logo: Mellon
Securities Trading Policy
EXHIBIT 23 P 5
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logo: Mellon
July 2000
Dear Mellon Financial Employee:
At Mellon, we take great pride in our transformation over the years from a
regional bank to a global financial services company. Our growth makes us better
able to meet customers' changing needs, gives us greater stability during any
unexpected economic downturn and affords us the opportunity to be the best
performing financial services company.
This diversity of our businesses also makes us a complex organization, which is
why it's more important than ever that you clearly understand Mellon's
Securities Trading Policy. Mellon has long maintained strict policies regarding
securities transactions, all with the same clear-cut objective: to establish and
demonstrate our compliance with the high standards with which we conduct our
business.
If you are new to Mellon, please take the time to fully understand the Policy
and consult it whenever you are unsure about appropriate actions. If you have
seen the Policy previously, I urge you to renew your understanding of the entire
document and its implications for you. Only by strict adherence to the Policy
can we ensure that our well-deserved reputation for integrity is preserved.
Sincerely yours,
/s/Martin G. McGuinn
Martin G. McGuinn
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
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Table of Contents
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Page #
INTRODUCTION ..................................................................1
CLASSIFICATION OF EMPLOYEES....................................................2
Insider Risk Employees....................................................2
Investment Employees....................................................2-3
Access Decision Makers....................................................3
Other Employees ..........................................................3
Consultants, Independent Contractors and Temporary Employees .............3
PERSONAL SECURITIES TRADING PRACTICES.......................................4-45
SECTION ONE-APPLICABLE TO INSIDER RISK EMPLOYEES
Quick Reference - Insider Risk Employees..................................4
Standards of Conduct for Insider Risk Employees.........................5-9
Restrictions on Transactions in Mellon Securities.....................10-12
Restrictions on Transactions in Other Securities......................12-15
Protecting Confidential Information....................................16-1
SECTION TWO-APPLICABLE TO INVESTMENT EMPLOYEES
Quick Reference - Investment Employees...................................19
Standards of Conduct for Investment Employees.........................20-25
Restrictions on Transactions in Mellon Securities.....................26-28
Restrictions on Transactions in Other Securities......................28-31
Protecting Confidential Information...................................32-34
Special Procedures for Access Decision Makers............................34
SECTION THREE-APPLICABLE TO OTHER EMPLOYEES
Quick Reference - Other Employees........................................35
Standards of Conduct for Other Employees..............................36-37
Restrictions on Transactions in Mellon Securities.....................37-39
Restrictions on Transactions in Other Securities......................39-42
Protecting Confidential Information...................................43-45
GLOSSARY
Definitions...........................................................46-52
Exhibit A - Sample Letter to Broker......................................53
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Introduction
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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.
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.
Employees outside the United States are also subject to applicable laws of
foreign jurisdictions, which may differ substantially from US law and which may
subject such employees to additional requirements. Such employees must comply
with applicable requirements of pertinent foreign laws as well as with the
provisions of the Policy. To the extent any particular portion of the Policy is
inconsistent with foreign law, employees should consult the General Counsel or
the Manager of Corporate Compliance.
Any provision of this Policy may be waived or exempted at the discretion of the
Manager of Corporate Compliance. Any such waiver or exemption will be evidenced
in writing and maintained in the Audit & Risk Review Department.
Employees must read the Policy and must comply with it. Failure to comply with
the provisions of 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 Corporate Compliance or his/her designee.
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Classification of Employees
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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, domestic and international
employees. It does not include consultants and contract or temporary employees,
nor employees of subsidiaries which are 50% or less owned by Mellon. Although
the Policy provisions generally have worldwide applicability, some sections of
the Policy may conflict with the laws or customs of the countries in which
Mellon operations are located. The Policy may be amended for operations outside
the United States only with the approval of the Manager of Corporate Compliance.
Employees are engaged in a wide variety of activities for Mellon. In light of
the nature of their activities and the impact of federal and state laws and the
regulations thereunder, 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: Insider Risk Employee, Investment Employee, Access Decision Maker
and 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 Corporate
Compliance, 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 Corporate Compliance.
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
commercial credit or corporate finance cus-tomers. This will typically include
certain employees in the credit, lending and leasing businesses, certain members
of the Audit & Risk Review, and Legal 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.
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Classification of Employees
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INVESTMENT EMPLOYEE
(cont.)
This will typically include:
o certain employees in fiduciary securities sales and trading, investment
management and advisory services, investment research and various trust or
fiduciary functions;
o an employee of a Mellon entity registered under the Investment Advisers Act
of 1940 who is also an "Access Person" as defined by Rule 17j-1 of the
Investment Company Act of 1940 (see glossary); and
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 (ADM)
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 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, INDEPENDENT
CONTRACTORS AND TEMPORARY
EMPLOYEES
Managers should inform consultants, independent contractors and temporary
employees of the general provisions of the Policy (such as the prohibition on
trading while in possession of material nonpublic information), but generally
they will not be required to preclear trades or report their personal securities
holdings. 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 Corporate Compliance
who will determine whether such individual should be subject to the preclearance
and reporting requirements of the Policy.
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Personal Securities Trading Practices
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SECTION ONE-APPLICABLE TO INSIDER RISK EMPLOYEES
QUICK REFERENCE-INSIDER RISK EMPLOYEES
SOME THINGS YOU MUST DO
DUPLICATE STATEMENTS & CONFIRMATIONs--Instruct your broker, trust account
manager or other entity through which you have a securities trading account to
send directly to MANAGER OF CORPORATE COMPLIANCE, MELLON FINANCIAL CORPORATION,
PO BOX 3130, PITTSBURGH, PA 15230-3130:
o Trade confirmations summarizing each transaction
o Periodic statements
Exhibit A of this Policy can be used to notify your broker. This applies to
all accounts in which you have a beneficial interest. (See Glossary)
PRECLEARANCE--Before initiating a securities transaction, written preclearance
must be obtained from the Manager of Corporate Compliance. This can be done by
completing a Preclearance Request Form and:
o delivering the request to the Manager of Corporate Compliance, AIM
151-4340,
o faxing the request to (412) 234-1516, or
o contacting the Manager of Corporate Compliance for other available
notification options.
Preclearance Request Forms can be obtained from Corporate Compliance (412)
234-1661. If preclearance approval is received the trade must be executed before
the end of the 3rd business day (with the date of approval being the 1st
business day), at which time the preclearance approval will expire.
SPECIAL APPROVALS
o Acquisition of securities in a Private Placement must be precleared by the
employee's Department/ Entity head and the Manager of Corporate Compliance.
o Acquisition of securities through an allocation by the underwriter of an
Initial Public Offering (IPO) is prohibited without the approval of the
Manager of Corporate Compliance. Approval can be given only when the
allocation is the result of a direct family relationship.
SOME THINGS YOU MUST NOT DO
MELLON SECURITIES--The following transactions in Mellon securities are
prohibited for all Mellon Employees:
o Short sales
o Purchasing and selling or selling and purchasing within 60 days
o Purchasing or selling during a blackout period
o Margin purchases or options other than employee options.
NON-MELLON SECURITIES--New investments in financial services organizations are
prohibited for certain employees only-see page 13.
OTHER RESTRICTIONS are detailed throughout Section One.
READ THE POLICY!
EXEMPTIONS
Preclearance is NOT required for:
o Purchases or sales of municipal bonds, non-financial commodities (such as
agricultural futures, metals, oil, gas, etc.), currency futures, financial
futures, index futures, index securities, securities issued by investment
companies, commercial paper; CDs; bankers' acceptances; repurchase
agreements; and direct obligations of the govern-ment of the United States.
o Transactions in any account over which the employee has no direct or
indirect control over the investment decision making process.
o Transactions that are non-volitional on the part of an employee (such as
stock dividends).
o Changes in elections under Mellon's 401(k) Retirement Savings Plan.
o An exercise of an employee stock option adminis-tered by Human Resources.
o Automatic reinvestment of dividends under a DRIP or Automatic Investment
Plan. (Optional cash purchases under a DRIP or Direct Purchase Plan do
require preclearance.)
o Sales of securities pursuant to tender offers and sales or exercises of
"Rights" (see page 7).
QUESTIONS?
(412) 234-1661
This page is for reference purposes only. Employees are reminded they must read
the Policy and comply with its provisions.
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Personal Securities Trading Practices
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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 require-ments, as discussed
below.
Every Insider Risk Employee must follow these procedures or risk seri-ous
sanctions, including dismissal. If you have any questions about these procedures
you should consult the Manager of Corporate Compliance. Interpretive issues that
arise under these procedures shall be decided by, and are subject to the
discretion of, the Manager of Corporate Compliance.
CONFLICT OF INTEREST
No employee may engage in or recommend any securities transac-tion 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 INFORMATION
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.
No employee may communi-cate material nonpublic information to others unless it
is properly within his or her job responsibilities to do so.
BROKERS
Trading Accounts--All Insider Risk Employees are encouraged to conduct their
personal investing through a Mellon affiliate brokerage account. This will
assist in the monitoring of account activity on an ongoing basis in order to
ensure compliance with the Policy.
PERSONAL SECURITIES TRANSACTIONS REPORTS
Trading Accounts--All Insider Risk 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 Manager of Corporate
Compliance copies of all trade confirmations and state-ments relating to each
account of which they are a beneficial owner regardless of what, if any,
securities are maintained in such accounts. Thus, for example, even if the
brokerage account contains only mutual funds or other exempt securities as that
term is defined by the Policy and the account has the capability to have
reportable securities traded in it, the Insider Risk Employee maintaining such
an account must arrange for duplicate account statements and trade confirmations
to be sent by the broker to the Manager of Corporate Compliance. An example of
an instruction letter to a broker is in Exhibit A.
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Personal Securities Trading Practices
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PRECLEARANCE FOR PERSONAL
SECURITIES TRANSACTIONS
All Insider Risk Employees must notify the Manager of Corporate Compliance in
writing and receive preclearance before they engage in any purchase or sale of a
security. Insider Risk Employees should refer to the provisions under
"Beneficial Ownership" on page 15, which are applicable to these provisions.
All requests for preclearance for a securities transaction shall be submitted by
completing a Preclearance Request Form which can be obtained from the Manager of
Corporate Compliance.
The Manager of Corporate Compliance 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 Manager of Corporate
Compliance to the Insider Risk Employee. A record of such notification will be
maintained by the Manager of Corporate Compliance. However, it shall be the
responsibility of the Insider Risk Employee to obtain a written record of the
Manager of Corporate Compliance's notification within 24 hours of such
notification. The Insider Risk Employee should retain a copy of this written
record.
As there could be many reasons for preclearance being granted or denied, Insider
Risk Employees should not infer from the preclear-ance 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 pre-clearance request. If
the Insider Risk Employee is preclearing as beneficial owner of another's
account, the response may be dis-closed to the other owner.
o Good Until Canceled/Stop Loss Orders ("Limit 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 Limit Order must be
canceled or a new preclearance authorization must be obtained.
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Personal Securities Trading Practices
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EXEMPTIONS FROM REQUIREMENT TO PRECLEAR
Preclearance by Insider Risk Employees is not required for the following
transactions:
o Purchases or sales of Exempt Securities (direct obligations of the
government of the United States; high quality short-term debt instruments;
bankers' acceptances; CDs; commercial paper; repurchase agreements; and
securities issued by open-end investment companies);
o Purchases or sales of municipal bonds, closed-end mutual funds;
non-financial commodities (such as agricultural futures, metals, oil, gas,
etc.), currency futures, financial futures, index futures and index
securities;
o Purchases or sales effected in any account over which an employee has no
direct or indirect control over the investment decision making process
(e.g., discretionary trading accounts). Discretionary trading accounts may
only be exempted from preclearance procedures, when the Manager of
Corporate Compliance, after a thorough review, is satisfied that the
account is truly discretionary;
o Transactions that are non-volitional on the part of an employee (such as
stock dividends);
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 by the Human Resources Department (for which the Human
Resources Department will forward information to the Manager of Corporate
Compliance);
o Changes to elections in the Mellon 401(k) plan;
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; and/or
o Sales effected pursuant to a bona fide tender offer.
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 Manager of Corporate Compliance. The report must be
made within 10 days of making or receiving the gift and must disclose the
following informa-tion: the name of the person receiving (giving) the gift, the
date of the transaction, and the name of the broker through which the
transac-tion 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.
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Personal Securities Trading Practices
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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 not required to preclear
enrollment, the periodic reinvestment of dividend pay-ments into additional
shares of company stock through a DRIP, or the periodic investments through an
AIP.
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.
RESTRICTED LIST
The Manager of Corporate Compliance 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 office of Corporate Compliance. 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.
To assist the Manager of Corporate Compliance in identifying compa-nies that may
be appropriate for inclusion on the Restricted List, the department/entity heads
in which Insider Risk Employees are employed are required to inform the Manager
of Corporate Compliance in writing of any companies they believe should be
included on the Restricted List, based upon facts known or readily available to
such department heads.
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Personal Securities Trading Practices
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RESTRICTED LIST
(cont.)
Although the reasons for inclusion on the Restricted List may vary, they could
typically include the following:
o Mellon is involved as a lender, investor or adviser in a merger,
acquisition or financial restructuring involving the company;
o Mellon is involved as a selling shareholder in a public distribution of the
company's securities;
o Mellon is involved as an agent in the distribution of the company's
securities;
o Mellon has received material nonpublic information on the company;
o Mellon is considering the exercise of significant creditors' rights against
the company; or
o The company is a Mellon borrower in Credit Recovery.
Department heads of sections in which Insider Risk Employees are employed are
also responsible for notifying the Manager of Corporate Compliance in writing of
any change in circumstances making it appropriate to remove a company from the
Restricted List.
The Manager of Corporate Compliance will retain copies of the restricted lists
for five years.
CONFIDENTIAL TREATMENT
The Manager of Corporate Compliance 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 this Policy.
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Personal Securities Trading Practices
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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 could be presumed to exercise influence or control (see
provisions under "Beneficial Ownership" on page 15 for a more complete
discussion of the accounts to which these restrictions apply). These
restrictions are to be followed in addition to any restrictions that apply to
particular officers or directors (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 Resources Department is exempt from this restriction. Further, Mellon
securities may be used to collateralize loans or 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.
o Mellon Blackout Period--Employees are prohibited from buying or selling
Mellon's publicly traded securities during a blackout period. The blackout
period begins the 16th day of the last month of each calendar quarter and
ends 3 business days after Mellon Financial Corporation publicly announces
the financial results for that quarter. Thus, the blackout periods begin on
March 16, June 16, September 16 and December 16. The end of the blackout
period is determined by counting business days only, and the day of the
earnings announcement is day 1. The blackout period ends at the end of day
3, and employees can trade Mellon securities on day 4.
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Personal Securities Trading Practices
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MELLON 401(K) PLAN
For purposes of the blackout period and 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:
o Employees are prohibited from increasing or decreasing their existing
account balance allocation to Mellon Common Stock during the blackout
period.
o 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 either the blackout period or 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 purposes of either the blackout or the 60-day rule.
MELLON EMPLOYEE
STOCK OPTIONS
Receipt--Your receipt of an employee stock option from Mellon is not deemed to
be a purchase of a security. Therefore, it is exempt from preclearance and
reporting requirements, can take place during the blackout period and does not
constitute a purchase for purposes of the 60-day prohibition.
Exercises--The exercise of an employee stock option that results in your holding
the shares is exempt from preclearance and reporting requirements, can take
place during the blackout period and does not constitute a purchase for purposes
of the 60-day prohibition.
"Cashless" Exercises--The exercise of an employee stock option which is part of
a "cashless exercise" or "netting of shares" that is administered by the Human
Resources Department or Chase Mellon Shareholder Services is exempt from the
preclearance and reporting requirements and will not constitute a purchase or a
sale for purposes of the 60-day prohibition. A "cashless exercise" or "netting
of shares" transaction is permitted during the blackout period for ShareSuccess
plan options only. They are not permitted during the blackout period for any
other plan options.
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MELLON EMPLOYEE
STOCK OPTIONS
(cont.)
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, are prohibited during the blackout period and constitute 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 sensi-tive to even the appearance of
impropriety in connection with their personal securities transactions. Employees
should refer to "Beneficial Ownership" on page 15, which is applicable to the
following restrictions.
The Mellon Code of Conduct contains certain restrictions on invest-ments 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 or sell
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. 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, in trading naked options, in
trading that could be deemed excessive or in 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.
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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 Corporate
Compliance. 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 NASD rules, 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--Insider Risk Employees are prohibited from acquiring
any security in a private placement unless they obtain the prior written
approval of the Manager of Corporate Compliance and the employee's
department head. Approval must be given by both persons for the acquisition
to be considered approved. After receipt of the necessary approvals and the
acquisition, 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.
PROHIBITION ON INVESTMENTS IN
SECURITIES OF FINANCIAL SERVICES
ORGANIZATIONS.
You are prohibited from acquiring any security issued by a financial services
organization if you are:
o a member of the Mellon Senior Management Committee.
o employed in any of the following departments:
o Corporate Strategy & Development
o Legal (Pittsburgh only)
o Finance (Pittsburgh only)
o an employee specifically designated by the Manager of Corporate Compliance
and informed that this prohibition is applicable to you.
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PROHIBITION ON INVESTMENTS IN
SECURITIES OF FINANCIAL SERVICES
ORGANIZATIONS
(cont.)
Financial Services Organizations--The term "security issued by a financial
services organization" includes any security issued by:
o Commercial Banks other than Mellon
o 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 term "securities issued by a financial services organization" DOES NOT
INCLUDE securities issued by mutual funds, variable annuities or insurance
policies. 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's becoming subject to this prohibition may be maintained or
disposed of at the owner's discretion consistent with this policy.
Additional securities of a financial services organization acquired through the
reinvestment of the dividends paid by such financial ser-vices organization
through a dividend reinvestment program (DRIP), or through an automatic
investment plan (AIP) are not subject to this prohibition, provided the
employee's election to participate in the DRIP or AIP predates the date of the
employee's becoming subject to this prohibition. Optional cash purchases through
a DRIP or direct purchase plan (DPP) are subject to this prohibition.
Securities acquired in any account over which an employee has no direct or
indirect control over the investment decision making process (e.g.,
discretionary trading accounts) are not subject to this prohibition.
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 Corporate Compliance.
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BENEFICIAL OWNERSHIP
The provisions of the Policy apply to transactions in the employee's own name
and to all other accounts over which the employee could be presumed to exercise
influence or control, including:
o accounts of a spouse, minor children or relatives to whom substantial
support is contributed;
o accounts of any other member of the employee's household (e.g., a relative
living in the same home);
o trust or other accounts for which the employee acts as trustee or otherwise
exercises any type of guidance or influence;
o corporate accounts controlled, directly or indirectly, by the employee;
o arrangements similar to trust accounts that are established for bona fide
financial purposes and benefit the employee; and
o any other account for which the employee is the beneficial owner (see
Glossary for a more complete legal definition of "beneficial owner").
NON-MELLON EMPLOYEE
BENEFIT PLANS.
The provisions discussed above do not apply to transactions done under a bona
fide employee benefits plan administered by an organization not affiliated with
Mellon and by an employee of that organization who shares beneficial interest
with a Mellon employee, and in the securities of the employing organization.
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 transac-tions in the
employer's securities done by the spouse as part of the spouse's employee
benefit plan.
The Securities Trading Policy does not apply in such a situation. Rather, the
other organization is relied upon to provide adequate supervision with respect
to conflicts of interest and compliance with securities laws.
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PROTECTING CONFIDENTIAL INFORMATION
As an employee you may receive information about Mellon, its cus-tomers and
other parties that, for various reasons, should be treated as confidential. All
employees are expected to strictly comply with mea-sures necessary to preserve
the confidentiality of information. Employees should refer to the Mellon Code of
Conduct.
INSIDER TRADING AND TIPPING
LEGAL PROHIBITIONS
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 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;
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INSIDER TRADING AND TIPPING
LEGAL PROHIBITIONS
(cont.)
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.
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 this 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.
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RESTRICTIONS ON THE FLOW OF
INFORMATION WITHIN MELLON
(THE "CHINESE WALL")
As a diversified financial services organization, Mellon faces unique challenges
in complying with the prohibitions on insider trading and tipping of material
non-public information, and misuse of confidential 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 com-pany'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 "Chinese
Wall" policy applicable to all employees. The "Chinese Wall" separates the
Mellon units or individuals that are likely to receive material nonpublic
information (Potential Insider 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 Chinese Wall.
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SECTION TWO-APPLICABLE TO INVESTMENT EMPLOYEES
QUICK REFERENCE-INVESTMENT EMPLOYEES
SOME THINGS YOU MUST DO
STATEMENT OF ACCOUNTS AND HOLDINGS--Provide to your Preclearance Compliance
Officer a statement of all securities accounts and holdings within 10 days of
becoming an Investment Employee, and again annually on request.
DUPLICATE STATEMENTS & CONFIRMATIONS--Instruct your broker, trust account
manager or other entity through which you have a securities trading account to
send directly to Compliance:
o Trade confirmations summarizing each transaction
o Periodic statements
Exhibit A can be used to notify your broker. Contact your designated
Preclearance Compliance Officer for the correct address. This applies to all
accounts in which you have a beneficial interest.
PRECLEARANCE--Before initiating a securities transaction, written preclearance
must be obtained from the desig-nated Preclearance Compliance Officer. This can
be accomplished by completing a Preclearance Request Form and:
o delivering or faxing the request to the designated Preclearance Compliance
Officer, or
o contacting the designated Preclearance Compliance Officer for other
available notification options.
Preclearance Request Forms can be obtained from the designated Preclearance
Compliance Officer. If preclearance approval is received the trade should be
communicated to the broker on the same day, and executed before the end of the
next business day, at which time the preclearance approval will expire.
SPECIAL APPROVALS
o Acquisition of securities in a Private Placement must be precleared by the
employee's Department/Entity head, the Manager of Corporate Compliance and
the designated Preclearance Compliance Officer.
o Acquisition of securities through an allocation by the underwriter of an
Initial Public Offering (IPO) is prohibited without the approval of the
Manager of Corporate Compliance. Approval can be given only when the
allocation is the result of a direct family relationship.
SOME THINGS YOU MUST NOT DO
MELLON SECURITIES--The following transactions in Mellon securities are
prohibited for all Mellon Employees:
o Short sales;
o Purchasing and selling or selling and purchasing within 60 days;
o Purchasing or selling during a blackout period
o Margin purchases or options other than employee options.
NON-MELLON SECURITIES--
o Purchasing and selling or selling and purchasing within 60 days is
discouraged, and any profits must be disgorged.
o New investments in financial services organizations are prohibited for
certain employees only (see page 30).
OTHER RESTRICTIONS are detailed throughout Section Two.
READ THE POLICY!
EXEMPTIONS
Preclearance is NOT required for:
o Purchases or sales of high quality short-term debt instruments,
non-financial commodities (such as agricultural futures, metals, oil, gas,
etc.), currency futures, financial futures, index futures, index
securities, open-end mutual funds, non-affiliated closed-end investment
companies, commercial paper; CDs; bankers' acceptances; repurchase
agreements; and direct obligations of the govern-ment of the United
States.)
o Transactions in any account over which the employee has no direct or
indirect control over the invest ment decision making process.
o Transactions that are non-volitional on the part of an employee (such as
stock dividends).
o Changes in elections under Mellon's 401(k) Retirement Savings Plan.
o An exercise of an employee stock option adminis-tered by Human Resources.
o Automatic reinvestment of dividends under a DRIP or Automatic Investment
Plan. (Optional cash pur-chases under a DRIP or Direct Purchase Plan do
require preclearance.)
o Sales of securities pursuant to tender offers and sales or exercises of
"Rights" (see page 23).
QUESTIONS?
Contact your designated Preclearance Compliance Officer. If you don't know
who that is, call 412-234-1661
This page is for reference purposes only. Employees are reminded they must read
the Policy and comply with its provisions.
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STANDARDS OF CONDUCT FOR INVESTMENT EMPLOYEES
Because of their particular responsibilities, Investment Employees are subject
to preclearance and personal securities reporting require-ments, 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 Manager of Corporate Compliance. Interpretive issues that
arise under these procedures shall be decided by, and are subject to the
discretion of, the Manager of Corporate Compliance.
CONFLICT OF INTEREST
No employee may engage in or recommend any securities transac-tion 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
INFORMATION
No employee may divulge the current portfolio 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.
No employee may communicate material nonpublic information to others unless it
is properly within his or her job responsibilities to do so.
BROKERS
Trading Accounts--All Investment Employees are encouraged to conduct their
personal investing through a Mellon affiliate brokerage account. This will
assist in the monitoring of account activity on an ongoing basis in order to
ensure compliance with the Policy.
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PERSONAL SECURITIES
TRANSACTIONS REPORTS
Statements & Confirmations--All Investment 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 Manager of Corporate
Compliance or designated Preclearance Compliance Officer copies of all trade
confirmations and statements relating to each account of which they are a
beneficial owner regardless of what, if any, securities are maintained in such
accounts. Thus, for example, even if the brokerage account contains only mutual
funds or other exempt securities as that term is defined by the Policy and the
account has the capability to have reportable securities traded in it, the
Investment Employee maintaining such an account must arrange for duplicate
account statements and trade confirmations to be sent by the broker to the
Manager of Corporate Compliance or designated Preclearance Compliance Officer.
Exhibit A is an example of an instruction letter to a broker.
Other securities transactions which were not completed through a brokerage
account, such as gifts, inheritances, spin-offs from securities held outside
brokerage accounts, or other transfers must be reported to the designated
Preclearance Compliance Officer within 10 days.
PRECLEARANCE FOR PERSONAL
SECURITIES TRANSACTIONS
All Investment Employees must notify the designated Preclearance Compliance
Officer in writing and receive preclearance before they engage in any purchase
or sale of a security for their own accounts. Investment Employees should refer
to the provisions under "Beneficial Ownership" on page 31, which are applicable
to these provisions.
All requests for preclearance for a securities transaction shall be submitted by
completing a Preclearance Request Form which can be obtained from the designated
Preclearance Compliance Officer.
The designated 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 designated Preclearance
Compliance Officer to the Investment Employee. A record of such notification
will be maintained by the designated Preclearance Compliance Officer. However,
it shall be the responsi-bility of the Investment Employee to obtain a written
record of the designated Preclearance Compliance Officer's notification within
48 hours of such notification. The Investment Employee should retain a copy of
this written record.
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.
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PRECLEARANCE FOR PERSONAL
SECURITIES TRANSACTIONS
(cont.)
Although making a preclearance request does not obligate an Investment Employee
to do the transaction, it should be noted that:
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 should 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 pre-clearance request. If the
Investment Employee is preclearing as beneficial owner of another's
account, the response may be dis-closed to the other owner.
o Good Until Canceled/Stop Loss Orders ("Limit 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 Limit Order must be canceled or a new
preclearance authorization must be obtained.
BLACKOUT POLICY
Except as described below, Investment Employees will not generally be given
clearance to execute a transaction in any security that is on the restricted
list maintained by their 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.
Exceptions--Regardless of any restrictions above, Investment Employees will
generally be given clearance to execute the following transactions:
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.
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.
The Investment Employee is limited to two such trades in the securities of any
one issuer in any calendar month.
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EXEMPTIONS FROM REQUIREMENT
TO PRECLEAR
Preclearance is not required for the following transactions:
o Purchases or sales of Exempt Securities (direct obligations of the
government of the United States; high quality short-term debt instruments;
bankers' acceptances; CDs; commercial paper; repurchase agreements; and
securities issued by open-end investment companies);
o Purchases or sales of non-affiliated closed-end investment companies;
non-financial commodities (such as agricultural futures, metals, oil, gas,
etc.), currency futures, financial futures, index futures and index
securities;
o Purchases or sales effected in any account over which an employee has no
direct or indirect control over the investment decision making process
(e.g., discretionary trading accounts). Discretionary trading accounts may
only be maintained, without being subject to preclearance procedures, when
the Manager of Corporate Compliance, after a thorough review, is satisfied
that the account is truly discretionary;
o Transactions that are non-volitional on the part of an employee (such as
stock dividends);
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 by the Human Resources Department (for which the Human
Resources Department will forward information to the Manager of Corporate
Compliance);
o Changes to elections in the Mellon 401(k) plan;
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; and/or
o Sales effected pursuant to a bona fide tender offer.
GIFTING OF SECURITIES
Investment Employees desiring to make a bona fide gift of securities or who
receive a bona fide gift of securities do not need to preclear the transaction.
However, Investment Employees must report such bona fide gifts to the designated
Preclearance Compliance Officer. 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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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 not required to preclear
enrollment, the periodic reinvestment of dividend payments into additional
shares of company stock through a DRIP, or the periodic investments through an
AIP.
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.
STATEMENT OF SECURITIES
ACCOUNTS AND HOLDINGS
Within ten days of receiving this Policy and on an annual basis thereafter,
all Investment Employees must submit to the designated Preclearance Compliance
Officer:
o a listing of all securities trading accounts in which the employee has a
beneficial interest.
o a statement of all securities in which they presently have any direct or
indirect beneficial ownership other than Exempt Securities, as defined in
the Glossary.
The annual report must be completed upon the request of Corporate Compliance,
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 this
Policy.
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RESTRICTED LIST
Each 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 their 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
in order to avoid unwarranted inferences.
The Preclearance Compliance Officer will retain copies of the restricted lists
for five years.
CONFIDENTIAL TREATMENT
The Manager of Corporate Compliance 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 this Policy. Documents received from Investment Employees are
also available for inspection by the boards of directors of 40-Act entities and
by the boards of directors (or trustees or managing general partners, as
applicable) of the investment companies managed or administered by 40-Act
entities.
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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 could be presumed to exercise influence or
control (see provisions under "Beneficial Ownership" on page 31 for a more
complete discussion of the accounts to which these restrictions apply). These
restrictions are to be followed in addition to any restrictions that apply to
particular officers or directors (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 Resources Department is exempt from this restriction. Further, Mellon
securities may be used to collateralize loans or 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.
o Mellon Blackout Period-Employees are prohibited from buying or selling
Mellon's publicly traded securities during a blackout period. The blackout
period begins the 16th day of the last month of each calendar quarter and
ends 3 business days after Mellon Financial Corporation publicly announces
the financial results for that quarter. Thus, the blackout periods begin on
March 16, June 16, September 16 and December 16. The end of the blackout
period is determined by counting business days only, and the day of the
earnings announcement is day 1. The blackout period ends at the end of day
3, and employees can trade Mellon securities on day 4.
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MELLON 401(K) PLAN
For purposes of the blackout period and 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:
o Employees are prohibited from increasing or decreasing their existing
account balance allocation to Mellon Common Stock during the blackout
period.
o 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 either the blackout period or 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 purposes of either the blackout or the 60-day rule.
MELLON EMPLOYEE
STOCK OPTIONS
Receipt-Your receipt of an employee stock option from Mellon is not deemed to be
a purchase of a security. Therefore, it is exempt from preclearance and
reporting requirements, can take place during the blackout period and does not
constitute a purchase for purposes of the 60-day prohibition.
Exercises-The exercise of an employee stock option that results in your holding
the shares is exempt from preclearance and reporting requirements, can take
place during the blackout period and does not constitute a purchase for purposes
of the 60-day prohibition.
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MELLON EMPLOYEE
STOCK OPTIONS
(cont.)
"Cashless" Exercises-The exercise of an employee stock option which is part of a
"cashless exercise" or "netting of shares" that is administered by the Human
Resources Department or Chase Mellon Shareholder Services is exempt from the
preclearance and reporting requirements and will not constitute a purchase or a
sale for purposes of the 60-day prohibition. A "cashless exercise" or "netting
of shares" transaction is permitted during the blackout period for ShareSuccess
plan options only. They are not permitted during the blackout period for any
other plan options.
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, are prohibited during the blackout period and constitute 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 "Beneficial Ownership" below, 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 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, in trading naked options, in
trading that could be deemed excessive or in 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.
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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 Corporate Compliance.
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 NASD rules, 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 Corporate Compliance, the designated
Preclearance Compliance Officer and the Investment Employee's department
head. Approval must be given by all three persons for the acquisition to be
considered approved. 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.
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. With respect to Investment
Employees, any profits realized on such short term trades must be disgorged
in accordance with procedures established by senior management. Exception:
securities may be sold pursuant to a bona fide tender offer without
disgorgement under the 60-day rule.
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PROHIBITION ON INVESTMENTS IN
SECURITIES OF FINANCIAL SERVICES
ORGANIZATION
You are prohibited from acquiring any security issued by a financial services
organization if you are:
o a member of the Mellon Senior Management Committee.
o employed in any of the following departments:
o Corporate Strategy & Development
o Legal (Pittsburgh only)
o Finance (Pittsburgh only)
o an employee specifically designated by the Manager of Corporate Compliance
and informed that this prohibition is applicable to you.
Financial Services Organizations-The term "security issued by a financial
services organization" includes any security issued by:
o Commercial Banks other than Mellon
o 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 term "securities issued by a financial services organization" DOES NOT
INCLUDE securities issued by mutual funds, variable annuities or insurance
policies. 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's becoming subject to this prohibition may be maintained or
disposed of at the owner's discretion consistent with this policy.
Additional securities of a financial services organization acquired through the
reinvestment of the dividends paid by such financial services organization
through a dividend reinvestment program (DRIP), or through an automatic
investment plan (AIP) are not subject to this prohibition, provided the
employee's election to participate in the DRIP or AIP predates the date of the
employee's becoming subject to this prohibition. Optional cash purchases through
a DRIP or direct purchase plan (DPP) are subject to this prohibition.
Securities acquired in any account over which an employee has no direct or
indirect control over the investment decision making process (e.g. discretionary
trading accounts) are not subject to this prohibition.
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 Corporate Compliance.
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BENEFICIAL OWNERSHIP
The provisions of the Policy apply to transactions in the employee's own name
and to all other accounts over which the employee could be presumed to exercise
influence or control, including:
o accounts of a spouse, minor children or relatives to whom substantial
support is contributed;
o accounts of any other member of the employee's household (e.g., a relative
living in the same home);
o trust or other accounts for which the employee acts as trustee or otherwise
exercises any type of guidance or influence;
o corporate accounts controlled, directly or indirectly, by the employee;
o arrangements similar to trust accounts that are established for bona fide
financial purposes and benefit the employee; and
o any other account for which the employee is the beneficial owner (see
Glossary for a more complete legal definition of "beneficial owner").
NON-MELLON EMPLOYEE
BENEFIT PLANS
The provisions discussed above do not apply to transactions done under a bona
fide employee benefits plan administered by an organization not affiliated with
Mellon and by an employee of that organization who shares beneficial interest
with a Mellon employee, and in the securities of the employing organization.
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.
The Securities Trading Policy does not apply in such a situation. Rather, the
other organization is relied upon to provide adequate supervision with respect
to conflicts of interest and compliance with securities laws.
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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 TIPPING
LEGAL PROHIBITIONS
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 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; and
o information regarding a company's possible noncompliance with environmental
protection laws.
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INSIDER TRADING AND TIPPING
LEGAL PROHIBITIONS
(cont.)
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.
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 this 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.
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RESTRICTIONS ON THE FLOW OF
INFORMATION WITHIN MELLON
(THE "CHINESE WALL")
As a diversified financial services organization, Mellon faces unique challenges
in complying with the prohibitions on insider trading and tipping of material
non-public information, and misuse of confidential 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 "Chinese
Wall" policy applicable to all employees. The "Chinese Wall" separates the
Mellon units or individuals that are likely to receive material nonpublic
information (Potential Insider 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 Chinese 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, designated Preclearance Compliance Officer or the
Manager of Corporate Compliance.
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SECTION THREE-APPLICABLE TO OTHER EMPLOYEES
QUICK REFERENCE-OTHER EMPLOYEES
SOME THINGS YOU MUST DO
o If you buy or sell Mellon Financial Corporation securities you must provide
a report of the trade and a copy of the broker confirmation within 10 days
of transaction to the Manager of Corporate Compliance, AIM 151-4340. This
does not apply to the exercise of employee stock options, or changes in
elections under Mellon's 401(k) Retirement Savings Plan.
o If you want to purchase any security in a Private Placement you must first
obtain the approval of your Department/Entity head and the Manager of
Corporate Compliance. Contact the Manager of Corporate Compliance at
412-234-0810.
o Acquisition of securities through an allocation by the underwriter of an
Initial Public Offering (IPO) is prohibited without the approval of the
Manager of Corporate Compliance. Approval can be given only when the
allocation is the result of a direct family relationship.
o For Employees who are subject to the prohibition on new investments in
financial services organizations (certain employees only-see page 41),
broker must send directly to Manager of Corporate Compliance, Mellon
Financial Corporation, PO Box 3130, Pittsburgh, PA 15230-3130:
o Broker trade confirmations summarizing each transaction
o Periodic statements
Exhibit A can be used to notify your broker of all accounts for which your
broker will be responsible for sending duplicate confirmations and statements.
SOME THINGS YOU MUST NOT DO
MELLON SECURITIES--The following transactions in Mellon securities are
prohibited for all Mellon Employees:
o Short sales
o Purchasing and selling or selling and purchasing within 60 days
o Purchasing or selling during a blackout period
o Margin purchases or options other than employee options.
NON-MELLON SECURITIES--
o New investments in financial services organizations (certain employees
only-see page 41).
OTHER RESTRICTIONS are detailed throughout Section
Three. READ THE POLICY!
QUESTIONS?
412-234-1661
This page is for reference purposes only. Employees are reminded they must read
the Policy and comply with its provisions.
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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 Manager of Corporate Compliance. Interpretive issues that arise
under these procedures shall be decided by, and are subject to the discretion
of, the Manager of Corporate Compliance.
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
INFORMATION
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.
No employee may communicate material nonpublic information to others unless it
is properly within his or her job responsibilities to do so.
BROKERS
Trading Accounts-All employees are encouraged to conduct their personal
investing through a Mellon affiliate brokerage account.
PERSONAL SECURITIES TRANSACTIONS
REPORTS
Other Employees must report in writing to the Manager of Corporate
Compliance within ten calendar days 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").
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, 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.
BROKERAGE ACCOUNT STATEMENTS
Certain Other Employees are subject to the restriction on investments in
financial services organizations and are required to instruct their brokers to
send statements directly to Corporate Compliance. See page 41.
An example of an instruction letter to a broker is contained in Exhibit A.
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CONFIDENTIAL TREATMENT
The Manager of Corporate Compliance 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 this Policy.
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 could be expected to exercise influence or control (see
provisions under "Beneficial Ownership" on page 42 for a more complete
discussion of the accounts to which these restrictions apply). These
restrictions are to be followed in addition to any restrictions that apply to
particular officers or directors (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 Resources Department is exempt from this restriction. Further, Mellon
securities may be used to collateralize loans or 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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o Mellon Blackout Period-Employees are prohibited from buying or selling
Mellon's publicly traded securities during a blackout period. The blackout
period begins the 16th day of the last month of each calendar quarter and
ends 3 business days after Mellon Financial Corporation publicly announces
the financial results for that quarter. Thus, the blackout periods begin on
March 16, June 16, September 16 and December 16. The end of the blackout
period is determined by counting business days only, and the day of the
earnings announcement is day 1. The blackout period ends at the end of day
3, and employees can trade Mellon securities on day 4.
MELLON 401(K) PLAN
For purposes of the blackout period and 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:
o Employees are prohibited from increasing or decreasing their existing
account balance allocation to Mellon Common Stock during the blackout
period.
o 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 either the blackout period or 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 purposes of either the blackout or the 60-day rule.
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MELLON EMPLOYEE
STOCK OPTIONS
Receipt-Your receipt of an employee stock option from Mellon is not deemed to be
a purchase of a security. Therefore, it is exempt from reporting requirements,
can take place during the blackout period and does not constitute a purchase for
purposes of the 60-day prohibition.
Exercises-The exercise of an employee stock option that results in your holding
the shares is exempt from reporting requirements, can take place during the
blackout period and does not constitute a purchase for purposes of the 60-day
prohibition.
"Cashless" Exercises-The exercise of an employee stock option which is part of a
"cashless exercise" or "netting of shares" that is administered by the Human
Resources Department or Chase Mellon Shareholder Services is exempt from the
preclearance and reporting requirements and will not constitute a purchase or a
sale for purposes of the 60-day prohibition. A "cashless exercise" or "netting
of shares" transaction is permitted during the blackout period for ShareSuccess
plan options only. They are not permitted during the blackout period for any
other plan options.
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, are
prohibited during the blackout period and constitute 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 "Beneficial Ownership" on page 42, 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 or sell
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. In addition, lending
employees who have assigned responsibilities in a specific industry group
are not permitted to trade securities in that industry. This prohibition
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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, in trading naked options, in
trading that could be deemed excessive or in 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.
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 Corporate Compliance.
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
NASD rules, 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-Other Employees are prohibited from acquiring any
security in a private placement unless they obtain the prior written
approval of the Manager of Corporate Compliance and the employee's
department head. Approval must be given by both persons for the acquisition
to be considered approved. After receipt of the necessary approvals and the
acquisition, 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.
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PROHIBITION ON INVESTMENTS IN
SECURITIES OF FINANCIAL SERVICES
ORGANIZATIONS
You are prohibited from acquiring any security issued by a financial services
organization if you are:
o a member of the Mellon Senior Management Committee.
o employed in any of the following departments:
o Corporate Strategy & Development
o Legal (Pittsburgh only)
o Finance (Pittsburgh only)
o an employee specifically designated by the Manager of Corporate Compliance
and informed that this prohibition is applicable to you.
Brokerage Accounts-All employees subject to this restriction on investments in
financial services organizations are required to instruct their brokers to
submit directly to the Manager of Corporate Compliance copies of all trade
confirmations and statements relating to each account of which they are a
beneficial owner regardless of what, if any, securities are maintained in such
accounts. Thus, for example, even if the brokerage account has no reportable
securities traded in it, the employee maintaining such an account must arrange
for duplicate account statements and trade confirmations to be sent by the
broker to the Manager of Corporate Compliance. An example of an instruction
letter to a broker is contained in Exhibit A.
Financial Services Organizations-The term "security issued by a financial
services organization" includes any security issued by:
o Commercial Banks other than Mellon
o 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 term "securities issued by a financial services organization" does not
include securities issued by mutual funds, variable annuities or insurance
policies. 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's becoming subject to this prohibition may be maintained or
disposed of at the owner's discretion consistent with this policy.
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PROHIBITION ON INVESTMENTS IN
SECURITIES OF FINANCIAL SERVICES
ORGANIZATIONS
(cont.)
Additional securities of a financial services organization acquired through the
reinvestment of the dividends paid by such financial services organization
through a dividend reinvestment program (DRIP), or through an automatic
investment plan (AIP) are not subject to this prohibition, provided the
employee's election to participate in the DRIP or AIP predates the date of the
employee's becoming subject to this prohibition. Optional cash purchases through
a DRIP or direct purchase plan (DPP) are subject to this prohibition.
Securities acquired in any account over which an employee has no direct or
indirect control over the investment decision making process (e.g. discretionary
trading accounts) are not subject to this prohibition.
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 Corporate Compliance.
BENEFICIAL OWNERSHIP
The provisions of the Policy apply to transactions in the employee's own name
and to all other accounts over which the employee could be presumed to exercise
influence or control, including:
o accounts of a spouse, minor children or relatives to whom substantial
support is contributed;
o accounts of any other member of the employee's household (e.g., a relative
living in the same home);
o trust or other accounts for which the employee acts as trustee or otherwise
exercises any type of guidance or influence;
o corporate accounts controlled, directly or indirectly, by the employee;
o arrangements similar to trust accounts that are established for bona fide
financial purposes and benefit the employee; and
o any other account for which the employee is the beneficial owner (see
Glossary for a more complete legal definition of "beneficial owner").
NON-MELLON EMPLOYEE
BENEFIT PLANS
The provisions discussed above do not apply to transactions done under a bona
fide employee benefits plan administered by an organization not affiliated with
Mellon and by an employee of that organization who shares beneficial interest
with a Mellon employee, and in the securities of the employing organization.
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.
The Securities Trading Policy does not apply in such a situation. Rather, the
other organization is relied upon to provide adequate supervision with respect
to conflicts of interest and compliance with securities laws.
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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 TIPPING
LEGAL PROHIBITIONS
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 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; information about a
company received from a director of that company; and
o information regarding a company's possible noncompliance with environmental
protection laws.
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<PAGE>
Personal Securities Trading Practices
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INSIDER TRADING AND TIPPING
LEGAL PROHIBITIONS
(cont.)
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.
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 this 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.
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<PAGE>
Personal Securities Trading Practices
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RESTRICTIONS ON THE FLOW OF
INFORMATION WITHIN MELLON
(THE "CHINESE WALL")
As a diversified financial services organization, Mellon faces unique challenges
in complying with the prohibitions on insider trading and tipping of material
non-public information, and misuse of confidential 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 "Chinese
Wall" policy applicable to all employees. The "Chinese Wall" separates the
Mellon units or individuals that are likely to receive material nonpublic
information (Potential Insider 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 Chinese Wall.
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<PAGE>
Glossary
--------------------------------------------------------------------------------
DEFINITIONS
o 40-ACT ENTITY-A Mellon entity registered under the Investment Company Act
and/or the Investment Advisers Act of 1940.
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 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.
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<PAGE>
Glossary
--------------------------------------------------------------------------------
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 BENEFICIAL OWNERSHIP-The definition that follows conforms to
interpretations of the Securities and Exchange Commission on this matter.
Because a determination of beneficial ownership requires a detailed
analysis of personal financial circumstances that are subject to change,
Corporate Compliance ordinarily will not advise employees on this
definition. It is the responsibility of employee to read the definition and
based on that definition, determine whether he/she is the beneficial owner
of an account. If the employee determines that he/she is not a beneficial
owner of an account and Corporate Compliance becomes aware of the existence
of the account, the employee will be responsible for justifying his/her
determination.
Securities owned of record or held in the employee's name are generally
considered to be beneficially owned by the employee.
Securities held in the name of any other person are deemed to be
beneficially owned by the employee if by reason of any contract,
understanding, relationship, agreement or other arrangement, the employee
obtains therefrom benefits substantially equivalent to those of ownership,
including the power to vote, or to direct the disposition of, such
securities. Beneficial ownership includes securities held by others for the
employee's benefit (regardless of record ownership), e.g., securities held
for the employee or members of the employee's immediate family, defined
below, by agents, custodians, brokers, trustees, executors or other
administrators; securities owned by the employee, but which have not been
transferred into the employee's name on the books of the company;
securities which the employee has pledged; or securities owned by a
corporation that should be regarded as the employee's personal holding
corporation. As a natural person, beneficial ownership is deemed to include
securities held in the name or for the benefit of the employee's immediate
family, which includes the employee's spouse, the employee's minor children
and stepchildren and the employee's relatives or
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<PAGE>
Glossary
--------------------------------------------------------------------------------
o BENEFICIAL OWNERSHIP-definition continued:
the relatives of the employee's spouse who are sharing the employee's home,
unless because of countervailing circumstances, the employee does not enjoy
benefits substantially equivalent to those of ownership. Benefits
substantially equivalent to ownership include, for example, application of
the income derived from such securities to maintain a common home, meeting
expenses that such person otherwise would meet from other sources, and the
ability to exercise a controlling influence over the purchase, sale or
voting of such securities. An employee is also deemed the beneficial owner
of securities held in the name of some other person, even though the
employee does not obtain benefits of ownership, if the employee can vest or
revest title in himself at once, or at some future time.
In addition, a person will be deemed the beneficial owner of a security if
he has the right to acquire beneficial ownership of such security at any
time (within 60 days) including but not limited to any right to acquire:
(1) through the exercise of any option, warrant or right; (2) through the
conversion of a security; or (3) pursuant to the power to revoke a trust,
discretionary account or similar arrangement.
With respect to ownership of securities held in trust, beneficial ownership
includes ownership of securities as a trustee in instances where either the
employee as trustee or a member of the employee's "immediate family" has a
vested interest in the income or corpus of the trust, the ownership by the
employee of a vested beneficial interest in the trust and the ownership of
securities as a settlor of a trust in which the employee as the settlor has
the power to revoke the trust without obtaining the consent of the
beneficiaries. Certain exemptions to these trust beneficial ownership rules
exist, including an exemption for instances where beneficial ownership is
imposed solely by reason of the employee being settlor or beneficiary of
the securities held in trust and the ownership, acquisition and disposition
of such securities by the trust is made without the employee's prior
approval as settlor or beneficiary. "Immediate family" of an employee as
trustee means the employee's son or daughter (including any legally adopted
children) or any descendant of either, the employee's stepson or
stepdaughter, the employee's father or mother or any ancestor of either,
the employee's stepfather or stepmother and the employee's spouse.
To the extent that stockholders of a company use it as a personal trading
or investment medium and the company has no other substantial business,
stockholders are regarded as beneficial owners, to the extent of their
respective interests, of the stock thus invested or traded in. A general
partner in a partnership is considered to have indirect beneficial
ownership in the securities held by the partnership to the extent of his
pro rata interest in the partnership. Indirect beneficial ownership is not,
however, considered to exist solely by reason of an indirect interest in
portfolio
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<PAGE>
Glossary
--------------------------------------------------------------------------------
o BENEFICIAL OWNERSHIP-definition continued:
securities held by any holding company registered under the Public Utility
Holding Company Act of 1935, a pension or retirement plan holding
securities of an issuer whose employees generally are beneficiaries of the
plan and a business trust with over 25 beneficiaries.
Any person who, directly or indirectly, creates or uses a trust, proxy,
power of attorney, pooling arrangement or any other contract, arrangement
or device with the purpose or effect of divesting such person of beneficial
ownership as part of a plan or scheme to evade the reporting requirements
of the Securities Exchange Act of 1934 shall be deemed the beneficial owner
of such security.
The final determination of beneficial ownership is a question to be
determined in light of the facts of a particular case. Thus, while the
employee may include security holdings of other members of his family, the
employee may nonetheless disclaim beneficial ownership of such securities.
o "CHINESE WALL" POLICY-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 DIRECT FAMILY RELATION-employee's husband, wife, father, mother, brother,
sister, daughter or son. Includes the preceding plus, where appropriate,
the following prefixes/suffix: grand-, step-, foster-, half- and -in-law.
o DISCRETIONARY TRADING ACCOUNT-an account over which the employee has no
direct or indirect control over the investment decision making process.
o EMPLOYEE-any employee of 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,
domestic and international employees; does not include consultants and
contract or temporary employees.
o EXEMPT SECURITIES-Exempt Securities are defined as:
o direct obligations of the government of the United States;
o high quality short-term debt instruments;
o bankers' acceptances;
o bank certificates of deposit and time deposits;
o commercial paper;
o repurchase agreements;
o securities issued by open-end investment companies;
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<PAGE>
Glossary
--------------------------------------------------------------------------------
o FAMILY RELATION-see direct family relation.
o GENERAL COUNSEL-General Counsel of Mellon Financial Corporation 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 INITIAL PUBLIC OFFERING (IPO)-the first offering of a company's securities
to the public through an allocation by the underwriter.
o INVESTMENT CLUB- is 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 an investment
club participates in the investment decision making process, Insider Risk
Employees, Investment Employees and Access Decision Makers belonging to
such investment clubs must preclear and report the securities transactions
contemplated by such investment clubs. In contrast, a private investment
company is an organization where the investor invests his/her money, but
has no direct control over the way his/her money is invested. Insider Risk
Employees, Investment Employees and Access Decision Makers investing in
such a private investment company are not required to preclear any of the
securities transactions made by the private investment company. Insider
Risk Employees, Investment Employees and Access Decision Makers are
required to report their investment in a private investment company to the
Manager of Corporate Compliance and certify to the Manager of Corporate
Compliance that they have no direct control over the way their money is
invested.
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 is composed of investment, legal, compliance,
and audit management representatives of Mellon and its affiliates. The
members of the Investment Ethics Committee are:
o President and Chief Investment Officer of The Dreyfus Corporation
(Committee Chair)
o General Counsel, Mellon Financial Corporation
o Chief Risk Management Officer, Mellon Trust
o Manager of Corporate Compliance, Mellon Financial Corporation
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<PAGE>
Glossary
--------------------------------------------------------------------------------
o Corporate Chief Auditor, Mellon Financial Corporation
o Chief Investment Officer, Mellon Private Asset Management
o Executive Officer of a Mellon investment adviser (rotating membership)
The Committee has oversight of issues related to personal securities
trading and investment activity by Access Decision Makers.
o MANAGER OF CORPORATE COMPLIANCE-the employee within the Audit & Risk Review
Department of Mellon Financial Corporation who is responsible for
administering the Securities Trading Policy, or any person to whom relevant
authority is delegated by the Manager of Corporate Compliance.
o MELLON-Mellon Financial Corporation and all of its direct and indirect
subsidiaries.
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. 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.
o 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.
o 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 Type Buy Sale
--------------------------------------------------------------------------------
Put Sale of Purchase of
Underlying Security Underlying Security
--------------------------------------------------------------------------------
Call Purchase of Sale of
Underlying Security Underlying Security
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<PAGE>
Glossary
--------------------------------------------------------------------------------
o PRECLEARANCE COMPLIANCE OFFICER-a person designated by the Manager of
Corporate Compliance 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 the Securities Act of 1933 because it does not
constitute a public offering. Includes limited partnerships.
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.
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<PAGE>
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EXHIBIT A-SAMPLE INSTRUCTION
LETTER TO BROKER
Logo: Mellon
Date
Broker ABC
Street Address
City, State ZIP
Re: John Smith & Mary Smith
Account No. xxxxxxxxxxxx
In connection with my existing brokerage accounts at your firm noted above,
please be advised that the Compliance Department of my employer should be noted
as an "Interested Party" with respect to my accounts. They should, therefore, be
sent copies of all trade confirmations and account statements relating to my
account.
Please send the requested documentation ensuring the account holder's name
appears on all correspondence to:
Manager, Corporate Compliance
Mellon Financial Corporation
PO Box 3130 Pittsburgh, PA 15230-3130
or
Preclearance Compliance Officer
(obtain address from your designated Preclearance Compliance Officer)
Thank you for your cooperation in this request.
Sincerely yours,
Employee
cc: Manager, Corporate Compliance (151-4340) or Preclearance Compliance Officer
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<PAGE>
Questions Concerning the Securities Trading Policy?
Contact Corporate Compliance, (412) 234-1661
AIM 151-4340, Mellon Bank, Pittsburgh, PA 15258-0001
Logo: Mellon
--------------
Corporate Compliance
www.mellon.com
CO-1041 Rev. 06/00 PD 06/00
