EXHIBIT 99.CODE ETH
GROSVENOR REGISTERED MULTI-STRATEGY FUND (TI 1), LLC
GROSVENOR REGISTERED MULTI-STRATEGY FUND (TI 2), LLC
GROSVENOR REGISTERED MULTI-STRATEGY FUND (TE), LLC
GROSVENOR REGISTERED MULTI-STRATEGY MASTER FUND, LLC
(EACH A "FUND" AND COLLECTIVELY, THE "FUNDS")
CODE OF BUSINESS CONDUCT FOR PRINCIPAL EXECUTIVE AND SENIOR FINANCIAL OFFICERS
BOARD APPROVAL RECEIVED March 2011
(as applicable)
LAST REVIEW DATE March 2011
APPLICABLE REGULATORY AUTHORITY Section 406 of the Sarbanes-Oxley Act of 2002;
Item 2 of Form N-CSR
I. OVERVIEW AND STATEMENT
Item 2 of Form N-CSR, the form used by registered management investment
companies to file certified annual and semi-annual 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 Business Conduct, which
sets forth the ethical standards to which the Fund holds its principal executive
officer and each of its senior financial officers.
II. POLICY
The Board of each Fund has adopted the following policy in order to comply with
the requirements as outlined below:
1. COVERED OFFICERS/PURPOSE OF THE CODE
This Code of Business Conduct (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:
- honest and ethical conduct, including the ethical handling of actual
or apparent conflicts of interest between personal and professional
relationships;
- 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;
- compliance with applicable laws and governmental rules and
regulations;
- the prompt internal reporting of violations of the Code to an
appropriate person or persons identified in the Code; and
- 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.
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2. ADMINISTRATION OF THE CODE
Except as otherwise designated by the Board, the CCO shall 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 Chief Legal Officer (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.
3. MANAGING CONFLICTS OF INTEREST
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. 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 may also be 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 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 generalconflicts of interest and other issues applicable
to the Fund under the Sarbanes-Oxley Act of 2002. 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:
- not knowingly use his or her personal influence or personal
relationships improperly to influence investment decisions or
financial reporting by the Fund
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whereby the Covered Officer, or a member of his or her family, would
benefit personally to the detriment of the Fund;
- 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;
- 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
- 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
Directors, 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 Officer should consider discussing with the Code Officer or
other appropriate person include:
- service as a director on the board of a public or private company or
service as a public official;
- the receipt of a non-de minimus gift when the gift is in relation to
doing business directly or indirectly with the Fund;
- 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;
- 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
- 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.
4. DISCLOSURE AND COMPLIANCE
It is the responsibility of each Covered Officer:
- 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;
- 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 Directors and auditors, and to governmental
regulators and self-regulatory organizations;
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- 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
- 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.
5. REPORTING AND ACCOUNTABILITY BY COVERED OFFICERS
Each Covered Officer must:
- 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;
- not retaliate against any employee or Covered Officer for reports of
potential violations that are made in good faith; and
- 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 policy set forth below in investigating and
enforcing this Code:
- The Code Officer will endeavor to take all appropriate action to
investigate any potential violation reported to him or her;
- 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;
- 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;
- The Fund's Audit Committee will be responsible for granting waivers,
as appropriate; and
- 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.
6. OTHER POLICIES
This Code shall be the sole code of ethics adopted by the Fund for the
purposes of Section 406 of the Sarbanes-Oxley Act of 2002and 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, if any, 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
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set forth in their respect Compliance Manuals are separate requirements
applicable to the Covered Officers and are not part of this Code.
7. DISCLOSURE OF AMENDMENTS TO THE CODE
Any amendments will, to the extent required, be disclosed in accordance
with law.
8. 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, if any, legal counsel
to the Independent Directors.
9. 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.
III. REPORTING REQUIREMENTS
1. BOARD REPORTING.
A. Each Covered Officer must annually 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;
B. 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;
2. ANNUAL REVIEW. The CCO and/or his or her designee will review this policy
on at least an annual basis, and more frequently as needed based on
business/regulatory requirements. 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 Directors.
IV. ESCALATION
Any issues that arise under this policy should be communicated to the
CCO. The CCO will escalate any compliance issues relating to this Policy, if
warranted, to the appropriate Fund Board.
V. SUPERVISION/OVERSIGHT
The Adviser's Legal/Compliance Department may perform periodic reviews and
assessments of compliance with relevant policies. Supervisory personnel are
responsible for ensuring that their employees understand and follow the rules in
this policy and any applicable procedures adopted to implement the policy.
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VI. RECORDKEEPING
All records must be maintained for at least six years, the first three in an
easily accessible place. The following records will be maintained to evidence
compliance with this policy:
1. 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;
2. a copy of the policy and any amendments;
3. a list of Covered Officers and reporting by Covered Officers.
All records may be maintained electronically.
VI. COORDINATION WITH OVERVIEW AND IMPLEMENTATION STATEMENT
This policy should be read and interpreted in conjunction with the Funds'
Overview and Implementation of Compliance Program, including the defined terms
contained therein.
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THIS POLICY IS THE PROPERTY OF THE FUNDS AND MUST NOT BE PROVIDED TO ANY
EXTERNAL PARTY WITHOUT EXPRESS PRIOR CONSENT FROM THE CCO.
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APPENDIX I
INITIAL ACKNOWLEDGEMENT
TO: JODIE L. CROTTEAU, COMPLIANCE OFFICER
I acknowledge that I have received and read a copy of the Code of Business
Conduct 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 Directors, if any, 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:
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(please print)
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Signature Date
Please return this completed form within one week from the date of your review
of these documents. Thank you!
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APPENDIX II
ANNUAL ACKNOWLEDGEMENT
TO: JODIE L. CROTTEAU, COMPLIANCE OFFICER
I acknowledge that I have received and read a copy of the Code of Business
Conduct 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:
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(please print)
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Signature Date
Please return this completed form 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.
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