REGISTERED ALTERNATIVE INVESTMENT GROUP FUNDS
CODE OF ETHICS FOR PRINCIPAL EXECUTIVE AND SENIOR FINANCIAL OFFICERS
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BOARD APPROVAL RECEIVED December 2005
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VERSION EFFECTIVE DATE January 3, 2006
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DATE LAST REVIEWED January 3, 2006
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APPLICABLE AUTHORITY Section 406 of the Sarbanes-Oxley Act of
2002; Item 2 of Form N-CSR
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OVERVIEW AND STATEMENT
Item 2 of Form N-CSR, the form used by registered management investment
companies to file certified shareholder reports, requires a registered
management investment company to disclose (1) whether it has adopted a code of
ethics that applies to the investment company's principal executive officer and
senior financial officers and, if it has not adopted such a code of ethics, why
it has not done so, and (2) any amendments to, or waivers from, the code of
ethics relating to such officers.
The Board of each Fund has adopted the following Code of Ethics, which sets
forth the ethical standards to which the Fund holds its principal executive
officer and each of its senior financial officers.
FUND LEVEL POLICIES AND PROCEDURES
I. COVERED OFFICERS/PURPOSE OF THE CODE
This Code of Ethics (the "Code") applies to the Fund's Principal
Executive Officer, Principal Financial Officer and Principal Accounting Officer
or Controller (the "Covered Officers") for the purpose of promoting:
o honest and ethical conduct, including the ethical handling of
actual or apparent conflicts of interest between personal and
professional relationships;
o full, fair, accurate, timely and understandable disclosure in
reports and documents that the Fund files with, or submits to,
the SEC, and in other public communications made by the Fund;
o compliance with applicable laws and governmental rules and
regulations;
o the prompt internal reporting of violations of the Code to an
appropriate person or persons identified in the Code; and
o accountability for adherence to the Code.
Each Covered Officer should adhere to a high standard of business ethics
and should be sensitive to situations that may give rise to actual or apparent
conflicts of interest.
II. ADMINISTRATION OF THE CODE
The Board has designated an individual to be primarily responsible for
the administration of the Code (the "Code Officer"). In the absence of the Code
Officer, his or her designee shall serve as the Code Officer, but only on a
temporary basis.
The Board has designated a person who meets the definition of a chief
legal officer (the "CLO") for purposes of the Sarbanes-Oxley Act of 2002 and the
rules promulgated thereunder as the Fund's CLO. The CLO of the Fund shall assist
the Fund's Code Officer in administration of this Code. The Code Officer, in
consultation with the CLO, shall be responsible for applying this Code to
specific situations (in consultation with Fund counsel, where appropriate) and
has the authority to interpret this Code in any particular situation.
III. MANAGING CONFLICTS OF INTEREST
OVERVIEW. A "conflict of interest" occurs when a Covered Officer's
personal interest interferes with the interests of, or his or her service to,
the Fund. For example, a conflict of interest would arise if a Covered Officer,
or a member of his or her family, receives improper personal benefits as a
result of the Covered Officer's position with the Fund.
Certain provisions in the 1940 Act and the rules and regulations
thereunder and the Advisers Act and the rules and regulations thereunder govern
certain conflicts of interest that arise out of the relationships between
Covered Officers and the Fund. If such conflicts are addressed in conformity
with applicable provisions of the 1940 Act and the Advisers Act, they will be
deemed to have been handled ethically. For example, Covered Officers may not
individually engage in certain transactions (such as the purchase or sale of
securities or other property) with the Fund because of their status as
"affiliated persons" of the Fund. The Fund's and its Adviser's compliance
programs and procedures are designed to prevent, or identify and correct,
violations of those provisions. This Code does not, and is not intended to,
repeat or replace those programs and procedures, and conduct that is consistent
with such programs and procedures falls outside of the parameters of this Code.
Although they do not typically present an opportunity for improper
personal benefit, conflicts may arise from, or as a result of, the contractual
relationships between the Fund and, as applicable, its Adviser, administrator,
principal underwriter, pricing and bookkeeping agent and/or transfer agent
(each, a "Primary Service Provider") of which the Covered Officers are also
officers or employees. As a result, this Code recognizes that the Covered
Officers will, in the normal course of their duties (whether formally for the
Fund or for a Primary Service Provider, or for both), be involved in
establishing
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policies and implementing decisions that will have different effects on the
Primary Service Providers and the Fund. The participation of the Covered
Officers in such activities is inherent in the contractual relationships between
the Fund and the Primary Service Providers and is consistent with the
performance by the Covered Officers of their duties as officers of the Fund. If
such conflicts are addressed in conformity with applicable provisions of the
1940 Act and the Advisers Act, they will be deemed to have been handled
ethically. In addition, it is recognized by the Board of the Fund that the
Covered Officers also may be officers or employees of one or more other
investment companies or organizations affiliated with the sponsor of the Fund
covered by other similar codes and that the codes of ethics of those other
investment companies or organizations will apply to the Covered Officers acting
in such capacities for such other investment companies.
This Code covers conflicts of interest that are not subject to provisions
in the 1940 Act and Advisers Act. The overarching principle is that the personal
interest of a Covered Officer should not be placed improperly before the
interests of the Fund. Certain examples of such conflicts of interest follow.
Each Covered Officer must:
o not knowingly use his or her personal influence or personal
relationships improperly to influence investment decisions or
financial reporting by the Fund whereby the Covered Officer, or a
member of his or her family, would benefit personally to the
detriment of the Fund;
o not knowingly cause the Fund to take action, or fail to take action,
for the individual personal benefit of the Covered Officer, or a
member of his or her family, rather than the benefit of the Fund;
o not use material non-public knowledge of portfolio transactions made
or contemplated for the Fund to trade personally or cause others to
trade personally in contemplation of the market effect of such
transactions; and
o report at least annually (or more frequently, as appropriate) known
affiliations or other relationships that may give rise to conflicts
of interest with respect to the Fund.
If a Covered Officer believes that he or she has a potential conflict of
interest that is likely to materially compromise his or her objectivity or his
or her ability to perform the duties of his or her role as a Covered Officer,
including a potential conflict of interest that arises out of his or her
responsibilities as an officer or employee of one or more Primary Service
Providers or other funds, he or she should consult with the Code Officer, the
CLO, the Fund's outside counsel, or counsel to the Independent Board Members, as
appropriate.
Examples of potential conflicts of interest that may materially
compromise objectivity or ability to perform the duties of a Covered Officer and
which the Covered
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Officer should consider discussing with the Code Officer or other appropriate
person include:
o service as a director on the board of a public or private company
or service as a public official;
o the receipt of a non-de minimis gift when the gift is in relation to
doing business directly or indirectly with the Fund;
o the receipt of entertainment from any company with which the Fund
has current or prospective business dealings, unless such
entertainment is business-related, reasonable in cost,
appropriate as to time and place, and not so frequent as to raise
any question of impropriety;
o an ownership interest in, or any consulting or employment
relationship with, any of the Fund's service providers, other
than the Primary Service Providers or any affiliated person
thereof; and
o a direct or indirect material financial interest in commissions,
transaction charges or spreads paid by the Fund for effecting
portfolio transactions or for selling or redeeming shares other
than an interest arising from the Covered Officer's employment,
such as compensation or equity ownership.
IV. DISCLOSURE AND COMPLIANCE
It is the responsibility of each Covered Officer:
o to familiarize himself or herself with the disclosure
requirements generally applicable to the Fund, as well as the
business and financial operations of the Fund;
o to not knowingly misrepresent, and to not knowingly cause others
to misrepresent, facts about the Fund to others, whether within
or outside the Fund, including to the Fund's Board, legal
counsel, legal counsel to the Independent Board Members and
auditors, and to governmental regulators and self-regulatory
organizations;
o to the extent appropriate within his or her area of
responsibility, consult with other officers and employees of the
Fund and the Primary Service Providers with the goal of promoting
full, fair, accurate, timely and understandable disclosure in the
reports and documents the Fund files with, or submits to, the SEC
and in other public communications made by the Fund; and
o to adhere to and, within his or her area of responsibility,
promote compliance with the standards and restrictions imposed by
applicable laws, rules and regulations.
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V. REPORTING AND ACCOUNTABILITY
Each Covered Officer must:
o upon adoption of the Code or becoming a Covered Officer,
acknowledge in writing to the Fund's Board that he or she has
received, read and understands the Code, using the form attached
as Appendix I hereto;
o annually thereafter acknowledge in writing to the Fund's Board
that he or she has received and read the Code and believes that
he or she has complied with the requirements of the Code, using
the form attached as Appendix II hereto;
o not retaliate against any employee or Covered Officer for reports
of potential violations that are made in good faith; and
o notify the Code Officer promptly if he or she knows of any
violation, or of conduct that reasonably could be expected to be
or result in a violation, of this Code. Failure to do so is a
violation of this Code.
The Fund will follow the procedures set forth below in investigating and
enforcing this Code:
o The Code Officer will endeavor to take all appropriate action to
investigate any potential violation reported to him or her;
o If, after such investigation, the Code Officer believes that no
violation has occurred, the Code Officer will so notify the
person(s) reporting the potential violation, and no further
action is required;
o Any matter that the Code Officer, upon consultation with the CLO,
believes is a violation will be reported by the Code Officer or
the CLO to the Fund's Audit Committee;
o If the Audit Committee concurs that a violation has occurred, it
will inform and make a recommendation to the Fund's Board, which
will consider appropriate action, which may include review of,
and appropriate modifications to, applicable policies and
procedures; notification to the appropriate personnel of the
Fund's Primary Service Providers or their boards; a
recommendation to censure, suspend or dismiss the Covered
Officer; or referral of the matter to the appropriate authorities
for civil action or criminal prosecution;
o The Fund's Audit Committee will be responsible for granting waivers,
as appropriate; and
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o This Code and any changes to or waivers of the Code will, to the
extent required, be disclosed as provided by SEC rules.
The Code Officer shall report to the Fund's Audit Committee quarterly any
violations of, or material issues arising under, this Code.
VI. OTHER POLICIES AND PROCEDURES
This Code shall be the sole code of ethics adopted by the Fund for the
purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms
applicable to registered management investment companies thereunder. Insofar as
other polices or procedures of the Fund or the Fund's Primary Service Providers
govern or purport to govern the behavior or activities of the Covered Officers
who are subject to this Code, they are superseded by this Code to the extent
that they conflict with the provisions of this Code. The Fund's and its
Adviser's and principal underwriter's codes of ethics under Rule 17j-1 under the
1940 Act and the more detailed policies and procedures of the Primary Service
Providers as set forth in their respect Compliance Manuals are separate
requirements applicable to the Covered Officers and are not part of this Code.
VII. AMENDMENTS
All material amendments to this Code must be in writing and approved or
ratified by the Fund's Board, including a majority of the Independent Board
Members.
VIII. CONFIDENTIALITY
All reports and records prepared or maintained pursuant to this Code will
be considered confidential and shall be maintained and protected accordingly.
Except as otherwise required by law or this Code or upon advice of counsel, such
reports and records shall not be disclosed to anyone other than the Fund's
Board, the Covered Officers, the Code Officer, the CLO, the Fund's Primary
Service Providers and their affiliates, and outside audit firms, legal counsel
to the Fund and legal counsel to the Independent Board Members and to the
Primary Service Providers and their affiliates.
IX. RECORDKEEPING
The Fund will maintain and preserve for a period of not less than six
(6) years from the date such action is taken, the first two (2) years in an
easily accessible place, a copy of the information or materials supplied to the
Audit Committee or the Board: (i) that provided the basis for any amendment or
waiver to this Code; and (ii) relating to any violation of the Code and
sanctions imposed for such violation, together with a written record of the
approval or action taken by the Audit Committee and/or Board.
The CLO is responsible for maintaining (i) a current list of the Fund's
Covered Officers and (ii) records of all activities related to this Policy,
including those records required to be maintained by the Fund pursuant to the
preceding paragraph.
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X. INTERNAL USE
The Code is intended solely for the internal use by the Fund and does
not constitute an admission, by or on behalf of the Fund, as to any fact,
circumstance, or legal conclusion.
XI. IMPLEMENTATION AND RESPONSIBLE PARTIES
The Code Officer, in conjunction with the CLO and BAC, shall be
responsible for administration of this Policy and for adopting specific
procedures to ensure compliance with the Fund Level Policies and Procedures set
forth herein.
XII. OVERSIGHT
The Code Officer, in conjunction with BAC, shall be responsible for
oversight of compliance with this Policy by the Covered Officers.
COORDINATION WITH OVERVIEW AND IMPLEMENTATION STATEMENT
This policy and procedures statement should be read and interpreted in
conjunction with the Overview and Implementation of Policies and Procedures
statement at the beginning of this compliance manual.
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This policy is the property of the Funds and, except as set forth in Section V.
hereof, must not be provided to any external party without express
prior consent from the CCO or the appropriate BAC legal or compliance unit.
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APPENDIX I
INITIAL ACKNOWLEDGEMENT
I acknowledge that I have received and read a copy of the Code of
Ethics for Principal Executive and Senior Financial Officers (the "Code") and
that I understand it. I further acknowledge that I am responsible for
understanding and complying with the policies set forth in the Code during my
tenure as a Covered Officer, as defined in the Code.
I have set forth below (and on attached sheets of paper, if necessary)
all known affiliations or other relationships that may give rise to conflicts of
interest for me with respect to the Fund.
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I also acknowledge my responsibility to report any known violation of
the Code to the Code Officer, the CLO, the Fund's outside counsel, or counsel to
the Independent Board Members, all as defined in this Code. I further
acknowledge that the policies contained in the Code are not intended to create
any contractual rights or obligations, express or implied. I also understand
that, consistent with applicable law, the Fund has the right to amend,
interpret, modify or withdraw any of the provisions of the Code at any time in
its sole discretion, with or without notice.
COVERED OFFICER NAME AND TITLE: _______________________________________________
(PLEASE PRINT)
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Signature Date
PLEASE RETURN THIS COMPLETED FORM TO THE CLO (________) WITHIN ONE WEEK FROM THE
DATE OF YOUR REVIEW OF THESE DOCUMENTS. THANK YOU!
APPENDIX II
ANNUAL ACKNOWLEDGEMENT
I acknowledge that I have received and read a copy of the Code of
Ethics for Principal Executive and Senior Financial Officers (the "Code") and
that I understand it. I further acknowledge that I am responsible for
understanding and complying with the policies set forth in the Code during my
tenure as a Covered Officer, as defined in the Code.
I also acknowledge that I believe that I have fully complied with the
terms and provisions of the Code during the period of time since the most recent
Initial or Annual Acknowledgement provided by me except as described below.
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I have set forth below (and on attached sheets of paper, if necessary)
all known affiliations or other relationships that may give rise to conflicts of
interest for me with respect to the Fund.(1)
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I further acknowledge that the policies contained in the Code are not
intended to create any contractual rights or obligations, express or implied. I
also understand that, consistent with applicable law, the Fund has the right to
amend, interpret, modify or withdraw any of the provisions of the Code at any
time in its sole discretion, with or without notice.
COVERED OFFICER NAME AND TITLE: _______________________________________________
(PLEASE PRINT)
________________________________________________________________________________
Signature Date
PLEASE RETURN THIS COMPLETED FORM TO THE CLO (_______) WITHIN ONE WEEK FROM THE
DATE OF YOUR RECEIPT OF A REQUEST TO COMPLETE AND RETURN IT. THANK YOU!
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(1) It is acceptable to refer to affiliations and other relationships previously
disclosed in prior Initial or Annual Acknowledgements without setting forth such
affiliations and relationships again.