 5 |
| PERSONAL SECURITIES TRANSACTIONS | 6 |
| Brokerage Accounts | 6 |
| Securities Not Held in a Brokerage Account | 6 |
| Private Placements | 6 |
| Prohibited Personal Securities Transactions | 7 |
| Pre-Clearance | 7 |
| Considerations for Approval of Personal Securities Transactions | 7 |
| Exceptions | 8 |
| REPORTING REQUIREMENTS | 9 |
| Brokerage Accounts | 9 |
| Securities Not Held in a Brokerage Account | 9 |
| Personal Securities Transactions | 9 |
| Discretionary Account | 9 |
| Private Placements | 10 |
| Current Directorships | 10 |
| Outside Activities | 10 |
| CONFIDENTIALITY | 10 |
| SANCTIONS | 10 |
| ADMINISTRATION OF THE CODE | 11 |
| Responsibilities of the Chief Compliance Officer | 11 |
| Maintenance of Records | 11 |
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OVERVIEW
Purpose and Construction
This Code of Ethics (the “Code”) is adopted by Fred Alger Management, Inc. (“FAM”), Fred
Alger & Company, Incorporated (“FAC”) (collectively, “Alger”), and each investment company
for which FAM serves as investment adviser (each a “Fund” and collectively the “Alger Funds”)
in accordance with Rule 17j-1 under the Investment Company Act of 1940, as amended and Rule
204A-1 under the Investment Advisers Act of 1940 (“Advisers Act”), as amended.
The Code’s intent is to protect the fiduciary princ iples that govern the conduct of FAM and FAC
(collectively with their affiliates “Alger”) . Moreover, the purpose of the Code is to ensure that
all activities be in full compliance with the Federal securities laws as well as all other laws and
regulations that apply to Alger’s businesses. For purposes of this Code, the Federal securities
laws include (i) the Securities Act of 1933, the Securities Exchange Act of 1934, the Sarbanes-
Oxley Act of 2002, the Investment Company Act of 1940, the Advisers Act and Title V of the
Gramm-Leach-Bliley Act and any rules adopted by the Securities and Exchange Commission
(“SEC”) under any of the foregoing statutes, and (ii) the Bank Secrecy Act (as it applies to Alger
and any investment companies (public or private) advised by it) and any rules adopted
thereunder by the SEC or the Department of the Treasury.
If you have reason to believe that certain acts, actions, or practices engaged in by an Alger
employee would constitute a violation of Federal or state securities laws to which Alger is
subject or would violate Alger’s policies or procedures inclusive of the Code, you must report it
to a member of the Compliance or Legal Departments.
All Access Persons (as defined below) are responsible, for, and have agreed as a requirement of
their employment, to review, be familiar with, and comply with the Code. Any questions with
respect to the Code should be directed to the Chief Compliance Officer (“CCO”) of FAM, FAC,
and/or the Funds.
Definitions
Access Person - An employee of any Alger entity, including full-time consultants or contractors,
and long-term temporary workers on more than a six (6) month assignment.
Analyst - A person employed by FAM as a Senior Analyst, Analyst, Associate Analyst, Research
Associate or in a comparable position whose function relates to providing information, advice or
recommendations to one or more Portfolio Managers.
Beneficial Owner - A person is considered to be the Beneficial Owner of the following securities
(which may be held in a Brokerage Account or otherwise):
· securities held in the person’s own name;
· securities held with another in joint tenancy, community property or other joint
ownership;
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· securities held by a bank or broker as nominee or custodian on behalf of an Access
Person or pledged as collateral for a loan;
· securities held by members of the Access Person’s immediate family sharing the same
household (“immediate family” means any child, stepc hild, grandchild, parent,
stepparent, grandparent, spouse, domestic partner, sibling, mother-in-law, father-in-law,
son-in-law, daughter-in-law, brother-in-law, sister-in-law, including adoptive
relationships);
· securities held by a relative of an Access Person not residing in the person’s home if the
Access Person is a custodian, guardian, or otherwise has controlling influence over the
purchase, sale or voting of such securities;
· securities held by a trust of which the Access Person is a beneficiary and has or shares the
power to make purchase or sale decisions;
· securities held by a trust for which the Access Person serves as a trustee and in which the
person has a pecuniary interest (including pecuniary interests by virtue of performance
fees or by virtu e of holdings by the person’s immediate family);
· securities held by a general partnership or limited partnership in which the Access Person
is a general partner; or
· securities held by a corporation in which the Access Person has a control position or in
which the Access Person has or shares investment control over the portfolio securities
(other than a registered investment company).
Brokerage Account - An account which is an arrangement between an Access Person (or account
over which the Access Person has a beneficial interest) and a licensed brokerage firm that allows
the Access Person to deposit funds with the firm and place investment orders for securities
through the brokerage firm, which then carries out the transactions on the Access Person’s
behalf.
Client - Any person, entity or investment vehicle to which any Alger entity provides investment
advisory or other services.
Fund Trustee - A Fund trustee who is not an Officer, Director, or employee of FAM or FAC.
· Fund Trustees are only subject to the Code to the extent that a trustee knows, or, in the
ordinary course of fulfilling his/her duties as a trustee of a Fund, should know that during
the fifteen (15) day period immediately before or after the date of the transaction in a
Security by the trustee, a Fund has purchased or sold the Security or such purchase or
sale by a Fund was considered by the Fund or FAM. In such case, the Fund Trustee
should seek pre-clearance for the transaction with the CCO.
Portfolio Manager - A FAM employee with the responsibility, authority, and ability to make
investment decisions with respect to a Client.
Personal Security Transaction - A transaction in any Security in which an Access Person is or
will become a Beneficial Owner.
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Private Placement - A Private Placement is a passive investment, in any securities of issuing
entities that is exempt from registration under the Securities Act of 1933 pursuant to Section
4(a)(2) or Section 4(a)(5) or pursuant to Rule 504, Rule 505, or Rule 506 under, the Securities
Act of 1933, as amended.
Security - Any note, stock, treasury stock, security future, bond, debenture, evidence of
indebtedness, certificate of interest or participation in any profit-sharing agreement, collateral-
trust certificate, pre-organization 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
(including a certificate of deposit), or on any group or index of securities (including any interest
therein or based on the value thereof), or relating to foreign currency, or, in general, any interest
or instrument commonly known as a “security” or any certificate of interest or participation in,
temporary or interim certificate of participation for, guarantee of, or warrant or right to subscribe
or to purchase, any of the foregoing.
Trader - Any person employed by FAM and/or FAC who is responsible for placing trades on
behalf of Clients.
GENERAL PRINCIPLES OF CONDUCT
An Access Person shall:
· act in the best interests of Clients;
· not consider their personal financial (or any other personal) situation in connection with
transactions for any Client;
· conduct themselves in a manner intended to avoid any actual, potential or perceived
conflict of interest;
· not abuse their position of trust and responsibility;
· not take inappropriate advantage of their position in relationship to Clients;
· not divulge to any person any information regarding transactions for any Client, except in
the performance of their duties;
· not transact in any securities that are restricted from purchase or sale by any Alger entity;
· not utilize an excess amount of their time, in the judgment of the CCO, for Personal
Securities Transactions or allow such transactions to otherwise interfere with their ability
to fulfill their responsibilities.
In consideration of these General Principles of Conduct, an Access Person may not recommend a
transaction in any Security for any Client unless they have first disclosed to the compliance
department their interest in such Security (or, if relevant, the issuer of such Security), including
without limitation:
· direct or indirect Beneficial Ownership of any Security;
· any position with the issuer of such Security or its affiliates;
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· any current or proposed business relationship with issuer of such Security, its affiliates,
or any party which has a significant interest in the Security or its issuer; or
· any ownership interest in a Security acquired through a Private Placement, where
transactions in securities of the same issuer are now being considered for any Client.
In such case, the decision to invest in the Securities of such an issuer on behalf of the Client shall
be subject to the review and approval of the CCO.
In furtherance of these principles, an Access Person must
· obtain prior written authorization of the CCO to serve on the board of directors (or
trustees) of any company. Such authorization will be based on a determination that the
board service would be consistent with the interests of the Funds and their shareholders
or would otherwise not conflict with FAM’s ability to provide services to its Clients.
· disclose all business, investment, or charity-related outside activities regardless of their
nature or scope (e.g. additional employment, volunteer work, investment in real estate).
· obtain prior written authorization of the CCO for any Private Placement investments.
PERSONAL SECURITIES TRANSACTIONS
Brokerage Accounts
No Access Person shall open or maintain a Brokerage Account that can hold Securities in which
they have a Beneficial Interest without the express prior written approval of the Compliance
Department.
An Access Person must report to the Compliance Department all Brokerage Account(s) in which
the Access Person has a Beneficial Interest, the name of the broker-dealer or bank with whom
the account was established and the date the account was established. An Access Person is
responsible for ensuring that the Compliance Department receives duplicate copies of all
confirmations and account statements prior to trading in any Brokerage Account.
Securities Not Held in a Brokerage Account
If an Access Person holds a Security in certificate or other form (and not in a Brokerage
Account), the Access Person shall provide the name of the Security (or Securities), the quantity
held, and the date the Security was acquired. This includes any 401(k) plans from prior
employment that allow the participant to hold individual security and not just mutual funds.
Private Placements
As noted above, an Access Person shall not make an investment in a Private Placement without
the express prior written approval of the CCO.
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Prohibited Personal Securities Transactions
An Access Person may not:
· acquire any Security in an initial public offering;
· engage in “short-selling”; or
· purchase or sell (write) options or futures.
Pre-Clearance
All Access Persons must pre-clear all Personal Securities Transactions with the Compliance
Department, except for:
· a transaction effected under an arrangement through which an Access Person has given a
third party full trading discretion over the Access Person’s account and, the Access
Person does not have any direct or indirect influence or control over the transaction. The
Access Person must have first provided the discretionary agreement with the third party
to the Compliance Department and have received the written approval of the CCO for
any such arrangement or relationship;
· purchases that are part of an automatic dividend reinvestment plan;
· purchases resulting from the exercise of rights acquired from an issuer as part of a pro-
rata distribution to all holders of a class of Securities of such issuer;
· sales pursuant to tender offers;
· transactions pursuant to stock splits and involuntary share buy-backs;
· gifts or bequests (either receiving or giving), although the sale of any Security received
as a gift or bequest must be pre-cleared;
· transactions in municipal securities;
· transactions in shares of investment companies(including those advised or sub-advised by
FAM);
· exchange traded funds (“ETFs”); ETF transactions will still require a pre-clearance form
to be completed.
· De minimis transactions at or below a value of $ 2,500.00; these transactions will still
require a pre-clearance form to be completed.
· direct obligations of the U.S. government; or
· bankers’ acceptances, bank certificates of deposit, commercial paper and high quality
short-term debt instruments, including repurchase agreements.
Considerations for Approval of Personal Securities Transactions
An Access Person will not be able to execute a Personal Securities Transaction if:
· there is a pending transaction in such Security for a Client;
· an Analyst (or the sector head if the Security in question is not covered by any Analyst),
currently intends to (or believes that there are circumstances about the Security which
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will may lead them to) issue a recommendation to transact in such Security within the
next seven (7) calendar days;
· any Portfolio Manager who owns such Security (or such Security is otherwise appropriate
for a Portfolio Manager to own) for a Client indicates their intent to purchase or sell the
Security for a Client within the next seven (7) calendar days
· any transaction in the security has occurred in the past seven (7) calendar days.
An Analyst will not be able to execute a Personal Securities Transaction in any Security in their
sector. For purposes of this Code, Traders and Analysts who are generalists are deemed to be in
all sectors.
An Access Person may not sell a Security that they have purchased within any sixty (60) day
period at a gain. An Access Person who sells a Security that they have purchased within sixty
(60) days at a gain may be required to make a donation to charity equivalent to the profit made
from the sale of the Security or face further sanctions. For clarity, ETFs are not subject to the 60
day holding period.
An Access Person may only make a request for a Personal Securities Transaction by submitting a
Pre-Clearance form. This form must be completed in its entirety, signed, and dated by the
Access Person. Once complete, the form must be submitted to the Compliance Department for
approval.
Any approval to place a Personal Security Transaction is valid only for the day on which it is
granted. The Compliance Department will communicate approval or denial of the trade via
email only. Please note all trades are considered denied until official approval is granted. If
approved, an Access Person may only transact in a Security between 3 p.m. and 4 p.m. EST. on
that date the approval is given (or during trading hours for foreign securities traded in foreign
markets). If the Access Person does not transact within this time period, they must re-submit
their request before placing the transition in the future.
Exceptions
Exceptions to the Code may be granted from time to time by the CCO. All exceptions, unless
otherwise stated below, shall be documented and shall provide the details of the transaction
including the name and title of the Access Person, the amount of shares, direction of the trade
(buy or sell), trade date, Security description, and rationale for the granting of the exception.
An example of an exception is a de minimis trade in a highly liquid Security, or an exception to
the seven (7) calendar day block where the execution of the transaction would not provide the
Access Person with better execution than a corresponding transaction for a Client.
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REPORTING REQUIREMENTS
No later than ten (10) calendar days after an Access Person becomes employed by an Alger
entity FAM or FAC and thereafter twenty (20) calendar days after the end of each calendar
quarter, each Access Person shall submit a report to the Compliance Department containing the
following information:
Brokerage Accounts
For all Brokerage Accounts for which the Access Person has a Beneficial Interest, the name of
the broker-dealer or bank with whom the account was established, and the date the account was
established.
Securities Not Held in a Brokerage Account
If an Access Person holds a Security in certificate or other form (and not in a Brokerage
Account), the Access Person shall provide:
· the name of the Security (or Securities),
· the quantity held, and
· the date the Security was acquired.
This includes 401(k) plans from prior employment that allow the participant to hold individual
Securities and not just mutual funds,
Personal Securities Transactions
With respect to all Personal Securities Transactions, (including those mentioned above):
· the date of the transaction;
· the title of the Security;
· the number of shares/units and the principal amount of each Security involved;
· the nature of the transaction (e.g., purchase, sale or any other type of acquisition or
disposition);
· the price at which the transaction was effected; and
· the name of the broker-dealer or bank with or through whom the transaction was effected.
Discretionary Account
With respect to an Access Person who has given discretion to have transactions placed by a third
party and for which the Access Person does not have any direct or indirect influence or control
over the transaction:
· a certification that the Access Person is not providing information or instructions to such
third party regarding the management of the account.
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Private Placements
With respect to all Private Placements:
· the date of the transaction;
· the title of the Security;
· the number of shares/units and the principal amount of each Security involved;
· the nature of the transaction (e.g., purchase, sale or any other type of acquisition or
disposition);
· the price at which the transaction was effected; and
· the Private Placement Memorandum Offering and any other relevant documents.
Current Directorships
An Access Persons must disclose if they serve on the board of directors (or trustees) of any
company.
Outside Activities
An Access Person must disclose all outside activities regardless of their nature or scope (e.g.
additional employment, volunteer work, investment in real estate).
If the information required to be reported in this section has already been provided through
another medium (such as information contained in broker trade confirmations or account
statements, or a personal trade pre-clearance form received by the Compliance Department),
that information does not need to be reported again, provided that a quarterly report is filed with
respect to any account established or closed during the quarter by the Access Person.
Additionally the Access Person is not relieved of reporting responsibilities with respect to any
information not reported through other mediums and required by the Code.
CONFIDENTIALITY
All information obtained from any Access Person hereunder shall be kept in strict confidence,
except that reports of Securities transactions hereunder will be made available to the SEC or any
other regulatory or self-regulatory organization to the extent required by law or regulation.
SANCTIONS
Upon discovering that an Access Person has not complied with the requirements of this Code,
the CCO, in consultation with other senior officers of FAM and FAC and/or the Trustees of the
Alger Funds, may impose on that person whatever sanctions they deem appropriate, including,
among other things, disgorgement of profits, fines, censure, suspension, or termination of
employment.
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ADMINISTRATION OF THE CODE
Responsibilities of the Chief Compliance Officer
The CCO is responsible for administration of the Code. In this connection, the duties of the
CCO or his and her designee include:
· trade pre-clearance;
· maintenance of a current list of all Access Persons with a description of their title or
employment;
· furnishing all Access Persons a copy of this Code and initially and periodically informing
them of their duties and obligations hereunder;
· reviewing transaction and holdings reports submitted by Access Persons;
· maintaining all records required by the Code;
· preparing listings of all transactions effected by Access Persons;
· interpreting of the Code;
· conducting such inspections or investigations, as shall reasonably be required to detect
and report any apparent or actual violations of this Code of Ethics to Alger and to the
Trustees of the Alger Funds; and
· submitting a quarterly report to the Board of Directors of each of FAM, FAC and to the
Trustees of the Alger Funds that
o certifies that the procedures to implement the Code are reasonably necessary to
prevent violations of the Code,
o summarizes the existing procedures to monitor the Code and any changes to the
Code,
o provides statistics regarding activity under the Code,
o describes any violation of the Code and any sanctions imposed as a result, and
summarizes any interpretations issued,
o details any exemptions granted,
o reports on any training provided, and
o reports any other significant information concerning the Code.
Maintenance of Records
FAM shall, on its own behalf and on the behalf of the Funds and FAC, maintain and make
available records with respect to the implementation of the Code in the manner and for the time
required by the Federal securities laws, including without limitation, Rule 17j-1(d) under the
Investment Company Act of 1940. Specifically, the CCO shall maintain the following for the
time and manner specified below:
· a copy of any Code that is in effect, or at any time within the past five (5) years was in
effect, must be maintained in an easily accessible place;
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· a record of any violation of any such Code, and of any action taken as a result of such
violation, must be maintained in an easily accessible place for at least five (5) years after
the end of the fiscal year in which the violation occurred;
· a copy of each report made by an Access Person, as well as trade confirmations and
account statements that contain information not duplicated in such reports, must be
maintained for at least five (5) years after the end of the fiscal year in which the report
was made or the information was provided, the first two (2) years in an easily accessible
place;
· A copy of each report made must be maintained for at least five (5) years after the end of
the fiscal year in which it was made, the first two (2) years in an easily accessible place;
· A list of all persons, currently or within the past five (5) years, who are or were required
to make reports pursuant to Rule 17j-1 and this Code, and a list of those persons
responsible for reviewing these reports must be maintained in an easily accessible place;
and
· A record of any decision, and the reasons supporting the decision, to permit an Access
Person to invest in a Private Placement, must be maintained for at least five years after
the end of the fiscal year in which the approval was granted.
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