Mackenzie Financial Corporation
BUSINESS CONDUCT
POLICY FOR OFFICERS,
DIRECTORS AND ACCESS PERSONS
December 31, 1998
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TABLE OF CONTENTS
Page
1. PURPOSE OF THE POLICY ....................................................1
Application of Policy.................................................1
Fair Treatment of Our Funds ..........................................1
2. CONFIDENTIALITY ............................................................1
Restriction on Communication of Confidential Information .............1
Do Not Disclose Material Non-Public Information ......................1
Confidentiality of Investment Decisions ..............................2
Continuation of Duty .................................................2
3. STANDARDS OF CONDUCT ......................................................2
Your Responsibilities to our Funds ...................................2
Your Obligations to Fellow Employees .................................2
Your Obligation to Comply with the Law ...............................3
Breach of Policies ...................................................3
4. CONFLICTS OF INTEREST ....................................................3
Business Judgement Standard ..........................................3
Examples of Conflicts of Interest ....................................3
Blackout Periods For Purchase of Publicly-Traded Securities ..........4
Policy With Respect To Gifts .........................................4
Disclosure ...........................................................4
5. SHORT TERM TRADING IN THE FUNDS BY EMPLOYEE ...............................5
Short-Term Trading Penalty ...........................................5
6. INSIDER TRADING AND REPORTING RULES FOR OFFICERS ..........................5
Definition of Insider ................................................5
Restrictions on Trades by Insiders ...................................5
Report of Trades by Insiders .........................................6
Rules for Purchase of Mackenzie and Related Company Securities .......7
Penalties for Improper Insider Trading ...............................7
7. PERSONAL TRADING RULES FOR ACCESS PERSONS .................................8
Application of Personal Trading Rules ................................8
Special Treatment or Investment Opportunities ........................8
Who is an "Access Person" ........................................... 8
Prohibited Activities ................................................9
Requirement for Independent Trading Decision ........................10
Requirement to Obtain Prior Approval for Personal Trades ............10
Exempt Securities ...................................................10
Procedures to Obtain Prior Approval. ................................11
Access Person Personal Trading Blackout Periods .....................13
Personal Trading Reporting Procedures. ..............................13
Compliance Review Procedures. .......................................14
Restricted List .....................................................14
Self-Dealing Restrictions ..........................................16
Cross-Trading .......................................................16
Appointment of Independent Review Committee or Person ...............16
Annual Report to the Committee. .....................................17
Annual Review of Policy. ............................................17
Principles Applicable to External Investment Advisors. ..............17
8. MEDIA AND ADVERTISING ...................................................18
Press Enquiries .....................................................18
9. REVIEW ...................................................................18
Review Process ......................................................18
10. ANNUAL CONFIRMATION .....................................................18
Annual Confirmation .................................................18
ACKNOWLEDGEMENT ..............................................................19
SCHEDULE A - Media Contact Persons
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1. PURPOSE OF THE POLICY
1.1 Application of Policy . This Business Conduct Policy (the "Policy")
applies to all officers, directors and Access Persons (as defined by
this Policy) of Mackenzie Financial Corporation and Mackenzie
Financial Services Inc. (collectively referred to as "Mackenzie" in
this Policy).
1.2 Fair Treatment of Our Funds. It is fundamental to the continuing
success of Mackenzie that we maintain the highest standards of
integrity and ethical business conduct in order to ensure the fair
treatment of our sponsored mutual funds and other client accounts
(collectively, the "Funds"). This can only be achieved if each of our
employees, officers and directors adhere to the highest principles of
conduct in the discharge of their duties.
2. CONFIDENTIALITY
2.1 Restriction on Communication of Confidential Information. In the
course of your duties at Mackenzie, you may obtain confidential
information concerning Mackenzie, its Funds, sales people (including
brokers and mutual fund dealers), and employees, officers and
directors of Mackenzie and its related companies. Communication of
confidential information within and outside of Mackenzie should be
permitted only when the recipient of the information has a legitimate
need to know such information in connection with his or her duties.
This requirement of confidentiality also applies to any asset of
Mackenzie including trade secrets, computer software, company records
and other proprietary information.
2.2 Do Not Disclose Material Non-Public Information.
(a) You may not use for your own financial gain or disclose for the
use of others, material information obtained as a result of your
employment or service with Mackenzie which has not been
previously disclosed to the public.
(b) Examples of material non-public information include:
(i) an actual or proposed change in control of Mackenzie;
(ii) a change in Mackenzie's dividend policy;
(iii)a significant change in earnings or anticipated earnings of
Mackenzie;
(iv) a merger or acquisition by Mackenzie;
(v) any other information which has not been generally disclosed
to the investing public which would be likely to materially
affect the price of publicly-traded shares.
2.3 Confidentiality of Investment Decisions . If you have access to
information about trades for the Funds you must keep all investment
decisions confidential until the trades have been made public in
accordance with the requirements of the Securities Act (Ontario) or
distributed to the public by Mackenzie.
2.4 Continuation of Duty . The duty of confidentiality applies to you even
after you leave Mackenzie.
3. STANDARDS OF CONDUCT
3.1 Your Responsibilities to our Funds .
(a) As an employee, officer or director of Mackenzie, you are
required to put the interests of Mackenzie's Funds first, ahead
of your personal self-interests. Above all, you must not take
unfair advantage of your position at Mackenzie nor your
relationship with the Funds, or engage in any conduct which is
not in the best interests of the Funds or Mackenzie.
(b) In addition, if you are an "Access Person" (described in Section
7 of this Policy), there are special rules which apply to your
personal trading activities. Trading transactions for the Funds
always have priority over your personal trading transactions.
(c) Mackenzie has a statutory duty to the Funds to act honestly, in
good faith and in their best interests and to exercise the degree
of care, diligence and skill that a reasonably prudent manager
would exercise in the circumstances. You must adhere to a similar
standard in performing your employment duties at Mackenzie.
3.2 Your Obligations to Fellow Employees . Mackenzie adheres to principles
of fair and equitable treatment of employees, including the evaluation
process, hiring, discipline, training and general interaction.
Mackenzie and its employees, officers and directors are bound by the
Human Rights Code, including the prohibition on discrimination or
harassment of others on the basis of age, race, colour, language,
national origin, religion, creed, marital status or sexual
orientation.
3.3 Your Obligation to Comply with the Law .
(a) Mackenzie and its employees, officers and directors are required
to comply with all laws applicable to Mackenzie's business
operations, including securities laws and other legal obligations
concerning the provision of investment advisory services, insider
trading or reporting of insider transactions.
(b) You have a duty to know, understand and comply with any of those
laws which apply to your employment duties and responsibilities.
You should be aware that your legal obligations may be more
extensive than your obligations to Mackenzie and our Funds under
this Policy. If you are uncertain about these requirements,
contact the Legal Department for guidance.
3.4 Breach of Policies . Failure to comply with this Policy or other
published policies of Mackenzie may be grounds for a warning, revision
of responsibilities, suspension or dismissal without further notice,
depending on the particular circumstances. If you commit fraud or
undertake any other illegal activity against the Funds or Mackenzie,
your conduct also will be reported to the appropriate legal
enforcement authorities. All employees, officers and directors must
report any contravention of Mackenzie policies which comes to their
notice, and co-operate in any resulting investigation.
4. CONFLICTS OF INTEREST
4.1 Business Judgement Standard . You must try to avoid any situation in
which your personal interests are in conflict with your duties as an
employee, officer or director of Mackenzie. When you are faced with
conflicts of interest, you are required to exercise the business
judgement of a responsible person, uninfluenced by considerations
other than the best interests of Mackenzie and the Funds.
4.2 Examples of Conflicts of Interest . Conflicts of interest may arise in
a number of ways. Some examples are:
(a) a personal interest in a proposed business transaction involving
Mackenzie or in a business activity also conducted by Mackenzie;
(b) a proposed directorship in a public company;
(c) becoming an insider in any public company by acquiring more than
10% of the voting rights of that company;
(d) use of Mackenzie's name in connection with outside political,
charitable or other business activities;
(e) an interest in the business of a supplier, contractor, customer,
competitor of Mackenzie or in a company in which Mackenzie has an
investment; and
(f) any business or personal activity which would interfere with your
employment duties at Mackenzie.
4.3 Blackout Periods For Purchase of Publicly-Traded Securities . It is
important that employees, officers and directors not purchase or sell
securities of Mackenzie Financial Corporation, Mackenzie Investment
Management Inc., the Mackenzie Master Limited Partnership or the
Mackenzie Income Trust if they have knowledge of any material
non-public information. Non-public information in the context of our
publicly-traded securities most often arises immediately prior to
release of quarterly and annual financial results. Accordingly, we
will impose blackout periods of 5 trading days before the release of
financial information, and for a period of 2 trading days after the
release of the information (to permit adequate dissemination into the
marketplace) during which you must not trade in the securities of
those entities. You will be notified by memorandum of the exact dates
of all blackout periods.
4.4 Policy With Respect To Gifts . You may only accept gifts from persons
or companies unrelated to Mackenzie which represent promotional items
of minimal value, such as golf balls, mugs, inexpensive pens or golf
shirts. You may also accept reasonable business promotion benefits
such as occasional meals, concert tickets or sporting event tickets.
You may not accept any gift of cash, by cheque, or as any other
financial equivalent to cash.
4.5 Disclosure . If you know a conflict of interest exists or could arise,
provide all details of the conflict of interest to the Executive
Vice-President, Legal immediately. If you are uncertain as to whether
a conflict of interest exists or could arise, discuss the matter with
the Executive Vice-President, Legal immediately.
5. SHORT TERM TRADING IN THE FUNDS BY EMPLOYEES,
OFFICERS AND DIRECTORS
5.1 Short-Term Trading Penalty . You are encouraged to invest in any of
our Funds. However, investments in all Funds other than our money
market funds must remain for a minimum of 30 days in order to avoid
increased expenses for the Funds. Your Investments in non-money market
funds which are redeemed within 30 days of the purchase date may be
charged a 1% short-term trading penalty which will be retained by the
Funds to compensate for the increased expenses.
6. INSIDER TRADING AND REPORTING RULES FOR OFFICERS
AND DIRECTORS
6.1 Definition of Insider. The following persons are insiders of Mackenzie
for purposes of the relevant securities laws:
(a) every director and each officer of Mackenzie holding the office
of Assistant Vice-President or higher; and
(b) every director and each officer of a Mackenzie subsidiary holding
the office of Assistant Vice-President or higher.
In addition, all directors and officers of Mackenzie and its
subsidiaries are insiders of Mackenzie Investment Management Inc.
("MIMI"), the Mackenzie Master Limited Partnership ("Master LP") and
the Mackenzie Income Trust ("MIT") by virtue of our ownership of more
than 10% of the voting shares of MIMI and because Mackenzie Financial
Services Inc. is the General Partner of the Master LP and the MIT.
6.2 Restrictions on Trades by Insiders.
(a) It is illegal for an insider or a person in a special
relationship with Mackenzie to give any information to another
person before it has been generally disclosed to the public,
other than during the necessary course of business, whether or
not the other person uses the information for trading purposes.
(b) It is also illegal for an insider or a person in a special
relationship with Mackenzie to purchase or sell securities of
Mackenzie with knowledge of a material change or a material fact
relating to Mackenzie that has not been generally disclosed to
the public (collectively referred to in this Policy as material
non-public information).
(c) A "person in a special relationship" to Mackenzie includes each
insider, affiliate or associate of Mackenzie and a person who was
an insider, affiliate or associate at the time of learning about
the material non-public information, but who has ceased to hold
that position.
(d) A "material change" is defined in the Securities Act (Ontario) to
be a change in the business, operations or capital of the issuer
that would reasonably be expected to have a significant effect on
the market price or value of any of the securities of the issuer.
In addition, "material fact" means a fact that significantly
affects or would reasonably be expected to have a significant
effect on the market price or value of such securities.
(e) Examples of "material non-public information" that an officer or
director could become aware of would include:
(i) an actual or proposed change in control of Mackenzie;
(ii) a change in Mackenzie's dividend policy;
(iii)a significant change in earnings or anticipated earnings of
Mackenzie;
(iv) a merger or acquisition by Mackenzie;
(v) any other information which has not been generally disclosed
to the investing public which would be likely to materially
affect the price of Mackenzie stock.
In summary, you may not use for your own financial gain or disclose
for the use of others, inside information obtained as a result of your
relationship with Mackenzie.
6.3 Report of Trades by Insiders. Mackenzie has adopted the following
rules for the reporting of trades by Mackenzie insiders for purchases
of stock of Mackenzie, MIMI, the Master LP and the MIT:
(a) an initial insider report must be filed by each new insider of
Mackenzie within 10 days of the date on which that person becomes
a Mackenzie insider, unless the person does not own beneficially,
directly or indirectly, or exercise control or direction over,
any Mackenzie, MIMI, Master LP or MIT securities.
(b) an insider must file a change report describing any change in
securities previously held or reported (or the first acquisition
of Mackenzie, MIMI, Master LP or MIT securities) within 10 days
of the trade date of the purchase or sale transaction.
(c) the rules for reporting changes apply to any transfer to a
nominee, agent or custodian, unless the transfer is merely to
give collateral for a genuine debt, and apply if you are an
insider in a company other than Mackenzie, MIMI, the Master LP or
the MIT.
(d) the insider reporting forms are maintained on computer disk in
the Legal Department and will be prepared by that Department on
receipt of the applicable transaction details. Individual insider
files are maintained by the Legal Department for all Mackenzie
insiders, and for all applicable securities transactions. If you
wish to prepare your own insider trading forms you are required
to provide a copy of the form to the Legal Department at the same
time that you file the form with the provincial securities
commissions.
(e) at present, Mackenzie, MIMI, the Master LP and the MIT are
reporting issuers in Alberta, British Columbia, Manitoba,
Newfoundland, Nova Scotia, Ontario, Quebec and Saskatchewan.
6.4 Rules for Purchase of Mackenzie and Related Company Securities. It is
important that insiders or persons with material non-public
information about Mackenzie, MIMI, the Master LP and the MIT do not
purchase or sell stock if they have knowledge of information which
would constitute material non-public information or where trading
activity might give rise to the perception that they possessed
material non-public information. Therefore, Mackenzie has adopted the
blackout periods set out in Section 4.3 of this Policy applicable to
the purchase of securities of those public entities.
6.5 Penalties for Improper Insider Trading. There are also restrictions in
provincial securities legislation preventing trading in other
companies' shares, or in "tipping" other persons, on the basis of
material non-public information. For example, an insider who
contravenes the restrictions imposed by the Securities Act (Ontario)
on insider trading is liable on conviction to a fine of up to
$1,000,000 and/or imprisonment for a term of up to 2 years. Higher
damages may apply in certain circumstances.
7. PERSONAL TRADING RULES FOR ACCESS PERSONS
7.1 Application of Personal Trading Rules. All "Access Persons" (as
defined below) are subject to special rules and restrictions with
respect to trading in securities within accounts covered by this
Policy (referred to as "personal trading"), as set out in this Section
7. Access Persons must not use any non-public information about our
Funds for their direct or indirect personal benefit or in a manner
which would not be in the best interests of our Funds. That
prohibition includes what is commonly called "front-running" and it is
not only a breach of our Policy, but is generally punishable under
Canada's securities legislation.
7.2 Special Treatment or Investment Opportunities. Access Persons also
must not use their position in Mackenzie to obtain special treatment
or investment opportunities not generally available to our Funds or
the public. Although non-management directors will not generally be
considered to be Access Persons under this Policy, they must adhere to
the same standards of ethical conduct as Access Persons when they are
in possession of non-public information or if they are offered special
treatment or investment opportunities not generally available to the
public by reason of their role as directors of Mackenzie.
7.3 Who is an "Access Person".
(a) Access to Non-Public Trading Information. You are an Access
Person if you are an employee who has, or is able to obtain
access to, non-public information concerning the portfolio
holdings, the trading activities or the ongoing investment
programs of our Funds.
(b) These Restrictions Apply to Various Accounts. If you are an
Access Person, the restrictions apply to:
- accounts registered in your name;
- accounts for which you are able to, directly or indirectly,
exercise investment or voting control; and
- accounts in which you have a "beneficial interest".
(c) What is a "Beneficial Interest". You have a beneficial interest
in an account if you are in a position to receive benefits
comparable to ownership benefits (through family relationship,
understanding, agreement or by other arrangements) or you have
the ability to gain ownership, either immediately or at some
future time.
(d) Examples of Beneficial Interest. You are considered to have a
beneficial interest in accounts:
- registered in your name;
- held by your spouse or other family members living in the
same household;
- held by a corporation, partnership or other entity in which
you participate in the investment or voting decisions;
- held in trust for you or those listed above, unless (i) the
trustee is someone other than your spouse or other family
members living in the same household; and (ii) you are not
able to, directly or indirectly, exercise investment or
voting control over the account; and
- held by an investment club, of which you or those listed
above participate in the investment or voting decisions.
The above examples are not exhaustive of all situations in which a
beneficial interest can exist. If you are uncertain about whether a
beneficial interest exists, or wish to obtain an exemption for a
specific account, contact the Legal Department compliance personnel
(referred to in this Policy as the "Compliance Officer").
7.4 Prohibited Activities. The following activities are prohibited:
- violating Canada's securities laws;
- communicating any non-public information concerning our
Funds or their investment trading to any persons within
Mackenzie who are not Access Persons or to anyone outside
Mackenzie;
- inducing a Fund to take, or fail to take, any action because
of personal interests;
- using knowledge of the Fund's portfolio transactions to
profit by the market effect of such transactions (e.g.
"front running" or similar activities);
- using your position in Mackenzie to obtain special treatment
or investment opportunities not generally available to our
Funds or the public;
- a purchase by an Access Person of an offering which is
subject to allocation, such as a new or secondary public
offering or a private placement (other than the limited
private placement exceptions set out in Section 7.8(b);
- a trade by an Access Person to or from one of our Funds;
- a trade by an Access Person in a security for which there is
an unfilled order outstanding by any of our Funds; and
- the use of derivatives to evade the restrictions imposed by
this Policy.
Other activities which are not specifically listed may still be
inappropriate if they would place you in a position of conflict with
the best interests of our Funds. If you are uncertain about whether a
particular activity may be prohibited, contact the Compliance Officer.
7.5 Requirement for Independent Trading Decision. If a portfolio manager
personally has registered ownership, can exercise investment or voting
control or has a beneficial interest in a security, and wishes to make
an initial purchase of a security of the same issuer for his/her
managed Fund, that decision must be reviewed and confirmed by another
portfolio manager or independent person uninfluenced by any factor
other than whether the proposed purchase is in the best interests of
the Fund. The initial decision to buy the security for the Fund must
be reported to the Compliance Officer along with supporting reasons
for the decision.
7.6 Requirement to Obtain Prior Approval for Personal Trades. All Access
Persons must obtain prior approval from the Compliance Officer for a
personal trade. Only the securities listed in Section 7.7 are exempt
from this pre-clearance process. All other trades must be pre-cleared
and will only be approved if the Compliance Officer is satisfied that
the personal trade will not conflict with the best interests of our
Funds and has not been offered to you because of your position in
Mackenzie.
7.7 Exempt Securities. The following securities are exempt from the pre-
clearance and reporting procedures in this Policy:
- securities of open-end mutual funds, segregated funds and
pooled trust funds;
- securities issued or guaranteed by the Government of Canada,
or the government of any province in Canada;
- securities issued or guaranteed by the Governments of the
United States, United Kingdom, Germany, Japan, France and
Italy;
- guaranteed investment certificates, certificates of deposit,
and other deposits with financial institutions (although
they may not technically be "securities");
- short-term debt securities maturing in less than 91 days
from their date of issue;
- options, futures or other derivatives on any broadly based
market indices approved by the Compliance Officer;
- physical commodities or securities relating to those
commodities; and
- securities of Mackenzie and its affiliates, in which our
Funds are prohibited from investing.
The above securities have been designated as exempt securities because
trading in those securities by Access Persons will generally not
affect the price of the securities or limit their availability to our
Funds, or because trading in those securities by our Funds will not
provide a personal benefit to the Access Person.
7.8 Procedures to Obtain Prior Approval. The following procedures have
been adopted to ensure that only personal trades which do not conflict
with the best interests of our Funds and which do not provide a
benefit to the Access Person from any anticipated Fund trading will be
approved by the Compliance Officer:
(a) No Conflict by Access Person. The Access Person must advise the
Compliance Officer that he or she:
- does not possess material non-public information relating to
the security;
- is not aware of any proposed trade or investment program
relating to that security by any of our funds;
- believes the proposed trade has not been offered because of
the Access Person's position in Mackenzie and is available
to any market participant on the same terms;
- believes the proposed trade does not contravene any of the
prohibited activities listed in Section 7.4 and, if the
Access Person is a portfolio manager, that the proposed
trade is not an appropriate trade for the portfolio
manager's managed funds at that time; and
- will provide any other information requested by the
Compliance Officer concerning the proposed personal trade.
(b) Special Rules for Private Placements. Private Placements will not
be approved unless, in addition to the requirements for the
approval of other trades, the Compliance Officer is satisfied
that the issuer is a "private company" under the Securities Act
(Ontario) and the Access Person has no reason to believe that the
issuer will make a public offering of its securities in the
foreseeable future. Examples of private placements which would
likely be approved include:
- shares, units or similar evidence of ownership of private
companies, private partnerships and other issuers where the
Access Person has a close personal or business relationship
(other than a relationship arising from the Access Person's
position with Mackenzie) with the founder or promoter of the
issuer; and
- tax shelters which are generally available on a private
placement basis.
(c) Compliance Officer Review. The Compliance Officer will review all
relevant information and will only grant approval for the
proposed personal trade if the Compliance Officer is satisfied
that the trade will not be contrary to the best interests of our
Funds, and does not contravene any of the other restrictions
imposed by this Policy.
(d) Trading Approval Period. The Compliance Officer will determine
the period of time during which the Access Person may conduct the
approved trade. The Access Person must re-apply for prior
approval if any part of the approved trade has not been completed
by the end of the trading approval period and the Access Person
still wishes to complete the remainder of the trade.
(e) De Minimus and Other Exception Rules. The Compliance Officer may
develop de minimus and other exception rules to permit a personal
trade to proceed where there is no likelihood of the trade being
contrary to the best interests of the Funds. For example, the
Compliance Officer may elect to waive the 5 trading days blackout
period described below where the Funds have disposed of all of
their shares of the relevant security and the Access Person also
wishes to sell the same security.
7.9 Access Person Personal Trading Blackout Periods. If the Access Person
is a portfolio manager, the Compliance Officer will generally not
approve the proposed trade if there has been trading in a security of
the same issuer by the portfolio manager's managed funds within the
previous 5 trading days. In all other cases, the Compliance Officer
will generally not approve the proposed trade by the Access Person if
there has been trading in a security of the same issuer by any of our
Funds within the previous trading day.
7.10 Personal Trading Reporting Procedures. If you are an Access Person,
you must:
(a) Initial List of Holdings. As of the commencement of this Policy,
or upon commencing employment with Mackenzie, provide the
Compliance Officer with a complete list (the number of securities
and the names of the securities) of the securities for all of
your accounts covered by this Policy.
(b) Copies of Account Statements. Instruct your dealer to provide
duplicate copies of all statements for your accounts covered by
this Policy on a timely basis to the Compliance Officer.
(c) Confirmations of Trades. Instruct your dealer to provide
duplicate copies of all confirmation slips for your accounts
covered by this Policy on a timely basis to the Compliance
Officer.
(d) Quarterly Report. Provide a report within 10 days of each
quarter- end disclosing all personal trading transactions which
occurred during that quarter.
(e) Annual Reports of Holdings. Provide a report within 35 days of
each calendar year-end listing the number and name of all
personal securities holdings for your accounts covered by this
Policy.
(f) Other Information. Provide such other information from time to
time as may be requested by the Compliance Officer for the proper
administration of the personal trading rules in this Policy.
7.11 Compliance Review Procedures.
(a) Review of Reported Trades. The Compliance Officer will review on
a regular basis reporting by Access Persons to ensure compliance
with the personal trading procedures in this Policy.
(b) Confidentiality of Information. All information received by the
Compliance Officer will be kept confidential and will only be
disclosed to others if the disclosure is required to administer
this Policy or is required by securities regulators or other
competent legal authorities. Both the Compliance Officer and the
Access Person are required to keep details of personal trading
approval requests confidential (whether the trades are permitted
or denied), subject to any legal obligation to report the trade
under Canada's securities legislation.
(c) Enforcement of Personal Trading Procedures. The Compliance
Officer will report any violations of the personal trading
procedures, and the action taken by Mackenzie, to the Independent
Review Committee or person designated under Section 7.15 of this
Policy.
(d) Breach of Code. You must report to the Compliance Officer any
violations of this Policy which come to your attention. If you
breach any of the provisions of this Policy, knowingly or
unknowingly, you may be issued a written warning, have your
employment responsibilities revised, be required to forfeit any
trading profits, be suspended or be terminated. You also may face
additional punishment under Canada's securities laws. You must
cooperate fully in any investigations initiated by Mackenzie
under this Policy or by securities regulators or other competent
legal authorities.
7.12 Restricted List.
(a) Criteria. The Restricted List will comprise companies in which:
(i) investment personnel have material non-public information;
(ii) Mackenzie or its managed accounts have, or are approaching,
a "substantial ownership interest" (20% or more of the
voting rights) on an aggregate basis;
(iii)Portfolio managers have determined that securities of the
companies should be purchased or sold by our managed
accounts (a "significant investment program");
(iv) Mackenzie or any of its officers or directors owns more than
10% of the outstanding shares; or
(v) it is determined that regulatory restrictions preclude
investment by our managed accounts.
(b) Where the Restricted List is Maintained. The Legal Department
will maintain the Restricted List in conjunction with information
supplied by the Investment Department.
(c) Adding Names to the Restricted List. Access Persons must give
notice to the Legal Department to add the name of a company to
the Restricted List when they have reason to believe that any of
the conditions in (a) above are present.
(d) Non-Public Information. If a company is on the Restricted List by
reason of material non-public information, Access Persons must
refrain from trading in securities of that company on behalf of
Mackenzie's managed accounts or for their personal account until
the material non-public information becomes public.
(e) Substantial Ownership Interest. If a company is on the Restricted
List by reason of a substantial ownership interest, Access
Persons trading on behalf of Mackenzie's Funds should ensure that
any proposed trades will not exceed the following limits:
(i) no single Mackenzie Fund will own more than 10% of any class
of shares of the company; and
(ii) Mackenzie's sponsored mutual funds collectively will not own
more than 20% of the voting rights of the company;
(f) Significant Investment Program. If a company is on the Restricted
List by reason of a significant investment program, Access
Persons must not trade in securities of that company for their
personal account until the investment program is complete and the
proposed personal trade has been pre-cleared as required by this
Policy.
7.13 Self-Dealing Restrictions. Additional self-dealing rules in the
Securities Act (Ontario) prohibit the following transactions:
(a) an investment by any accounts managed by Mackenzie (including the
mutual funds) in any company in which any officer or director of
Mackenzie or their associates owns more than 10% of the
outstanding securities of the company;
(b) an investment by any of our managed portfolios in a company in
which any portfolio manager of Mackenzie or MIMI is an officer or
director, unless that specific fact is disclosed to the managed
account and the written consent of the client is obtained before
the purchase; and
(c) the purchase or sale of the securities of any company from or to
the account of any portfolio manager of Mackenzie or MIMI or
their associates.
7.14 Cross-Trading. Portfolio managers may trade securities from one
managed account to another managed account generally only through the
facilities of a stock exchange and only at a market price that is fair
to each of the managed accounts. Portfolio managers should obtain
market value information from more than one market source before
completing the cross-trade transaction and document the information
received. Exceptions to this rule may be made for MIMI funds and
certain securities not listed on an exchange. Portfolio managers
should refer to the Compliance Officer where appropriate.
7.15 Appointment of Independent Review Committee or Person.
(a) Mackenzie has appointed the Regulatory Compliance and Ethics
Committee of the Board of Directors of Mackenzie as an
Independent Review Committee to oversee this Business Conduct
Policy. Each of the independent directors on the Committee is
free from any interest and any business or other relationship
which could, or could reasonably be perceived to, materially
interfere with the individual's ability to act in the best
interests of Fund investors under this Policy.
(b) The Committee will be responsible for approval of all personal
trading rules and other provisions of this Policy and for
monitoring the administration of the Policy from time to time.
The Board of Directors of Mackenzie has approved the provisions
of this Policy.
7.16 Annual Report to the Committee. The Compliance Officer will provide a
written report, at least annually, to the Independent Review Committee
summarizing:
- compliance with the Policy for the period under review;
- violations of the Policy for the period under review;
- sanctions imposed under the Policy by Mackenzie during the
period under review;
- whether Mackenzie's external investment advisors have
confirmed that they have complied with the basic principles
set out in section 7.18 of this Policy in providing
investment advisory services to Mackenzie's Funds during the
period under review;
- change in procedures recommended for the Policy; and
- any other information requested by the Committee.
7.17 Annual Review of Policy. After receiving the Compliance Officer's
report, the Independent Review Committee will review the Policy to
ensure that Mackenzie's administration of the Policy is adequate, and
to identify any amendments which may be necessary in light of legal
and business developments and Mackenzie's experience in administering
the Policy. The Committee will recommend such amendments to
Mackenzie's Board of Directors for consideration.
7.18 Principles Applicable to External Investment Advisors. In order to
exercise our statutory standard of care as manager of our Funds,
Mackenzie will require each external investment advisor to confirm in
writing that, in providing investment advisory services to our Funds,
it will:
- act honestly, in good faith and in the best interests of the
Funds and exercise the degree of care, diligence and skill
that a reasonably prudent manager would exercise in the
circumstances, or otherwise adhere to the standard of care
required of a reasonably prudent manager in its home
jurisdiction;
- comply with all securities laws applicable in its home
jurisdiction (and, to the best of its knowledge, other
jurisdictions in which the Funds invest) with respect to any
activities carried out on behalf of the Funds;
- require the portfolio managers and any insiders of the
Fund's portfolio activities to place the interests of the
Funds first, ahead of their own interests, in all personal
trading conflicts of interest involving securities which
would not be exempt securities under this Policy; and
- submit a report annually to Mackenzie confirming compliance
with these personal trading standards in respect of the
advisory services provided to the Funds.
8. MEDIA AND ADVERTISING
8.1 Press Enquiries. Any media questions or requests for interviews should
be referred to the persons listed in the Media Contact Persons
schedule which accompanies this Policy.
9. REVIEW
9.1 Review Process. The Legal Department will update this Policy as
required to reflect any changes in the law. The Policy will be
reviewed by the Independent Review Committee and the Board of
Directors of Mackenzie annually. If you are uncertain about any
requirements or procedures in this Policy, you should contact the
Executive Vice- President, Legal.
10. ANNUAL CONFIRMATION
10.1 Annual Confirmation. You will be asked on an annual basis to sign the
Acknowledgement form set out below to confirm your awareness of the
Policy, your compliance with its provisions during the prior year and
your commitment to abide by its terms in the current year. The
Acknowledgement should be returned to Mackenzie's Legal Department.
<PAGE>
ACKNOWLEDGEMENT
I hereby acknowledge that I have read the Business Conduct Policy For
Officers, Directors and Access Persons of Mackenzie and am fully aware of its
terms. I confirm that during the prior year I have complied with all provisions
of the Policy and that I will comply with those provisions in the current year.
--------------------- -----------------------
Signature Date
Please print your name
Please return this signed Acknowledgement to Harold P. Hands, Executive
Vice-President, Legal.
<PAGE>
SCHEDULE A
MACKENZIE FINANCIAL CORPORATION
Business Conduct Policy
Media Contact Persons
Officer Title Subject Matter
Alexander Christ Chairman & Any matter
Chief Executive Officer
Theresa Currie President & Multiple Retirement
Chief Executive Officer Services Inc.
Neil Lovatt Vice-Chairman Investment Management
Philip Cunningham Executive Vice-President Marketing
David Feather Senior Vice-President Marketing
Harold Hands Executive Vice-President Legal, Investor Relations
James Hunter President and Chief Any matter
Executive Officer
James Dryburgh Senior Vice-President & Financial
Chief Financial Officer
Scott Sinclair Chief Operating Officer Multiple Retirement Services
Inc. or
M.R.S. Securities Services
Inc.
Laurie Munro Vice-Chairman M.R.S. Trust Company,
Multiple Retirement Services
Inc.,
M.R.S. Securities Services
Inc.
Richard Sambrook Senior Vice-President Counsel Accounts
Mark Tiffin Senior Vice-President Marketing
Allan Warren President & Chief Executive M.R.S. Trust Company
Officer
