EX-99.CODE ETH
CIM HIGH YIELD SECURITIES
AMENDED AND RESTATED
CODE OF ETHICS
I. INTRODUCTION
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A. GENERAL PRINCIPLES
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This Code of Ethics ("Code") establishes rules of conduct for
"Covered Persons" (as defined herein) of CIM High Yield
Securities (the "Fund") and is designed to govern the personal
securities activities of Covered Persons. In general, in
connection with personal securities transactions, Covered Persons
should (1) always place the interests of the Fund's shareholders
first; (2) ensure that all personal securities transactions are
conducted consistent with this Code and in such a manner as to
avoid any actual or potential conflict of interest or any abuse
of a Covered Person's position of trust and responsibility; and
(3) not take inappropriate advantage of their positions.
B. APPLICABILITY
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For purposes of this Code, "Covered Person" shall mean:
1. Any officer or employee of the Fund or of any investment
adviser, subadviser or co-adviser to the Fund or of any
company in a control relationship to the Fund or such
investment adviser, subadviser or co-adviser who, in
connection with his or her regular functions or duties,
makes, participates in or obtains information regarding the
purchase or sale of securities by the Fund or whose
functions relate to the making of any recommendation to the
Fund regarding the purchase or sale of securities, including
the person or persons with the direct responsibility and
authority to make investment decisions affecting the Fund
(the "Portfolio Manager");
2. Any natural person in a control relationship to the Fund or
of any investment adviser, subadviser or co-adviser to the
Fund who obtains information concerning recommendations made
to the Fund with regard to the purchase or sale of a
security by the Fund; and
3. Any Trustee of the Fund.
For purposes of this Code, (a) an "Advisory Person" means any
employee of the Fund or of any investment adviser, subadviser or
co-adviser to the Fund described in paragraph 1 above and any
natural person described in paragraph 2 above; (b) a person who
normally assists in the preparation of public reports or who
receives public reports but who receives no information about
current recommendations or trading or who obtains knowledge of
current recommendations or trading activity once or infrequently
or inadvertently shall not be deemed to be either an Advisory
Person or a Covered Person, and (C) the defined terms "Covered
Person", "Advisory Person" and "Portfolio Manager" shall not
include any person who is subject to securities transaction
pre-clearance requirements and securities transaction reporting
requirements of a code of ethics adopted by an investment adviser
or subadviser or co-adviser to the Fund (an "Investment Adviser")
or an administrator of the Fund (an "Administrator") in
compliance with Rule 17j-1 of the Investment Company Act of 1940,
as amended (the "1940 Act"), and/or Rule 204-2(a)(12) of the
Investment Advisers Act of 1940, as amended (the "Advisers Act"),
as long as such Investment Adviser or Administrator, as
applicable, complies with the provisions of Article V of this
Code.
II. RESTRICTIONS ON ACTIVITIES
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A. BLACKOUT PERIODS
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1. No Covered Person shall purchase or sell, directly or
indirectly, any security in which he or she has, or by
reason of such transaction acquires, any direct or indirect
beneficial ownership (as defined in Attachment A to this
Code) on a day during which the Fund has a pending "buy" or
"sell" order in that same security until that order is
executed or withdrawn. The foregoing shall not apply to a
person who is a Covered Person with respect to the Fund by
virtue of being a Trustee of the Fund, but who is not an
"interested person" (as defined in the 1940 Act) of the Fund
(a "Disinterested Trustee").
2. No Portfolio Manager shall purchase or sell, directly or
indirectly, any security in which he or she has, or by
reason of such transaction acquires, any direct or indirect
beneficial ownership (Attachment A to this Code) in within
fifteen (15) calendar days before or after the Fund trades
in that security.
B. INTERESTED TRANSACTIONS
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No Covered Person shall recommend any securities transactions by
the Fund without having disclosed his or her interest, if any, in
such securities or the issuer thereof, including without
limitation:
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1. any direct or indirect beneficial ownership (as defined in
Attachment A to this Code) of any securities of such issuer;
2. any contemplated transaction by such person in such
securities;
3. any position with such issuer or its affiliates; and
4. any present or proposed business relationship between such
issuer or its affiliates and such person or any party in
which such person has a significant interest.
C. INITIAL PUBLIC OFFERINGS
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No Advisory Person shall acquire any securities in an initial
public offering for his or her personal account.
D. PRIVATE PLACEMENTS
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No Advisory Person shall acquire, directly or indirectly,
beneficial ownership of any securities in a private placement
without the prior approval of the Designated Review Officer (as
hereinafter defined) who has been provided by such Advisory
Person with full details of the proposed transaction (including
written certification that the investment opportunity did not
arise by virtue of the Advisory Person's activities on behalf of
the Fund) and has concluded after consultation with other
investment advisory personnel of the Fund that the Fund has no
foreseeable interest in purchasing such securities.
E. SHORT-TERM TRADING PROFITS
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No Advisory Person shall profit from the purchase and sale, or
sale and purchase, of the same (or equivalent) securities of
which such Advisory Person has beneficial ownership within 60
calendar days. Any profit so realized shall, unless the Fund's
Board approves otherwise, be paid over to the Fund or to a
charitable organization of the Advisory Person's choosing.
F. GIFTS
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No Advisory Person shall receive any gift or other things of more
than DE MINIMIS value from any person or entity that does
business with or on behalf of the Fund.
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G. SERVICE AS A DIRECTOR
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No Advisory Person shall serve on the board of directors of any
publicly traded company without prior authorization from the
Designated Review Officer (as defined below) based upon a
determination that such board service would be consistent with
the interests of the Fund and its shareholders.
III. EXEMPT TRANSACTIONS
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A. For purposes of this Code, the term "security" shall have the
same meaning as that set forth in ss.2(a)(36) of the 1940 Act
except that it shall not include the following:
1. direct obligations of the Government of the United States;
2. bankers' acceptances;
3. bank certificates of deposit;
4. commercial paper and high quality short-term debt
instruments; and
5. shares of registered open-end investment companies.
B. The prohibitions described in paragraphs (A) and (E) of Article
II shall not apply to:
1. Purchases or sales effected in any account over which the
Covered Person has no direct or indirect influence or
control;
2. Purchases or sales that are non-volitional on the part of
the Covered Person;
3. Purchases that are part of an automatic dividend
reinvestment plan;
4. 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 the issuer, and
sales of such rights so acquired; or
5. Subject to the advance approval by a Designated Review
Officer (as defined below) purchases or sales which are only
remotely potentially harmful to the Fund because such
purchases or sales would be unlikely to affect a highly
institutional market, or because such purchases or sales are
clearly not related economically to the securities held,
purchased or sold by the Fund.
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IV. COMPLIANCE PROCEDURES
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A. PRECLEARANCE
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A Covered Person may, directly or indirectly, acquire or dispose
of beneficial ownership of a security, including shares of the
Fund, only if (1) such purchase or sale has been approved by a
review officer designated by the Fund or, in the case of a
Covered Person employed by an Investment Adviser, by such
Investment Adviser (each, a "Designated Review Officer"), (2) the
approved transaction is completed by the close of business on the
next business day after approval is received and (3) the
Designated Review Officer has not rescinded such approval prior
to execution of the transaction.
B. REPORTING OBLIGATIONS
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1. Unless excepted by Section 2 of this Paragraph B, every
Covered Person must report to the Designated Review Officer
as described below.
(a) INITIAL HOLDINGS REPORTS. Not later than 10 days after
the person becomes an Covered Person, the following
information:
(i) the title, number of shares and principal amount
of each security in which the Covered Person had
any direct or indirect beneficial ownership when
the person became a Covered Person;
(ii) the name of any broker, dealer or bank with whom
the Covered Person maintained an account in
which any securities were held for the direct or
indirect benefit of the Covered Person as of the
date the person became a Covered Person; and
(iii) the date that the report is signed and submitted
by the Covered Person.
(b) QUARTERLY TRANSACTION REPORTS. Not later than 10 days
after the end of each calendar quarter, the following
information:
(i) With respect to any transaction during the
quarter in a security in which the Covered
Person had any direct or indirect beneficial
ownership:
(1) the date of the transaction, the title, the
interest rate and maturity date (if
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applicable), the number of shares and the
principal amount of each 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 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 signed and
submitted by the Covered Person.
(ii) With respect to any account established by the
Covered Person in which any securities were held
during the quarter for the direct or indirect
benefit of the Covered Person:
(1) the name of the broker, dealer or bank with
whom the Covered Person established the
account;
(2) the date that the account was established;
and
(3) the date that the report is signed and
submitted by the Covered Person.
(iii) In the event that no reportable transactions
occurred during the quarter, the report should
be so noted and returned signed and dated.
(c) ANNUAL HOLDINGS REPORTS. Not later than each January
30th, the following information (which information must
be current as of a date no more than 30 days before the
report is submitted):
(i) the title, number of shares and principal amount
of each security in which the Covered Person had
any direct or indirect beneficial ownership;
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(ii) the name of any broker, dealer or bank with whom
the Covered Person maintains an account in which
any securities are held for the direct or
indirect benefit of the Covered Person; and
(iii) the date on which the report is signed and
submitted by the Covered Person.
2. The following are the exceptions to the reporting
requirements outlined in Section 1 of this Paragraph B:
(a) A person need not make any report required under
Section 1 of this Paragraph B with respect to
transactions effected for, and securities held in, any
account over which the person has no direct influence
or control, including such an account in which the
person has any beneficial ownership.
(b) A person who would otherwise be required to make the
reports described in this Paragraph B shall not be
required to file reports pursuant to this Paragraph B
if such person is required to file reports pursuant to
a code of ethics described in Article V hereof.
(c) A Disinterested Trustee who would be required to make
the reports required under Section 1 of this Paragraph
B solely by reason of being a trustee of the Fund need
not make:
(i) an initial holdings report under Section 1(a) of
this Paragraph B or an annual holdings report
under Section 1(c) of this Paragraph B; or
(ii) a quarterly transaction report under Section
1(b) of this Paragraph B, unless the
Disinterested Trustee knew or, in the ordinary
course of fulfilling his or her official duties
as a Trustee of the Fund, should have known,
that during the 15-day period immediately before
or after the Trustee's transaction in a
security, the Fund purchased or sold the
security or the Fund or its investment adviser,
subadviser or co-adviser considered purchasing
or selling the security.
(d) A person need not make a quarterly transaction report
under Section 1(b) of this Paragraph B if the report
would duplicate information contained in broker trade
confirmations or account statements received by the
Designated Review Officer with respect to the person in
the time period required under Section 1(b), if all of
the
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information required under Section 1(b) is contained in
the broker trade confirmations or account statements or
in the records of the Fund.
3. Any report delivered pursuant to this Paragraph B 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
securities to which the report relates.
C. CERTIFICATION OF COMPLIANCE
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Each Covered Person is required to certify annually that he or
she has read and understood the Fund's Code and recognizes that
he or she is subject to such Code. Further, each Covered Person
is required to certify annually that he or she has complied with
all the requirements of the Code and that he or she has disclosed
or reported all personal securities transactions required to be
disclosed or reported pursuant to the requirements of the Code.
D. REVIEW BY THE BOARD OF TRUSTEES
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At least annually, an officer of the Fund shall furnish a written
report to the Board of Trustees that:
1. describes any issues arising under this Code of Ethics since
the last report to the Board of Trustees, including, but not
limited to, information about material violations of this
Code of Ethics and sanctions imposed in response to the
material violations; and
2. certifies that the Fund has adopted procedures reasonably
necessary to prevent its Covered Persons from violating this
Code of Ethics.
V. INVESTMENT ADVISER'S AND ADMINISTRATOR'S CODES OF ETHICS
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Each Investment Adviser and Administrator shall:
(1) submit to the Board of Trustees of the Fund a copy of the Code of
Ethics adopted by such Investment Adviser or Administrator pursuant to
Rule 17j-1 of the 1940 Act and/or Rule 204-2(a)(12) of the Advisers
Act, which Code of Ethics shall comply with the recommendations of the
Investment Company Institute's Advisory Group on Personal Investing or
be accompanied by a statement explaining any difference and supplying
the rationale therefor;
(2) promptly report to the Board of Trustees of the Fund in writing any
material amendments to such Investment Adviser's or Administrator's
Code of Ethics;
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(3) promptly furnish to the Board of Trustees of the Fund, upon
request, copies of any reports made pursuant to such Investment
Adviser's or Administrator's Code of Ethics by any person who would be
a Covered Person, Advisory Person or Portfolio Manager hereunder if
such person were not subject to such Investment Adviser's or
Administrator's Code of Ethics; and
(4) immediately furnish to the Board of Trustees of the Fund all
material information regarding any violation of such Investment
Adviser's or Administrator's Code of Ethics by any person who would be
a Covered Person, Advisory Person or Portfolio Manager hereunder if
such person were not subject to such Investment Adviser's or
Administrator's Code of Ethics.
VI. SANCTIONS
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Upon discovering that a Covered Person has not complied with the
requirements of this Code, the Designated Review Officer shall submit
findings to the Board of Trustees of the Fund. With respect to
officers, employees or Trustees of the Fund, the Board of Trustees of
the Fund may impose on that Covered Person whatever sanctions the Board
of Trustees of the Fund deems appropriate, including, among other
things, disgorgement of profits, censure, suspension or termination of
employment.
VII. CONFIDENTIALITY
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All information obtained from any Covered Person hereunder or from an
Investment Adviser pursuant to Article V hereof shall be kept in strict
confidence, except that reports of securities transactions hereunder
may be made available to the Securities and Exchange Commission or any
other regulatory or self-regulatory organization, and may otherwise be
disclosed to the extent required by law or regulation.
VIII. OTHER LAWS, RULE AND STATEMENTS OF POLICY
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Nothing contained in this Code shall be interpreted as relieving any
Covered Person from acting in accordance with the provision of any
applicable law, rule, or regulation or any other statement of policy or
procedures governing the conduct of such person adopted by the Fund.
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IX. RECORDS
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The Fund shall maintain records in the manner and to the extent set
forth below, which records may be maintained on microfilm under the conditions
described in Rule 31a-2 under the 1940 Act and shall be available for
examination by representatives of the Securities and Exchange Commission.
1. A copy of this Code of Ethics and any other Code of Ethics which
is, or at any time within the past five years has been, in effect
shall be preserved in an easily accessible place.
2. A record of any violation of this Code of Ethics, and of any
action taken as a result of such violation, shall be preserved in
an easily accessible place for a period of not less than five
years following the end of the fiscal year in which the violation
occurs.
3. A copy of each report made by a Covered Person pursuant to this
Code of Ethics shall be preserved for a period of not less than
five years from the end of the fiscal year in which the report is
made, the first two years in an easily accessible place.
4. A list of all persons who are, or within the past five years have
been, required to make reports pursuant to this Code of Ethics
shall be maintained in an easily accessible place.
5. A copy of each report required under Paragraph D of Article IV
shall be preserved for a period of not less than five years from
the end of the fiscal year in which it is made, the first two
years in an early accessible place.
6. A record of any decision, and the reasons supporting the
decision, to approve the acquisition by Advisory Person of
securities under Paragraph D of Article II, shall be preserved
for a period of not less than five years from the end of the
fiscal year in which the approval is granted.
X. FURTHER INFORMATION
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If any person has any questions with regard to the applicability of the
provisions of this Code generally or with regard to any securities
transaction or transactions such person should consult the applicable
Designated Review Officer.
Dated: April 5, 1995
as amended July 5, 1995
as further amended January 11, 2000
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ATTACHMENT A
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The term "beneficial ownership" as used in the attached Code of Ethics
(the "Code") is to be interpreted by reference to Rule 16a-1(a)(2) under the
Securities Exchange Act of 1934 (the "Rule"), except that the determination of
direct or indirect beneficial ownership for purposes of the Code must be made
with respect to all securities that a Covered Person has or acquires. Under the
Rule, a person is generally deemed to have beneficial ownership of securities if
the person, directly or indirectly, through any contract, arrangement,
understanding, relationship or otherwise, has or shares a direct or indirect
pecuniary interest in the securities.
The term "pecuniary interest" in particular securities is generally
defined in the Rule to mean the opportunity, directly or indirectly, to profit
or share in any profit derived from a transaction in the securities. A person is
refutably deemed to have an "indirect pecuniary interest" within the meaning of
the Rule in any securities held by members of the person's immediate family
sharing the same household, the term "immediate family" including any child,
stepchild, grandchild, parent, stepparent, grandparent, spouse, sibling,
mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law,
sister-in-law, as well as adoptive relationships. Under the Rule, an indirect
pecuniary interest also includes, among other things: a general partner's
proportionate interest in the portfolio securities held by a general or limited
partnership; a performance-related fee, other than an asset-based fee, received
by any broker, dealer, bank, insurance company, investment company, investment
adviser, investment manager, trustee or person or entity performing a similar
function; a person's right to dividends that is separated or separable from the
underlying securities; a person's interest in securities held by certain trusts;
and a person's right to acquire equity securities through the exercise or
conversion of any derivative security, whether or not presently exercisable, the
term "derivative security being generally defined as any option, warrant,
convertible security, stock appreciation right, or similar right with an
exercise or conversion privilege at a price related to an equity security, or
similar securities with, or value derived from, the value of an equity security.
For purposes of the Rule, a person who is a shareholder of a corporation or
similar entity is NOT deemed to have a pecuniary interest in portfolio
securities held by the corporation or entity, so long as the shareholder is not
a controlling shareholder of the corporation or the entity and does not have or
share investment control over the corporation's or the entity portfolio.