Document/Exhibit Description Pages Size
1: 485BPOS Post-Effective Amendment No. 16 92± 370K
5: EX-23 Consent of Independent Accountant 1 5K
6: EX-99 Certificate of Secretary 1 6K
3: EX-99 Code of Ethics 114± 351K
2: EX-99 Custodian Agreement 23± 85K
4: EX-99 Power of Attorney 4± 20K
Securities Trading Policy
General Edition
September 2003
Dear Employee:
From Mellon's first day of business, in 1869, we have maintained
an uncompromising culture that practices the highest standards of
business ethics. We have built a system of guiding principles,
Mellon's Shared Values, and have encouraged employees to live
those values each day. For the benefit of our customers, our
shareholders, our communities and each other, we expect no less
than honorable behavior from one another when conducting Mellon
business.
Over the last couple of years, we have seen dramatic examples of
the damage irresponsible or unethical business behavior can have
on an individual or a corporation. To help employees make the
right decisions for Mellon and our constituents, we have
developed a comprehensive CODE OF CONDUCT and Corporate Policies
and Procedures that help guide our actions.
One of our most important policies, the SECURITIES TRADING
Policy, is intended to secure each employee's commitment to
continued service with integrity. Because your personal
investments can lead to conflicts of interest, you must fully
understand and comply with the investment guidelines contained in
Mellon's SECURITIES TRADING POLICY.
In business, building a reputation of integrity can take the hard
work of many employees over many years. As recent high-profile
business failures have demonstrated, it doesn't take nearly as
much time or as many employees to damage or altogether destroy
that reputation.
At Mellon, maintaining the reputation we've earned for more than
130 years of honest, open business practices is the
responsibility of every employee. We can do so by remaining
diligent in our strict adherence to Mellon's CODE OF CONDUCT and
all of Mellon's Corporate Policies and Procedures, particularly
the SECURITIES TRADING POLICY. If you are new to Mellon, please
take the time to fully understand the policy, and consult it
whenever you are unsure about appropriate activity. If you have
seen the policy before, I urge you to renew your understanding of
the entire document and the ways in which it applies to you.
Sincerely yours,
/S/ MARTY
Marty McGuinn
Chairman and Chief Executive Officer
TABLE OF CONTENTS
--------------------------------------------------------------------------------
PAGE #
INTRODUCTION
1
CLASSIFICATION OF EMPLOYEES
2-3
Insider Risk Employee
Investment Employee 2
Access Decision Maker (ADM)
Other Employee 2-3
Consultants, Independent Contractors and Temporary Employees
3
3
3
PERSONAL SECURITIES TRADING PRACTICES
SECTION ONE - APPLICABLE TO INSIDER RISK EMPLOYEES
Table of Contents 4-17
Quick Reference - Insider Risk Employees
Standards of Conduct for Insider Risk Employees 4
Restrictions on Transactions in Mellon Securities
Restrictions on Transactions in Other Securities 5
Protecting Confidential Information
6-11
11-12
13-15
16-17
SECTION TWO - APPLICABLE TO INVESTMENT EMPLOYEES
Table of Contents 18-32
Quick Reference - Investment Employees 18
Standards of Conduct for Investment Employees 19
Restrictions on Transactions in Mellon Securities
Restrictions on Transactions in Other Securities 20-25
Protecting Confidential Information
Special Procedures for Access Decision Makers 26-27
28-30
31-32
32
SECTION THREE - APPLICABLE TO OTHER EMPLOYEES
Table of Contents 33-43
Quick Reference - Other Employees 33
Standards of Conduct for Other Employees
Restrictions on Transactions in Mellon Securities 34
Restrictions on Transactions in Other Securities
Protecting Confidential Information 35-36
37-38
38-41
42-43
GLOSSARY DEFINITIONS
44-47
EXHIBIT A - SAMPLE LETTER TO BROKER
48
Note that a more detailed Table of Contents is contained in Sections One, Two
and Three
INTRODUCTION
--------------------------------------------------------------------------
The SECURITIES TRADING POLICY (the "Policy") is designed to reinforce Mellon
Financial Corporation's ("Mellon's") reputation for integrity by avoiding
even the appearance of impropriety in the conduct of Mellon's business. The
Policy sets forth procedures and limitations which govern the personal
securities transactions of every Mellon employee.
Mellon and its employees are subject to certain laws and regulations
governing personal securities trading. Mellon has developed this Policy to
promote the highest standards of behavior and ensure compliance with
applicable laws.
This Policy covers the personal trading activities of all employees in their
own accounts and in accounts in which they have indirect ownership. While
employees should consult the Glossary for a complete definition of the terms
"security" and "indirect ownership", in general they mean:
o SECURITY - any investment that represents an ownership stake or debt
stake in a company or government. While the Policy provides for
exemptions for certain securities, if not expressly exempt in the Policy,
all securities are covered (see Glossary for definition of Exempt
securities)
o INDIRECT OWNERSHIP - you are presumed to have indirect ownership of
accounts held by members of your family with whom you share a household.
This includes your spouse, your children, and any other family members in
your home. Generally, you are deemed to be the indirect owner of
securities if you have the opportunity to directly or indirectly share,
at any time, in profits derived from transactions in such securities
Employees should be aware that they may be held personally liable for any
improper or illegal acts committed during the course of their employment and
that "ignorance of the law" is not a defense. Employees may be subject to
civil penalties such as fines, regulatory sanctions including suspensions,
as well as criminal penalties.
The provisions of the Policy have worldwide applicability and cover trading
in any part of the world. Employees are also subject to applicable laws of
jurisdictions in those countries in which they conduct business. To the
extent any particular portion of the Policy is inconsistent with, or in
particular less restrictive than such laws, employees should consult the
General Counsel or the Manager of the Ethics Office.
The Policy may be amended and any provision waived or exempted only at the
discretion of the Manager of the Ethics Office. Any such waiver or
exemption will be evidenced in writing and maintained in the Ethics Office.
Employees must read the Policy and must comply with it - in this regard,
employees should comply with the spirit of the Policy as well as the strict
letter of its provisions. Failure to comply with the Policy may result in
the imposition of serious sanctions, including but not limited to
disgorgement of profits, dismissal, substantial personal liability and
referral to law enforcement agencies or other regulatory agencies.
Employees should retain the Policy in their records for future reference.
Any questions regarding the Policy should be referred to the Manager of the
Ethics Office or his/her designee.
Page 1
CLASSIFICATION OF EMPLOYEES
--------------------------------------------------------------------------------
The Policy is applicable to all employees of Mellon
and all of its subsidiaries which are more than 50%
owned by Mellon. This includes all full-time,
part-time, benefited and non-benefited, exempt and
non-exempt employees. In general, it does not
include employees of subsidiaries which are 50% or
less owned by Mellon. The Policy's applicability to
consultants and contract or temporary employees will
be determined on a case-by-case basis.
Employees are engaged in a wide variety of activities
for Mellon. In light of the nature of their
activities and the impact of various laws and
regulations, the Policy imposes different
requirements and limitations on employees based on
the nature of their activities for Mellon. To assist
employees in complying with the requirements and
limitations imposed on them in light of their
activities, employees are classified into one of four
categories:
o Insider Risk Employee
o Investment Employee
o Access Decision Maker
o Other Employee
Appropriate requirements and limitations are
specified in the Policy based upon an employee's
classification.
Business line management, in conjunction with the
Manager of the Ethics Office, will determine the
classification of each employee based on the
following guidelines. EMPLOYEES SHOULD CONFIRM THEIR
CLASSIFICATION WITH THEIR PRECLEARANCE COMPLIANCE
OFFICER OR THE MANAGER OF THE ETHICS OFFICE.
INSIDER RISK EMPLOYEE You are considered to be an Insider Risk Employee if,
in the normal conduct of your Mellon
responsibilities, you are likely to receive or be
perceived to possess or receive, material nonpublic
information concerning Mellon's customers. This will
typically include certain employees in the Corporate
& Institutional Services business group, certain
members of Corporate Support Departments, and all
members of the Senior Management Committee who are
not Investment Employees.
INVESTMENT EMPLOYEE You are considered to be an Investment Employee if,
in the normal conduct of your Mellon
responsibilities, you are likely to receive or be
perceived to possess or receive, material nonpublic
information concerning Mellon's trading in securities
for the accounts of others and/or if you provide
investment advice.
Page 2
CLASSIFICATION OF EMPLOYEES
--------------------------------------------------------------------------------
INVESTMENT EMPLOYEE This will typically include employees in the Asset
(CONTINUED) Management business group, such as:
o certain employees in fiduciary securities sales
and trading, investment management and advisory
services, investment research and various trust or
fiduciary functions; an employee of a Mellon entity
regulated by certain investment company laws.
Examples are:
- in the US, includes employees who are advisory
persons (see Glossary) or employees who are
access persons (see Glossary) as defined by
Rule 17j-1 of the Investment Company Act of
1940
- in the UK, includes employees in companies
undertaking specified activities under the
Financial Services and Markets Act 2000
(Regulated Activities), Order 2001 and
therefore regulated by the Financial Services
Authority
o any member of Mellon's Senior Management
Committee who, as part of his/her usual duties,
has management responsibility for fiduciary
activities or routinely has access to
information about customers' securities
transactions.
ACCESS DECISION MAKER A person designated as such by the Investment Ethics
(ADM) Committee. Generally, this will be portfolio managers
and research analysts who make recommendations or
decisions regarding the purchase or sale of equity,
convertible debt, and non-investment grade debt
securities for mutual funds and other managed
accounts. See further details in the Access Decision
Maker edition of the Policy.
OTHER EMPLOYEE You are considered to be an Other Employee if you are
an employee of Mellon Financial Corporation or any of
its direct or indirect subsidiaries who is not an
Insider Risk Employee, Investment Employee, or an ADM.
CONSULTANTS, Managers should inform consultants, independent
INDEPENDENT contractors and temporary employees of the general
CONTRACTORS AND provisions of the Policy (such as the prohibition on
TEMPORARY trading while in possession of material nonpublic
EMPLOYEES information). Whether or not a consultant,
independent contractor or temporary employee will be
required to preclear trades or report their personal
securities holdings will be determined on a
case-by-case basis. If one of these persons would be
considered an Insider Risk Employee, Investment
Employee or Access Decision Maker if the person were a
Mellon employee, the person's manager should advise
the Manager of the Ethics Office who will determine
whether such individual should be subject to the
preclearance and reporting requirements of the Policy.
Page 3
Personal Securities Trading Practices
SECTION ONE - APPLICABLE TO INSIDER RISK EMPLOYEES
TABLE OF CONTENTS
------------------------
PAGE #
QUICK REFERENCE - INSIDER RISK EMPLOYEES 5
STANDARDS OF CONDUCT FOR INSIDER RISK EMPLOYEES 6-11
- Conflict of Interest 6
- Material Nonpublic Information 6
- Personal Securities Transaction Reports 6
- Preclearance for Personal Securities Transactions 7
- Exemptions from Requirement to Preclear 8
- Gifting of Securities 9
- Ownership 9
- Non-Mellon Employee Benefit Plans 9
- DRIPs, DPPs and AIPs 10
- Investment Clubs and Private Investment Companies 10
- Restricted List 11
- Confidential Treatment 11
RESTRICTIONS ON TRANSACTIONS IN MELLON SECURITIES 11-12
- General Restrictions 11
- Mellon 401(k) Plan 12
- Mellon Employee Stock Options 12
- Mellon Employee Stock Purchase Plan (ESPP) 12
RESTRICTIONS ON TRANSACTIONS IN OTHER SECURITIES 13-15
- Credit, Consulting or Advisory Relationship 13
- Customer Transactions 13
- Excessive Trading, Naked Options 13
- Front Running 13
- Initial Public Offerings 13
- Material Nonpublic Information 13
- Private Placements 14
- Scalping 14
- Short-Term Trading 14
- Spread Betting 14
- Prohibition on Investments in Securities of Financial 15
Services Organizations
16-17
PROTECTING CONFIDENTIAL INFORMATION 16-17
- Insider Trading and Tipping Legal Prohibitions 17
- Mellon's Policy 17
- Restrictions on the Flow of Information Within Mellon
(The "Securities Fire Wall") 44-47
GLOSSARY DEFINITIONS 48
EXHIBIT A - SAMPLE LETTER TO BROKER
Page 4
QUICK REFERENCE-INSIDER RISK EMPLOYEES
--------------------------------------------------------------------------------
SOME THINGS YOU MUST DO EXEMPTIONS
DUPLICATE STATEMENTS & CONFIRMATIONS - Preclearance is NOT required for:
------------------------------------ ---
Instruct your broker, trust account o transactions in Exempt
manager or other entity through which securities (see Glossary)
you have a securities trading account to o transactions in municipal
send directly to the Preclearance bonds
Compliance Officer or his/her designee: o transactions in closed-end
o trade confirmations summarizing investment companies
each transaction o transactions in non-financial
o periodic statements commodities (such as
agricultural futures,
Exhibit A can be used to notify your metals, oil, gas, etc.),
broker. Contact the Preclearance currency futures, financial
Compliance Officer for the correct futures
address. This applies to all accounts o transactions in index
in which you have direct or indirect securities
ownership (see Glossary). o transactions in approved
accounts in which the
PRECLEARANCE - Before initiating a employee has no direct or
------------
securities transaction, written indirect influence or
preclearance must be obtained from the control over the investment
Preclearance Compliance Officer. decision making process
Contact the Preclearance Compliance o involuntary transactions on
Officer for applicable approval the part of an employee
procedures. (such as stock dividends or
sales of fractional shares)
If preclearance approval is received, o changes in elections under
the trade must be executed before the Mellon's 401(k) Retirement
end of the 3rd business day (with the Savings Plan
date of approval being the 1st business o enrollment, changes in salary
day), at which time the preclearance withholding percentages and
approval will expire. sales of shares held in
Mellon's Employee Stock
SPECIAL APPROVALS Purchase Plan (ESPP); sales
of shares previously
PRIVATE PLACEMENTS - Acquisition of withdrawn from the ESPP do
------------------
securities in a Private Placement must require preclearance
be precleared by the Mellon Senior o receipt and exercise of an
Management Committee Member who employee stock option
represents the employee's line of administered through Human
business or department, the Manager of Resources
the Ethics Office and the Preclearance o automatic reinvestment of
Compliance Officer. To initiate dividends under a Dividend
approval, contact the Ethics Office Reinvestment Plan (DRIP) or
Automatic Investment Plan
IPOS - Acquisition of securities through (AIP); initial share
-----
an allocation by the underwriter of an purchase and optional cash
Initial Public Offering (IPO) is purchases under a DRIP or
prohibited without the approval of the Direct Purchase Plan (DPP)
Manager of the Ethics Office. Approval do require preclearance as
can be given only when the allocation is do sales of shares acquired
the result of a direct family through a DRIP, DPP or AIP
relationship o sales pursuant to bona fide
tender offers and sales or
SOME THINGS YOU MUST NOT DO exercises of "rights" (see
Page 8)
MELLON SECURITIES - The following
-----------------
transactions in Mellon securities are QUESTIONS?
prohibited for all Mellon employees:
o short sales Contact Mellon's Ethics Office at:
o purchasing and selling or selling o Securities Trading Policy
and purchasing within 60 days Help Line: 412-234-1661
o margin purchases or options other o Mellon's Ethics Help Line
than employee options - Toll Free Telephone
o Asia (except Japan):
Non-Mellon Securities - New investments 001-800-710-63562
in financial services organizations are o Australia: 0011-800-710-63562
prohibited for certain employees only - o Brazil: 0800-891-3813
see Page 15 o Europe: 00-800-710-63562
o Japan: appropriate
OTHER RESTRICTIONS are detailed international access code +
------------------ 800-710-63562 (Access codes
throughout Section One. Read the Policy! are: 0061010, 001010,
================ 0041010 or 0033010)
o US and Canada: 1-888-MELLON2
(1-888-635-5662)
o All other locations: call
collect to 412-236-7519
- Email: ethics@mellon.com
- Postal Mail: P.O. Box
535026, Pittsburgh, PA
15253-5026 USA
THIS PAGE IS FOR REFERENCE PURPOSES ONLY. EMPLOYEES ARE REMINDED THEY MUST
READ THE POLICY AND COMPLY WITH ITS PROVISIONS.
Page 5
PERSONAL SECURITIES TRADING PRACTICES-INSIDER RISK EMPLOYEES
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STANDARDS OF CONDUCT FOR INSIDER RISK EMPLOYEES
Because of their particular responsibilities, Insider
Risk Employees are subject to preclearance and personal
securities reporting requirements, as discussed below.
Every Insider Risk Employee must follow these
procedures or risk serious sanctions, including
dismissal. If you have any questions about these
procedures, you should consult the Ethics Office or
your Preclearance Compliance Officer. Interpretive
issues that arise under these procedures shall be
decided by, and are subject to the discretion of, the
Manager of the Ethics Office.
CONFLICT OF INTEREST No employee may engage in or recommend any securities
transaction that places, or appears to place, his or
her own interests above those of any customer to whom
financial services are rendered, including mutual funds
and managed accounts, or above the interests of Mellon.
MATERIAL NONPUBLIC No employee may engage in or recommend a securities
INFORMATION transaction, for his or her own benefit or for the
benefit of others, including Mellon or its customers,
while in possession of material nonpublic information
regarding such securities or the issuer of such
securities. No employee may communicate material
nonpublic information to others unless it is properly
within his or her job responsibilities to do so.
PERSONAL SECURITIES STATEMENTS AND CONFIRMATIONS - All Insider Risk
TRANSACTION REPORTS Employees are required to instruct their broker, trust
account manager or other entity through which they have
a securities trading account to submit directly to the
Preclearance Compliance Officer or his/her designee,
copies of all trade confirmations and statements
relating to each account of which they are an owner
(direct or indirect) regardless of what, if any,
securities are maintained in such accounts. Thus, even
if the account contains only mutual funds or other
Exempt securities as that term is defined by the
Policy, but the account has the capability to have
reportable securities traded in it, the Insider Risk
Employee must arrange for duplicate account statements
and trade confirmations to be sent to the Preclearance
Compliance Officer or his/her designee. An example of
an instruction letter to a broker is contained in
Exhibit A.
OTHER SECURITIES TRANSACTIONS which were not completed
through an account, such as gifts, inheritances,
spin-offs from securities held outside accounts, or
other transfers must be reported to the Preclearance
Compliance Officer or his/her designee within 10 days
of the transaction.
Page 6
PERSONAL SECURITIES TRADING PRACTICES-INSIDER RISK EMPLOYEES
-------------------------------------------------------------------------------
PRECLEARANCE FOR Insider Risk Employees must notify the Preclearance
PERSONAL SECURITIES Compliance Officer in writing and receive preclearance
TRANSACTIONS before they engage in any purchase or sale of a
security for their own accounts or in accounts in which
they are an indirect owner. Insider Risk Employees
should refer to the provisions under " Ownership" on
Page 9, which are applicable to these provisions.
All requests for preclearance for a securities
transaction shall be submitted by completing a
Preclearance Request Form.
The Preclearance Compliance Officer will notify the
Insider Risk Employee whether the request is approved
or denied, without disclosing the reason for such
approval or denial.
Notifications may be given in writing or verbally by
the Preclearance Compliance Officer to the Insider Risk
Employee. A record of such notification will be
maintained by the Preclearance Compliance Officer.
However, it shall be the responsibility of the Insider
Risk Employee to obtain a written record of the
Preclearance Compliance Officer's notification within
24 hours of such notification. The Insider Risk
Employee should retain a copy of this written record
for at least two years.
As there could be many reasons for preclearance being
granted or denied, Insider Risk Employees should not
infer from the preclearance response anything regarding
the security for which preclearance was requested.
Although making a preclearance request does not
obligate an Insider Risk Employee to do the
transaction, it should be noted that:
o preclearance requests should not be made for a
transaction that the Insider Risk Employee does
not intend to make
o preclearance authorization will expire at the end
of the third business day after it is
received. The day authorization is granted is
considered the first business day
o Insider Risk Employees should not discuss with
anyone else, inside or outside Mellon, the
response they received to a preclearance
request. If the Insider Risk Employee is
preclearing as an indirect owner of another's
account, the response may be disclosed to the
other owner
o standard orders to trade at certain prices
(sometimes called "limit", "stop-loss",
"good-until-cancelled", or "standing buy/sell"
orders) must be precleared, and security
transactions receiving preclearance
authorization must be executed before the
preclearance expires. At the end of the
three-day preclearance authorization period,
any unexecuted order must be canceled or a new
preclearance authorization must be obtained
Page 7
PERSONAL SECURITIES TRADING PRACTICES-INSIDER RISK EMPLOYEES
-------------------------------------------------------------------------------
EXEMPTIONS FROM Preclearance by Insider Risk Employees is not required
REQUIREMENT TO for the following transactions:
PRECLEAR
o purchases or sales of Exempt securities
(generally means direct obligations of the
governments of the United States and United
Kingdom; commercial paper; high-quality,
short-term debt instruments; bankers'
acceptances; bank certificates of deposits and
time deposits; repurchase agreements;
securities issued by open-end investment
companies, which for this purpose includes
open-end mutual funds and variable capital
companies; fixed and variable annuities; and
unit trusts (see Glossary for definition of
Exempt securities))
o purchases or sales of closed-end investment
companies
o purchases or sales of municipal bonds
o purchase or sales of non-financial commodities
(such as agricultural futures, metals, oil, gas,
etc.), currency futures, financial futures
o purchases or sales of index securities (sometimes
referred to as exchange traded funds)
o purchases or sales effected in accounts in which
an employee has no direct or indirect influence
or control over the investment decision making
process ("non-discretionary accounts").
Non-discretionary accounts may only be exempted
from preclearance procedures, when the Manager
of the Ethics Office, after a thorough review,
is satisfied that the account is truly
non-discretionary to the employee (that is, the
employee has given total investment discretion
to an investment manager and retains no ability
to influence specific trades). Standard broker
accounts generally are not deemed to be
non-discretionary to the employee, even if the
broker is given some discretion to make
investment decisions
o transactions that are involuntary on the part of
an employee (such as stock dividends or sales
of fractional shares); however, sales initiated
by brokers to satisfy margin calls are not
considered involuntary and must be precleared
o the sale of Mellon stock received upon the
exercise of an employee stock option if the
sale is part of a "netting of shares" or
"cashless exercise" administered through the
Human Resources Department
o changes to elections in the Mellon 401(k) plan
o enrollment, changes in salary withholding
percentages and sales of shares held in the
Mellon Employee Stock Purchase Plan (ESPP);
sales of shares previously withdrawn from the
ESPP do require preclearance
o purchases effected upon the exercise of rights
issued by an issuer pro rata to all holders of
a class of securities, to the extent such
rights were acquired from such issuer
o sales of rights acquired from an issuer, as
described above
o sales effected pursuant to a bona fide tender
offer
o automatic reinvestment of dividends under a
Dividend Reinvestment Plan (DRIP) or Automatic
Investment Plan (AIP); initial share purchase
and optional cash purchases under a DRIP or
Direct Purchase Plan (DPP) must be precleared
as do sales of shares acquired through a DRIP,
DPP or AIP
Page 8
PERSONAL SECURITIES TRADING PRACTICES-INSIDER RISK EMPLOYEES
-------------------------------------------------------------------------------
GIFTING OF SECURITIES Insider Risk Employees desiring to make a bona fide
gift of securities or who receive a bona fide gift,
including an inheritance, of securities do not need to
preclear the transaction. However, Insider Risk
Employees must report such bona fide gifts to the
Preclearance Compliance Officer or his/her designee.
The report must be made within 10 days of making or
receiving the gift and must disclose the following
information: the name of the person receiving (giving)
the gift, the date of the transaction, and the name of
the broker through which the transaction was effected.
A bona fide gift is one where the donor does not
receive anything of monetary value in return. An
Insider Risk Employee who purchases a security with the
intention of making a gift must preclear the purchase
transaction.
OWNERSHIP The preclearance, reporting and other provisions of the
Policy apply not only to securities held in the
employee's own name but also to all other securities
indirectly owned by the employee (see Glossary for
definition of indirect owner). Generally you are the
indirect owner of securities if you have the
opportunity, directly or indirectly, to share in any
profits from a transaction in those securities. This
could include:
o securities held by members of your family who
share the same household with you
o securities held by a trust in which you are a
settler, trustee, or beneficiary
o securities held by a partnership in which you are
a general partner
o securities in which any contract, arrangement,
understanding or relationship gives you direct
or indirect economic interest
NON-MELLON EMPLOYEE The provisions discussed above do not apply to
BENEFIT PLANS transactions done under a bona fide employee benefit
plan of an organization not affiliated with Mellon by
an employee of that organization who shares ownership
interest with a Mellon employee. This means if a
Mellon employee's spouse is employed at a non-Mellon
company, the Mellon employee is not required to obtain
approval for transactions IN THE EMPLOYER'S SECURITIES
done by the spouse as part of the spouse's employee
benefit plan.
In such situations, the spouse's employer has primary
responsibility for providing adequate supervision with
respect to conflicts of interest and compliance with
securities laws regarding its own employee benefit
plans.
However, employee benefit plans which allow the
employee to buy and sell securities other than those of
their employer are subject to the Policy, including the
preclearance and reporting provisions.
Page 9
PERSONAL SECURITIES TRADING PRACTICES-INSIDER RISK EMPLOYEES
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DRIPS, DPPS AND AIPS Certain companies with publicly traded securities
establish:
o Dividend Reinvestment Plans (DRIPs) - These
permit shareholders to have their dividend payments
channeled to the purchase of additional shares of
such company's stock. An additional benefit offered
to DRIP participants is the right to buy additional
shares by sending in a check before the dividend
reinvestment date ("optional cash purchases")
o Direct Purchase Plans (DPPs) - These allow
purchasers to buy stock by sending a check directly
to the issuer, without using a broker
o Automatic Investment Plans (AIPs) - These allow
purchasers to set up a plan whereby a fixed amount
of money is automatically deducted from their
checking account each month and used to purchase
stock directly from the issuer
Participation in a DRIP, DPP or AIP is voluntary.
Insider Risk Employees who enroll in a DRIP or AIP are
required to preclear the initial enrollment in the plan
when accompanied by an initial share purchase
transaction. However, the periodic reinvestment of
dividend payments into additional shares of company
stock through a DRIP, or the periodic investments
through an AIP are not required to be precleared.
Insider Risk Employees must preclear all optional cash
purchases through a DRIP and all purchases through a
DPP. Insider Risk Employees must also preclear all
sales through a DRIP, DPP or AIP.
INVESTMENT CLUBS AND Certain organizations create a unique means of
PRIVATE INVESTMENT investing:
COMPANIES
o Investment Clubs - a membership organization
where investors make joint decisions on which
securities to buy or sell. The securities are
generally held in the name of the investment club.
Since each member of the investment club
participates in the investment decision making
process, each Insider Risk employee belonging to
such a club must preclear and report the securities
transactions of the club.
o Private Investment Company - an investment
company (see Glossary) whose shares are not deemed
to be publicly held (sometimes called "hedge
funds"). Insider Risk employees investing in such a
private investment company are not required to
preclear any of the securities transactions made by
the private investment company.
However, Insider Risk employees' investments in
Private Investment Companies are considered to be
private placements and approval must be received
prior to investing. Employees should refer to the
Private Placement provision of the Policy on Page
14 for approval requirements.
Page 10
PERSONAL SECURITIES TRADING PRACTICES-INSIDER RISK EMPLOYEES
-------------------------------------------------------------------------------
RESTRICTED LIST The Preclearance Compliance Officer will maintain a
list (the "Restricted List") of companies whose
securities are deemed appropriate for implementation of
trading restrictions for Insider Risk Employees. The
Restricted List will not be distributed outside of the
Preclearance Compliance Office. From time to time,
such trading restrictions may be appropriate to protect
Mellon and its Insider Risk Employees from potential
violations, or the appearance of violations, of
securities laws. The inclusion of a company on the
Restricted List provides no indication of the
advisability of an investment in the company's
securities or the existence of material nonpublic
information on the company. Nevertheless, the contents
of the Restricted List will be treated as confidential
information to avoid unwarranted inferences.
The Preclearance Compliance Officer will retain copies
of the restricted lists for six years.
CONFIDENTIAL The Manager of the Ethics Office and/or the
TREATMENT Preclearance Compliance Officer will use his or her
best efforts to assure that all requests for
preclearance, all personal securities transaction
reports and all reports of securities holdings are
treated as "Personal and Confidential." However, such
documents will be available for inspection by
appropriate regulatory agencies and by other parties
within and outside Mellon as are necessary to evaluate
compliance with or sanctions under the Policy.
RESTRICTIONS ON TRANSACTIONS IN MELLON SECURITIES
Insider Risk employees who engage in transactions
involving Mellon securities should be aware of their
unique responsibilities with respect to such
transactions arising from the employment relationship
and should be sensitive to even the appearance of
impropriety.
The following restrictions apply to all transactions in
Mellon's publicly traded securities occurring in the
employee's own account and in all other accounts over
which the employee has indirect ownership. These
restrictions are to be followed in addition to any
restrictions that apply to particular senior officers
or directors of Mellon such as restrictions under
Section 16 of the Securities Exchange Act of 1934.
o SHORT SALES - Short sales of Mellon securities by
employees are prohibited.
o SHORT-TERM TRADING - Employees are prohibited
from purchasing and selling, or from selling and
purchasing, Mellon securities within any
60-calendar day period.
o MARGIN TRANSACTIONS - Purchases on margin of
Mellon's publicly traded securities by employees is
prohibited. Margining Mellon securities in
connection with a cashless exercise of an employee
stock option through the Human Resource Department
is exempt from this restriction. Further, Mellon
securities may be used to collateralize loans for
non-securities purposes or for the acquisition of
securities other than those issued by Mellon.
o OPTION TRANSACTIONS - Option transactions
involving Mellon's publicly traded securities are
prohibited. Transactions under Mellon's Long-Term
Incentive Plan or other employee option plans are
exempt from this restriction.
o MAJOR MELLON EVENTS - Employees who have
knowledge of major Mellon events that have not yet
been announced are prohibited from buying or
selling Mellon's publicly traded securities before
such public announcements, even if the employee
believes the event does not constitute material
nonpublic information.
Page 11
PERSONAL SECURITIES TRADING PRACTICES-INSIDER RISK EMPLOYEES
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MELLON 401(K) PLAN For purposes of the short-term trading rule, employees
changing their existing account balance allocation to
increase or decrease the amount allocated to Mellon
Common Stock will be treated as a purchase or sale of
Mellon Stock, respectively. This means employees are
prohibited from increasing their existing account
balance allocation to Mellon Common Stock and then
decreasing it within 60 days. Similarly, employees are
prohibited from decreasing their existing account
balance allocation to Mellon Common Stock and then
increasing it within 60 days.
However, changes to existing account balance
allocations in the 401(k) plan will not be compared to
transactions in Mellon securities outside the 401(k)
for purposes of the 60-day rule. (Note: this does not
apply to members of the Executive Management Group, who
should consult with the Legal Department)
Except for the above, there are no other restrictions
applicable to the 401(k) plan. This means, for example:
o employees are not required to preclear any
elections or changes made in their 401(k)
account
o there is no restriction on employees changing
their salary deferral contribution percentages
with regard to the 60-day rule
o the regular salary deferral contribution to
Mellon Common Stock in the 401(k) that takes
place with each pay will not be considered a
purchase for the purpose of the 60-day rule
MELLON EMPLOYEE RECEIPT or EXERCISE of an employee stock option from
STOCK OPTIONS Mellon is exempt from the reporting and preclearance
requirements and does not constitute a purchase or sale
for the purpose of the 60-day prohibition.
SALES - The sale of the Mellon securities that were
received in the exercise of an employee stock option is
treated like any other sale under the Policy
(regardless of how little time has elapsed between the
option exercise and the sale). Thus, such sales are
subject to the preclearance and reporting requirements
and are considered sales for purposes of the 60-day
prohibition.
MELLON EMPLOYEE ENROLLMENT and CHANGING SALARY WITHHOLDING PERCENTAGES
STOCK PURCHASE PLAN in the ESPP are exempt from preclearance and reporting
(ESPP) requirements and do not constitute a purchase for
purposes of the 60-day prohibition.
SELLING SHARES HELD IN THE ESPP - Insider Risk
employees are not required to preclear or report sales
of stock held in the ESPP, including shares acquired
upon reinvestment of dividends. However, sale of stock
held in the ESPP is considered a sale for purposes of
the 60-day prohibition and will be compared to
transactions in Mellon securities outside of the ESPP.
SELLING SHARES PREVIOUSLY WITHDRAWN - The sale of the
Mellon securities that were received as a withdrawal
from the ESPP is treated like any other sale under the
Policy, regardless of how little time has elapsed
between the withdrawal and the sale. Thus, such sales
are subject to the preclearance and reporting
requirements and are considered sales for purposes of
the 60-day prohibition.
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PERSONAL SECURITIES TRADING PRACTICES-INSIDER RISK EMPLOYEES
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RESTRICTIONS ON TRANSACTIONS IN OTHER SECURITIES
Purchases or sales by an employee of the securities of
issuers with which Mellon does business, or other
third-party issuers, could result in liability on the
part of such employee. Employees should be sensitive
to even the appearance of impropriety in connection
with their personal securities transactions. Employees
should refer to "Ownership" on Page 9, which is
applicable to the following restrictions.
The Mellon CODE OF CONDUCT contains certain
restrictions on investments in parties that do business
with Mellon. Employees should refer to the CODE OF
CONDUCT and comply with such restrictions in addition
to the restrictions and reporting requirements set
forth below.
The following restrictions apply to ALL securities
transactions by Insider Risk Employees:
o CREDIT, CONSULTING OR ADVISORY RELATIONSHIP -
Employees may not buy, hold or trade securities
of a company if they are considering granting,
renewing, modifying or denying any credit
facility to that company, acting as a benefits
consultant to that company, or acting as an
adviser to that company with respect to the
company's own securities without the prior
permission of the Ethics Office. In addition,
lending employees who have assigned
responsibilities in a specific industry group
are not permitted to trade securities in that
industry. This prohibition does not apply to
transactions in open-end mutual funds.
o CUSTOMER TRANSACTIONS - Trading for customers and
Mellon accounts should always take precedence
over employees' transactions for their own or
related accounts.
o EXCESSIVE TRADING, NAKED OPTIONS - Mellon
discourages all employees from engaging in
short-term or speculative trading, writing
naked options, trading that could be deemed
excessive or trading that could interfere with
an employee's job responsibilities.
o FRONT RUNNING - Employees may not engage in
"front running," that is, the purchase or sale
of securities for their own accounts on the
basis of their knowledge of Mellon's trading
positions or plans or those of their customers.
o INITIAL PUBLIC OFFERINGS - Insider Risk Employees
are prohibited from acquiring securities
through an allocation by the underwriter of an
Initial Public Offering (IPO) without the
approval of the Manager of the Ethics Office.
Approval can be given only when the allocation
comes through an employee of the issuer who is
a direct family relation of the Insider Risk
Employee. Due to certain laws and regulations
(for example, NASD rules in the US), this
approval may not be available to employees of
registered broker-dealers.
o MATERIAL NONPUBLIC INFORMATION - Employees
possessing material nonpublic information
regarding any issuer of securities must refrain
from purchasing or selling securities of that
issuer until the information becomes public or
is no longer considered material.
Page 13
PERSONAL SECURITIES TRADING PRACTICES-INSIDER RISK EMPLOYEES
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RESTRICTIONS ON TRANSACTIONS IN OTHER SECURITIES (CONTINUED)
o PRIVATE PLACEMENTS - Insider Risk Employees are
prohibited from acquiring any security in a
private placement unless they obtain the prior
written approval of the Manager of the Ethics
Office, the Preclearance Compliance Officer and
the Mellon Senior Management Committee Member
representing the employee's line of business or
department. Employees should contact the
Ethics Office to initiate approval. Approval
must be given by all three persons for the
acquisition to be considered approved.
Private placements include certain co-operative
investments in real estate, co-mingled investment
vehicles such as hedge funds, and investments in
family owned businesses. For purposes of the
Policy, time-shares and cooperative investments in
real estate used as a primary or secondary
residence are not considered to be private
placements.
After receipt of the necessary approvals and the
acquisition, Insider Risk employees are required to
disclose that investment if they participate in any
subsequent consideration of credit for the issuer,
or of an investment in the issuer for an advised
account. Final decision to acquire such securities
for an advised account will be subject to
independent review.
o SCALPING - Employees may not engage in
"scalping," that is, the purchase or sale of
securities for their own or Mellon's accounts
on the basis of knowledge of customers' trading
positions or plans.
o SHORT-TERM TRADING - All employees are
discouraged from purchasing and selling, or
from selling and purchasing, the same (or
equivalent) securities within any 60-calendar
day period.
o SPREAD BETTING - Employees may not engage in
"spread betting" (essentially taking bets on
securities pricing to reflect market movements)
or similar activities as a mechanism for
avoiding the restrictions on personal
securities trading arising under the provisions
of the Policy. Such transactions themselves
constitute transactions in securities for the
purposes of the Policy and are subject to all
of the provisions applicable to other
non-exempted transactions.
Page 14
PERSONAL SECURITIES TRADING PRACTICES-INSIDER RISK EMPLOYEES
-------------------------------------------------------------------------------
PROHIBITION ON You are prohibited from acquiring any security issued
INVESTMENTS IN by a financial services organization if you are:
SECURITIES OF
FINANCIAL SERVICES o a member of the Mellon Senior Management Committee
ORGANIZATIONS
o employed in any of the following departments:
Corporate Strategy & Development
Legal (Mellon headquarters only)
Finance (Mellon headquarters only)
o an employee specifically designated by the
Manager of the Ethics Office and informed that
this prohibition is applicable to you
FINANCIAL SERVICES ORGANIZATIONS - The phrase "security
issued by a financial services organization" includes
any security issued by:
o Commercial Banks other than Mellon
o Financial Holding Companies (or Bank Holding
Companies) other than Mellon
o Insurance Companies
o Investment Advisory Companies
o Shareholder Servicing Companies
o Thrifts
o Savings and Loan Associations
o Broker-Dealers
o Transfer Agents
o Other Depository Institutions
The phrase "securities issued by a financial services
organization" DOES NOT INCLUDE Exempt securities (see
Glossary). Further, for purposes of determining
whether a company is a financial services organization,
subsidiaries and parent companies are treated as
separate issuers.
EFFECTIVE DATE - Securities of financial services
organizations properly acquired before the employee is
subject to this prohibition may be maintained or
disposed of at the owner's discretion consistent with
the Policy.
Any acquisition of financial service organization
securities that is exempt from preclearance pursuant to
the express provision of the Policy is also exempt from
this prohibition. This includes (assuming full
compliance with the applicable preclearance exemption):
o Exempt securities (see Glossary)
o acquisition in a non-discretionary account
o involuntary acquisitions
o securities received as gifts
o reinvestment of dividends (but not initial share
and optional cash purchases) under a DRIP or
acquisitions through an AIP
o acquisitions through a non-Mellon employee
benefit plan
Within 30 days of becoming subject to this prohibition,
all holdings of securities of financial services
organizations must be disclosed in writing to the
Manager of the Ethics Office.
Page 15
PERSONAL SECURITIES TRADING PRACTICES-INSIDER RISK EMPLOYEES
-------------------------------------------------------------------------------
PROTECTING CONFIDENTIAL INFORMATION
As an employee you may receive information about
Mellon, its customers and other parties that, for
various reasons, should be treated as confidential.
All employees are expected to strictly comply with
measures necessary to preserve the confidentiality of
information. Employees should refer to the Mellon CODE
OF CONDUCT.
INSIDER TRADING AND Securities laws generally prohibit the trading of
TIPPING securities while in possession of "material nonpublic"
LEGAL PROHIBITIONS information regarding the issuer of those securities
(insider trading). Any person who passes along
material nonpublic information upon which a trade is
based (tipping) may also be liable.
Information is "material" if there is a substantial
likelihood that a reasonable investor would consider it
important in deciding whether to buy, sell or hold
securities. Obviously, information that would affect
the market price of a security (price sensitive
information) would be material. Examples of
information that might be material include:
o a proposal or agreement for a merger, acquisition
or divestiture, or for the sale or purchase of
substantial assets
o tender offers, which are often material for the
party making the tender offer as well as for the
issuer of the securities for which the tender offer
is made
o dividend declarations or changes
o extraordinary borrowings or liquidity problems
o defaults under agreements or actions by
creditors, customers or suppliers relating to a
company's credit standing
o earnings and other financial information, such as
significant restatements, large or unusual
write-offs, write-downs, profits or losses
o pending discoveries or developments, such as new
products, sources of materials, patents, processes,
inventions or discoveries of mineral deposits
o a proposal or agreement concerning a financial
restructuring
o a proposal to issue or redeem securities, or a
development with respect to a pending issuance or
redemption of securities
o a significant expansion or contraction of
operations
o information about major contracts or increases or
decreases in orders
o the institution of, or a development in,
litigation or a regulatory proceeding
o developments regarding a company's senior
management
o information about a company received from a
director of that company
o information regarding a company's possible
noncompliance with environmental protection laws
This list is not exhaustive. All relevant
circumstances must be considered when determining
whether an item of information is material.
Page 16
PERSONAL SECURITIES TRADING PRACTICES-INSIDER RISK EMPLOYEES
-------------------------------------------------------------------------------
INSIDER TRADING AND
TIPPING LEGAL
PROHIBITIONS "Nonpublic" - Information about a company is nonpublic
(CONTINUED) if it is not generally available to the investing
public. Information received under circumstances
indicating that it is not yet in general circulation
and which may be attributable, directly or indirectly,
to the company or its insiders is likely to be deemed
nonpublic information.
If you obtain material nonpublic information, you may
not trade related securities until you can refer to
some public source to show that the information is
generally available (that is, available from sources
other than inside sources) and that enough time has
passed to allow wide dissemination of the information.
While information appearing in widely accessible
sources--such as in newspapers or on the
internet--becomes public very soon after publication,
information appearing in less accessible sources--such
as regulatory filings, may take up to several days to
be deemed public. Similarly, highly complex
information might take longer to become public than
would information that is easily understood by the
average investor.
MELLON'S POLICY Employees who possess material nonpublic information
about a company--whether that company is Mellon,
another Mellon entity, a Mellon customer or supplier,
or other company--may not trade in that company's
securities, either for their own accounts or for any
account over which they exercise investment
discretion. In addition, employees may not recommend
trading in those securities and may not pass the
information along to others, except to employees who
need to know the information in order to perform their
job responsibilities with Mellon. These prohibitions
remain in effect until the information has become
public.
Employees who have investment responsibilities should
take appropriate steps to avoid receiving material
nonpublic information. Receiving such information
could create severe limitations on their ability to
carry out their responsibilities to Mellon's fiduciary
customers.
Employees managing the work of consultants and
temporary employees who have access to the types of
confidential information described in the Policy are
responsible for ensuring that consultants and temporary
employees are aware of Mellon's policy and the
consequences of noncompliance.
Questions regarding Mellon's policy on material
nonpublic information, or specific information that
might be subject to it, should be referred to the
General Counsel.
RESTRICTIONS ON THE As a diversified financial services organization,
FLOW OF INFORMATION Mellon faces unique challenges in complying with the
WITHIN MELLON (THE prohibitions on insider trading and tipping of material
"SECURITIES FIRE nonpublic information, and misuse of confidential
WALL") information. This is because one Mellon unit might
have material nonpublic information about a company
while other Mellon units may have a desire, or even a
fiduciary duty, to buy or sell that company's
securities or recommend such purchases or sales to
customers. To engage in such broad-ranging financial
services activities without violating laws or breaching
Mellon's fiduciary duties, Mellon has established a
"Securities Fire Wall" policy applicable to all
employees. The "Securities Fire Wall" separates the
Mellon units or individuals that are likely to receive
material nonpublic information (potential Insider Risk
functions) from the Mellon units or individuals that
either trade in securities, for Mellon's account or for
the accounts of others, or provide investment advice
(Investment functions). Employees should refer to CPP
903-2(C) THE SECURITIES FIRE WALL.
Page 17
Personal Securities Trading Practices
SECTION TWO - APPLICABLE TO INVESTMENT EMPLOYEES
TABLE OF CONTENTS
------------------------
PAGE #
QUICK REFERENCE - INVESTMENT EMPLOYEES 19
STANDARDS OF CONDUCT FOR INVESTMENT EMPLOYEES 20-25
- Conflict of Interest 20
- Material Nonpublic Information 20
- Personal Securities Transaction Reports 20
- Statement of Securities Accounts and Holdings 21
- Preclearance for Personal Securities Transactions 21-22
- Special Standards for Preclearance Compliance Officers 22
- Exemptions from Requirement to Preclear 23
- Gifting of Securities 23
- Ownership 24
- Non-Mellon Employee Benefit Plans 24
- DRIPs, DPPs and AIPs 24
- Investment Clubs and Private Investment Companies 25
- Restricted List 25
- Confidential Treatment 25
RESTRICTIONS ON TRANSACTIONS IN MELLON SECURITIES 26-27
- General Restrictions 26
- Mellon 401(k) Plan 27
- Mellon Employee Stock Options 27
- Mellon Employee Stock Purchase Plan (ESPP) 27
RESTRICTIONS ON TRANSACTIONS IN OTHER SECURITIES 28-30
- Customer Transactions 28
- Excessive Trading, Naked Options 28
- Front Running 28
- Initial Public Offerings 28
- Material Nonpublic Information 28
- Private Placements 28
- Scalping 29
- Short-Term Trading 29
- Spread Betting 29
- Prohibition on Investments in Securities of Financial 30
Services Organizations
31-32
PROTECTING CONFIDENTIAL INFORMATION 31-32
- Insider Trading and Tipping Legal Prohibitions 32
- Mellon's Policy 32
- Restrictions on the Flow of Information Within Mellon
(The "Securities Fire Wall") 32
SPECIAL PROCEDURES FOR ACCESS DECISION MAKERS 44-47
GLOSSARY DEFINITIONS 48
EXHIBIT A - SAMPLE LETTER TO BROKER
Page 18
QUICK REFERENCE-INVESTMENT EMPLOYEES
--------------------------------------------------------------------------------
SOME THINGS YOU MUST DO EXEMPTIONS
STATEMENT OF ACCOUNTS AND HOLDINGS - Preclearance is NOT required for:
---------------------------------- ---
Provide to the Preclearance Compliance o transactions in Exempt
Officer or his/her designee a statement securities (see Glossary)
of all securities accounts and holdings o transactions in
within 10 days of becoming an Investment non-affiliated, closed-end
Employee and again annually on request. investment companies
o transactions in non-financial
DUPLICATE STATEMENTS & CONFIRMATIONS - commodities (such as
------------------------------------ agricultural futures, metals,
Instruct your broker, trust account oil, gas, etc.), currency
manager or other entity through which you futures, financial futures
have a securities trading account to send o transactions in index
directly to the Preclearance Compliance securities
Officer or his/her designee: o transactions in approved
o trade confirmations summarizing accounts over which the
each transaction employee has no direct or
o periodic statements indirect influence or control
over the investment decision
Exhibit A can be used to notify your making process
broker. Contact the Preclearance o involuntary transactions on
Compliance Officer for the correct the part of an employee (such
address. This applies to all accounts in as stock dividends or sales of
which you have direct or indirect fractional shares)
ownership (see Glossary). o changes in elections under
Mellon's 401(k) Retirement
PRECLEARANCE - Before initiating a Savings Plan
------------ o enrollment, changes in salary
securities transaction, written withholding percentages and
preclearance must be obtained from the sales of shares held in
Preclearance Compliance Officer. Mellon's Employee Stock
Contact the Preclearance Compliance Purchase Plan (ESPP); sales of
Officer for applicable approval shares previously withdrawn
procedures. from the ESPP do require
preclearance
If preclearance approval is received, the o receipt and exercise of an
trade must be communicated to the broker employee stock option
on the same day and executed before the administered through Human
end of the next business day, at which Resources
time the preclearance approval will o automatic reinvestment of
expire. dividends under a Dividend
Reinvestment Plan (DRIP) or
SPECIAL APPROVALS Automatic Investment Plan
(AIP); initial share purchase
PRIVATE PLACEMENTS - Acquisition of and optional cash purchases
------------------- under a DRIP or Direct Purchase
securities in a Private Placement must be Plan (DPP) do require
precleared by the Mellon Senior preclearance, as do sales of
Management Committee Member who shares acquired through a DRIP,
represents the employee's line of DPP or AIP
business or department, the Manager of o sales pursuant to bona fide
the Ethics Office and the Preclearance tender offers and sales or
Compliance Officer. To initiate exercises of "rights" (see Page
approval, contact the Ethics Office. 23)
IPOS - Acquisition of securities through
----
an allocation by the underwriter of an
Initial Public Offering (IPO) is
prohibited without the approval of the QUESTIONS?
Manager of the Ethics Office. Approval
can be given only when the allocation is Contact Mellon's Ethics Office at:
the result of a direct family o Securities Trading Policy
relationship. Help Line: 412-234-1661
o Mellon's Ethics Help Line
SOME THINGS YOU MUST NOT DO - Toll Free Telephone
o Asia (except Japan):
MELLON SECURITIES - The following 001-800-710-63562
----------------- o Australia: 0011-800-710-63562
transactions in Mellon securities are o Brazil: 0800-891-3813
prohibited for all Mellon employees: o Europe: 00-800-710-63562
o short sales o Japan: appropriate
o purchasing and selling or selling international access code +
and purchasing within 60 days 800-710-63562 (Access codes
o margin purchases or options other are: 0061010, 001010,
than employee options 0041010 or 0033010)
o US and Canada: 1-888-MELLON2
NON-MELLON SECURITIES (1-888-635-5662)
--------------------- o All other locations: call
o purchasing and selling or selling collect to 412-236-7519
and purchasing the same or equivalent - Email: ethics@mellon.com
security within 60 days is - Postal Mail: P.O. Box
discouraged, and any profits must be 535026, Pittsburgh, PA
disgorged 15253-5026 USA
o new investments in financial
services organizations are prohibited
for CERTAIN EMPLOYEES - see Page 30
------------------
THIS PAGE IS FOR REFERENCE
OTHER RESTRICTIONS are detailed in PURPOSES ONLY. EMPLOYEES ARE
------------------ REMINDED THEY MUST READ THE
Section Two. Read the Policy! POLICY AND COMPLY WITH ITS
=============== PROVISIONS.
Page 19
PERSONAL SECURITIES TRADING PRACTICES-INVESTMENT EMPLOYEES
-------------------------------------------------------------------------------
STANDARDS OF CONDUCT FOR INVESTMENT EMPLOYEES
Because of their particular responsibilities,
Investment Employees are subject to preclearance and
personal securities reporting requirements, as
discussed below.
Every Investment Employee must follow these procedures
or risk serious sanctions, including dismissal. If
you have any questions about these procedures, you
should consult the Ethics Office or the Preclearance
Compliance Officer. Interpretive issues that arise
under these procedures shall be decided by, and are
subject to the discretion of, the Manager of the
Ethics Office.
CONFLICT OF INTEREST No employee may engage in or recommend any securities
transaction that places, or appears to place, his or
her own interests above those of any customer to whom
financial services are rendered, including mutual
funds and managed accounts, or above the interests of
Mellon.
MATERIAL NONPUBLIC No employee may divulge the current portfolio
INFORMATION positions, or current or anticipated portfolio
transactions, programs or studies, of Mellon or any
Mellon customer to anyone unless it is properly within
his or her job responsibilities to do so.
No employee may engage in or recommend a securities
transaction, for his or her own benefit or for the
benefit of others, including Mellon or its customers,
while in possession of material nonpublic information
regarding such securities or the issuer of such
securities. No employee may communicate material
nonpublic information to others unless it is properly
within his or her job responsibilities to do so.
PERSONAL SECURITIES STATEMENTS & CONFIRMATIONS - All Investment Employees
TRANSACTION REPORTS are required to instruct their broker, trust account
manager or other entity through which they have a
securities trading account to submit directly to the
Preclearance Compliance Officer or his/her designee,
copies of all trade confirmations and statements
relating to each account of which they are an owner
(direct or indirect) regardless of what, if any,
securities are maintained in such accounts. Thus,
even if the account contains only mutual funds or
other Exempt securities as that term is defined by the
Policy, but the account has the capability to have
reportable securities traded in it, the Investment
Employee must arrange for duplicate account statements
and trade confirmations to be sent to the Preclearance
Compliance Officer or his/her designee. Exhibit A is
an example of an instruction letter to a broker.
OTHER SECURITIES TRANSACTIONS which were not completed
through an account, such as gifts, inheritances,
spin-offs from securities held outside accounts, or
other transfers must be reported to the Preclearance
Compliance Officer or his/her designee within 10 days
of the transaction.
Page 20
PERSONAL SECURITIES TRADING PRACTICES-INVESTMENT EMPLOYEES
-------------------------------------------------------------------------------
STATEMENT OF Within ten days of receiving the Policy and on an
SECURITIES ACCOUNTS annual basis thereafter, all Investment Employees must
AND HOLDINGS submit to the Preclearance Compliance Officer or
his/her designee:
o a listing of all accounts that may trade
reportable securities in which the employee is a
direct or indirect owner regardless of what, if
any, securities are maintained in such accounts.
Thus, for example, even if the account contains
only mutual funds or other Exempt securities (see
Glossary) but has the capability of holding
reportable securities, the account must be disclosed
o a statement of all securities held outside of
securities trading accounts in which the employee
presently has any direct or indirect ownership
other than Exempt securities (see Glossary).
The annual report must be completed upon the request
of the Ethics Office, and the information submitted
must be current within 30 days of the date the report
is submitted. The annual statement of securities
holdings contains an acknowledgment that the
Investment Employee has read and complied with the
Policy.
PRECLEARANCE FOR All Investment Employees must notify the Preclearance
PERSONAL SECURITIES Compliance Officer in writing and receive preclearance
TRANSACTIONS before they engage in any purchase or sale of a
security for their own accounts or in accounts in
which they are an indirect owner. Investment
Employees should refer to the provisions under "
Ownership" on Page 24, which are applicable to these
provisions.
All requests for preclearance for a securities
transaction shall be submitted by completing a
Preclearance Request Form.
The Preclearance Compliance Officer will notify the
Investment Employee whether the request is approved or
denied, without disclosing the reason for such
approval or denial.
Notifications may be given in writing or verbally by
the Preclearance Compliance Officer to the Investment
Employee. A record of such notification will be
maintained by the Preclearance Compliance Officer.
However, it shall be the responsibility of the
Investment Employee to obtain a written record of the
Preclearance Compliance Officer's notification within
24 hours of such notification. The Investment
Employee should retain a copy of this written record
for at least two years.
As there could be many reasons for preclearance being
granted or denied, Investment Employees should not
infer from the preclearance response anything
regarding the security for which preclearance was
requested.
Page 21
PERSONAL SECURITIES TRADING PRACTICES-INVESTMENT EMPLOYEES
-------------------------------------------------------------------------------
PRECLEARANCE FOR Although making a preclearance request does not
PERSONAL SECURITIES obligate an Investment Employee to do the transaction,
TRANSACTIONS it should be noted that:
(CONTINUED)
o preclearance requests should not be made for a
transaction that the Investment Employee does
not intend to make
o the order for a transaction must be placed with
the broker on the same day that preclearance
authorization is received. The broker must
execute the trade by the close of business on
the next business day, at which time the
preclearance authorization will expire
o Investment Employees should not discuss with
anyone else, inside or outside Mellon, the
response they received to a preclearance
request. If the Investment Employee is
preclearing as an indirect owner of another's
account, the response may be disclosed to the
other owner
o standard orders to trade at certain prices
(sometimes called "limit", "stop-loss",
"good-until-cancelled", or "standing buy/sell"
orders) must be precleared, and security
transactions receiving preclearance
authorization must be executed before the
preclearance expires. At the end of the
preclearance authorization period, any
unexecuted order must be canceled or a new
preclearance authorization must be obtained
SPECIAL STANDARDS FOR Investment Employees will generally not be given
PRECLEARANCE clearance to execute a transaction in any security
COMPLIANCE OFFICERS that is on the restricted list maintained by the
Preclearance Compliance Officer, or for which there is
a pending buy or sell order for an affiliated
account. This provision does not apply to
transactions effected or contemplated by index funds.
The Preclearance Compliance Officer may approve
certain de minimus transactions even when the firm is
trading such securities. However, de minimus
transactions require preclearance approval. The
following transaction limits are available for this
exception:
In the US,
o purchase or sale of up to $50,000 of securities
of:
- the top 200 issuers on the Russell list of
largest publicly traded companies
- other companies with a market capitalization of
$20 billion or higher
o purchase or sale of up to the greater of 100
shares or $10,000 of securities:
- ranked 201 to 500 on the Russell list of largest
publicly traded companies
- other companies with a market capitalization of
$5 billion or higher
In the UK,
o purchase or sale of up to(pound)30,000 of
securities of:
- top 100 companies on the FTSE All Share Index
- other companies with a market capitalization of
(pound)10 billion or higher
o purchase or sale of up to the greater of 100
shares or(pound)6 thousand of securities of:
- companies ranked 101 to 250 on the FTSE All
Share Index
- other companies with a market capitalization of
(pound)3 billion or higher
The following restrictions or conditions are imposed
upon the above described transactions:
o employees must cooperate with the Preclearance
Compliance Officer's request to document
market capitalization amounts
o approval is limited to two such trades in the
securities of any one issuer in any
calendar month
o short-term profit disgorgement is NOT waived for
such transactions
o preclearance is required prior to executing the
transaction
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EXEMPTIONS FROM Preclearance by Investment Employees is not required
REQUIREMENT TO for the following transactions:
PRECLEAR
o purchases or sales of Exempt securities
(generally means direct obligations of the
governments of the United States and United
Kingdom; commercial paper; high-quality,
short-term debt instruments; banker's acceptances;
bank certificates of deposits and time deposits;
repurchase agreements; securities issued by
open-end investment companies, which for this
purpose includes open-end mutual funds and
variable capital companies; fixed and variable
annuities; and unit trusts (see Glossary for
definition of Exempt securities))
o purchases or sales of non-affiliated, closed-end
investment companies
o purchase or sales of non-financial commodities
(such as agricultural futures, metals, oil, gas,
etc.), currency futures, financial futures
o purchases or sales of index securities
(sometimes referred to as exchange traded funds)
o purchases or sales effected in accounts in which
an employee has no direct or indirect influence or
control over the investment decision making process
("non-discretionary accounts"). Non-discretionary
accounts may only be exempted from preclearance
procedures, when the Manager of the Ethics Office,
after a thorough review, is satisfied that the
account is truly non-discretionary to the employee
(that is, the employee has given total investment
discretion to an investment manager and retains no
ability to influence specific trades). Standard
broker accounts generally are not deemed to be
non-discretionary to the employee, even if the
broker is given some discretion to make investment
decisions
o transactions that are involuntary on the part of
an employee, such as stock dividends or sales of
fractional shares; however, sales initiated by
brokers to satisfy margin calls are not considered
involuntary and must be precleared
o the sale of Mellon stock received upon the
exercise of an employee stock option if the sale is
part of a "netting of shares" or "cashless
exercise" administered through the Human Resources
Department
o changes to elections in the Mellon 401(k) plan
o enrollment, changes in salary withholding
percentages and sales of shares held in the Mellon
Employee Stock Purchase Plan (ESPP); sales of
shares previously withdrawn from the ESPP do
require preclearance
o purchases effected upon the exercise of rights
issued by an issuer pro rata to all holders of a
class of securities, to the extent such rights
were acquired from such issuer
o sales of rights acquired from an issuer, as
described above
o sales effected pursuant to a bona fide tender
offer
o automatic reinvestment of dividends under a
Dividend Reinvestment Plan (DRIP) or Automatic
Investment Plan (AIP); initial share purchase and
optional cash purchases under a DRIP or Direct
Purchase Plan (DPP) must be precleared as do sales
of shares of shares acquired through a DRIP, DPP
or AIP
GIFTING OF SECURITIES Investment Employees desiring to make a bona fide gift
of securities or who receive a bona fide gift of
securities, including an inheritance, do not need to
preclear the transaction. However, Investment
Employees must report such bona fide gifts to the
Preclearance Compliance Officer or his/her designee.
The report must be made within 10 days of making or
receiving the gift and must disclose the following
information: the name of the person receiving (giving)
the gift, the date of the transaction, and the name of
the broker through which the transaction was
effected. A bona fide gift is one where the donor
does not receive anything of monetary value in return.
An Investment Employee who purchases a security with
the intention of making a gift must preclear the
purchase transaction.
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PERSONAL SECURITIES TRADING PRACTICES-INVESTMENT EMPLOYEES
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OWNERSHIP The preclearance, reporting and other provisions of
the Policy apply not only to securities held in the
employee's own name but also to all other securities
indirectly owned by the employee (see Glossary for the
definition of indirect owner). Generally you are the
indirect owner of securities if you have the
opportunity, directly or indirectly, to share in any
profits from a transaction in those securities. This
could include:
o securities held by members of your family who
share the same household with you
o securities held by a trust in which you are a
settler, trustee, or beneficiary
o securities held by a partnership in which you
are a general partner
o securities in which any contract, arrangement,
understanding or relationship gives you direct or
indirect economic interest
NON-MELLON EMPLOYEE The provisions discussed above do not apply to
BENEFIT PLANS transactions done under a bona fide employee benefit
plan of an organization not affiliated with Mellon by
an employee of that organization who shares ownership
interest with a Mellon employee. This means if a
Mellon employee's spouse is employed at a non-Mellon
company, the Mellon employee is not required to obtain
approval for transactions IN THE EMPLOYER'S SECURITIES
done by the spouse as part of the spouse's employee
benefit plan.
In such situations, the spouse's employer has primary
responsibility for providing adequate supervision with
respect to conflicts of interest and compliance with
securities laws regarding its own employee benefit
plans.
However, employee benefit plans which allow the
employee to buy or sell securities other than those of
their employer are subject to the Policy, including
the preclearance and reporting provisions
DRIPS, DPPS AND AIPS Certain companies with publicly traded securities
establish:
o Dividend Reinvestment Plans (DRIPs) - These
permit shareholders to have their dividend
payments channeled to the purchase of additional
shares of such company's stock. An additional
benefit offered to DRIP participants is the right
to buy additional shares by sending in a check
before the dividend reinvestment date ("optional
cash purchases")
o Direct Purchase Plans (DPPs) - These allow
purchasers to buy stock by sending a check
directly to the issuer, without using a broker
o Automatic Investment Plans (AIPs) - These allow
purchasers to set up a plan whereby a fixed amount
of money is automatically deducted from their
checking account each month and used to purchase
stock directly from the issuer
Participation in a DRIP, DPP or AIP is voluntary.
Investment Employees who enroll in a DRIP or AIP are
required to preclear the initial enrollment in the
plan when accompanied by an initial share purchase
transaction. However, the periodic reinvestment of
dividend payments into additional shares of company
stock through a DRIP, or the periodic investments
through an AIP are not required to be precleared.
Investment Employees must preclear all optional cash
purchases through a DRIP and all purchases through a
DPP. Investment Employees must also preclear all sales
through a DRIP, DPP or AIP.
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PERSONAL SECURITIES TRADING PRACTICES-INVESTMENT EMPLOYEES
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INVESTMENT CLUBS AND Certain organizations create a unique means of
PRIVATE INVESTMENT investing:
COMPANIES
o Investment Clubs - a membership organization
where investors make joint decisions on which
securities to buy or sell. The securities are
generally held in the name of the investment
club. Since each member of the investment club
participates in the investment decision making
process, each Investment Employee belonging to
such a club must preclear and report the
securities transactions of the club.
o Private Investment Company - an investment
company (see Glossary) whose shares are not
deemed to be publicly held (sometimes called
"hedge funds"). Investment Employees investing
in such a private investment company are not
required to preclear any of the securities
transactions made by the private investment
company.
However, Investment Employees' investments in Private
Investment Companies are considered to be private
placements and approval must be received prior to
investing. Employees should refer to the Private
Placement provision of the Policy on Page 28 for
approval requirements.
RESTRICTED LIST The Preclearance Compliance Officer will maintain a
list (the "Restricted List") of companies whose
securities are deemed appropriate for implementation
of trading restrictions for Investment Employees in
his/her area. From time to time, such trading
restrictions may be appropriate to protect Mellon and
its Investment Employees from potential violations, or
the appearance of violations, of securities laws. The
inclusion of a company on the Restricted List provides
no indication of the advisability of an investment in
the company's securities or the existence of material
nonpublic information on the company. Nevertheless,
the contents of the Restricted List will be treated as
confidential information to avoid unwarranted
inferences.
The Preclearance Compliance Officer will retain copies
of the restricted lists for six years.
CONFIDENTIAL TREATMENT The Manager of the Ethics Office and/or Preclearance
Compliance Officer will use his or her best efforts to
assure that all requests for preclearance, all
personal securities transaction reports and all
reports of securities holdings are treated as
"Personal and Confidential." However, such documents
will be available for inspection by appropriate
regulatory agencies, and by other parties within and
outside Mellon as are necessary to evaluate compliance
with or sanctions under the Policy. Documents
received from Investment Employees are also available
for inspection by the boards of directors, trustees or
managing general partners of any Mellon entity
regulated by investment company laws.
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PERSONAL SECURITIES TRADING PRACTICES-INVESTMENT EMPLOYEES
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RESTRICTIONS ON TRANSACTIONS IN MELLON SECURITIES
Investment Employees who engage in transactions
involving Mellon securities should be aware of their
unique responsibilities with respect to such
transactions arising from the employment relationship
and should be sensitive to even the appearance of
impropriety.
The following restrictions apply to all transactions in
Mellon's publicly traded securities occurring in the
employee's own account and in all other accounts over
which the employee has indirect ownership. These
restrictions are to be followed in addition to any
restrictions that apply to particular senior officers
or directors of Mellon such as restrictions under
Section 16 of the Securities Exchange Act of 1934.
o SHORT SALES - Short sales of Mellon securities by
employees are prohibited.
o SHORT-TERM TRADING - Investment Employees are
prohibited from purchasing and selling, or from
selling and purchasing Mellon securities within any
60-calendar day period. In addition to any other
sanction, any profits realized on such short-term
trades must be disgorged in accordance with
procedures established by senior management.
o MARGIN TRANSACTIONS - Purchases on margin of
Mellon's publicly traded securities by employees is
prohibited. Margining Mellon securities in
connection with a cashless exercise of an employee
stock option through the Human Resource Department
is exempt from this restriction. Further, Mellon
securities may be used to collateralize loans for
non-securities purposes or for the acquisition of
securities other than those issued by Mellon.
o OPTION TRANSACTIONS - Option transactions
involving Mellon's publicly traded securities are
prohibited. Transactions under Mellon's Long-Term
Incentive Plan or other employee option plans are
exempt from this restriction.
o MAJOR MELLON EVENTS - Employees who have
knowledge of major Mellon events that have not yet
been announced are prohibited from buying or
selling Mellon's publicly traded securities before
such public announcements, even if the employee
believes the event does not constitute material
nonpublic information.
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PERSONAL SECURITIES TRADING PRACTICES-INVESTMENT EMPLOYEES
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MELLON 401(K) PLAN For purposes of the short-term trading rule, employees
changing their existing account balance allocation to
increase or decrease the amount allocated to Mellon
Common Stock will be treated as a purchase or sale of
Mellon Stock, respectively. This means employees are
prohibited from increasing their existing account
balance allocation to Mellon Common Stock and then
decreasing it within 60 days. Similarly, employees are
prohibited from decreasing their existing account
balance allocation to Mellon Common Stock and then
increasing it within 60 days. However:
o with respect to Investment Employees, any profits
realized on short-term changes in the 401(k) will
not have to be disgorged
o changes to existing account balance allocations
in the 401(k) plan will not be compared to
transactions in Mellon securities outside the 401(k)
for purposes of the 60-day rule. (Note: this does
not apply to members of the Executive Management
Group, who should consult with the Legal Department)
Except for the above, there are no other restrictions
applicable to the 401(k) plan. This means, for example:
o employees are not required to preclear any
elections or changes made in their 401(k) account
o there is no restriction on employees changing
their salary deferral contribution percentages with
regard to the 60-day rule
o the regular salary deferral contribution to
Mellon Common Stock in the 401(k) that takes place
with each pay will not be considered a purchase for
purpose of the 60-day rule
MELLON EMPLOYEE RECEIPT or EXERCISE of an employee stock option from
STOCK OPTIONS Mellon is exempt from the reporting and preclearance
requirements and does not constitute a purchase or sale
for the purpose of the 60-day prohibition.
SALES - The sale of the Mellon securities that were
received in the exercise of an employee stock option is
treated like any other sale under the Policy,
regardless of how little time has elapsed between the
option exercise and the sale. Thus, such sales are
subject to the preclearance and reporting requirements
and are considered sales for purposes of the 60-day
prohibition.
MELLON EMPLOYEE ENROLLMENT and CHANGING SALARY WITHHOLDING PERCENTAGES
STOCK PURCHASE PLAN in the ESPP are exempt from preclearance and reporting
(ESPP) requirements and do not constitute a purchase for
purposes of the 60-day prohibition.
SELLING SHARES HELD IN THE ESPP - Investment employees
are not required to preclear or report sales of stock
held in the ESPP, including shares acquired upon
reinvestment of dividends. However, sale of stock held
in the ESPP is considered a sale for purposes of the
60-day prohibition and will be compared to transactions
in Mellon securities outside of the ESPP.
SELLING SHARES PREVIOUSLY WITHDRAWN - The sale of the
Mellon securities that were received as a withdrawal
from the ESPP is treated like any other sale under the
Policy, regardless of how little time has elapsed
between the withdrawal and the sale. Thus, such sales
are subject to the preclearance and reporting
requirements and are considered sales for purposes of
the 60-day prohibition.
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PERSONAL SECURITIES TRADING PRACTICES-INVESTMENT EMPLOYEES
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RESTRICTIONS ON TRANSACTIONS IN OTHER SECURITIES
Purchases or sales by an employee of the securities of
issuers with which Mellon does business, or other
third-party issuers, could result in liability on the
part of such employee. Employees should be sensitive
to even the appearance of impropriety in connection
with their personal securities transactions. Employees
should refer to "Ownership" on Page 24 which is
applicable to the following restrictions.
The Mellon CODE OF CONDUCT contains certain
restrictions on investments in parties that do business
with Mellon. Employees should refer to the CODE OF
CONDUCT and comply with such restrictions in addition
to the restrictions and reporting requirements set
forth below.
The following restrictions apply to ALL securities
transactions by Investment Employees:
o CUSTOMER TRANSACTIONS - Trading for customers and
Mellon accounts should always take precedence
over employees' transactions for their own or
related accounts.
o EXCESSIVE TRADING, NAKED OPTIONS - Mellon
discourages all employees from engaging in
short-term or speculative trading, writing
naked options, trading that could be deemed
excessive or trading that could interfere with
an employee's job responsibilities.
o FRONT RUNNING - Employees may not engage in
"front running," that is, the purchase or sale
of securities for their own accounts on the
basis of their knowledge of Mellon's trading
positions or plans or those of their customers.
o INITIAL PUBLIC OFFERINGS - Investment Employees
are prohibited from acquiring securities
through an allocation by the underwriter of an
Initial Public Offering (IPO) without the
approval of the Manager of the Ethics Office.
Approval can be given only when the allocation
comes through an employee of the issuer who is
a direct family relation of the Investment
Employee. Due to certain laws and regulations
(for example, NASD rules in the US), this
approval may not be available to employees of
registered broker-dealers.
o MATERIAL NONPUBLIC INFORMATION - Employees
possessing material nonpublic information
regarding any issuer of securities must refrain
from purchasing or selling securities of that
issuer until the information becomes public or
is no longer considered material.
o PRIVATE PLACEMENTS - Investment Employees are
prohibited from acquiring any security in a
private placement unless they obtain the prior
written approval of the Manager of the Ethics
Office, the Preclearance Compliance Officer and
the Mellon Senior Management Committee Member
representing the employee's line of business or
department. Employees should contact the
Ethics Office to initiate approval. Approval
must be given by all three persons for the
acquisition to be considered approved.
Private placements include certain co-operative
investments in real estate, co-mingled investment
vehicles such as hedge funds, and investments in
family owned businesses. For purposes of the
Policy, time-shares and cooperative investments in
real estate used as a primary or secondary
residence are not considered to be private
placements.
After receipt of the necessary approvals and the
acquisition, Investment Employees are required to
disclose that investment if they participate in any
subsequent consideration of credit for the issuer
or of an investment in the issuer for an advised
account. Final decision to acquire such securities
for an advised account will be subject to
independent review.
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PERSONAL SECURITIES TRADING PRACTICES-INVESTMENT EMPLOYEES
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RESTRICTIONS ON TRANSACTIONS IN OTHER SECURITIES (CONTINUED)
o SCALPING - Employees may not engage in
"scalping," that is, the purchase or sale of
securities for their own or Mellon's accounts
on the basis of knowledge of customers' trading
positions or plans.
o SHORT-TERM TRADING - All Investment Employees are
discouraged from purchasing and selling, or
from selling and purchasing, the same (or
equivalent) securities within any 60-calendar
day period. Any profits realized on such
short-term trades must be disgorged in
accordance with procedures established by
senior management. Transactions that are
exempt from preclearance will not be considered
purchases or sales for purposes of profit
disgorgement. Investment Employees should be
aware that for purposes of profit disgorgement,
trading in derivatives (such as options) is
deemed to be trading in the underlying
security. (See Page 47 in the Glossary for an
explanation of option transactions.)
Therefore, certain investment strategies may be
difficult to implement without being subject to
profit disgorgement. Furthermore, Investment
Employees should also be aware that profit
disgorgement from 60-day trading may be greater
than the economic profit or greater than the
profit reported for purposes of income tax
reporting.
o SPREAD BETTING - Employees may not engage in
"spread betting" (essentially taking bets on
securities pricing to reflect market movements)
or similar activities as a mechanism for
avoiding the restrictions on personal
securities trading arising under the provisions
of the Policy. Such transactions themselves
constitute transactions in securities for the
purposes of the Policy and are subject to all
of the provisions applicable to other
non-exempted transactions.
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PERSONAL SECURITIES TRADING PRACTICES-INVESTMENT EMPLOYEES
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PROHIBITION ON You are prohibited from acquiring any security issued
INVESTMENTS IN by a financial services organization if you are:
SECURITIES OF
FINANCIAL SERVICES o a member of the Mellon Senior Management Committee
ORGANIZATIONS
o employed in any of the following departments:
Corporate Strategy & Development
Legal (Mellon headquarters only)
Finance (Mellon headquarters only)
o an employee specifically designated by the
Manager of the Ethics Office and informed that this
prohibition is applicable to you
FINANCIAL SERVICES ORGANIZATIONS - The phrase "security
issued by a financial services organization" includes
any security issued by:
o Commercial Banks other than Mellon
o Financial Holding Companies (or Bank Holding
Companies) other than Mellon
o Insurance Companies
o Investment Advisory Companies
o Shareholder Servicing Companies
o Thrifts
o Savings and Loan Associations
o Broker-Dealers
o Transfer Agents
o Other Depository Institutions
The phrase "securities issued by a financial services
organization" DOES NOT INCLUDE Exempt securities (see
Glossary). Further, for purposes of determining
whether a company is a financial services organization,
subsidiaries and parent companies are treated as
separate issuers.
EFFECTIVE DATE - Securities of financial services
organizations properly acquired before the employee was
subject to this prohibition may be maintained or
disposed of at the owner's discretion consistent with
the Policy.
Any acquisition of financial service organization
securities that is exempt from preclearance pursuant to
the express provision of the Policy is also exempt from
this prohibition. This includes (assuming full
compliance with the applicable preclearance exemption):
o Exempt securities (see Glossary)
o acquisition in a non-discretionary account
o involuntary acquisitions
o securities received as gifts
o reinvestment of dividends (but not initial share
and optional cash purchases) under a DRIP or
acquisitions through an AIP
o acquisitions through a non-Mellon employee
benefit plan
Within 30 days of becoming subject to this prohibition,
all holdings of securities of financial services
organizations must be disclosed in writing to the
Ethics Office.
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PERSONAL SECURITIES TRADING PRACTICES-INVESTMENT EMPLOYEES
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PROTECTING CONFIDENTIAL INFORMATION
As an employee you may receive information about
Mellon, its customers and other parties that, for
various reasons, should be treated as confidential.
All employees are expected to strictly comply with
measures necessary to preserve the confidentiality of
information. Employees should refer to the Mellon CODE
OF CONDUCT.
INSIDER TRADING AND Securities laws generally prohibit the trading of
TIPPING securities while in possession of "material nonpublic"
LEGAL PROHIBITIONS information regarding the issuer of those securities
(insider trading). Any person who passes along
material nonpublic information upon which a trade is
based (tipping) may also be liable.
Information is "material" if there is a substantial
likelihood that a reasonable investor would consider it
important in deciding whether to buy, sell or hold
securities. Obviously, information that would affect
the market price of a security (price sensitive
information) would be material. Examples of
information that might be material include:
o a proposal or agreement for a merger, acquisition
or divestiture, or for the sale or purchase of
substantial assets
o tender offers, which are often material for the
party making the tender offer as well as for
the issuer of the securities for which the
tender offer is made
o dividend declarations or changes
o extraordinary borrowings or liquidity problems
o defaults under agreements or actions by
creditors, customers or suppliers relating to a
company's credit standing
o earnings and other financial information, such as
significant restatements, large or unusual
write-offs, write-downs, profits or losses
o pending discoveries or developments, such as new
products, sources of materials, patents,
processes, inventions or discoveries of mineral
deposits
o a proposal or agreement concerning a financial
restructuring
o a proposal to issue or redeem securities, or a
development with respect to a pending issuance
or redemption of securities
o a significant expansion or contraction of
operations
o information about major contracts or increases or
decreases in orders
o the institution of, or a development in,
litigation or a regulatory proceeding
o developments regarding a company's senior
management
o information about a company received from a
director of that company
o information regarding a company's possible
noncompliance with environmental protection laws
This list is not exhaustive. All relevant
circumstances must be considered when determining
whether an item of information is material.
"Nonpublic" - Information about a company is nonpublic
if it is not generally available to the investing
public. Information received under circumstances
indicating that it is not yet in general circulation
and which may be attributable, directly or indirectly,
to the company or its insiders is likely to be deemed
nonpublic information.
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PERSONAL SECURITIES TRADING PRACTICES-INVESTMENT EMPLOYEES
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INSIDER TRADING AND
TIPPING LEGAL
PROHIBITIONS If you obtain material nonpublic information, you may
(CONTINUED) not trade related securities until you can refer to
some public source to show that the information is
generally available (that is, available from sources
other than inside sources) and that enough time has
passed to allow wide dissemination of the information.
While information appearing in widely accessible
sources--such as in newspapers or on the
internet--becomes public very soon after publication,
information appearing in less accessible sources--such
as regulatory filings, may take up to several days to
be deemed public. Similarly, highly complex
information might take longer to become public than
would information that is easily understood by the
average investor.
MELLON'S POLICY Employees who possess material nonpublic information
about a company--whether that company is Mellon,
another Mellon entity, a Mellon customer or supplier,
or other company--may not trade in that company's
securities, either for their own accounts or for any
account over which they exercise investment
discretion. In addition, employees may not recommend
trading in those securities and may not pass the
information along to others, except to employees who
need to know the information in order to perform their
job responsibilities with Mellon. These prohibitions
remain in effect until the information has become
public.
Employees who have investment responsibilities should
take appropriate steps to avoid receiving material
nonpublic information. Receiving such information
could create severe limitations on their ability to
carry out their responsibilities to Mellon's fiduciary
customers.
Employees managing the work of consultants and
temporary employees who have access to the types of
confidential information described in the Policy are
responsible for ensuring that consultants and temporary
employees are aware of Mellon's policy and the
consequences of noncompliance.
Questions regarding Mellon's policy on material
nonpublic information, or specific information that
might be subject to it, should be referred to the
General Counsel.
RESTRICTIONS ON THE As a diversified financial services organization,
FLOW OF INFORMATION Mellon faces unique challenges in complying with the
WITHIN MELLON (THE prohibitions on insider trading and tipping of material
"SECURITIES FIRE nonpublic information, and misuse of confidential
WALL") information. This is because one Mellon unit might
have material nonpublic information about a company
while other Mellon units may have a desire, or even a
fiduciary duty, to buy or sell that company's
securities or recommend such purchases or sales to
customers. To engage in such broad ranging financial
services activities without violating laws or breaching
Mellon's fiduciary duties, Mellon has established a
"Securities Fire Wall" policy applicable to all
employees. The "Securities Fire Wall" separates the
Mellon units or individuals that are likely to receive
material nonpublic information (potential Insider Risk
functions) from the Mellon units or individuals that
either trade in securities, for Mellon's account or for
the accounts of others, or provide investment advice
(Investment functions). Employees should refer to CPP
903-2(C) THE SECURITIES FIRE WALL.
SPECIAL PROCEDURES FOR ACCESS DECISION MAKERS
Certain Portfolio Managers and Research Analysts in the
fiduciary businesses have been designated as Access
Decision Makers and are subject to additional
procedures which are discussed in a separate edition of
the SECURITIES TRADING POLICY. If you have reason to
believe that you may be an Access Decision Maker,
contact your supervisor, Preclearance Compliance
Officer or the Ethics Office.
Page 32
Personal Securities Trading Practices
SECTION THREE - APPLICABLE TO OTHER EMPLOYEES
TABLE OF CONTENTS
------------------------
PAGE #
QUICK REFERENCE - OTHER EMPLOYEES 34
STANDARDS OF CONDUCT FOR OTHER EMPLOYEES 35-36
- Conflict of Interest 35
- Material Nonpublic Information 35
- Personal Securities Transaction Reports 35
- Account Statements 35
- Ownership 36
- Non-Mellon Employee Benefit Plans 36
- Confidential Treatment 36
RESTRICTIONS ON TRANSACTIONS IN MELLON SECURITIES 37-38
- General Restrictions 37
- Mellon 401(k) Plan 37
- Mellon Employee Stock Options 38
- Mellon Employee Stock Purchase Plan (ESPP) 38
RESTRICTIONS ON TRANSACTIONS IN OTHER SECURITIES 38-41
- Credit, Consulting or Advisory Relationship 38
- Customer Transactions 38
- Excessive Trading, Naked Options 38
- Front Running 39
- Initial Public Offerings 39
- Material Nonpublic Information 39
- Private Placements 39
- Scalping 39
- Short-Term Trading 39
- Spread Betting 39
- Prohibition on Investments in Securities of Financial 40-41
Services Organizations
42-43
PROTECTING CONFIDENTIAL INFORMATION 42-43
- Insider Trading and Tipping Legal Prohibitions 43
- Mellon's Policy 43
- Restrictions on the Flow of Information Within Mellon
(The "Securities Fire Wall") 44-47
GLOSSARY DEFINITIONS 48
EXHIBIT A - SAMPLE LETTER TO BROKER
Page 33
QUICK REFERENCE-OTHER EMPLOYEES
-------------------------------------------------------------------------------
SOME THINGS YOU MUST DO SOME THINGS YOU MUST NOT DO
o If you buy or sell MELLON MELLON SECURITIES - The following
------- -----------------
FINANCIAL CORPORATION SECURITIES you transactions in Mellon securities
--------------------------------
must provide a report of the trade are prohibited for all Mellon
and a copy of the trade confirmation employees:
within 10 days of transaction to the o short sales
Ethics Office or to your Compliance o purchasing and selling or
Officer. This does not apply to selling and purchasing
changes in elections under Mellon's within 60 days
401(k) Retirement Savings Plan, o margin purchases or options
transactions in Mellon's Employee other than employee
Stock Purchase Plan (ESPP) or the options.
exercise of Mellon's employee stock
options. However, the reporting NON-MELLON SECURITIES
provisions do apply to sales of ---------------------
Mellon stock previously acquired o new investments in
through the exercise of employee financial services
stock options or the ESPP. organizations (certain
employees only - see
Pages 40-41)
o Due to certain laws and
regulations (for example, NASD rules OTHER RESTRICTIONS are detailed
in the US) there may be additional ------------------
reporting requirements for Other throughout Section Three. Read
Employees who are employees of ====
registered broker-dealers. Check the Policy!
with the Manager of the Ethics ==========
Office or your Compliance Officer to
determine if this impacts you.
QUESTIONS?
Contact Mellon's Ethics Office at:
o The Securities Trading
o For employees who are subject to Policy Help Line:
the prohibition on new investments 1-412-234-1661
in financial services organizations o Mellon's Ethics Help Line
(certain employees only - see Pages - Toll Free Telephone
40-41), you must instruct your o Asia (except Japan):
broker, trust account manager or 001-800-710-63562
other entity where you have a o Australia:
securities trading account to send 0011-800-710-63562
directly to the Manager of the o Brazil: 0800-891-3813
Ethics Office: o Europe: 00-800-710-63562
- trade confirmations summarizing o Japan: appropriate
each transaction international access code
- periodic statements + 800-710-63562 (Access
codes are: 0061010,
Exhibit A can be used to notify your 001010, 0041010 or
broker or account manager. 0033010)
o US and Canada:
SPECIAL APPROVALS 1-888-MELLON2
(1-888-635-5662)
o PRIVATE PLACEMENTS - Acquisition o All other locations: call
of securities in a Private collect to 412-236-7519
Placement must approved by the - Email: ethics@mellon.com
Mellon Senior Management - Postal Mail: P.O. Box
Committee Member who represents 535026 Pittsburgh, PA
your line of business or 15253-5026 USA
department, the Compliance
Officer and the Manager of the
Ethics Office. Contact the
Manager of the Ethics Office to
initiate approval.
o IPOS - Acquisition of securities
through an allocation by the
underwriter of an Initial
Public Offering (IPO) is
prohibited without the approval
of the Manager of the Ethics
Office. Approval can be given
only when the allocation is the
result of a direct family
relationship.
THIS PAGE IS FOR REFERENCE PURPOSES ONLY. EMPLOYEES ARE REMINDED THEY MUST
READ THE POLICY AND COMPLY WITH ITS PROVISIONS.
Page 34
PERSONAL SECURITIES TRADING PRACTICES-OTHER EMPLOYEES
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STANDARDS OF CONDUCT FOR OTHER EMPLOYEES
Every "Other Employee" must follow these procedures or
risk serious sanctions, including dismissal. If you
have any questions about these procedures, you should
consult the Ethics Office. Interpretive issues that
arise under these procedures shall be decided by, and
are subject to the discretion of, the Manager of the
Ethics Office.
CONFLICT OF INTEREST No employee may engage in or recommend any securities
transaction that places, or appears to place, his or
her own interests above those of any customer to whom
financial services are rendered, including mutual funds
and managed accounts, or above the interests of Mellon.
MATERIAL NONPUBLIC No employee may engage in or recommend a securities
INFORMATION transaction, for his or her own benefit or for the
benefit of others, including Mellon or its customers,
while in possession of material nonpublic information
regarding such securities or the issuer of such
securities. No employee may communicate material
nonpublic information to others unless it is properly
within his or her job responsibilities to do so.
PERSONAL SECURITIES "Other Employees" must report in writing to the Ethics
TRANSACTION REPORTS Office or the Compliance Officer within ten calendar
days of the transaction whenever they purchase or sell
Mellon securities. Purchases and sales include
optional cash purchases under Mellon's Dividend
Reinvestment and Common Stock Purchase Plan (the
"Mellon DRIP"). Due to certain laws and regulations
(for example, NASD rules in the US), there may be
additional reporting requirements for "Other Employees"
who are employees of registered broker-dealers.
Contact the Manager of the Ethics Office or your
Compliance Officer for guidance.
It should be noted that the reinvestment of dividends
under the DRIP, changes in elections under Mellon's
401(k) Retirement Savings Plan, the receipt of stock
under Mellon's Restricted Stock Award Plan,
transactions under Mellon's Employee Stock Purchase
Plan and the receipt or exercise of options under
Mellon's employee stock option plans are not considered
purchases or sales for the purpose of this reporting
requirement.
ACCOUNT STATEMENTS Certain "Other Employees" are subject to the
restriction on investments in financial services
organizations and are required to instruct their
brokers and/or securities account managers to send
statements directly to the Ethics Office. See Page 40.
An example of an instruction letter to a broker or
account manager is contained in Exhibit A.
Page 35
PERSONAL SECURITIES TRADING PRACTICES-OTHER EMPLOYEES
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OWNERSHIP The provisions of the Policy apply not only to
securities held in the employee's own name but also to
all other securities indirectly owned by the employee
(see Glossary for definition of indirect ownership).
Generally you are the indirect owner of securities if
you have the opportunity, directly or indirectly, to
share in any profits from a transaction in those
securities. This could include:
o securities held by members of your family who
share the same household with you
o securities held by a trust in which you are a
settler, trustee, or beneficiary
o securities held by a partnership in which you are
a general partner
o securities in which any contract, arrangement,
understanding or relationship gives you direct
or indirect economic interest
NON-MELLON EMPLOYEE The provisions discussed above do not apply to
BENEFIT PLANS transactions done under a bona fide employee benefit
plan of an organization not affiliated with Mellon by
an employee of that organization who shares ownership
interest with a Mellon employee. This means if a
Mellon employee's spouse is employed at a non-Mellon
company, the Policy provisions do not apply to
transactions IN THE EMPLOYER'S SECURITIES done by the
spouse as part of the spouse's employee benefit plan.
In such situations, the spouse's employer has primary
responsibility for providing adequate supervision with
respect to conflicts of interest and compliance with
securities laws regarding its own employee benefit
plans.
However, employee benefit plans which allow the
employee to buy and sell securities other than those of
their employer are subject to the provisions of the
Policy, including the reporting provisions.
CONFIDENTIAL The Manager of the Ethics Office and the Compliance
TREATMENT Officer will use his or her best efforts to assure that
all personal securities transaction reports and all
reports of securities holdings are treated as "Personal
and Confidential." However, such documents will be
available for inspection by appropriate regulatory
agencies and by other parties within and outside Mellon
as are necessary to evaluate compliance with or
sanctions under the Policy.
Page 36
PERSONAL SECURITIES TRADING PRACTICES-OTHER EMPLOYEES
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RESTRICTIONS ON TRANSACTIONS IN MELLON SECURITIES
Employees who engage in transactions involving Mellon
securities should be aware of their unique
responsibilities with respect to such transactions
arising from the employment relationship and should be
sensitive to even the appearance of impropriety.
The following restrictions apply to all transactions in
Mellon's publicly traded securities occurring in the
employee's own account and in all other accounts over
which the employee has indirect ownership. These
restrictions are to be followed in addition to any
restrictions that apply to particular senior officers
or directors of Mellon such as restrictions under
Section 16 of the Securities Exchange Act of 1934.
o SHORT SALES - Short sales of Mellon securities by
employees are prohibited.
o SHORT-TERM TRADING - Employees are prohibited
from purchasing and selling, or from selling
and purchasing, Mellon securities within any
60-calendar day period.
o MARGIN TRANSACTIONS - Purchases on margin of
Mellon's publicly traded securities by
employees is prohibited. Margining Mellon
securities in connection with a cashless
exercise of an employee stock option through
the Human Resource Department is exempt from
this restriction. Further, Mellon securities
may be used to collateralize loans for
non-securities purposes or for the acquisition
of securities other than those issued by Mellon.
o OPTION TRANSACTIONS - Option transactions
involving Mellon's publicly traded securities
are prohibited. Transactions under Mellon's
Long-Term Incentive Plan or other employee
option plans are exempt from this restriction.
o MAJOR MELLON EVENTS - Employees who have
knowledge of major Mellon events that have not
yet been announced are prohibited from buying
or selling Mellon's publicly traded securities
before such public announcements, even if the
employee believes the event does not constitute
material nonpublic information.
MELLON 401(K) PLAN For purposes of the short-term trading rule, employees
changing their existing account balance allocation to
increase or decrease the amount allocated to Mellon
Common Stock will be treated as a purchase or sale of
Mellon Stock, respectively. This means employees are
prohibited from increasing their existing account
balance allocation to Mellon Common Stock and then
decreasing it within 60 days. Similarly, employees are
prohibited from decreasing their existing account
balance allocation to Mellon Common Stock and then
increasing it within 60 days. However, changes to
existing account balance allocations in the 401(k) plan
will not be compared to transactions in Mellon
securities outside the 401(k) for purposes of the
60-day rule. (Note: this does not apply to members of
the Executive Management Group, who should consult with
the Legal Department.)
Except for the above there are no other restrictions
applicable to the 401(k) plan. This means, for example:
o employees are not required to report any
elections or changes made in their 401(k) account
o there is no restriction on employees changing
their salary deferral contribution percentages with
regard to the 60-day rule
o the regular salary deferral contribution to
Mellon Common Stock in the 401(k) that takes place
with each pay will not be considered a purchase for
purposes of the 60-day rule
Page 37
PERSONAL SECURITIES TRADING PRACTICES-OTHER EMPLOYEES
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MELLON EMPLOYEE RECEIPT and EXERCISE of an employee stock option from
STOCK OPTIONS Mellon is exempt from reporting requirements and does
not constitute a purchase for purposes of the 60-day
prohibition.
SALES - The sale of the Mellon securities that were
received in the exercise of an employee stock option is
treated like any other sale under the Policy
(regardless of how little time has elapsed between the
option exercise and the sale). Thus, such sales are
subject to the reporting requirements and are
considered sales for purposes of the 60-day prohibition.
MELLON EMPLOYEE ENROLLMENT and CHANGING SALARY WITHHOLDING PERCENTAGES
STOCK PURCHASE PLAN in the ESPP are exempt from reporting requirements and
(ESPP) do not constitute a purchase for purposes of the 60-day
prohibition.
SELLING SHARES HELD IN THE ESPP - Sales of stock held
in the ESPP, including shares acquired upon
reinvestment of dividends, are exempt from the
reporting requirements. However, sale of stock held in
the ESPP is considered a sale for purposes of the
60-day prohibition and will be compared to transactions
in Mellon securities outside of the ESPP.
SELLING SHARES PREVIOUSLY WITHDRAWN - The sale of the
Mellon securities that were received as a withdrawal
from the ESPP is treated like any other sale under the
Policy, regardless of how little time has elapsed
between the withdrawal and the sale. Thus, such sales
are subject to the reporting requirements and are
considered sales for purposes of the 60-day prohibition.
RESTRICTIONS ON TRANSACTIONS IN OTHER SECURITIES
Purchases or sales by an employee of the securities
of issuers with which Mellon does business, or other
third-party issuers, could result in liability on the
part of such employee. Employees should be sensitive
to even the appearance of impropriety in connection
with their personal securities transactions.
Employees should refer to "Ownership" on Page 36,
which is applicable to the following restrictions.
The Mellon CODE OF CONDUCT contains certain
restrictions on investments in parties that do business
with Mellon. Employees should refer to the CODE OF
CONDUCT and comply with such restrictions in addition
to the restrictions and reporting requirements set
forth below.
The following restrictions apply to ALL securities
transactions by employees:
o CREDIT, CONSULTING OR ADVISORY RELATIONSHIP -
Employees may not buy, hold or trade securities of a
company if they are considering granting, renewing,
modifying or denying any credit facility to that
company, acting as a benefits consultant to that
company, or acting as an adviser to that company
with respect to the company's own securities without
the prior permission of the Ethics Office. In
addition, lending employees who have assigned
responsibilities in a specific industry group are
not permitted to trade securities in that industry.
This prohibition does not apply to transactions in
open-end mutual funds.
o CUSTOMER TRANSACTIONS - Trading for customers and
Mellon accounts should always take precedence
over employees' transactions for their own or
related accounts.
o EXCESSIVE TRADING, NAKED OPTIONS - Mellon
discourages all employees from engaging in
short-term or speculative trading, writing
naked options, trading that could be deemed
excessive or trading that could interfere with
an employee's job responsibilities.
Page 38
PERSONAL SECURITIES TRADING PRACTICES-OTHER EMPLOYEES
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RESTRICTIONS ON TRANSACTIONS IN OTHER SECURITIES (CONTINUED)
o FRONT RUNNING - Employees may not engage in
"front running," that is, the purchase or sale of
securities for their own accounts on the basis of
their knowledge of Mellon's trading positions or
plans or those of their customers.
o INITIAL PUBLIC OFFERINGS - Other Employees are
prohibited from acquiring securities through an
allocation by the underwriter of an Initial Public
Offering (IPO) without the approval of the Manager
of the Ethics Office. Approval can be given only
when the allocation comes through an employee of the
issuer who is a direct family relation of the Other
Employee. Due to certain laws and regulations (for
example, NASD rules in the US), this approval may
not be available to employees of registered
brokers-dealers.
o MATERIAL NONPUBLIC INFORMATION - Employees
possessing material nonpublic information regarding
any issuer of securities must refrain from
purchasing or selling securities of that issuer
until the information becomes public or is no longer
considered material.
o PRIVATE PLACEMENTS - Other Employees are
prohibited from acquiring any security in a private
placement unless they obtain the prior written
approval of the Manager of the Ethics Office, the
Compliance Officer and the Mellon Senior Management
Committee Member representing the employee's line of
business or department. Employees should contact
the Ethics Office to initiate approval. Approval
must be given by all three persons for the
acquisition to be considered approved.
Private placements include certain co-operative
investments in real estate, co-mingled investment
vehicles such as hedge funds, and investments in
family owned businesses. For purposes of the
Policy, time-shares and cooperative investments in
real estate used as a primary or secondary residence
are not considered to be private placements.
After receipt of the necessary approvals and the
acquisition, "Other Employees" are required to
disclose that investment if they participate in any
subsequent consideration of credit for the issuer or
of an investment in the issuer for an advised
account. Final decision to acquire such securities
for an advised account will be subject to
independent review.
o SCALPING - Employees may not engage in
"scalping," that is, the purchase or sale of
securities for their own or Mellon's accounts on the
basis of knowledge of customers' trading positions
or plans.
o SHORT-TERM TRADING - Employees are discouraged
from purchasing and selling, or from selling and
purchasing, the same (or equivalent) securities
within any 60-calendar day period.
o SPREAD BETTING - Employees may not engage in
"spread betting" (essentially taking bets on
securities pricing to reflect market movements) or
similar activities as a mechanism for avoiding the
restrictions on personal securities trading arising
under the provisions of the Policy. Such
transactions themselves constitute transactions in
securities for the purposes of the Policy and are
subject to all of the provisions applicable to other
non-exempted transactions.
Page 39
PERSONAL SECURITIES TRADING PRACTICES-OTHER EMPLOYEES
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PROHIBITION ON You are prohibited from acquiring any security issued
INVESTMENTS IN by a financial services organization if you are:
SECURITIES OF
FINANCIAL SERVICES o a member of the Mellon Senior Management Committee
ORGANIZATIONS
o employed in any of the following departments:
Corporate Strategy & Development
Legal (Mellon headquarters only)
Finance (Mellon headquarters only)
o an employee specifically designated by the
Manager of the Ethics Office and informed that this
prohibition is applicable to you
SECURITIES ACCOUNTS - All employees subject to this
restriction on investments in financial services
organizations are required to instruct their broker,
trust account manager or other entity through which
they have a securities account to submit directly to
the Ethics Office copies of all trade confirmations and
statements relating to each account of which they are
an owner, direct or indirect, regardless of what, if
any, securities are maintained in such accounts. Thus,
even if the account contains only mutual funds or other
exempt securities as that term is defined by the Policy
but the account has the capability to have reportable
securities traded in it, the employee must arrange for
duplicate account statements and trade confirmations to
be sent to the Ethics Office. An example of an
instruction letter to the broker is contained in
Exhibit A.
FINANCIAL SERVICES ORGANIZATIONS - The phrase "security
issued by a financial services organization" includes
any security issued by:
o Commercial Banks other than Mellon
o Financial Holding Companies (or Bank Holding
Companies) other than Mellon
o Insurance Companies
o Investment Advisory Companies
o Shareholder Servicing Companies
o Thrifts
o Savings and Loan Associations
o Brokers-Dealers
o Transfer Agents
o Other Depository Institutions
The phrase "securities issued by a financial services
organization" DOES NOT INCLUDE Exempt securities (see
Glossary). Further, for purposes of determining
whether a company is a financial services organization,
subsidiaries and parent companies are treated as
separate issuers.
EFFECTIVE Date - Securities of financial services
organizations properly acquired before the employee is
subject to this prohibition may be maintained or
disposed of at the owner's discretion consistent with
the Policy.
Page 40
PERSONAL SECURITIES TRADING PRACTICES-OTHER EMPLOYEES
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PROHIBITION ON The acquisition of financial service organization
INVESTMENTS IN securities through any of the following means is exempt
SECURITIES OF from this prohibition:
FINANCIAL SERVICES
ORGANIZATIONS o Exempt securities (see Glossary)
(CONTINUED) o acquisition in a non-discretionary account
o involuntary acquisitions
o securities received as gifts
o reinvestment of dividends (but not initial share
and optional cash purchases) under a dividend
reinvestment program (DRIP) or acquisition
through an automatic investment plan (AIP)
o acquisitions through a non-Mellon employee
benefit plan
Within 30 days of becoming subject to this prohibition,
all holdings of securities of financial services
organizations must be disclosed in writing to the
Manager of the Ethics Office.
Page 41
PERSONAL SECURITIES TRADING PRACTICES-OTHER EMPLOYEES
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PROTECTING CONFIDENTIAL INFORMATION
As an employee you may receive information about
Mellon, its customers and other parties that, for
various reasons, should be treated as confidential.
All employees are expected to strictly comply with
measures necessary to preserve the confidentiality of
information. Employees should refer to the Mellon CODE
OF CONDUCT.
INSIDER TRADING AND Securities laws generally prohibit the trading of
TIPPING securities while in possession of "material nonpublic"
LEGAL PROHIBITIONS information regarding the issuer of those securities
(insider trading). Any person who passes along
material nonpublic information upon which a trade is
based (tipping) may also be liable.
Information is "material" if there is a substantial
likelihood that a reasonable investor would consider it
important in deciding whether to buy, sell or hold
securities. Obviously, information that would affect
the market price (price sensitive information) of a
security would be material. Examples of information
that might be material include:
o a proposal or agreement for a merger, acquisition
or divestiture, or for the sale or purchase of
substantial assets
o tender offers, which are often material for the
party making the tender offer as well as for the
issuer of the securities for which the tender offer
is made
o dividend declarations or changes
o extraordinary borrowings or liquidity problems
o defaults under agreements or actions by
creditors, customers or suppliers relating to a
company's credit standing
o earnings and other financial information, such as
significant restatements, large or unusual
write-offs, write-downs, profits or losses
o pending discoveries or developments, such as new
products, sources of materials, patents, processes,
inventions or discoveries of mineral deposits
o a proposal or agreement concerning a financial
restructuring
o a proposal to issue or redeem securities, or a
development with respect to a pending issuance or
redemption of securities
o a significant expansion or contraction of
operations
o information about major contracts or increases or
decreases in orders
o the institution of, or a development in,
litigation or a regulatory proceeding
o developments regarding a company's senior
management
o information about a company received from a
director of that company
o information regarding a company's possible
noncompliance with environmental protection laws
This list is not exhaustive. All relevant
circumstances must be considered when determining
whether an item of information is material.
"Nonpublic" - Information about a company is nonpublic
if it is not generally available to the investing
public. Information received under circumstances
indicating that it is not yet in general circulation
and which may be attributable, directly or indirectly,
to the company or its insiders is likely to be deemed
nonpublic information.
Page 42
PERSONAL SECURITIES TRADING PRACTICES-OTHER EMPLOYEES
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INSIDER TRADING AND If you obtain material nonpublic information, you may
TIPPING not trade related securities until you can refer to
LEGAL PROHIBITIONS some public source to show that the information is
(CONTINUED) generally available (that is, available from sources
other than inside sources) and that enough time has
passed to allow wide dissemination of the information.
While information appearing in widely accessible
sources--such as in newspapers or on the
internet--becomes public very soon after publication,
information appearing in less accessible sources--such
as regulatory filings, may take up to several days to
be deemed public. Similarly, highly complex
information might take longer to become public than
would information that is easily understood by the
average investor.
MELLON'S POLICY Employees who possess material nonpublic information
about a company--whether that company is Mellon,
another Mellon entity, a Mellon customer or supplier,
or other company--may not trade in that company's
securities, either for their own accounts or for any
account over which they exercise investment discretion.
In addition, employees may not recommend trading in those
securities and may not pass the information along to
others, except to employees who need to know the
information in order to perform their job
responsibilities with Mellon. These prohibitions
remain in effect until the information has become
public.
Employees who have investment responsibilities should
take appropriate steps to avoid receiving material
nonpublic information. Receiving such information
could create severe limitations on their ability to
carry out their responsibilities to Mellon's fiduciary
customers.
Employees managing the work of consultants and
temporary employees who have access to the types of
confidential information described in the Policy are
responsible for ensuring that consultants and temporary
employees are aware of Mellon's policy and the
consequences of noncompliance.
Questions regarding Mellon's policy on material
nonpublic information, or specific information that
might be subject to it, should be referred to the
General Counsel.
RESTRICTIONS ON THE As a diversified financial services organization,
FLOW OF INFORMATION Mellon faces unique challenges in complying with the
WITHIN MELLON (THE prohibitions on insider trading and tipping of material
"SECURITIES FIRE nonpublic information, and misuse of confidential
WALL") information. This is because one Mellon unit might
have material nonpublic information about a company
while other Mellon units may have a desire, or even a
fiduciary duty, to buy or sell that company's
securities or recommend such purchases or sales to
customers. To engage in such broad-ranging financial
services activities without violating laws or breaching
Mellon's fiduciary duties, Mellon has established a
"Securities Fire Wall" policy applicable to all
employees. The "Securities Fire Wall" separates the
Mellon units or individuals that are likely to receive
material nonpublic information (potential Insider Risk
functions) from the Mellon units or individuals that
either trade in securities, for Mellon's account or for
the accounts of others, or provide investment advice
(Investment functions). Employees should refer to CPP
903-2(C) THE SECURITIES FIRE WALL.
Page 43
GLOSSARY
-------------------------------------------------------------------------------
DEFINITIONS
o ACCESS DECISION MAKER - A person designated as such by the Investment
Ethics Committee. Generally, this will be portfolio managers and research
analysts who make recommendations or decisions regarding the purchase or
sale of equity, convertible debt, and non-investment grade debt securities
for investment companies and other managed accounts. See further details
in the Access Decision Maker edition of the Policy.
o ACCESS PERSON - As defined by Rule 17j-1 under the Investment Company Act
of 1940, "access person" means:
(A) With respect to a registered investment company or an investment
adviser thereof, any director, officer, general partner, or advisory
person (see definition below), of such investment company or
investment adviser;
(B) With respect to a principal underwriter, any director, officer, or
general partner of such principal underwriter who in the ordinary
course of his/her business makes, participates in or obtains
information regarding the purchase or sale of securities for the
registered investment company for which the principal underwriter so
acts, or whose functions or duties as part of the ordinary course of
his business relate to the making of any recommendations to such
investment company regarding the purchase or sale of securities.
(C) Notwithstanding the provisions of paragraph (A) hereinabove, where the
investment adviser is primarily engaged in a business or businesses
other than advising registered investment companies or other advisory
clients, the term "access person" shall mean: any director, officer,
general partner, or advisory person of the investment adviser who,
with respect to any registered investment company, makes any
recommendations, participates in the determination of which
recommendation shall be made, or whose principal function or duties
relate to the determination of which recommendation will be made, to
any such investment company; or who, in connection with his duties,
obtains any information concerning securities recommendations being
made by such investment adviser to any registered investment company.
(D) An investment adviser is "primarily engaged in a business or
businesses other than advising registered investment companies or
other advisory clients" when, for each of its most recent three fiscal
years or for the period of time since its organization, whichever is
less, the investment adviser derived, on an unconsolidated basis, more
than 50 percent of (i) its total sales and revenues, and (ii) its
income (or loss) before income taxes and extraordinary items, from
such other business or businesses.
o ADVISORY PERSON of a registered investment company or an investment
adviser thereof means:
(A) Any employee of such company or investment adviser (or any company in
a control relationship to such investment company or investment
adviser) who, in connection with his regular functions or duties,
makes, participates in, or obtains information regarding the purchase
or sale of a security by a registered investment company, or whose
functions relate to the making of any recommendation with respect to
such purchases or sales; and
(B) Any natural person in a control relationship to such company or
investment adviser who obtains information concerning recommendations
made to such company with regard to the purchase or sale of a
security.
o APPROVAL - written consent or written notice of non-objection.
o DIRECT FAMILY RELATION - employee's spouse, children (including
stepchildren, foster children, sons-in-law and daughters-in-law),
grandchildren, parents (including step-parents, mothers-in-law and
fathers-in-law) grandparents, and siblings (including brothers-in-law,
sisters-in-law and step brothers and sisters). Also includes adoptive
relationships.
o EMPLOYEE - an individual employed by Mellon Financial Corporation or its
more-than-50%-owned direct or indirect subsidiaries; includes all
full-time, part-time, benefited and non-benefited, exempt and non-exempt
employees in all world-wide locations; generally, for purposes of the
Policy, does not include consultants and contract or temporary employees.
o ETHICS OFFICE - the group within the Audit & Risk Review Department of
Mellon which is responsible for administering the ethics program at
Mellon, including the Securities Trading Policy.
Page 44
GLOSSARY
-------------------------------------------------------------------------------
DEFINITIONS (CONTINUED)
o EXEMPT SECURITIES - defined as:
- direct obligations of the sovereign governments of the United States
and the United Kingdom (does not include obligations of other
instrumentalities of the US and UK governments or quasi-government
agencies)
- commercial paper
- high-quality, short-term debt instruments having a maturity of 366 days
or less at issuance and rated in one of the two highest rating
categories
- bankers' acceptances
- bank certificates of deposit and time deposits
- repurchase agreements
- securities issued by open-end investment companies (i.e., mutual funds
and variable capital companies)
- fixed and variable annuities
- unit trusts
o FAMILY RELATION - see direct family relation.
o GENERAL COUNSEL - General Counsel of Mellon or any person to whom
relevant authority is delegated by the General Counsel.
o INDEX FUND - an investment company or managed portfolio which contains
securities of an index in proportions designed to replicate the return of
the index.
o INDIRECT OWNERSHIP - The securities laws of most jurisdictions attribute
ownership of securities to someone in certain circumstances, even though
the securities are not held in that person's name. For example, US federal
securities laws contain a concept of "beneficial ownership", and UK
securities laws contain a concept of securities held by "associates" (this
term includes business or domestic relationships giving rise to a
"community of interest"). The definition of "indirect ownership" that
follows is used to determine whether securities held other than in your
name are subject to the preclearance and other provisions of the Policy.
It was designed to be consistent with various securities laws; however,
there can be no assurance that attempted adherence to this definition will
provide a defense under any particular law. Moreover, a determination of
indirect ownership requires a detailed analysis of personal and/or
financial circumstances that are subject to change. It is the
responsibility of each employee to apply the definition below to his/her
own circumstances. If the employee determines that he/she is not an
indirect owner of an account and the Ethics Office becomes aware of the
account, the employee will be responsible for justifying his/her
determination. Any such determination should be based upon objective
evidence (such as written documents), rather than subjective or intangible
factors.
GENERAL STANDARD. Generally, you are the indirect owner of securities (and
preclearance and other provisions of the Policy will therefore apply to
those securities) if, through any contract, arrangement, understanding,
relationship or otherwise, you have the opportunity, directly or
indirectly, to share at any time in any profit derived from a transaction
in them (a "pecuniary interest"). The following is guidance on the
application of this definition to some common situations.
FAMILY MEMBERS. You are presumed to be an indirect owner of securities
held by members of your immediate family who share the same household with
you. "Immediate family" means your spouse, your children (including
stepchildren, foster children, sons-in-law and daughters-in-law), your
grandchildren, your parents (including stepparents, mothers-in-law and
fathers-in-law), your grandparents and your siblings (including
brothers-in-law, sisters-in-law and step brothers and sisters) and
includes adoptive relationships. This presumption of ownership may be
rebutted, but it will be difficult to do so if, with respect to the other
person, you commingle any assets or share any expenses, you provide or
receive any financial support, you influence investment decisions, you
include them as a dependent for tax purposes or as a beneficiary under an
employee benefit plan, or you are in any way financially codependent. Any
attempt to disclaim indirect ownership with respect to family members who
share your household MUST be based upon countervailing facts that you can
prove in writing.
Page 45
GLOSSARY
-------------------------------------------------------------------------------
DEFINITIONS (CONTINUED)
o INDIRECT OWNERSHIP (CONT.)
PARTNERSHIPS. If you are a general partner in a general or limited
partnership, you are deemed to own your proportionate share of the
securities owned by the partnership. Your "proportionate share" is the
greater of your share of profits or your share of capital, as evidenced by
the partnership agreement. Limited partners are NOT deemed to be owners of
partnership securities absent unusual circumstances, such as influence
over investment decisions.
SHAREHOLDERS OF CORPORATIONS. You are NOT deemed to own the securities
held by a corporation in which you are a shareholder unless you are a
controlling shareholder or you have or share investment control over the
corporation's portfolio.
TRUSTS. Generally, parties to a trust will be deemed indirect owners of
securities in the trust only if they have BOTH a pecuniary interest in the
trust and investment control over the trust. "Investment control" is the
power to direct the disposition of the securities in the trust. Specific
applications are as follows:
TRUSTEES: A trustee is deemed to have investment control over the trust
unless there are at least three trustees and a majority is required for
action. A trustee has a pecuniary interest in the trust if (i) the
trustee is also a trust beneficiary, (ii) an immediate family member of
the trustee (whether or not they share the same household) is a
beneficiary, or (iii) the trustee receives certain types of
performance-based fees.
SETTLORS: If you are the settlor of a trust (that is, the person who
puts the assets into the trust), you are an indirect owner of the
trust's assets if you have a pecuniary interest in the trust AND you
have or share investment control over the trust. You are deemed to have
a pecuniary interest in the trust if you have the power to revoke the
trust without anyone else's consent or if members of your immediate
family who share your household are beneficiaries of the trust.
BENEFICIARIES. If you or a member of your immediate family who shares
your household is a beneficiary of a trust, you are deemed to have a
pecuniary interest in the trust and will therefore be deemed an indirect
owner of the trust's assets if you have or share investment control over
the trust.
REMAINDER INTERESTS. Remainder interests are those that do not take
effect until after some event that is beyond your control, such as the
death of another person. Remainder interests are typically created by
wills or trust instruments. You are NOT deemed to be an indirect owner
of securities in which you only have a remainder interest provided you
have no power, directly or indirectly, to exercise or share investment
control or any other interest.
DERIVATIVE SECURITIES. You are the indirect owner of any security you
have the right to acquire through the exercise or conversion of any
option, warrant, convertible security or other derivative security,
whether or not presently exercisable.
o INITIAL PUBLIC OFFERING (IPO) - the first offering of a company's
securities to the public through an allocation by the underwriter.
o INVESTMENT COMPANY - a company that issues securities that represent an
undivided interest in the net assets held by the company. Mutual funds
are open-end investment companies that issue and sell REDEEMABLE
securities representing an undivided interest in the net assets of the
company.
o INVESTMENT ETHICS COMMITTEE - committee that has oversight
responsibility for issues related to personal securities trading and
investment activity by Access Decision Makers. The committee is composed
of investment, legal, risk management, audit and ethics management
representatives of Mellon and its affiliates. The members of the
Investment Ethics Committee are determined by the Corporate Ethics
Officer.
o MANAGER OF THE ETHICS OFFICE - individual appointed by the Corporate
Ethics Officer to manage the Ethics Office.
o MELLON - Mellon Financial Corporation.
Page 46
GLOSSARY
--------------------------------------------------------------------------------
DEFINITIONS (CONTINUED)
o NON-DISCRETIONARY ACCOUNT - an account for which the employee has no
direct or indirect control over the investment decision making process.
Non-discretionary accounts may only be exempted from preclearance and
reporting procedures, when the Manager of the Ethics Office, after a
thorough review, is satisfied that the account is truly non-discretionary
to the employee (that is, the employee has given total investment
discretion to an investment manager and retains no ability to influence
specific trades). Standard broker accounts generally are not deemed to
be non-discretionary to the employee, even if the broker is given some
discretion to make investment decisions.
o OPTION - a security which gives the investor the right, but not the
obligation, to buy or sell a specific security at a specified price
within a specified time frame. For purposes of compliance with the
Policy, any Mellon employee who buys/sells an option, is deemed to have
purchased/sold the underlying security when the option was
purchased/sold. Four combinations are possible as described below.
Call Options
-If a Mellon employee buys a call option, the employee is
considered to have purchased the underlying security on the date
the option was purchased.
-If a Mellon employee sells a call option, the employee is
considered to have sold the underlying security on the date the
option was sold.
Put Options
-If a Mellon employee buys a put option, the employee is
considered to have sold the underlying security on the date the
option was purchased.
-If a Mellon employee sells a put option, the employee is
considered to have bought the underlying security on the date the
option was sold.
Below is a table describing the above:
Transaction Type
____________________________________________________________
Option Buy Sale
Type
____________________________________________________________
Put Sale of Underlying Purchase of Underlying
Security Security
_____________________________________________________________
Call Purchase of Underlying Sale of Underlying
Security Security
o PRECLEARANCE COMPLIANCE OFFICER - a person designated by the Manager of
the Ethics Office and/or the Investment Ethics Committee to administer,
among other things, employees' preclearance requests for a specific
business unit.
o PRIVATE PLACEMENT - an offering of securities that is exempt from
registration under various laws and rules, such as the Securities Act of
1933 in the US and the Listing Rules in the UK. Such offerings are
exempt from registration because they do not constitute a public
offering. Private placements can include limited partnerships.
o SECURITY - any investment that represents an ownership stake or debt stake
in a company, partnership, governmental unit, business or other
enterprise. It includes stocks, bonds, notes, evidences of indebtedness,
certificates of participation in any profit-sharing agreement and
certificates of deposit. It also includes many types of puts, calls,
straddles and options on any security or group of securities; fractional
undivided interests in oil, gas, or other mineral rights; "investment
contracts", "variable" life insurance policies and "variable" annuities,
whose cash values or benefits are tied to the performance of an investment
account. It does not include currencies. Unless expressly exempt, all
securities transactions are covered under the provisions of the Policy
(see definition of Exempt securities).
o SECURITIES FIRE WALL - procedures designed to restrict the flow of
information within Mellon from units or individuals who are likely to
receive material nonpublic information to units or individuals who trade
in securities or provide investment advice.
o SENIOR MANAGEMENT COMMITTEE - the Senior Management Committee of Mellon
Financial Corporation.
o SHORT SALE - the sale of a security that is not owned by the seller at the
time of the trade.
Page 47
EXHIBIT A - SAMPLE INSTRUCTION LETTER TO BROKER
Date
Broker ABC
Street Address
City, State ZIP
Re: John Smith
Account No. xxxxxxxxxxxx
To whom it may concern:
In connection with my existing brokerage account(s) with your firm, please
be advised that my employer should be noted as an "Interested Party" with
respect to my account(s). They should, therefore, be sent copies of all
trade confirmations and account statements relating to my account on a
regular basis.
Please send the requested documentation ensuring the account holder's name
appears on all correspondence to:
Manager of the Ethics Office
Mellon Financial Corporation
PO Box 3130
Pittsburgh, PA 15230-3130
Thank you for your cooperation in this request.
Sincerely yours,
Employee
cc: Manager of the Ethics Office (153-3300)
Page 48
Securities Trading Policy
Access Decision Maker Edition
September 2003
Dear Employee:
From Mellon's first day of business, in 1869, we have maintained
an uncompromising culture that practices the highest standards of
business ethics. We have built a system of guiding principles,
Mellon's Shared Values, and have encouraged employees to live
those values each day. For the benefit of our customers, our
shareholders, our communities and each other, we expect no less
than honorable behavior from one another when conducting Mellon
business.
Over the last couple of years, we have seen dramatic examples of
the damage irresponsible or unethical business behavior can have
on an individual or a corporation. To help employees make the
right decisions for Mellon and our constituents, we have
developed a comprehensive CODE OF CONDUCT and Corporate Policies
and Procedures that help guide our actions.
One of our most important policies, the SECURITIES TRADING
Policy, is intended to secure each employee's commitment to
continued service with integrity. Because your personal
investments can lead to conflicts of interest, you must fully
understand and comply with the investment guidelines contained in
Mellon's SECURITIES TRADING POLICY.
In business, building a reputation of integrity can take the hard
work of many employees over many years. As recent high-profile
business failures have demonstrated, it doesn't take nearly as
much time or as many employees to damage or altogether destroy
that reputation.
At Mellon, maintaining the reputation we've earned for more than
130 years of honest, open business practices is the
responsibility of every employee. We can do so by remaining
diligent in our strict adherence to Mellon's CODE OF CONDUCT and
all of Mellon's Corporate Policies and Procedures, particularly
the SECURITIES TRADING POLICY. If you are new to Mellon, please
take the time to fully understand the policy, and consult it
whenever you are unsure about appropriate activity. If you have
seen the policy before, I urge you to renew your understanding of
the entire document and the ways in which it applies to you.
Sincerely yours,
/s/ MARTY
Marty McGuinn
Chairman and Chief Executive Officer
TABLE OF CONTENTS-ACCESS DECISION MAKERS
------------------------------------------------------------------------
PAGE #
QUICK REFERENCE - ACCESS DECISION MAKERS 1
INTRODUCTION 2
CLASSIFICATION OF EMPLOYEES 3
Access Decision Maker (ADM) 3
Micro-Cap Access Decision Maker 3
Consultants, Independent Contractors and Temporary 3
Employees
3
THE INVESTMENT ETHICS COMMITTEE
4-12
STANDARDS OF CONDUCT FOR ACCESS DECISION MAKERS 4
- Conflict of Interest 4
- Material Nonpublic Information 4
- Personal Securities Transaction Reports 5
- Statement of Securities Accounts and Holdings 5
- Quarterly Reporting 6
- Preclearance for Personal Securities Transactions 7
- Special Standards for Preclearance Compliance 7
Officers 8
- Special Rules for MCADMs 9
- Contemporaneous Disclosure 10
- 7-Day Blackout Policy 10
- Exemptions from Requirement to Preclear 11
- Gifting of Securities 11
- Ownership 11
- Non-Mellon Employee Benefit Plans 12
- DRIPs, DPPs and AIPs 12
- Investment Clubs and Private Investment Companies 12
- Restricted List
- Confidential Treatment 13-14
13
RESTRICTIONS ON TRANSACTIONS IN MELLON SECURITIES 14
- General Restrictions 14
- Mellon 401(k) Plan 14
- Mellon Employee Stock Options
- Mellon Employee Stock Purchase Plan (ESPP) 15-17
15
RESTRICTIONS ON TRANSACTIONS IN OTHER SECURITIES 15
- Customer Transactions 15
- Excessive Trading, Naked Options 15
- Front Running 15
- Initial Public Offerings 15-16
- Material Nonpublic Information 16
- Private Placements 16
- Scalping 16
- Short-Term Trading 16
- Spread Betting 17
- Prohibition on Investments in Securities of
Financial Services Organizations 18-19
18-19
PROTECTING CONFIDENTIAL INFORMATION 19
- Insider Trading and Tipping Legal Prohibitions 19
- Mellon's Policy
- Restrictions on the Flow of Information Within 20-23
Mellon (The "Securities Fire Wall")
24
GLOSSARY DEFINITIONS
EXHIBIT A - SAMPLE LETTER TO BROKER
[Download Table]
QUICK REFERENCE-ACCESS DECISION MAKERS
--------------------------------------------------------------------------------
SOME THINGS YOU MUST DO SOME THINGS YOU MUST NOT DO
STATEMENT OF ACCOUNTS AND HOLDINGS - MELLON SECURITIES - The following
Provide to the Preclearance Compliance transactions in Mellon securities are
Officer or his/her designee a statement prohibited for all Mellon employees:
of all securities accounts and holdings o short sales
within 10 days of becoming an ADM and o purchasing and selling or selling
again annually on request. In addition, and purchasing within 60 days
provide to the Preclearance Compliance o margin purchases or options other
Officer or his/her designee within 30 than employee options
days after every quarter-end thereafter
a report for requested securities NON-MELLON SECURITIES
holdings. o portfolio Managers are prohibited
from purchasing or selling the
DUPLICATE STATEMENTS & CONFIRMATIONS - same or equivalent security 7
Instruct your broker, trust account days before or after a fund or
manager or other entity through which other advised account
you have a securities trading account to transaction
send directly to the Preclearance o for all ADMs, purchasing and
Compliance Officer or his/her designee: selling or selling and
o trade confirmations summarizing purchasing the same or
each transaction equivalent security within 60
o periodic statements days is discouraged, and any
profits must be disgorged
Exhibit A can be used to notify your o new investments in financial
broker or account manager. Contact the services organizations are
Preclearance Compliance Officer for the prohibited for CERTAIN
correct address. This applies to all employees- see Page 17
accounts in which you have direct or
indirect ownership (see Glossary). OTHER RESTRICTIONS are detailed
throughout the Policy. Read the Policy!
===============
PRECLEARANCE - Before initiating a
securities transaction, written EXEMPTIONS
----------
preclearance must be obtained from the
Preclearance Compliance Officer. Preclearance is NOT required for:
Contact the Preclearance Compliance o transactions in Exempt securities
Officer for applicable approval (see Glossary)
procedures. o transactions in non-affiliated,
closed-end investment companies
If preclearance approval is received, o transactions in non-financial
the trade must be communicated to the commodities (such as
broker on the same day and executed agricultural futures, metals,
before the end of the next business day, oil, gas, etc.), currency
at which time the preclearance approval futures, financial futures
will expire. o transactions in index securities
o transactions in approved accounts
CONTEMPORANEOUS DISCLOSURE - ADMs must in which the employee has no
--------------------------
obtain written authorization from the direct or indirect influence or
ADM's Chief Investment Officer (CIO) or control over the investment
other Investment Ethics Committee (IEC) decision making process
designee prior to making or acting upon o involuntary transactions on the
a portfolio recommendation in a security part of an employee (such as
which they own directly or indirectly. stock dividends or sales of
Contact the Preclearance Compliance fractional shares)
Officer for available forms. o changes in elections under
Mellon's 401(k) Retirement
PRIVATE PLACEMENTS -Acquisition of Savings Plan
securities in a Private Placement must o enrollment, changes in salary
be precleared by the IEC. Prior withholding percentages and
holdings must be approved by the IEC sales of shares held in
within 90 days of becoming an ADM. To Mellon's Employee Stock
initiate preclearance or approval, Purchase Plan (ESPP); sales of
contact the Ethics Office. shares previously withdrawn
from the ESPP do require
IPOS - Acquisition of securities through preclearance
----
an allocation by the underwriter of an o receipt and exercise of an
Initial Public Offering (IPO) is employee stock option
prohibited without the approval of the administered through Human
Manager of the Ethics Office. Approval Resources
can be given only when the allocation is o automatic reinvestment of
the result of a direct family dividends under a Dividend
relationship. Reinvestment Plan (DRIP) or
Automatic Investment Plan
MICRO-CAP SECURITIES - Unless approved (AIP); initial share purchase
--------------------
by the IEC, Micro-Cap ADMs (MCADMs) are and optional cash purchases
prohibited from purchasing any security under a DRIP or Direct Purchase
of an issuer with low common equity Plan (DPP) do require
market capitalization (at the time of preclearance, as do sales of
acquisition). Securities with the shares acquired through a DRIP,
following market caps are subject to DPP or AIP
this prohibition: o sales pursuant to a bona fide
o in the US, $100 million or less tender offer and sales or
o in the UK,(POUND)60 million or less exercises of "rights" (see Page
10)
MCADMs must obtain, on their
Preclearance Request Form, the written QUESTIONS?
----------
authorization of their immediate
supervisor and their CIO prior to Contact Mellon's Ethics Office at:
trading any security of an issuer with o The Securities Trading Policy
low common equity market Help Line: 1-412-234-1661
capitilization. Securities with the o Mellon's Ethics Help Line
following market caps are subject to - Toll Free Telephone
this requirement: o Asia (except Japan):
o in the US, more than $100 million 001-800-710-63562
but less than or equal to $250 million o Australia: 0011-800-710-63562
o in the UK, more than(pound)60 million o Brazil: 0800-891-3813
but less than or equal to(pound) o Europe: 00-800-710-63562
150 million o Japan: international
access code
+ 800-710-63562 (codes are:
Any prior holding of such securities 0061010, 001010, 0041010 or
must be approved by the CIO. 0033010)
o US and Canada: 1-888-MELLON2
(1-888-635-5662)
o All other locations: call
collect to 412-236-7519
- Email: ethics@mellon.com
- Postal Mail: PO Box 535026
Pittsburgh, PA 15253-5026 USA
THIS PAGE IS FOR REFERENCE PURPOSES ONLY. EMPLOYEES ARE REMINDED THEY MUST READ
THE POLICY AND COMPLY WITH IT.
Page 1
INTRODUCTION
--------------------------------------------------------------------------------
The SECURITIES TRADING POLICY (the "Policy") is designed to
reinforce Mellon Financial Corporation's ("Mellon's")
reputation for integrity by avoiding even the appearance of
impropriety in the conduct of Mellon's business. The
Policy sets forth procedures and limitations which govern
the personal securities transactions of every Mellon
employee.
Mellon and its employees are subject to certain laws and
regulations governing personal securities trading. Mellon
has developed the Policy to promote the highest standards
of behavior and ensure compliance with applicable laws.
This Policy covers the personal trading activities of all
employees in their own accounts and in accounts in which
they have indirect ownership. While employees should
consult the Glossary for a complete definition of the terms
"security" and "indirect ownership", in general they mean:
o SECURITY - any investment that represents an
ownership stake or debt stake in a company or
government. While the Policy provides for exemptions
for certain securities, if not expressly exempt in the
Policy, all securities are covered (see Glossary for
definition of Exempt securities)
o INDIRECT OWNERSHIP - you are presumed to have
indirect ownership of accounts held by members of your
family with whom you share a household. This includes
your spouse, your children, and any other family members
in your home. Generally, you are deemed to be the
indirect owner of securities if you have the opportunity
to directly or indirectly share, at any time, in profits
derived from transactions in such securities
Employees should be aware that they may be held personally
liable for any improper or illegal acts committed during
the course of their employment and that "ignorance of the
law" is not a defense. Employees may be subject to civil
penalties such as fines, regulatory sanctions including
suspensions, as well as criminal penalties.
The provisions of the Policy have worldwide applicability
and cover trading in any part of the world. Employees are
also subject to applicable laws of jurisdictions in those
countries in which they conduct business. To the extent any
particular portion of the Policy is inconsistent with, or
in particular less restrictive than such laws, employees
should consult the General Counsel or the Manager of the
Ethics Office.
The Policy may be amended and any provision waived or
exempted only at the discretion of the Manager of the
Ethics Office. Any such waiver or exemption will be
evidenced in writing and maintained in the Ethics Office.
Employees must read the Policy and must comply with it - in
this regard, employees should comply with the spirit of the
Policy as well as the strict letter of its provisions.
Failure to comply with the Policy may result in the
imposition of serious sanctions, including but not limited
to disgorgement of profits, dismissal, substantial personal
liability and referral to law enforcement agencies or other
regulatory agencies. Employees should retain the Policy in
their records for future reference. Any questions
regarding the Policy should be referred to the Manager of
the Ethics Office or his/her designee.
SPECIAL EDITION This edition of the Policy has been prepared especially for
Access Decision Makers. If you believe you are not an
Access Decision Maker, please contact your supervisor,
Preclearance Compliance Officer, the Manager of the Ethics
Office or access Mellon's Intranet to obtain the general
edition of the Policy.
PURPOSE It is imperative that Mellon and its affiliates avoid even
the appearance of a conflict between the personal
securities trading of its employees and its fiduciary
duties to investment companies and managed account
clients. Potential conflicts of interest are most acute
with respect to personal securities trading by those
employees most responsible for directing managed fund and
account trades: portfolio managers and research analysts.
To avoid even the appearance of impropriety, an Investment
Ethics Committee has been formed. The Committee, in turn,
has established the following practices which apply to
Access Decision Makers. These practices do not limit the
authority of any Mellon affiliate to impose additional
restrictions or limitations.
Page 2
CLASSIFICATION OF EMPLOYEES
--------------------------------------------------------------------------------
Employees are engaged in a wide variety of activities
for Mellon. In light of the nature of their activities
and the impact of various laws and regulations, the
Policy imposes different requirements and limitations on
employees based on the nature of their activities for
Mellon. To assist the employees who are portfolio
managers and research analysts in complying with the
requirements and limitations imposed on them in light of
their activities, employees are classified into one or
both of the following categories:
o Access Decision Maker
o Micro-Cap Access Decision Maker
Appropriate requirements and limitations are specified
in the Policy based upon the employee's classification.
The Investment Ethics Committee will determine and
designate the classification of each employee based on
the following guidelines.
ACCESS DECISION MAKER Generally this will be portfolio managers and research
(ADM) analysts who make recommendations or decisions regarding
the purchase or sale of equity, convertible debt, and
non-investment grade debt securities for mutual funds
and other managed accounts. Neither traders nor
portfolio managers of funds which are limited to
replicating an index are ADMs.
MICRO-CAP ACCESS Generally this will be ADMs who make recommendations or
DECISION MAKER (MCADM) decisions regarding the purchase or sale of any security
of an issuer with a low common equity market
capitalization. In the US, the market cap is equal to
or less than $250 million and in the UK the market cap
is equal to or less than (pound)150 million. MCADMs are
also ADMs.
CONSULTANTS, Managers should inform consultants, independent
INDEPENDENT contractors and temporary employees of the general
CONTRACTORS AND provisions of the Policy (such as the prohibition on
TEMPORARY EMPLOYEES trading while in possession of material nonpublic
information). Whether or not a consultant, independent
contractor or temporary employee will be required to
preclear trades or report their personal securities
holdings will be determined on a case-by-case basis. If
one of these persons would be considered an ADM and the
person were a Mellon employee, the person's manager
should advise the Manager of the Ethics Office who will
determine whether such individual should be subject to
the preclearance and reporting requirements of the
Policy.
THE INVESTMENT ETHICS COMMITTEE (IEC)
The IEC is composed of investment, legal, risk
management, and audit & ethics management
representatives of Mellon and its affiliates. The chief
executive officer, senior investment officer and the
Preclearance Compliance Officer at each Mellon
investment affiliate, working together, will be
designees of the IEC. The IEC will meet periodically to
review the actions taken by its designees and to
consider issues related to personal securities trading
and investment activity by ADMs.
Page 3
PERSONAL SECURITIES TRADING PRACTICES-ACCESS DECISION MAKERS
--------------------------------------------------------------------------------
STANDARDS OF CONDUCT FOR ACCESS DECISION MAKERS
Because of their particular responsibilities, ADMs are
subject to preclearance and personal securities
reporting requirements, as discussed below.
Every ADM must follow these procedures or risk serious
sanctions, including dismissal. If you have any
questions about these procedures, you should consult the
Ethics Office or the Preclearance Compliance Officer.
Interpretive issues that arise under these procedures
shall be decided by, and are subject to the discretion
of, the Manager of the Ethics Office.
CONFLICT OF INTEREST No employee may engage in or recommend any securities
transaction that places, or appears to place, his or her
own interests above those of any customer to whom
financial services are rendered, including mutual funds
and managed accounts, or above the interests of Mellon.
MATERIAL NONPUBLIC No employee may divulge the current portfolio positions,
INFORMATION or current or anticipated portfolio transactions,
programs or studies, of Mellon or any Mellon customer to
anyone unless it is properly within his or her job
responsibilities to do so.
No employee may engage in or recommend a securities
transaction, for his or her own benefit or for the
benefit of others, including Mellon or its customers,
while in possession of material nonpublic information
regarding such securities or the issuer of such
securities. No employee may communicate material
nonpublic information to others unless it is properly
within his or her job responsibilities to do so.
PERSONAL SECURITIES STATEMENTS & CONFIRMATIONS - All ADMs are required to
TRANSACTION REPORTS instruct their broker, trust account manager or other
entity through which they have a securities trading
account to submit directly to the Preclearance
Compliance Officer or his/her designee, copies of all
trade confirmations and statements relating to each
account of which they are an owner (direct or indirect)
regardless of what, if any, securities are maintained in
such accounts. Thus, even if the account contains only
mutual funds or other Exempt securities as that term is
defined by the Policy, but the account has the
capability to have reportable securities traded in it,
the ADM must arrange for duplicate account statements
and trade confirmations to be sent to the Preclearance
Compliance Officer or his/her designee. Exhibit A is an
example of an instruction letter to a broker.
OTHER SECURITIES TRANSACTIONS which were not completed
through an account, such as gifts, inheritances and
spin-offs from securities held outside accounts, or
other transfers must be reported to the Preclearance
Compliance Officer or his/her designee within 10 days of
the transaction.
Page 4
PERSONAL SECURITIES TRADING PRACTICES-ACCESS DECISION MAKERS
--------------------------------------------------------------------------------
STATEMENT OF Within ten days of becoming an ADM and on an annual
SECURITIES ACCOUNTS basis thereafter, all ADMs must submit to the
AND HOLDINGS Preclearance Compliance Officer or his/her designee:
o a listing of all accounts that may trade
reportable securities in which the employee is a
direct or indirect owner regardless of what, if any,
securities are maintained in such accounts. Thus,
for example, even if the account contains only mutual
funds or other Exempt securities (see Glossary) but
has the capability of holding reportable securities,
the account must be disclosed
o a statement of all securities held outside of
securities trading accounts in which the employee
presently has any direct or indirect ownership other
than Exempt securities (see Glossary)
The annual report must be completed upon the request of
the Ethics Office, and the information submitted must be
current within 30 days of the date the report is
submitted. The annual statement of securities holdings
contains an acknowledgment that the ADM has read and
complied with the Policy.
QUARTERLY REPORTING ADMs are required to submit quarterly to the
Preclearance Compliance Officer or his/her designee the
Quarterly Securities Report. This report must be
submitted within 30 days of each quarter end and
includes information on:
o securities directly or indirectly owned at any
time during the quarter which were also either
recommended for a transaction or in the portfolio
managed by the ADM during the quarter
o positions obtained in private placements
o securities of issuers owned directly or indirectly
at any time during the quarter which at the time of
acquisition or at the date designated by the
Preclearance Compliance Officer (whichever is later)
had a market capitalization that was equal to or less
than:
- in the US, $250 million
- in the UK, (pound)150 million
o securities transactions which were not completed
through a securities account, such as gifts,
inheritances, spin-offs from securities held outside
securities accounts, or other transfers
A form for making this report can be obtained from the
Preclearance Compliance Officer or from the Securities
Trading Policy website on Mellon's intranet.
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PRECLEARANCE FOR All ADMs must notify the Preclearance Compliance Officer
PERSONAL SECURITIES in writing and receive preclearance before they engage
TRANSACTIONS in any purchase or sale of a security for their own
accounts or in accounts in which they are an indirect
owner. ADMs should refer to the provisions under "
Ownership" on Page 11, which are applicable to these
provisions.
All requests for preclearance for a securities
transaction shall be submitted by completing a
Preclearance Request Form.
The Preclearance Compliance Officer will notify the ADM
whether the request is approved or denied, without
disclosing the reason for such approval or denial.
Notifications may be given in writing or verbally by the
Preclearance Compliance Officer to the ADM. A record of
such notification will be maintained by the Preclearance
Compliance Officer. However, it shall be the
responsibility of the ADM to obtain a written record of
the Preclearance Compliance Officer's notification
within 24 hours of such notification. The ADM should
retain a copy of this written record for at least two
years.
As there could be many reasons for preclearance being
granted or denied, ADMs should not infer from the
preclearance response anything regarding the security
for which preclearance was requested.
Although making a preclearance request does not obligate
an ADM to do the transaction, it should be noted that:
o preclearance requests should not be made for a
transaction that the ADM does not intend to make
o the order for a transaction must be placed with
the broker on the same day that preclearance
authorization is received. The broker must execute
the trade by the close of business on the next
business day, at which time the preclearance
authorization will expire
o ADMs should not discuss with anyone else, inside
or outside Mellon, the response they received to a
preclearance request. If the ADM is preclearing as
an indirect owner of another's account, the response
may be disclosed to the other owner
o standard orders to trade at certain prices
(sometimes called "limit", "stop-loss",
"good-until-cancelled", or "standing buy/sell"
orders) must be precleared, and security transactions
receiving preclearance authorization must be executed
before the preclearance expires. At the end of the
preclearance authorization period, any unexecuted
order must be canceled or a new preclearance
authorization must be obtained
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SPECIAL STANDARDS ADMs will generally not be given clearance to execute a
FOR PRECLEARANCE transaction in any security that is on the restricted
COMPLIANCE OFFICERS list maintained by the Preclearance Compliance Officer or
for which there is a pending buy or sell order for an
affiliated account. This provision does not apply to
transactions effected or contemplated by index funds.
The Preclearance Compliance Officer may approve certain
de minimus transactions even when the firm is trading
such securities. However, de minimus transactions
require preclearance approval. The following transaction
limits are available for this exemption:
o in the US, transactions in the amount of $10,000 or
100 shares, whichever is greater, of the top 500
issuers on the Russell List of largest publicly traded
companies or other companies with a market
capitalization of $5 billion or higher
o in the UK, transactions in the amount of (pound)6
thousand or 100 shares, whichever is greater, of
companies ranked in the top 100 of the FTSE All Share
Index or other companies with a market capitalization
of (pound)3 billion or higher
The following restrictions or conditions are imposed upon
the above described transactions:
o employees must cooperate with the Preclearance
Compliance Officer's request to document market
capitalization amounts
o approval is limited to two such trades in the
securities of any one issuer in any calendar month
o short-term profit disgorgement is NOT waived for
such transactions
o preclearance is required prior to executing the
transaction
SPECIAL RULES FOR ADMs who are designated as MCADMs have additional
MCADMS restrictions when voluntarily acquiring, both directly
and indirectly, securities of issuers with low common
equity market capitalization. The thresholds for these
restrictions are:
o in the US, securities with a market cap equal to or
less than $250 million
o in the UK, securities with a market cap equal to or
less than (pound)150 million
Newly designated MCADMs must obtain CIO/CEO authorization
to continue holding such securities. The MCADM must
indicate on their next Quarterly Securities Report that
approval to continue holding such securities has not yet
been received. The Preclearance Compliance Officer will
then request appropriate approvals.
MCADMs are prohibited from voluntarily acquiring the
following securities without express written approval
from the Investment Ethics Committee:
o in the US, securities with a market cap of $100
million or less
o in the UK, securities with a market cap of(pound)60
million or less
Involuntary acquisitions of such securities (such as
those acquired through inheritance, gift or spin-off)
must be disclosed in a memo to the Preclearance
Compliance Officer within 10 days of the involuntary
acquisition. This memo must be attached to the next
Quarterly Securities Report filed by the MCADM.
MCADMs must obtain written approval, on the Preclearance
Request Form, from both their immediate supervisor and
their Chief Investment Officer before voluntarily buying
or selling the following:
o in the US, securities with a market cap of more
than $100 million but less than or equal to $250
million
o in the UK, securities with a market cap of more
than (pound)60 million but less than or equal to
(pound)150 million
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CONTEMPORANEOUS ADMs must obtain written authorization prior to making or
DISCLOSURE acting upon a portfolio recommendation (including
recommendations to "hold") in a security which they own
directly or indirectly. This authorization must be
obtained from the ADM's CIO, CEO or other IEC designee
prior to the first such portfolio recommendation or
transaction in a particular security in a calendar
month. The following personal securities holdings are
exempt from the requirement to obtain written
authorization preceding a portfolio recommendation or
transaction:
o Exempt securities (see Glossary)
o securities held in accounts over which the ADM has
no investment discretion, which are professionally \
managed by a non-family member, and where the ADM
has no actual knowledge that such account is
currently holding the same or equivalent security at
the time of the portfolio recommendation or
transaction
o personal holdings of equity securities of the
following:
- in the US, the top 200 issuers on the Russell list
of largest publicly traded companies and other
companies with a market capitalization of $20
billion or higher
- in the UK, the top 100 companies on the FTSE All
Share Index and other companies with a market
capitalization of (pound)10 billion or higher
o personal holdings of debt securities which do not
have a conversion feature and are rated investment
grade BBB or better
o personal holdings of ADMs who are index fund
managers and who have no investment discretion in
replicating an index
o personal holdings of Portfolio Managers in Mellon
Private Wealth Management if the Portfolio Manager
exactly replicates the model or clone portfolio. A
disclosure form is required if the Portfolio Manager
recommends securities which are not in the clone or
model portfolio or recommends a model or clone
security in a different percentage than model or
clone amounts. Disclosure forms are also required
when the Portfolio Manager recommends individual
securities to clients, even if Mellon shares control
of the investment process with other parties
If a personal securities holding does not fall under one
of these exemptions, the ADM must complete and forward a
disclosure form for authorization by the CIO or designee,
prior to the first recommendation or transaction in the
security in the current calendar month. Disclosure
forms for subsequent transactions in the same security
are not required for the remainder of the calendar month
so long as purchases (or sales) in all portfolios do not
exceed the maximum number of shares, options, or bonds
disclosed on the disclosure form. If the ADM seeks to
effect a transaction or makes a recommendation in a
direction opposite to the most recent disclosure form, a
new disclosure form must be completed prior to the
transaction or recommendation.
Once the CIO authorization is obtained, the ADM may make
the recommendation or trade the security in the managed
portfolio without the Preclearance Compliance Officer's
signature. However, the ADM must deliver the
authorization form to the Preclearance Compliance Officer
on the day of the CIO's authorization. The Preclearance
Compliance Officer will forward a copy of the completed
form for the ADM's files. The ADM is responsible for
following-up with the Preclearance Compliance Officer in
the event a completed form is not returned to the ADM
within 5-business days. It is recommended that the ADM
retain completed forms for two years.
A listing of Investment Ethics Committee designees and
the personal securities disclosure forms are available on
the Mellon intranet, or can be obtained from your
Preclearance Compliance Officer.
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7-DAY BLACKOUT POLICY Portfolio managers (except index fund managers) are
prohibited from buying or selling a security within
7-calendar days before and after their investment company
or managed account has effected a transaction in that
security. In addition to other appropriate sanctions, if
such ADMs effect such personal transactions during that
period, these individuals must disgorge any and all
profit realized from such transactions, in accordance
with procedures established by the Investment Ethics
Committee, except that the following transactions will
not be subject to disgorgement:
o in the US, transactions in the amount of $10,000 or
100 shares, whichever is greater, of the top 500
issuers on the Russell List of largest publicly
traded companies or other companies with a market
capitalization of $5 billion or higher
o in the UK, transactions in the amount of (pound)6
thousand or 100 shares, whichever is greater, of
companies ranked in the top 100 of the FTSE All
Share Index or other companies with a market
capitalization of (pound)3 billion or higher
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PERSONAL SECURITIES TRADING PRACTICES-ACCESS DECISION MAKERS
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EXEMPTIONS FROM Preclearance by ADMs is not required for the following
REQUIREMENT TO transactions:
PRECLEAR
o purchases or sales of Exempt securities (generally
means direct obligations of the governments of the
United States and United Kingdom; commercial paper;
high-quality, short-term debt instruments; banker's
acceptances; bank certificates of deposits and time
deposits; repurchase agreements; securities issued
by open-end investment companies, which for this
purpose includes open-end mutual funds and variable
capital companies; fixed and variable annuities; and
unit trusts (see Glossary for definition of Exempt
securities))
o purchases or sales of non-affiliated, closed-end
investment companies
o purchase or sales of non-financial commodities (such
as agricultural futures, metals, oil, gas, etc.),
currency futures, financial futures
o purchases or sales of index securities (sometimes
referred to as exchange traded funds)
o purchases or sales effected in accounts in which an
employee has no direct or indirect influence or
control over the investment decision making process
("non-discretionary accounts"). Non-discretionary
accounts may only be exempted from preclearance
procedures, when the Manager of the Ethics Office,
after a thorough review, is satisfied that the
account is truly non-discretionary to the employee
(that is, the employee has given total investment
discretion to an investment manager and retains no
ability to influence specific trades). Standard
broker accounts generally are not deemed to be
non-discretionary to the employee, even if the
broker is given some discretion to make investment
decisions
o transactions that are involuntary on the part of an
employee, such as stock dividends or sales of
fractional shares; however, sales initiated by
brokers to satisfy margin calls are not considered
involuntary and must be precleared
o the sale of Mellon stock received upon the exercise
of an employee stock option if the sale is part of a
"netting of shares" or "cashless exercise"
administered through the Human Resources Department
o changes to elections in the Mellon 401(k) plan
o enrollment, changes in salary withholding
percentages and sales of shares held in the Mellon
Employee Stock Purchase Plan (ESPP); sales of shares
previously withdrawn from the ESPP do require
preclearance
o purchases effected upon the exercise of rights
issued by an issuer pro rata to all holders of a
class of securities, to the extent such rights were
acquired from such issuer
o sales of rights acquired from an issuer, as
described above
o sales effected pursuant to a bona fide tender offer
o automatic reinvestment of dividends under a Dividend
Reinvestment Plan (DRIP) or Automatic Investment
Plan (AIP); initial share purchase and optional cash
purchases under a DRIP or Direct Purchase Plan (DPP)
must be precleared as do sales of shares acquired
through a DRIP, DPP or AIP
GIFTING OF SECURITIES ADMs desiring to make a bona fide gift of securities or
who receive a bona fide gift of securities, including an
inheritance, do not need to preclear the transaction.
However, ADMs must report such bona fide gifts to the
Preclearance Compliance Officer or his/her designee.
The report must be made within 10 days of making or
receiving the gift and must disclose the following
information: the name of the person receiving (giving)
the gift; the date of the transaction; and the name of
the broker through which the transaction was effected.
A bona fide gift is one where the donor does not receive
anything of monetary value in return. An ADM who
purchases a security with the intention of making a gift
must preclear the purchase transaction.
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PERSONAL SECURITIES TRADING PRACTICES-ACCESS DECISION MAKERS
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OWNERSHIP The preclearance, reporting and other provisions of the
Policy apply not only to securities held in the
employee's own name but also to all other securities
indirectly owned by the employee (see Glossary for
definition of indirect owner). Generally you are the
indirect owner of securities if you have the
opportunity, directly or indirectly, to share in any
profits from a transaction in those securities. This
could include:
o securities held by members of your family who share
the same household with you
o securities held by a trust in which you are a
settler, trustee, or beneficiary
o securities held by a partnership in which you are a
general partner
o securities in which any contract, arrangement,
understanding or relationship gives you direct or
indirect economic interest
NON-MELLON EMPLOYEE With the exception of the provisions in the Policy
BENEFIT PLANS regarding Contemporaneous Disclosures and Quarterly
Reporting, the Policy does not apply to transactions
done under a bona fide employee benefit plan of an
organization not affiliated with Mellon by an employee
of that organization who shares ownership interest with
a Mellon employee. This means if a Mellon employee's
spouse is employed at a non-Mellon company, the Mellon
employee is not required to obtain approval for
transactions IN THE EMPLOYER'S SECURITIES done by the
spouse as part of the spouse's employee benefit plan.
In such situations, the spouse's employer has primary
responsibility for providing adequate supervision with
respect to conflicts of interest and compliance with
securities laws regarding its own employee benefit
plans.
However, employee benefit plans which allow the
employee to buy or sell securities other than those of
their employer are subject to the Policy, including the
preclearance and reporting provisions.
DRIPS, DPPS AND AIPS Certain companies with publicly traded securities
establish:
o Dividend Reinvestment Plans (DRIPs) - These permit
shareholders to have their dividend payments
channeled to the purchase of additional shares of
such company's stock. An additional benefit offered
to DRIP participants is the right to buy additional
shares by sending in a check before the dividend
reinvestment date ("optional cash purchases").
o Direct Purchase Plans (DPPs) - These allow
purchasers to buy stock by sending a check directly
to the issuer, without using a broker.
o Automatic Investment Plans (AIPs) - These allow
purchasers to set up a plan whereby a fixed amount
of money is automatically deducted from their
checking account each month and used to purchase
stock directly from the issuer.
Participation in a DRIP, DPP or AIP is voluntary.
ADMs who enroll in a DRIP or AIP are required to
preclear the initial enrollment in the plan when
accompanied by an initial share purchase transaction.
However, the periodic reinvestment of dividend payments
into additional shares of company stock through a DRIP,
or the periodic investments through an AIP are not
required to be precleared.
ADMs must preclear all optional cash purchases through
a DRIP and all purchases through a DPP. ADMs must also
preclear all sales through a DRIP, DPP or AIP.
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INVESTMENT CLUBS AND Certain organizations create a unique means of
PRIVATE INVESTMENT investing:
COMPANIES
o Investment Clubs - a membership organization where
investors make joint decisions on which securities
to buy or sell. The securities are generally held in
the name of the investment club. Since each member
of the investment club participates in the
investment decision making process, ADMs belonging
to such a club must preclear and report the
securities transactions of the club.
o Private Investment Company - an investment company
(see Glossary) whose shares are not deemed to be
publicly held (sometimes called "hedge funds"). ADMs
investing in such a private investment company are
not required to preclear any of the securities
transactions made by the private investment company.
However, ADMs' investments in Private Investment
Companies are considered to be private placements
and approval must be received prior to investing.
Employees should refer to the Private Placement
provision of the Policy on Pages 15 and 16 for
approval requirements.
RESTRICTED LIST The Preclearance Compliance Officer will maintain a
list (the "Restricted List") of companies whose
securities are deemed appropriate for implementation of
trading restrictions for ADMs in his/her area. From
time to time, such trading restrictions may be
appropriate to protect Mellon and its ADMs from
potential violations, or the appearance of violations,
of securities laws. The inclusion of a company on the
Restricted List provides no indication of the
advisability of an investment in the company's
securities or the existence of material nonpublic
information on the company. Nevertheless, the contents
of the Restricted List will be treated as confidential
information to avoid unwarranted inferences.
The Preclearance Compliance Officer will retain copies
of the restricted lists for six years.
CONFIDENTIAL TREATMENT The Manager of the Ethics Office and/or Preclearance
Compliance Officer will use his or her best efforts to
assure that all requests for preclearance, all personal
securities transaction reports and all reports of
securities holdings are treated as "Personal and
Confidential." However, such documents will be
available for inspection by appropriate regulatory
agencies, and by other parties within and outside
Mellon as are necessary to evaluate compliance with or
sanctions under the Policy. Documents received from
ADMs are also available for inspection by the boards of
directors, trustees or managing general partners of any
Mellon entity regulated by certain investment company
laws.
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PERSONAL SECURITIES TRADING PRACTICES-ACCESS DECISION MAKERS
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RESTRICTIONS ON TRANSACTIONS IN MELLON SECURITIES
ADM Employees who engage in transactions involving
Mellon securities should be aware of their unique
responsibilities with respect to such transactions
arising from the employment relationship and should be
sensitive to even the appearance of impropriety.
The following restrictions apply to all transactions in
Mellon's publicly traded securities occurring in the
employee's own account and in all other accounts over
which the employee has indirect ownership. These
restrictions are to be followed in addition to any
restrictions that apply to particular senior officers
or directors of Mellon such as restrictions under
Section 16 of the Securities Exchange Act of 1934.
o SHORT SALES - Short sales of Mellon securities by
employees are prohibited.
o SHORT-TERM TRADING - ADMs are prohibited from
purchasing and selling, or from selling and
purchasing Mellon securities within any 60-calendar
day period. In addition to any other sanctions, any
profits realized on such short-term trades must be
disgorged in accordance with procedures established
by senior management.
o MARGIN TRANSACTIONS - Purchases on margin of
Mellon's publicly traded securities by employees is
prohibited. Margining Mellon securities in
connection with a cashless exercise of an employee
stock option through the Human Resources Department
is exempt from this restriction. Further, Mellon
securities may be used to collateralize loans for
non-securities purposes or for the acquisition of
securities other than those issued by Mellon.
o OPTION TRANSACTIONS - Option transactions involving
Mellon's publicly traded securities are prohibited.
Transactions under Mellon's Long-Term Incentive Plan
or other employee option plans are exempt from this
restriction.
o MAJOR MELLON EVENTS - Employees who have knowledge
of major Mellon events that have not yet been
announced are prohibited from buying or selling
Mellon's publicly traded securities before such
public announcements, even if the employee believes
the event does not constitute material nonpublic
information.
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PERSONAL SECURITIES TRADING PRACTICES-ACCESS DECISION MAKERS
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MELLON 401(K) PLAN For purposes of the short-term trading rule, employees
changing their existing account balance allocation to
increase or decrease the amount allocated to Mellon
Common Stock will be treated as a purchase or sale of
Mellon Stock, respectively. This means employees are
prohibited from increasing their existing account
balance allocation to Mellon Common Stock and then
decreasing it within 60 days. Similarly, employees are
prohibited from decreasing their existing account
balance allocation to Mellon Common Stock and then
increasing it within 60 days. However:
o with respect to ADMs, any profits realized on
short-term changes in the 401(k) will not have to be
disgorged
o changes to existing account balance allocations in
the 401(k) plan will not be compared to transactions
in Mellon securities outside the 401(k) for purposes
of the 60-day rule. (Note: This does not apply to
members of the Executive Management Group, who should
consult with the Legal Department)
Except for the above, there are no other restrictions
applicable to the 401(k) plan. This means, for example:
o employees are not required to preclear any elections
or changes made in their 401(k) account
o there is no restriction on employees changing their
salary deferral contribution percentages with regard
to the 60-day rule
o the regular salary deferral contribution to Mellon
Common Stock in the 401(k) that takes place with each
pay will not be considered a purchase for the 60-day
rule
MELLON EMPLOYEE RECEIPT or EXERCISE of an employee stock option from
STOCK OPTIONS Mellon is exempt from reporting and preclearance
requirements and does not constitute a purchase for
purposes of the 60-day prohibition.
SALES - The sale of the Mellon securities that were
received in the exercise of an employee stock option is
treated like any other sale under the Policy, regardless
of how little time has elapsed between the option
exercise and the sale. Thus, such sales are subject to
the preclearance and reporting requirements and are
considered sales for purposes of the 60-day prohibition.
MELLON EMPLOYEE ENROLLMENT and CHANGING SALARY WITHHOLDING PERCENTAGES
STOCK PURCHASE PLAN in the ESPP are exempt from preclearance and reporting
(ESPP) requirements and do not constitute a purchase for
purposes of the 60-day prohibition.
SELLING SHARES HELD IN THE ESPP - ADMs are not required
to preclear or report sales of stock held in the ESPP,
including shares acquired upon reinvestment of
dividends. However, sale of stock held in the ESPP is
considered a sale for purposes of the 60-day prohibition
and will be compared to transactions in Mellon
securities outside of the ESPP.
SELLING SHARES PREVIOUSLY WITHDRAWN - The sale of the
Mellon securities that were received as a withdrawal
from the ESPP is treated like any other sale under the
Policy, regardless of how little time has elapsed
between the withdrawal and the sale. Thus, such sales
are subject to the preclearance and reporting
requirements and are considered sales for purposes of
the 60-day prohibition.
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RESTRICTIONS ON TRANSACTIONS IN OTHER SECURITIES
Purchases or sales by an employee of the securities of
issuers with which Mellon does business, or other
third-party issuers, could result in liability on the
part of such employee. Employees should be sensitive
to even the appearance of impropriety in connection
with their personal securities transactions. Employees
should refer to "Ownership" on Page 11 which is
applicable to the following restrictions.
The Mellon CODE OF CONDUCT contains certain
restrictions on investments in parties that do business
with Mellon. Employees should refer to the CODE OF
CONDUCT and comply with such restrictions in addition
to the restrictions and reporting requirements set
forth below.
The following restrictions apply to ALL securities
transactions by ADMs:
o CUSTOMER TRANSACTIONS - Trading for customers and
Mellon accounts should always take precedence over
employees' transactions for their own or related
accounts.
o EXCESSIVE TRADING, NAKED OPTIONS - Mellon
discourages all employees from engaging in
short-term or speculative trading, writing naked
options, trading that could be deemed excessive or
trading that could interfere with an employee's job
responsibilities.
o FRONT RUNNING - Employees may not engage in "front
running," that is, the purchase or sale of
securities for their own accounts on the basis of
their knowledge of Mellon's trading positions or
plans or those of their customers.
o INITIAL PUBLIC OFFERINGS - ADMs are prohibited from
acquiring securities through an allocation by the
underwriter of an Initial Public Offering (IPO)
without the approval of the Investment Ethics
Committee. Approval can be given only when the
allocation comes through an employee of the issuer
who is a direct family relation of the ADM. Due to
certain laws and regulations (for example, NASD
rules in the US), this approval may not be available
to employees of registered broker-dealers.
o MATERIAL NONPUBLIC INFORMATION - Employees
possessing material nonpublic information regarding
any issuer of securities must refrain from
purchasing or selling securities of that issuer
until the information becomes public or is no longer
considered material.
o PRIVATE PLACEMENTS - Participation in private
placements is prohibited without the prior written
approval of the Investment Ethics Committee. The
Committee will generally not approve an ADM's
acquiring, in a private placement, direct or
indirect ownership of any security of an issuer in
which any managed fund or account is authorized to
invest within the ADM's fund complex. Employees
should contact the Ethics Office to initiate
approval.
Private placements include certain co-operative
investments in real estate, co-mingled investment
vehicles such as hedge funds, and investments in
family owned businesses. For the purpose of the
Policy, time-shares and cooperative investments in
real estate used as a primary or secondary residence
are not considered to be private placements.
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RESTRICTIONS ON TRANSACTIONS IN OTHER SECURITIES (CONTINUED)
PRIVATE PLACEMENTS (CONTINUED) - When considering
requests for participation in private placements,
the Investment Ethics Committee will take into
account the specific facts and circumstances of the
request prior to reaching a decision on whether to
authorize a private placement investment by an ADM.
These factors include, among other things, whether
the opportunity is being offered to an individual by
virtue of his or her position with Mellon or its
affiliates, or his or her relationship to a managed
fund or account. The Investment Ethics Committee
will also consider whether a fund or account managed
by the ADM is authorized to invest in securities of
the issuer in which the ADM is seeking to invest.
At its discretion, the Investment Ethics Committee
may request any and all information and/or
documentation necessary to satisfy itself that no
actual or potential conflict, or appearance of a
conflict, exists between the proposed private
placement purchase and the interests of any managed
fund or account.
ADMs who have prior holdings of securities obtained
in a private placement must request the written
authorization of the Investment Ethics Committee to
continue holding the security. This request for
authorization must be initiated within 90 days of
becoming an ADM.
To request authorization for prior holdings or new
proposed acquisitions of securities issued in an
eligible private placement, contact the Manager of
the Ethics Office.
o SCALPING - Employees may not engage in "scalping,"
that is, the purchase or sale of securities for
their own or Mellon's accounts on the basis of
knowledge of customers' trading positions or plans.
o SHORT-TERM TRADING - ADMs are discouraged from
purchasing and selling, or from selling and
purchasing, the same (or equivalent) securities
within any 60 calendar day period. Any profits
realized on such short-term trades must be
disgorged in accordance with procedures
established by senior management. Transactions
that are exempt from preclearance will not be
considered purchases or sales for purposes of
profit disgorgement. ADMs should be aware that
for purposes of profit disgorgement, trading in
derivatives (such as options) is deemed to be
trading in the underlying security. (See Page
23 in the Glossary for an explanation of option
transactions.) Therefore, certain investment
strategies may be difficult to implement without
being subject to profit disgorgement.
Furthermore, ADMs should also be aware that
profit disgorgement from 60-day trading may be
greater than the economic profit or greater than
the profit reported for purposes of income tax
reporting.
o SPREAD BETTING - Employees may not engage in
"spread betting" (essentially taking bets on
securities pricing to reflect market movements) or
similar activities as a mechanism for avoiding the
restrictions on personal securities trading arising
under the provisions of the Policy. Such
transactions themselves constitute transactions in
securities for the purposes of the Policy and are
subject to all of the provisions applicable to other
non-exempted transactions.
Page 16
PERSONAL SECURITIES TRADING PRACTICES-ACCESS DECISION MAKERS
--------------------------------------------------------------------------------
PROHIBITION ON You are prohibited from acquiring any security issued by
INVESTMENTS IN a financial services organization if you are:
SECURITIES OF
FINANCIAL SERVICES o a member of the Mellon Senior Management Committee
ORGANIZATIONS
o employed in any of the following departments:
- Corporate Strategy & Development
- Legal (Mellon headquarters only)
- Finance (Mellon headquarters only)
o an employee specifically designated by the Manager
of the Ethics Office and informed that this
prohibition is applicable to you
FINANCIAL SERVICES ORGANIZATIONS - The phrase "security
issued by a financial services organization" includes
any security issued by:
o Commercial Banks other than Mellon
o Financial Holding Companies (or Bank Holding
Companies) other than Mellon
o Insurance Companies
o Investment Advisory Companies
o Shareholder Servicing Companies
o Thrifts
o Savings and Loan Associations
o Broker-Dealers
o Transfer Agents
o Other Depository Institutions
The phrase "securities issued by a financial services
organization" DOES NOT INCLUDE Exempt securities (see
Glossary). Further, for purposes of determining whether
a company is a financial services organization,
subsidiaries and parent companies are treated as
separate issuers.
EFFECTIVE DATE - Securities of financial services
organizations properly acquired before the employee was
subject to this prohibition may be maintained or
disposed of at the owner's discretion consistent with
the Policy.
Any acquisition of financial service organization
securities that is exempt from preclearance pursuant to
the express provision of the Policy is also exempt from
this prohibition. This includes (assuming full
compliance with the applicable preclearance exemption):
o Exempt securities (see Glossary)
o acquisition in a non-discretionary account
o involuntary acquisitions
o securities received as gifts
o reinvestment of dividends (but not initial share
and optional cash purchases) under a DRIP or
acquisitions through an AIP
o acquisitions through a non-Mellon employee benefit
plan
Within 30 days of becoming subject to this prohibition,
all holdings of securities of financial services
organizations must be disclosed in writing to the Ethics
Office.
Page 17
PERSONAL SECURITIES TRADING PRACTICES-ACCESS DECISION MAKERS
--------------------------------------------------------------------------------
PROTECTING CONFIDENTIAL INFORMATION
As an employee you may receive information about Mellon,
its customers and other parties that, for various
reasons, should be treated as confidential. All
employees are expected to strictly comply with measures
necessary to preserve the confidentiality of
information. Employees should refer to the Mellon CODE
OF CONDUCT.
INSIDER TRADING AND Securities laws generally prohibit the trading of
TIPPING LEGAL securities while in possession of "material nonpublic"
PROHIBITIONS information regarding the issuer of those securities
(insider trading). Any person who passes along material
nonpublic information upon which a trade is based
(tipping) may also be liable.
Information is "material" if there is a substantial
likelihood that a reasonable investor would consider it
important in deciding whether to buy, sell or hold
securities. Obviously, information that would affect
the market price of a security (price sensitive
information) would be material. Examples of information
that might be material include:
o a proposal or agreement for a merger, acquisition
or divestiture, or for the sale or purchase of
substantial assets
o tender offers, which are often material for the
party making the tender offer as well as for the
issuer of the securities for which the tender offer
is made
o dividend declarations or changes
o extraordinary borrowings or liquidity problems
o defaults under agreements or actions by creditors,
customers or suppliers relating to a company's
credit standing
o earnings and other financial information, such as
significant restatements, large or unusual
write-offs, write-downs, profits or losses
o pending discoveries or developments, such as new
products, sources of materials, patents, processes,
inventions or discoveries of mineral deposits
o a proposal or agreement concerning a financial
restructuring
o a proposal to issue or redeem securities, or a
development with respect to a pending issuance or
redemption of securities
o a significant expansion or contraction of
operations
o information about major contracts or increases or
decreases in orders
o the institution of, or a development in,
litigation or a regulatory proceeding
o developments regarding a company's senior
management
o information about a company received from a
director of that company
o information regarding a company's possible
noncompliance with environmental protection laws
This list is not exhaustive. All relevant circumstances
must be considered when determining whether an item of
information is material.
Page 18
PERSONAL SECURITIES TRADING PRACTICES-ACCESS DECISION MAKERS
--------------------------------------------------------------------------------
INSIDER TRADING AND "Nonpublic" - Information about a company is nonpublic
TIPPING LEGAL if it is not generally available to the investing
PROHIBITIONS public. Information received under circumstances
(CONTINUED) indicating that it is not yet in general circulation and
which may be attributable, directly or indirectly, to
the company or its insiders is likely to be deemed
nonpublic information.
If you obtain material non-public information, you may
not trade related securities until you can refer to some
public source to show that the information is generally
available (that is, available from sources other than
inside sources) and that enough time has passed to allow
wide dissemination of the information. While
information appearing in widely accessible sources--such
as in newspapers or on the internet--becomes public very
soon after publication, information appearing in less
accessible sources--such as regulatory filings, may take
up to several days to be deemed public. Similarly,
highly complex information might take longer to become
public than would information that is easily understood
by the average investor.
MELLON'S POLICY Employees who possess material nonpublic information
about a company--whether that company is Mellon, another
Mellon entity, a Mellon customer or supplier, or other
company--may not trade in that company's securities,
either for their own accounts or for any account over
which they exercise investment discretion. In addition,
employees may not recommend trading in those securities
and may not pass the information along to others, except
to employees who need to know the information in order
to perform their job responsibilities with Mellon.
These prohibitions remain in effect until the
information has become public.
Employees who have investment responsibilities should
take appropriate steps to avoid receiving material
nonpublic information. Receiving such information could
create severe limitations on their ability to carry out
their responsibilities to Mellon's fiduciary customers.
Employees managing the work of consultants and temporary
employees who have access to the types of confidential
information described in the Policy are responsible for
ensuring that consultants and temporary employees are
aware of Mellon's policy and the consequences of
noncompliance.
Questions regarding Mellon's policy on material
nonpublic information, or specific information that
might be subject to it, should be referred to the
General Counsel.
RESTRICTIONS ON THE As a diversified financial services organization, Mellon
FLOW OF INFORMATION faces unique challenges in complying with the
WITHIN MELLON (THE prohibitions on insider trading and tipping of material
"SECURITIES FIRE non-public information, and misuse of confidential
WALL") information. This is because one Mellon unit might have
material nonpublic information about a company while
other Mellon units may have a desire, or even a
fiduciary duty, to buy or sell that company's securities
or recommend such purchases or sales to customers. To
engage in such broad ranging financial services
activities without violating laws or breaching Mellon's
fiduciary duties, Mellon has established a "Securities
Fire Wall" policy applicable to all employees. The
"Securities Fire Wall" separates the Mellon units or
individuals that are likely to receive material
nonpublic information (potential Insider Risk functions)
from the Mellon units or individuals that either trade
in securities, for Mellon's account or for the accounts
of others, or provide investment advice (Investment
functions). Employees should refer to CPP 903-2(C) THE
SECURITIES FIRE WALL.
Page 19
GLOSSARY
--------------------------------------------------------------------------------
DEFINITIONS
o ACCESS DECISION MAKER - A person designated as such by the Investment
Ethics Committee. Generally, this will be portfolio managers and research
analysts who make recommendations or decisions regarding the purchase or
sale of equity, convertible debt, and non-investment grade debt securities
for investment companies and other managed accounts. See further details in
the Access Decision Maker edition of the Policy.
o ACCESS PERSON - As defined by Rule 17j-1 under the Investment Company Act
of 1940, "access person" means:
(A) With respect to a registered investment company or an investment
adviser thereof, any director, officer, general partner, or advisory
person (see definition below), of such investment company or
investment adviser;
(B) With respect to a principal underwriter, any director, officer, or
general partner of such principal underwriter who in the ordinary
course of his/her business makes, participates in or obtains
information regarding the purchase or sale of securities for the
registered investment company for which the principal underwriter so
acts, or whose functions or duties as part of the ordinary course of
his business relate to the making of any recommendations to such
investment company regarding the purchase or sale of securities.
(C) Notwithstanding the provisions of paragraph (A) hereinabove, where the
investment adviser is primarily engaged in a business or businesses
other than advising registered investment companies or other advisory
clients, the term "access person" shall mean: any director, officer,
general partner, or advisory person of the investment adviser who,
with respect to any registered investment company, makes any
recommendations, participates in the determination of which
recommendation shall be made, or whose principal function or duties
relate to the determination of which recommendation will be made, to
any such investment company; or who, in connection with his duties,
obtains any information concerning securities recommendations being
made by such investment adviser to any registered investment company.
(D) An investment adviser is "primarily engaged in a business or
businesses other than advising registered investment companies or
other advisory clients" when, for each of its most recent three fiscal
years or for the period of time since its organization, whichever is
less, the investment adviser derived, on an unconsolidated basis, more
than 50 percent of (i) its total sales and revenues, and (ii) its
income (or loss) before income taxes and extraordinary items, from
such other business or businesses.
o ADVISORY PERSON of a registered investment company or an investment adviser
thereof means:
(A) Any employee of such company or investment adviser (or any company in
a control relationship to such investment company or investment
adviser) who, in connection with his regular functions or duties,
makes, participates in, or obtains information regarding the purchase
or sale of a security by a registered investment company, or whose
functions relate to the making of any recommendation with respect to
such purchases or sales; and
(B) Any natural person in a control relationship to such company or
investment adviser who obtains information concerning recommendations
made to such company with regard to the purchase or sale of a
security.
o APPROVAL - written consent or written notice of non-objection.
o DIRECT FAMILY RELATION - employee's spouse, children (including
stepchildren, foster children, sons-in-law and daughters-in-law),
grandchildren, parents (including step-parents, mothers-in-law and
fathers-in-law) grandparents, and siblings (including brothers-in-law,
sisters-in-law and step brothers and sisters). Also includes adoptive
relationships.
o EMPLOYEE - an individual employed by Mellon Financial Corporation or its
more-than-50%-owned direct or indirect subsidiaries; includes all
full-time, part-time, benefited and non-benefited, exempt and non-exempt
employees in all world-wide locations; generally, for purposes of the
Policy, does not include consultants and contract or temporary employees.
o ETHICS OFFICE - the group within the Audit & Risk Review Department of
Mellon which is responsible for administering the ethics program at Mellon,
including the Securities Trading Policy.
Page 20
GLOSSARY
--------------------------------------------------------------------------------
DEFINITIONS (CONTINUED)
o EXEMPT SECURITIES - defined as:
direct obligations of the sovereign governments of the United States and
the United Kingdom (does not include obligations of other
instrumentalities of the US and UK governments or quasi-government
agencies)
commercial paper
high-quality, short-term debt instruments having a maturity of 366 days or
less at issuance and rated in one of the two highest rating categories
bankers' acceptances
bank certificates of deposit and time deposits
repurchase agreements
securities issued by open-end investment companies (i.e., mutual funds and
variable capital companies)
fixed and variable annuities
unit trusts
o FAMILY RELATION - see direct family relation.
o GENERAL COUNSEL - General Counsel of Mellon or any person to
whom relevant authority is delegated by the General Counsel.
o INDEX FUND - an investment company or managed portfolio
which contains securities of an index in proportions designed
to replicate the return of the index.
o INDIRECT OWNERSHIP - The securities laws of most jurisdictions attribute
ownership of securities to someone in certain circumstances, even though
the securities are not held in that person's name. For example, US federal
securities laws contain a concept of "beneficial ownership", and UK
securities laws contain a concept of securities held by "associates" (this
term includes business or domestic relationships giving rise to a
"community of interest"). The definition of "indirect ownership" that
follows is used to determine whether securities held other than in your
name are subject to the preclearance and other provisions of the Policy.
It was designed to be consistent with various securities laws; however,
there can be no assurance that attempted adherence to this definition will
provide a defense under any particular law. Moreover, a determination of
indirect ownership requires a detailed analysis of personal and/or
financial circumstances that are subject to change. It is the
responsibility of each employee to apply the definition below to his/her
own circumstances. If the employee determines that he/she is not an
indirect owner of an account and the Ethics Office becomes aware of the
account, the employee will be responsible for justifying his/her
determination. Any such determination should be based upon objective
evidence (such as written documents), rather than subjective or intangible
factors.
GENERAL STANDARD. Generally, you are the indirect owner of securities (and
preclearance and other provisions of the Policy will therefore apply to
those securities) if, through any contract, arrangement, understanding,
relationship or otherwise, you have the opportunity, directly or
indirectly, to share at any time in any profit derived from a transaction
in them (a "pecuniary interest"). The following is guidance on the
application of this definition to some common situations.
FAMILY MEMBERS. You are presumed to be an indirect owner of securities
held by members of your immediate family who share the same household with
you. "Immediate family" means your spouse, your children (including
stepchildren, foster children, sons-in-law and daughters-in-law), your
grandchildren, your parents (including stepparents, mothers-in-law and
fathers-in-law), your grandparents and your siblings (including
brothers-in-law, sisters-in-law and step brothers and sisters) and
includes adoptive relationships. This presumption of ownership may be
rebutted, but it will be difficult to do so if, with respect to the other
person, you commingle any assets or share any expenses, you provide or
receive any financial support, you influence investment decisions, you
include them as a dependent for tax purposes or as a beneficiary under an
employee benefit plan, or you are in any way financially codependent. Any
attempt to disclaim indirect ownership with respect to family members who
share your household MUST be based upon countervailing facts that you can
prove in writing.
Page 21
GLOSSARY
-----------------------------------------------------------------------------
DEFINITIONS (CONTINUED)
o INDIRECT OWNERSHIP (CONT.)
PARTNERSHIPS. If you are a general partner in a general or limited
partnership, you are deemed to own your proportionate share of the
securities owned by the partnership. Your "proportionate share" is the
greater of your share of profits or your share of capital, as evidenced by
the partnership agreement. Limited partners are NOT deemed to be owners of
partnership securities absent unusual circumstances, such as influence
over investment decisions.
SHAREHOLDERS OF CORPORATIONS. You are NOT deemed to own the securities
held by a corporation in which you are a shareholder unless you are a
controlling shareholder or you have or share investment control over the
corporation's portfolio.
TRUSTS. Generally, parties to a trust will be deemed indirect owners of
securities in the trust only if they have BOTH a pecuniary interest in the
trust and investment control over the trust. "Investment control" is the
power to direct the disposition of the securities in the trust. Specific
applications are as follows:
TRUSTEES: A trustee is deemed to have investment control
over the trust unless there are at least three trustees and
a majority is required for action. A trustee has a
pecuniary interest in the trust if (i) the trustee is also a
trust beneficiary, (ii) an immediate family member of the
trustee (whether or not they share the same household) is a
beneficiary, or (iii) the trustee receives certain types of
performance-based fees.
SETTLORS: If you are the settlor of a trust (that is, the
person who puts the assets into the trust), you are an
indirect owner of the trust's assets if you have a pecuniary
interest in the trust AND you have or share investment
control over the trust. You are deemed to have a pecuniary
interest in the trust if you have the power to revoke the
trust without anyone else's consent or if members of your
immediate family who share your household are beneficiaries
of the trust.
BENEFICIARIES. If you or a member of your immediate family
who shares your household is a beneficiary of a trust, you
are deemed to have a pecuniary interest in the trust and
will therefore be deemed an indirect owner of the trust's
assets if you have or share investment control over the
trust.
REMAINDER INTERESTS. Remainder interests are those that do not take effect
until after some event that is beyond your control, such as the death of
another person. Remainder interests are typically created by wills or
trust instruments. You are NOT deemed to be an indirect owner of
securities in which you only have a remainder interest provided you have
no power, directly or indirectly, to exercise or share investment control
or any other interest.
DERIVATIVE SECURITIES. You are the indirect owner of any security you have
the right to acquire through the exercise or conversion of any option,
warrant, convertible security or other derivative security, whether or not
presently exercisable.
o INITIAL PUBLIC OFFERING (IPO) - the first offering of a company's
securities to the public through an allocation by the underwriter.
o INVESTMENT COMPANY - a company that issues securities that represent an
undivided interest in the net assets held by the company. Mutual funds are
open-end investment companies that issue and sell REDEEMABLE securities
representing an undivided interest in the net assets of the company.
o INVESTMENT ETHICS COMMITTEE - committee that has oversight responsibility
for issues related to personal securities trading and investment activity
by Access Decision Makers. The committee is composed of investment, legal,
risk management, audit and ethics management representatives of Mellon and
its affiliates. The members of the Investment Ethics Committee are
determined by the Corporate Ethics Officer.
o MANAGER OF THE ETHICS OFFICE - individual appointed by the Corporate
Ethics Officer to manage the Ethics Office.
o MELLON - Mellon Financial Corporation.
Page 22
GLOSSARY
-----------------------------------------------------------------------------
DEFINITIONS (CONTINUED)
o NON-DISCRETIONARY ACCOUNT - an account for which the employee has no
direct or indirect control over the investment decision making process.
Non-discretionary accounts may only be exempted from preclearance and
reporting procedures, when the Manager of the Ethics Office, after a
thorough review, is satisfied that the account is truly non-discretionary
to the employee (that is, the employee has given total investment
discretion to an investment manager and retains no ability to influence
specific trades). Standard broker accounts generally are not deemed to be
non-discretionary to the employee, even if the broker is given some
discretion to make investment decisions.
o OPTION - a security which gives the investor the right, but not the
obligation, to buy or sell a specific security at a specified price within
a specified time frame. For purposes of compliance with the Policy, any
Mellon employee who buys/sells an option, is deemed to have purchased/sold
the underlying security when the option was purchased/sold. Four
combinations are possible as described below.
Call Options
-If a Mellon employee buys a call option, the employee
is considered to have purchased the underlying security
on the date the option was purchased.
-If a Mellon employee sells a call option, the employee
is considered to have sold the underlying security on
the date the option was sold.
Put Options
-If a Mellon employee buys a put option, the employee is
considered to have sold the underlying security on the
date the option was purchased.
-If a Mellon employee sells a put option, the employee
is considered to have bought the underlying security on
the date the option was sold.
Below is a table describing the above:
Transaction Type
__________________________________________________________
Option Buy Sale
Type
__________________________________________________________
Put Sale of Underlying Purchase of Underlying
Security Security
__________________________________________________________
Call Purchase of Underlying Sale of Underlying
Security Security
o PRECLEARANCE COMPLIANCE OFFICER - a person designated by the Manager of
the Ethics Office and/or the Investment Ethics Committee to administer,
among other things, employees' preclearance requests for a specific
business unit.
o PRIVATE PLACEMENT - an offering of securities that is exempt from
registration under various laws and rules, such as the Securities Act of
1933 in the US and the Listing Rules in the UK. Such offerings are exempt
from registration because they do not constitute a public offering.
Private placements can include limited partnerships.
o SECURITY - any investment that represents an ownership stake or debt stake
in a company, partnership, governmental unit, business or other
enterprise. It includes stocks, bonds, notes, evidences of indebtedness,
certificates of participation in any profit-sharing agreement and
certificates of deposit. It also includes many types of puts, calls,
straddles and options on any security or group of securities; fractional
undivided interests in oil, gas, or other mineral rights; "investment
contracts", "variable" life insurance policies and "variable" annuities,
whose cash values or benefits are tied to the performance of an investment
account. It does not include currencies. Unless expressly exempt, all
securities transactions are covered under the provisions of the Policy
(see definition of Exempt securities).
o SECURITIES FIRE WALL - procedures designed to restrict the flow of
information within Mellon from units or individuals who are likely to
receive material nonpublic information to units or individuals who trade
in securities or provide investment advice.
o SENIOR MANAGEMENT COMMITTEE - the Senior Management Committee of Mellon
Financial Corporation.
o SHORT SALE - the sale of a security that is not owned by the seller at the
time of the trade.
Page 23
EXHIBIT A - SAMPLE INSTRUCTION LETTER TO BROKER
Date
Broker ABC
Street Address
City, State ZIP
Re: John Smith
Account No. xxxxxxxxxxxx
To whom it may concern:
In connection with my existing brokerage account(s) with your firm, please be
advised that my employer should be noted as an "Interested Party" with respect
to my account(s). They should therefore, be sent copies of all trade
confirmations and account statements relating to my account on a regular basis.
Please send the requested documentation ensuring the account holder's name
appears on all correspondence to:
Manager of the Ethics Office
Mellon Financial Corporation
PO Box 3130
Pittsburgh, PA 15230-3130
Thank you for your cooperation in this request.
Sincerely yours,
Employee
cc: Manager of the Ethics Office (153-3300)
Page 24
Securities Trading Policy
Dreyfus Nonmanagement Board Member Edition
9/03
INTRODUCTION The SECURITIES TRADING POLICY (the "Policy") is
designed to reinforce the reputation for integrity of
The Dreyfus Corporation and its subsidiaries
(collectively, "Dreyfus") by avoiding even the
appearance of impropriety in the conduct of their
businesses.
SPECIAL EDITION This edition of the Policy has been prepared
specifically for Board Members of the investment
companies advised by Dreyfus (each a "Fund").
NONMANAGEMENT You are considered to be a Nonmanagement Board Member
BOARD MEMBER if you are a director or trustee of any Fund who is not
also an officer or employee of Dreyfus.
INDEPENDENT The term "Independent Mutual Fund Board Member" means
MUTUAL FUND those Nonmanagement Board Members who are not deemed
BOARD MEMBER "interested persons" of their Fund(s), as defined by
the Investment Company Act of 1940, as amended.
STANDARDS OF OUTSIDE ACTIVITIES
CONDUCT FOR
NONMANAGEMENT o Nonmanagement Board Members are prohibited from
BOARD MEMBERS accepting nomination or serving as a director,
trustee or managing general partner of an
investment company not advised by Dreyfus, or
accepting employment with or acting as a
consultant to any person acting as a registered
investment adviser to an investment company,
without the express prior approval of the board
of directors/trustees of the pertinent Fund(s)
for which the Nonmanagement Board Member serves
as a director/trustee. In any such
circumstance, management of Dreyfus must be
given advance notice by the Nonmanagement Board
Member of his/her request in order to allow
management to provide its input, if any, for
the relevant Fund board of directors/trustees'
consideration.
o Independent Mutual Fund Board Members are
prohibited from owning Mellon securities (since
that would destroy their independent status).
Insider Trading and Tipping
Federal securities laws generally prohibit the trading
of securities while in possession of "material
nonpublic" information regarding the issuer of those
securities(insider trading). Any person who passes
along material nonpublic information upon which a trade
is based (tipping) may also be liable.
Information is "material" if there is a substantial
likelihood that a reasonable investor would consider
it important in deciding whether to buy, sell or hold
securities. Obviously, information that would affect the
market price of a security would be material. Examples of
information that might be material include:
o a proposal or agreement for a merger,
acquisition or divestiture, or for the sale or
purchase of substantial assets
o tender offers, which are often material for the
party making the tender offer as well as for
the issuer of the securities for which the
tender offer is made;
o dividend declarations or changes;
o extraordinary borrowings or liquidity problems;
o defaults under agreements or actions by
creditors, customers or suppliers relating to a
company's credit standing;
o earnings and other financial information, such
as large or unusual write-offs, write-downs,
profits or losses;
o pending discoveries or developments, such as
new products, sources of materials, patents,
processes, inventions or discoveries of mineral
deposits;
o a proposal or agreement concerning a financial
restructuring;
o proposal to issue or redeem securities, or a
development with respect to a pending issuance
or redemption of securities;
o significant expansion or contraction of
operations;
o information about major contracts or increases
or decreases in orders;
o the institution of, or a development in,
litigation or a regulatory proceeding;
o developments regarding a company's senior
management;
o information about a company received from a
director of that company; and
o information regarding a company's possible
noncompliance with environmental protection
laws.
This list is not exhaustive. All relevant circumstances
must be considered when determining whether an item of
information is material.
"Nonpublic"- Information about a company is nonpublic
if it is not generally available to the investing
public. Information received under circumstances
indicating that it is not yet in general circulation
and which may be attributable, directly or indirectly,
to the company or its insiders is likely to be deemed
nonpublic information.
If you obtain material non-public information you may
not trade related securities until you can refer to
some public source to show that the information is
generally available (that is, available from sources
other than inside sources)and that enough time has
passed to allow wide dissemination of the information.
While information appearing in widely accessible
sources--such as in newspapers or on the
internet--becomes public very soon after publication,
information appearing in less accessible sources--such
as regulatory filings, may take up to several days to
be deemed public. Similarly, highly complex information
might take longer to become public than would
information that is easily understood by the average
investor.
CONFLICT OF INTEREST--No Nonmanagement Board Member may
recommend a securities transaction for any Fund without
disclosing any interest he or she has in such
securities or the issuer thereof (other than an
interest in publicly traded securities where the total
investment is less than or equal to $25,000),including:
o any direct or indirect ownership of any
securities of such issuer;
o any contemplated transaction by the
Nonmanagement Board Member in such securities;
o any position with such issuer or its affiliates;
and
(2)
o any present or proposed business relationship
between such issuer or its affiliates and the
Nonmanagement Board Member or any party in
which the Nonmanagement Board Member has an
ownership interest (see "indirect ownership" in
the Glossary).
PORTFOLIO INFORMATION--No Nonmanagement Board Member may
divulge the current portfolio positions, or current or
anticipated portfolio transactions, programs or
studies, of any Fund to anyone unless it is properly
within his or her responsibilities as a Nonmanagement
Board Member to do so
MATERIAL NONPUBLIC INFORMATION--No Nonmanagement Board
Member may engage in or recommend any securities
transaction, for his or her own benefit or for the
benefit of others, including any Fund, while in
possession of material nonpublic information. No
Nonmanagement Board Member may communicate material
nonpublic information to others unless it is properly
within his or her responsibilities as a Nonmanagement
Board Member to do so.
PRECLEARANCE FOR Nonmanagement Board Members are permitted to engage in
PERSONAL personal securities transactions without obtaining
SECURITIES prior approval from the Preclearance Compliance Officer.
TRANSACTIONS
PERSONAL O INDEPENDENT MUTUAL FUND BOARD MEMBERS--Any
SECURITIES Independent Mutual Fund Board Member, as
TRANSACTIONS defined above, who effects a securities
REPORTS transaction where he or she knew, or in the
ordinary course of fulfilling his or her
official duties should have known, that during
the 15-day period immediately preceding or
after the date of such transaction the same
security was purchased or sold, or was being
considered for purchase or sale, by Dreyfus
(including any Fund or other account managed by
Dreyfus), is required to report such personal
securities transaction. In the event a personal
securities transaction report is required, it
must be submitted to the Preclearance
Compliance Officer not later than ten days
after the end of the calendar quarter in which
the transaction to which the report relates was
effected. The report must include the date of
the transaction, the title and number of shares
or principal amount of the security, 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 or other entity with or
through whom the transaction was effected. This
reporting requirement can be satisfied by
sending a copy of the confirmation statement
regarding such transaction to the Preclearance
Compliance Officer within the time period
specified.
o "INTERESTED" MUTUAL FUND BOARD MEMBERS--Mutual
Fund Board Members who are "interested persons"
of a Fund, as defined by the Investment Company
Act of 1940, are required to report their
personal securities transactions. Personal
securities transaction reports are required to
be submitted to the Preclearance Compliance
Officer not later than ten days after the end
of the calendar quarter in which the
transaction to which the report relates was
effected. The report must include the date of
the transaction, the title and number of shares
or principal amount of the security, 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 or other entity with or
through whom the
(3)
transaction was effected. This reporting
requirement can be satisfied by sending a copy
of the confirmation statement regarding such
transaction to the Preclearance Compliance
Officer within the time period specified.
EXEMPTIONS FROM Notwithstanding the foregoing, securities transaction
REPORTING reports are not required for the following transactions:
REQUIREMENTS
purchases or sales of "exempt securities" (see
Glossary);
purchases or sales effected in any account over
which the Nonmanagement Board Member has no direct
or indirect control over the investment
decision-making process (i.e., non-discretionary
trading accounts);
transactions which are non-volitional on the part of
the Nonmanagement Board Member (such as stock
dividends);
purchases which are part of an automatic
reinvestment of dividends under a DRIP;
purchases effected upon the exercise of rights
issued by an issuer pro rata to all holders of a
class of securities, to the extent such rights were
acquired from such issuer; and\or
sales of rights acquired from an issuer, as
described above.
CONFIDENTIAL TREATMENT
THE PRECLEARANCE COMPLIANCE OFFICER WILL USE HIS OR HER
BEST EFFORTS TO ASSURE THAT ALL PERSONAL SECURITIES
TRANSACTION REPORTS ARE TREATED AS "PERSONAL AND
CONFIDENTIAL." HOWEVER, SUCH DOCUMENTS WILL BE
AVAILABLE FOR INSPECTION BY APPROPRIATE REGULATORY
AGENCIES AND OTHER PARTIES WITHIN AND OUTSIDE MELLON AS
ARE NECESSARY TO EVALUATE COMPLIANCE WITH OR SANCTIONS
UNDER THIS POLICY.
(4)
GLOSSARY o ACCESS PERSON--As defined by Rule 17j-1 under
Defintions the Investment Company Act of 1940, "access
person" includes, with respect to a registered
investment company, any director of such
investment company. Each Nonmanagement Board
Member is therefore considered an access person
of his or her respective Funds.
o APPROVAL--written consent or written notice of
nonobjection.
o ETHICS OFFICE--the group within the Audit & Risk
Review Department of Mellon which is
responsible for administering the ethics
program at Mellon, including the Securities
Trading Policy.
o EXEMPT SECURITIES--exempt securities are defined
as:
. direct obligations of the government of the
United States;
. bankers' acceptances;
. bank certificates of deposit and time deposits;
. commercial paper;
. high quality short-term debt instruments;
. repurchase agreements
. securities issued by open-end investment
companies.
o INDIRECT OWNERSHIP--The securities laws of most
jurisdictions attribute ownership of securities
to someone in certain circumstances, even
though the securities are not held in that
person's name. The definition of "indirect
ownership" that follows is used to determine
whether securities held other than in your name
are subject to the provisions of the Policy. It
was designed to be consistent with various
securities laws; however, there can be no
assurance that attempted adherence to this
definition will provide a defense under any
particular law. Moreover, a determination of
indirect owner ship requires a detailed
analysis of personal and/or financial
circumstances that are subject to change. It is
the responsibility of each Nonmanagement Board
Member to apply the definition below to his/her
own circumstances. Any such determination
should be based upon objective evidence (such
as written documents), rather than subjective
or intangible factors.
GENERAL STANDARD. Generally, you are the indirect owner
of securities if, through any contract, arrangement,
understanding, relationship or otherwise, you have the
opportunity, directly or indirectly, to share at any
time in any profit derived from a transaction in them
(a "pecuniary interest").The following is guidance on
the application of this definition to some common
situations.
FAMILY MEMBERS. You are presumed to be an indirect
owner of securities held by members of your immediate
family who share the same household with you.
"Immediate family" means your spouse, your children
(including stepchildren, foster children, sons-in-law
and daughters-in-law), your grandchildren, your parents
(including stepparents,
(5)
mothers-in-law and fathers-in-law), your grandparents
and your siblings (including brothers-in-law, sisters-
in-law and step brothers and sisters) and includes
adoptive relationships. This presumption of ownership
may be rebutted, but it will be difficult to do so if,
with respect to the other person, you commingle any
assets or share any expenses, you provide or receive
any financial support, you influence investment
decisions, you include them as a dependent for tax
purposes or as a beneficiary under an employee benefit
plan, or you are in any way financially codependent.
Any attempt to disclaim indirect ownership with respect
to family members who share your household must be
based upon countervailing facts that you can prove in
writing.
PARTNERSHIPS. If you are a general partner in a general
or limited partnership, you are deemed to own your
proportionate share of the securities owned by the
partnership. Your "proportionate share" is the greater
of your share of profits or your share of capital, as
evidenced by the partnership agreement. Limited
partners are not deemed to be owners of partnership
securities absent unusual circumstances, such as
influence over investment decisions.
SHAREHOLDERS OF CORPORATIONS. You are not deemed to own
the securities held by a corporation in which you are a
shareholder unless you are a controlling shareholder or
you have or share investment control over the
corporation's portfolio.
TRUSTS. Generally, parties to a trust will be deemed
indirect owners of securities in the trust only if they
have both a pecuniary interest in the trust and
investment control over the trust. "Investment control"
is the power to direct the disposition of the
securities in the trust. Specific applications areas
follows:
TRUSTEES: A trustee is deemed to have
investment control over the trust unless there
are at least three trustees and a majority is
required for action. A trustee has a pecuniary
interest in the trust if (i) the trustee is
also a trust beneficiary, (ii) an immediate
family member of the trustee (whether or not
they share the same household) is a
beneficiary, or (iii) the trustee receives
certain types of performance-based fees.
SETTLORS: If you are the settlor of a trust
(that is, the person who puts the assets into
the trust), you are an indirect owner of the
trust's assets if you have a pecuniary interest
in the trust and you have or share investment
control over the trust. You are deemed to have
a pecuniary interest in the trust if you have
the power to revoke the trust without any one
else's consent or if members of your immediate
family who share your household are
beneficiaries of the trust.
BENEFICIARIES. If you or a member of your
immediate family who shares your household is a
beneficiary of a trust, you are deemed to have
a pecuniary interest in the trust and will
therefore be deemed an indirect owner of the
trust's assets if you have or share investment
control over the trust.
(6)
REMAINDER INTERESTS. Remainder interests are
those that do not take effect until after some
event that is beyond your control, such as the
death of another person. Remainder interests
are typically created by wills or trust
instruments. You are not deemed to be an
indirect owner of securities in which you only
have a remainder interest provided you have no
power, directly or indirectly, to exercise or
share investment control or any other interest.
DERIVATIVE SECURITIES. You are the indirect
owner of any security you have the right to
acquire through the exercise or conversion of
any option, warrant, convertible security or
other derivative security, whether or not
presently exercisable.
o INVESTMENT COMPANY--a company that issues
securities that represent an undivided interest
in the net assets held by the company. Mutual
funds are investment companies that issue and
sell redeemable securities representing an
undivided interest in the net assets of the
company.
o INVESTMENT ETHICS COMMITTEE--committee that has
oversight responsibility for issues related to
personal securities trading by certain
employees, including those who make
recommendations or decisions regarding the
purchase or sale of portfolio securities by
Funds or other managed accounts. The committee
is composed of investment, legal, risk
management, audit and ethics management
representatives of Mellon and its affiliates.
The members of the Investment Ethics Committee
are determined by the Corporate Ethics Officer.
o MELLON--Mellon Financial Corporation and all of
its direct and indirect subsidiaries.
o NON-DISCRETIONARY TRADING ACCOUNT--an account
over which you have no direct or indirect
control over the investment decision making
process.
o PRECLEARANCE COMPLIANCE OFFICER--a person
designated by the Manager of the Ethics Office
and/or the Investment Ethics Committee to
administer, among other things, employees'
preclearance requests for a specific business
unit.
(7)
NOTES
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