HIRTLE CALLAGHAN & CO., INC.
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INTEGRITY POLICY
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Hirtle Callaghan & Co., Inc. ("Hirtle Callaghan" or "Firm") is committed to
maintaining the highest standards of ethical dealing and integrity both with
respect to all of its clients, including The Hirtle Callaghan Trust ("Trust"), a
registered investment company to which the Firm serves as an investment adviser.
In furtherance of this objective, and in accord with Rule 17j-1 under the
Investment Company Act of 1940 and Rule 204-2(a)(12) under the Investment
Advisers Act Hirtle Callaghan has adopted a comprehensive policy ("Policy") to
provide guidance for its personnel about the standards of conduct each such
individual is expected to meet. The reporting and review procedures prescribed
by this Policy, as it may be amended from time to time, are also designed to
comply with the requirements imposed on the Firm under various provisions of the
Federal securities laws, and have been formulated in light of the specialized
nature of the investment advisory services that the Firm provides.
Specifically, this Policy has been formulated in light of the fact that the Firm
does not provide traditional portfolio management services to its clients and,
in general, does not make recommendations with respect to the purchase and sale
of individual securities or the selection of brokers and dealers through which
securities transactions are effected on behalf of the Firm"s clients. Instead,
the Firm functions as each client"s "chief investment officer" by (i)
formulating an asset allocation program based on the financial circumstances of
each client; (ii) identifying investment firms that specialize in the asset
class or investment strategy selected; and (iii) negotiating with such firms to
assure that client assets placed with the firm will be managed on a basis that
is cost-effective for the client.
Each Firm Employee is required to read and to be familiar with this Policy and
to certify, at least annually, that he or she understands the Policy and has
complied with it. FIRM EMPLOYEES SHOULD BE MINDFUL OF THE FACT THAT THIS POLICY
DEPENDS UPON THE TIMELY FILING BY FIRM EMPLOYEES OF COMPLETE AND ACCURATE
REPORTS. CERTAIN FIRM EMPLOYEES WHO HAVE BEEN DEEMED "ACCESS PERSONS" HAVE
SPECIAL REPORTING REQUIREMENTS UNDER THIS POLICY. The imposition of sanctions
for violations of these Polices shall be at the discretion of the Firm"s Board
of Directors. At minimum, a written record of each incident shall be prepared
and maintained in employee files, for review in connection with the preparation
of the Firm"s Form ADV and, where appropriate, review by the Firm"s counsel and
the Trust. Repeated or serious violation may result in dismissal. Under certain
circumstances, violations of this Policy may subject individual employees or
officers of the Firm, or the Firm itself, to enforcement action by the
Securities and Exchange Commission ("SEC") or other regulatory authorities.
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HIRTLE CALLAGHAN & CO., INC.
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INTEGRITY POLICY
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CONTENTS
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SECTION I: STANDARDS OF CONDUCT applicable to all Firm Employees. Firm Employees
should be aware that Standards of Conduct extend to activities outside the Firm
and may extend to securities transactions effected by a Firm Employee for his or
her own account ("Personal Securities Account") and to transactions effected in
any securities account ("Related Account") in which a Firm Employee has a
Beneficial Ownership Interest.
SECTION II: REPORTING REQUIREMENTS that comply with the requirements imposed on
the Firm, in its capacity as an investment adviser to a registered investment
company, under the provisions of Rule 17j-1 under the Investment Company Act of
1940 ("1940 Act") and the Investment Advisers Act of 1940 ("Advisers Act").
SECTION III: INSIDER TRADING AND SECURITIES FRAUD ENFORCEMENT ACT OF 1988. This
act requires Hirtle Callaghan to establish, maintain, and enforce written
policies and procedures designed to detect and prevent insider trading by any
Firm Employee. Policies so established are included here.
SECTION IV: RECORD KEEPING AND REVIEW requirements relating to the information
that Firm Employees are required to submit to the Firm pursuant to this
Integrity Policy.
APPENDIX A-1: Securities Account Identification Form: [must be filed by Firm
employee upon employment and when changes in listing occur]
APPENDIX A-2: Quarterly Report Form and Definitions: [must be filed quarterly
by all employees]
APPENDIX A-3: Initial/Annual Holdings Report Form [must be filed by all
employees upon employment and annually thereafter]
APPENDIX B-1: Form of Certification to The Hirtle Callaghan Trust [provided by
Designated Principal annually to the Board of Trustees of The
Hirtle Callaghan Trust]
APPENDIX B-2: List of Access Persons [Designated Principal must review and
update as necessary]
APPENDIX B-3: Firm Employee/Access Person Certification [includes Policy
summary; must be filed annually by each employee]
APPENDIX C-1: Definitions and Examples.
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I STANDARDS OF CONDUCT
FIVE POINT SUMMARY
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o THE INTERESTS OF THE FIRM"S CLIENTS ARE PARAMOUNT; AVOID EVEN THE
APPEARANCE OF ACTING OTHER THAN IN THE BESTS INTERESTS OF A CLIENT.
o KEEP ALL MATTERS RELATING TO THE FIRM OR ITS CLIENTS STRICTLY
CONFIDENTIAL.
o FIRM EMPLOYEES MAY NOT PARTICIPATE IN ANY IPO EXCEPT UNDER
EXTRAORDINARY CIRCUMSTANCES AND WITH THE PRIOR WRITTEN APPROVAL OF THE
FIRM AND FIRM EMPLOYEES MAY NOT FACILITATE SUCH PARTICIPATION BY ANY
CLIENT OF THE FIRM;
o FIRM EMPLOYEES MAY NOT PURCHASE ANY PRIVATELY PLACED SECURITY WITHOUT
THE PRIOR WRITTEN APPROVAL OF THE FIRM.
o FIRM EMPLOYEES ARE FORBIDDEN FROM TRADING, EITHER PERSONALLY OR ON
BEHALF OF OTHERS ON MATERIAL INSIDE INFORMATION ("INSIDER TRADING")
AND FROM COMMUNICATING OR DISSEMINATING MATERIAL INSIDE INFORMATION TO
OTHERS ("TIPPING").
A. Improper Conduct: General.
In general, it is inappropriate for any person associated with Hirtle Callaghan
to engage in any conduct that would give rise to an implication that such person
was acting other than in the best interests of the Firm"s clients, including the
Trust. As more fully discussed below, the Firm has adopted specific procedures
designed to eliminate to the greatest extent possible, investment related
situations that might give rise to conflicts of interests between the Firm and
its personnel on the one hand and the Firm"s clients on the other. Conduct
outside of the investment arena could also affect the Firm"s reputation for
integrity and fair dealing and Firm personnel are expected to refrain from
engaging in such conduct. It is, of course, not possible to enumerate all
conduct that might be deemed inappropriate. It is not, however,the intent of
this Policy to prohibit the everyday courtesies of business life. The following
examples are offered as guidance and should be applied with sound judgment and
common sense:
It would be improper for any employee, officer or director of the Firm
(hereinafter, "Firm Employee"), without written authorization from the
Firm"s Board of Directors or Designated Principal to:
(i) engage in any self-dealing or other transactions benefitting a
Firm Employee at the expense of the Firm or its clients.
(ii) accept a gift or bequest, particularly from a client or an
organization, such as a brokerage firm with which the Firm does
business ("Firm Supplier") if such acceptance would give rise to any
implication of improper influence. (Advertising or promotional
material or gifts recognizing established relationships with Firm
Suppliers of a value not exceeding $100 per source would generally not
be deemed to give rise to such an implication.)
(iii) borrow money from or lend money to a client or Firm Supplier,
except that loans from a bank or margin purchases through a brokerage
firm that are clients or Firm Suppliers is permissible provided that
no special terms are arranged for the benefit of a Firm Employee.
(iv) invest in business ventures sponsored by a client or a Firm
Supplier, except that investments in public traded securities of
highly capitalized, listed issuers would generally be permissible.
(v) make any contributions or expenditures for political candidates on
behalf of the Firm without the written consent of the Firm, provided
that Firm Employees individually may campaign for or contribute to
candidates of their choice.
(vi) engage in the conduct of another business, accept employment
outside of the Firm or serve on the
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board of any public company without the approval of the Firm. Firm
Employees who serve as directors or trustees of any non-public company
or nonprofit organizations are encouraged to report relevant
information to the Firm's Board of Directors or Designated Principal.
(vii) trade, either personally or on behalf of others, on material
inside information and from communicating or disseminating material
inside information to others ("tipping"). Specific information
relating to this matter are set forth in Section IV of this Policy.
(viii) cause another person to do something on behalf of a Firm
Employee that he or she could not have done personally.
B. Special Responsibilities of Firm Employees with respect to the Trust.
Neither the Firm, nor any Firm Employee may, in connection with the purchase or
sale, directly or indirectly, of a security or otherwise:
(i) employ any device, scheme or artifice to defraud the Trust;
(ii) make any untrue statement of a material fact to the Trust or omit
to state a material fact necessary in order to make the
statements made to the Trust, in light of the circumstances under
which they are made, not misleading;
(iii)engage in any act, practice or course of business that operates
or would operate as a fraud or deceit on the Trust; or
(iv) engage in any manipulative practice with respect to the Trust.
C. Confidentiality.
The nature of the Firm"s business is such that employees may be in possession of
confidential, proprietary or market-sensitive information, including material
inside information. All employees have an obligation to respect and protect the
confidential nature of relationships with and information about former, present
and prospective clients, portfolio relationships with and information about
former, present and prospective clients, portfolio companies and suppliers of
the Firm. Any such information that is acquired by employees in the course of
the Firm"s business must be kept confidential and may be used solely for proper
purposes of the Firm. Under no circumstances shall an employee disclose such
information to unauthorized persons or use or assist others in using
confidential information for personal gain.
In addition to information concerning other companies or persons, confidential
information about the Firm or its employees should not be disclosed to persons
outside the Firm, or to employees who have no reasonable need for such
information in the course of their duties, nor should any employee use or assist
others in using confidential information for personal gain or any other reason.
This principle applies, among other matters, to investment policy and strategy,
trade secrets, pricing information (especially non-public fee schedules),
internal policies and financial status. In addition, the Firm is, from time to
time, party to confidentiality agreements that prohibit Firm Employees from
disclosing confidential information to any one outside of the Firm and may be
subject to suit in the event that the terms of any such agreement are breached.
D. Securities Accounts of Firm Employees.
Each Firm Employee is required to adhere to the following procedures in
connection with securities transactions effected for his or her own account
("Personal Securities Accounts"). The procedures described below are also
applicable to securities transactions made in any account in which the Firm
Employee has a Beneficial Ownership Interest or over which the Firm Employee has
direct, indirect or shared influence or control ("Related Accounts").
Each Firm Employee shall submit to the Board of Directors or Designated
Principal a list of Personal Securities Accounts and Related Accounts and shall
similarly report any changes or additions in such list promptly as they may
occur.
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E. Acquisition of "Hot Issues" Prohibited.
It is the Firm"s policy that neither the Firm nor any Firm Employee may
participate in any initial public offering where in the availability of the
securities being issued is limited ("IPO" or "Hot Issue"), either directly or in
an Related Account. In addition, it is the policy of the Firm that the Firm will
not facilitate the direct acquisition of Hot Issues by individual clients. The
principle underlying this prohibition is that, if a Firm Employee (or the Firm
itself) participates in such an offering and does not make the opportunity to
acquire the issue available to those of the Firm"s clients for whom such an
investment may be suitable, there arises an implication that the Firm Employee
(or the Firm) has his or her own interests ahead of those of the client.1
Notwithstanding this prohibition, the Firm's Board of Directors and/or
Designated Principal, in their sole discretion, may approve the acquisition of a
Hot Issue by a Firm Employee (or spouse or other family member) in circumstances
that permit the Board or Designated Principal reasonably to determine that the
opportunity to acquire the security has been made available to the person for
reasons other than the person's relationship with the Firm or its clients, such
as when the opportunity to participate in the offering results from a
pre-existing ownership of an interest in in the issuer or an investor in such
issuer, or other substantial, pre-existing relationship. Any such approval must
be requested and approved in writing prior to effecting the transaction in
question.
F. Private Placements.
Neither the Firm or any Firm Employee may acquire an interest in an offering of
securities that are exempt from registration under the Securities Act of 1933
("Private Placements" or "Limited Offering Securities") unless approval of such
acquisition is requested and approved in writing by the Board of Directors or
Designated Principal in advance of the purchase. Such approval may be granted in
cases where the acquisition does not conflict with the policies underlying this
Policy, or the interests of the Firm or its clients and in circumstances in
which the opportunity to acquire the security has been made available to the
person for reasons other than the person's relationship with the Firm or its
clients.
G. Improper Transactions.
If a case should arise where it appears that, in contravention of this Policy,
the Board of Directors or Designated Principal may require such transactions to
be unwound and/or may impose other sanctions, as deemed appropriate by the Firm.
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1 See, e.g. IN THE MATTER OF SPEAKER AND JANUS, Investment Advisers Act Release
No. 1605 (January 13, 1997); IN THE MATTER OF JOAN CONAN Investment Advisers Act
Release No. 1446 (September 30, 1994).
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II REPORTING REQUIREMENTS
FIVE POINT SUMMARY
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o EVERY FIRM EMPLOYEE MUST SUBMIT TO THE FIRM A QUARTERLY REPORT ON
EVERY TRANSACTION INVOLVING A COVERED SECURITY EFFECTED IN ANY
PERSONAL SECURITIES ACCOUNT OR RELATED ACCOUNT DURING THE PRECEDING
QUARTER.
o EVERY FIRM EMPLOYEE MUST SUBMIT TO FIRM A LIST OF ALL PERSONAL
SECURITIES ACCOUNTS AND RELATED ACCOUNTS IN WHICH ANY FIRM EMPLOYEE
HAS A BENEFICIAL INTEREST.
o EACH FIRM EMPLOYEE WHO IS AN ACCESS PERSON MUST SUBMIT TO THE FIRM AN
INITIAL STATEMENT OF HIS OR HER HOLDINGS OF COVERED SECURITIES.
o EACH FIRM EMPLOYEE WHO IS AN ACCESS PERSON MUST SUBMIT TO THE FIRM AN
ANNUAL STATEMENT OF HIS OR HER HOLDINGS OF COVERED SECURITIES.
o EVERY FIRM EMPLOYEE WILL BE REQUIRED ANNUALLY TO CERTIFY THAT HE OR
SHE HAS COMPLIED WITH THOSE REPORTING REQUIREMENTS TO WHICH HE OR SHE
IS SUBJECT UNDER THIS POLICY.
A. Identification of Securities Accounts
Every Firm Employee must submit a list of all accounts held with any broker,
bank or investment adviser in which he or she has a Beneficial Interest. The
first such report shall be made within 10 days of the date on which the Firm
Employee commences employment. Such report shall be substantially in the form
Appendix A-1 to this Policy. Each listing must include:
(i) The name of the broker, dealer or bank with whom the Access
Person who established the account;
(ii) The date the account was established; and
(iii) The date that the report is submitted by the Access Person.
B. Submission of Quarterly Reports
Within 10 days of the end of each calendar quarter, every Firm Employee shall
submit to the Designated Principal a report of every transaction in a Covered
Security effected in any Personal Securities Account or any Related Account
during such quarter. The report shall be substantially in the form of Appendix
A-2 to this Policy. Each Quarterly Report must include:
(i) The date of the transaction, the title, the interest rate and
maturity date (if applicable), the number of shares and the
principal amount of each Covered Security involved;
(ii) The nature of the transaction (i.e., purchase, sale or any other
type of acquisition or disposition);
(iii)The price of the Covered Security at which the transaction was
effected;
(iv) The name of the broker, dealer or bank with or through which the
transaction was effected; and
(v) The date that the report is submitted by the Access Person.
(vi) With respect to any brokerage or bank account established by an
Access Perons in which securities are held during the quarter,
the quarterly report shall include the name of the broker, dealer
or bank with whom the Access Person who established the account,
the date the account was established; and the date that the
report is submitted by the Access Person.
C. Additional Reports To be Submitted by Access Persons
(i) IDENTITY OF ACCESS PERSONS. A Firm Employee or other individual
will be deemed an
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"Access Person" for purposes of this Policy in accordance with
the analysis set forth in Schedule B-1. Those individuals who
have been deemed Access Persons are listed in Appendix B-1; Firm
Employees who may become Access Persons will be notified of their
status by the Firm.
(ii) INITIAL HOLDINGS STATEMENT. Every Access Person shall submit to
the Firm an initial statement of his or her holdings of Covered
Securities ("Initial Holdings Statement"). This statement must be
submitted within 10 days of the date on which such person becomes
an Access Person, except that, in the case of individuals who
were Access Person on February 29, 2000, no such initial
statement must be submitted. The Initial Holdings Statement shall
be substantially in the form of Appendix A-3 to this Policy. Each
Initial Holdings Statement must include:
(a) The title, number of shares and principal amount of each
Covered Security in which the Access Person had any direct
or indirect beneficial ownership when the person became an
Access Person;
(b) The name of any broker, dealer or bank with whom the Access
Person maintained an account in which any securities were
held for the direct or indirect benefit of the Access Person
as of the date the person became an Access Person; and
(c) The date that the report is submitted by the Access Person.
(iii)ANNUAL HOLDINGS STATEMENT. On or before January 30 of each year,
every Access Person must submit an Annual Holdings Statement,
which Annual Holdings Statement must be current as of December 31
of the immediately preceding year. The Annual Holdings Statement
shall be substantially in the form of Appendix A-3 to this
Policy. Each Annual Holdings Statement must include:
(a) The title, number of shares and principal amount of each
Covered Security in which the Access Person had any direct
or indirect beneficial ownership when the person became an
Access Person;
(b) The name of any broker, dealer or bank with whom the Access
Person maintained an account in which any securities were
held for the direct or indirect benefit of the Access Person
as of the date the person became an Access Person; and
(c) The date that the report is submitted by the Access Person.
D. Annual Certification
Every Firm Employee must certify, in substantially the form of Appendix A-5 that
he or she is familiar with the provisions of this Policy and has complied with
such Policy during the preceding calendar year. This certification shall be
submitted with the Quarterly Report submitted by the Firm Employee relating to
the quarter ending December 31 of each year or alternatively, in the case of
Access Persons, with the annual holdings statement.
E. Exempted Accounts/Exempted Transactions
With the approval of the Designated Principal, Firm Employees may arrange for
the Firm to receive duplicate confirmations of transactions involving Covered
Securities in lieu of filing Quarterly Reports. [Note: Initial Holdings Reports
and Annual Holdings Reports would still be required to be filed by Access
Persons.]
Neither the quarterly Reporting requirement or Holdings Statements are required
with respect to transactions affected for, or Covered Securities held in, any
account over which the Firm Employee has no direct or indirect influence or
control. A determination as to whether any securities account or transaction may
be within the scope of this exception must be made, in writing, by the
Designated Principal or by the Firm's Board of Directors.
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III INSIDER TRADING POLICY
FIVE POINT SUMMARY
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o THE MAKING OF INVESTMENT DECISIONS BASED ON "MATERIAL" "INSIDE
INFORMATION" IS PROHIBITED;
o COMMUNICATING "MATERIAL" "INSIDE INFORMATION" TO OTHERS IS
PROHIBITED.
o INFORMATION IS "INSIDE INFORMATION" IF IT IS NOT GENERALLY KNOWN
TO THE MARKETPLACE.
o INFORMATION IS CONSIDERED "MATERIAL" IF IS LIKELY TO BE
CONSIDERED IMPORTANT BY A REASONABLE INVESTOR IN MAKING AN
INVESTMENT DECISION.
o VIOLATION OF THE FIRM"S INSIDER TRADING POLICY CAN RESULT IN
VIOLATIONS OF FEDERAL LAW THAT MAY CARRY CIVIL AND/OR CRIMINAL
PENALTIES.
A. Prohibition.
Hirtle Callaghan forbids any Firm Employee from trading, either personally or on
behalf of others, on material nonpublic information or communicating material
nonpublic information to others in violation of the law. This conduct is
frequently referred to as "insider trading." The Firm prohibits any employee
from trading, either personally or on behalf of others (including any funds and
private accounts managed by the Firm) on material inside information and
prohibits communication or dissemination of material inside information to
others ("tipping") in violation of the law. THE FIRM"S POLICY APPLIES TO EVERY
OFFICER, DIRECTOR AND EMPLOYEE AND EXTENDS TO ACTIVITIES WITHIN AND OUTSIDE
THEIR DUTIES AT THE FIRM.
B. What is Insider Trading?
The term "insider trading" is not defined in the federal securities laws, but
generally is used to refer to the use of material nonpublic information to trade
in securities (whether or not one is an "insider") or to communications of
material nonpublic information to others. While the law concerning insider
trading is not static, it is generally understood that the law prohibits:
trading by an insider, while in possession of material nonpublic information, or
trading by a non-insider, while in possession of material nonpublic information,
where the information either was disclosed to the non-insider in violation of an
insider's duty to keep it confidential or was misappropriated, or communicating
material nonpublic information to others.
C. Identifying Inside Information.
Before trading for yourself or others in the securities of a company about which
you may have potential inside information, ask yourself the following questions:
o Is this information that an investor would consider important in
making his or her investment decisions?
o Is this information that would substantially affect the market
price of the securities if generally disclosed?
o What is the source of the information?
o Has the information been effectively communicated to the
marketplace? 2
If, after consideration of the above, you believe that the information is
material and nonpublic, or if you have questions as to whether the information
is material and nonpublic, you should report the matter to the Board of
Directors or Designated Principal and refrain from trading with respect to the
security involved and refrain from communicating the information in question to
any one other than the Board of Directors or Designated Principal, either inside
or outside of the Firm until you have received instructions on the matter from
the Board of Directors or Designated Principal. The elements of insider trading
and the penalties for such unlawful conduct are discussed below.
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2 For example, information that has been published in a newspaper or magazine of
general publication, such as REUTERS or THE WALL STREET JOURNAL would be deemed
to have been effectively communicated to the public.
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(i) Who is an Insider?
The concept of "insider" is broad. It includes officers, directors and employees
of a company. In addition, a person can be a "temporary insider" if he or she
enters into a special confidential relationship in the conduct of a company's
affairs and as a result is given access to information solely for the company's
purposes. A temporary insider can include, among others, a company's attorneys,
accountants, consultants, bank lending officers, and the employees of such
organizations. In addition, Hirtle Callaghan may become a temporary insider of a
company it advises or for which it performs other services. According to the
Supreme Court, the company must expect the individual to keep the disclosed
nonpublic information confidential and the relationship must at least imply such
a duty before the individual will be considered an insider.
(ii) What is Material Information?
Trading on inside information is not a basis for liability unless the
information is material. "Material information" generally is defined as
information for which there is a substantial likelihood that a reasonable
investor would consider it important in making his or her investment decisions,
or information that is reasonably certain to have a substantial effect on the
price of a company's securities.3
(iii) What is Nonpublic Information?
Information is nonpublic until it has been effectively communicated to the
market place. One must be able to point to some fact to show that the
information is generally public. For example, information found in a report
filed with the SEC, or appearing in REUTERS ECONOMIC SERVICES, THE WALL STREET
JOURNAL or other publications of general circulation would be considered public.
(iv) What are the Penalties for Insider Trading?
Penalties for trading on or communicating material nonpublic information are
severe, both for individuals involved in such unlawful conduct and their
employers. A person can be subject to some or all of the penalties below even if
he or she does not personally benefit from the violation. Penalties include
civil injunctions, treble damages, disgorgement of parties, jail sentences,
fines for the person who committed the violation of up to three times the profit
gained or loss avoided, whether or not the person actually benefitted, and fines
for the employer or other controlling person of up to the greater of $1,000,000
or three times the amount of the profit gained or loss avoided. In addition, any
violation of this policy statement can be expected to result in serious
sanctions by Hirtle Callaghan, including dismissal of the persons involved.
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3 Examples of information that should be presumed "material" include but are not
limited to information relevant to dividend changes, earnings estimates,
significant changes in relationships with clients, suppliers and key personnel,
mergers or acquisitions, major litigation or significant new products or
discoveries. This list is not exhaustive.
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IV FIRM RESPONSIBILITIES: REVIEW AND RECORD KEEPING
FIVE POINT SUMMARY
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o ALL FIRM EMPLOYEES WILL BE REMINDED EACH QUARTER OF THEIR
REPORTING OBLIGATIONS UNDER THIS POLICY
o A DETERMINATION WILL BE MADE THE DESIGNATED PRINCIPAL OF WHICH
FIRM EMPLOYEE ARE ACCESS PERSONS AND THUS SUBJECT TO EXPANDED
REPORTING OBLIGATIONS, AND A CURRENT LIST OF SUCH ACCESS PERSONS
SHALL BE MAINTAINED AS APPENDIX B TO THIS POLICY.
o THE DESIGNATED PRINCIPAL SHALL REVIEW ALL QUARTERLY REPORTS WITH
A VIEW TO DETERMINING WHETHER ANY REPORTED TRANSACTIONS MAY HAVE
VIOLATED THIS POLICY.
o THE DESIGNATED PRINCIPAL SHALL BE RESPONSIBLE FOR ASSURING THAT
ALL RECORDS REQUIRED TO BE MAINTAINED UNDER RULE 204-2 OF THE
ADVISERS ACT AND RULE 17J-1 OF THE 1940 ACT ARE MAINTAINED IN THE
MANNER PRESCRIBED.
o THE FIRM SHALL AT LEAST ANNUALLY CERTIFY TO THE BOARD OF TRUSTEES
OF THE TRUST THAT THE FIRM THIS POLICY REMAINS IN EFFECT AND IS
ADEQUATE TO ASSURE THAT ACCESS PERSONS OF THE TRUST WHO ARE FIRM
EMPLOYEES HAVE NOT VIOLATED ITS PROVISIONS.
A. Notification to Firm Employees of their Obligations under this Policy.
THE DESIGNATED PRINCIPAL OR HIS DESIGNEE WILL, AT THE END OF EACH QUARTER,
PROVIDE TO EACH FIRM EMPLOYEE WITH THE NECESSARY REPORTING FORM (APPENDIX A-2)
AND ASSURE THAT SUCH FORM IS COMPLETED AND SUBMITTED TO DESIGNATED PRINCIPAL FOR
REVIEW. AT THE END OF EACH YEAR, SUCH QUARTERLY REPORTING FORMS WILL BE
ACCOMPANIED BY AN ANNUAL HOLDINGS REPORT FORM (APPENDIX A-2); SECURITIES ACCOUNT
IDENTIFICATION FORM (APPENDIX A-2) AND FIRM/EMPLOYEE/ACCESS PERSON CERTIFICATION
FORM (APPENDIX B-1) AND ASSURE THAT SUCH FORMS ARE COMPLETED AND SUBMITTED TO
DESIGNATED PRINCIPAL FOR REVIEW.
B. Identification of Access Persons.
THE DESIGNATED PRINCIPAL SHALL BE RESPONSIBLE FOR MAKING AN INTIAL DETERMINATION
AS TO WHICH FIRM EMPLOYEE'S SHOULD BE DEEMED "ACCESS PERSONS" FOR PURPOSES OF
THE REPORTING REQUIREMENTS OF THIS POLICY. SUCH DETERMINATIONS SHALL BE LISTED
ON APPENDIX B-1 AND SHALL BE SUJECT TO RATIFICATION OF THE FIRM'S BOARD OF
DIRECTORS AT THE NEXT BOARD MEETING FOLLOWING SUCH DETERMINATION.
C. Review Procedures; Procedures to be Followed in the Event of a
Violation.
The Designated Principal shall, following receipt of the various reports
required to be made under this Policy, consider (i) whether any personal
securities transaction evidences an apparent violation of this policy, and in
particular Sections IPart B or III hereof; and (ii) whether any apparent
violation of the reporting requirement has occurred. Upon making a determination
that a violation of this Code, including its reporting requirements, has
occurred, the Designated Principal shall report such violations to the Firm's
Board of Directors, which shall determine what actions, if any, should be taken.
The Designated Principal shall prepare quarterly reports with respect to any
material trading violation under this Policy; any such reports shall be provided
to the Trust's Board of Trustees, as appropriate.
D. Required Records.
The Firm will maintain records relating to this Policy in the manner and to the
extent et out below, and will make these records available to the SEC or any
representative of the SEC at any time and from time to time for reasonable
periodic, special or other examination:
(i) A copy of this policy and the Firm's prior policy shall be
maintained in an easily accessible place;
(ii) A record of any violation of the Policy, and of any action taken
as a result of the violation, must be maintained in an easily
accessible place for at lease five years after the
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end of the fiscal year in which the violation occurs;
(iii)A copy of each report made by an Access Person/Firm Employee as
required by this section must be maintained for at lease five
years after the end of the fiscal year in which the report is
made or the information is provided, the first two year in an
easily accessible place;
(iv) A record of Access persons who are or, within the past five
years, were, required to make reports under this Policy or who
are or were responsible for reviewing these reports, must be
maintained in an easily accessible place; and
(v) A copy of each report prepared by the Designated Principal
required by this section must be maintained for at lease five
years after the end of the fiscal yea in which it is made, the
first two years in an easily accessible place.
(vi) A record of any decision, and the reasons supporting the
decision, to approve the acquisition by investment personnel of
Limited Offering Securities for at lease five years after the end
of the fiscal year in which the approval is granted
E. Certification to the Trust.
The Designated Principal shall annually prepare a written report to be presented
to the Board of Trustees of the Trust detailing (i) any issues arising under
this Policy since the preceding report, including information about material
violations of this Policy and sanction imposed in response to such material
violations; and (ii) a certification, in the form of Appendix A-4 hereto, that
this Policy as currently in effect is designed to be reasonably necessary to
prevent Access Persons from violating this Policy.
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Integrity Policy
<PAGE>
APPENDICES
----------
Appendix A-1 Securities Account Identification Form
Appendix A-2 Quarterly Report Form
Appendix A-3 Initial/Annual Holdings Report Form
Appendix B-1 Form of Certification to The Hirtle Callaghan Trust
Appendix B-2 List of Access Persons
Appendix B-3 Firm Employee/Access Person Certification
Appendix C: Definitions and Examples
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Integrity Policy
<PAGE>
A-1 Securities Account Identification Form
[NAME OF FIRM EMPLOYEE]
---------------------
This report is being submitted pursuant to the Integrity Policy established by
Hirtle, Callaghan & Co., Inc. ("Firm") The undersigned certifies that the
following is an accurate and complete listing of all securities accounts in
which I have a Beneficial Interest and that I will inform the Firm, in writing,
of any additional such account that may be established not later than 10 days
after the calendar quarter in which such additional account is established:
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------
Date Established Name of the Account/Account No. Name of Broker/Bank/Adviser
--------------------------------------------------------------------------------------------
<S> <C> <C>
--------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------
</TABLE>
Name of Reporting Person (Print): _________________________________
Signature of Reporting Person: _________________________________
Date of Submission _________________________________
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<PAGE>
A-2: Quarterly Report Form
HIRTLE, CALLAGHAN & CO., INC.
QUARTERLY SECURITIES TRANSACTION REPORT FOR THE QUARTER ENDED:
***SEE REVERSE FOR IMPORTANT DEFINITIONS***
FROM: [NAME OF FIRM EMPLOYEE]
---------------------
1. This report is being submitted pursuant to the Integrity Policy established
by Hirtle, Callaghan & Co., Inc. The undersigned certifies that the
transactions described below were purchased or sold in reliance upon public
information lawfully obtained and were not based upon information obtained
as a result of any affiliation with Hirtle Callaghan & Co., Inc. ("Firm")
2. PLEASE CHECK ONE:
o The undersigned had no reportable securities transactions during
the above-referenced quarterly period. OR
o Please see attached confirmation/statement relating to reportable
securities transactions during the above referenced period, which
statement includes all of the information : indicated in the
table below. OR
o The undersigned had the following reportable securities
transactions during the above referenced period:
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------
DATE TRANSACTION SECURITY AMOUNT PRICE/SHARE BROKER TOTAL
---- ----------- -------- ------ ----------- ------ -----
---------------------------------------------- COMMISSION
(interest rate/maturity (principal amount, ----------
date, if applicable) if applicable)
--------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
EXAMPLE (Sold) (IBM Common) (100 Shares) ($48 1/2) (Paine ($148)
------- Webber)
(1/3/00) --------------------------
--------------------------------------------------------------------------------------------------------------
(1/25/00) (Buy) (NYC Housing Bond) ($5000) (NA)
--------------------------
(7.25% 12/31/08)
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
</TABLE>
3.
o The undersigned certifies that an accurate listing of all
securities accounts in which I have a Beneficial Interest is on
file with the Firm. OR
o During the above-referenced quarterly period, the undersigned
established following account(s):
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------
Date Established Name of the Account/Account No. Name/Address of Broker/Bank/Adviser
--------------------------------------------------------------------------------------------
<S> <C> <C>
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
</TABLE>
I certify that the information I am providing in this report is accurate and
includes all transactions pursuant to which, and account in which, I acquired
direct or indirect beneficial ownership of a security, other than transactions
in U.S. Government securities, transactions in mutual fund shares or
transactions in accounts over which I have no direct or indirect influence or
control in accordance with a determination to that effect under the Policy. This
report shall not be construed as an admission that I have or have had any direct
or indirect beneficial ownership in the securities listed.
Signature of Reporting Person: _________________________________
Date of Submission _________________________________
NOTE: REPORT MUST BE FILED WITHIN TEN DAYS OF THE END OF THE CALENDAR
QUARTER TO WHICH THE REPORT RELATES.
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Integrity Policy
<PAGE>
A-3: Initial/Annual Holdings Report Form
[NAME OF FIRM EMPLOYEE]
---------------------
This report is being submitted pursuant to the Integrity Policy established by
Hirtle, Callaghan & Co., Inc. ("Firm") The undersigned certifies that the
following is an accurate and complete listing of all Covered Securities in which
I have a Beneficial Interest
o As of the date on which I became an "Access Person" under the
Policy. OR
o As of December 31, 20__.
--------------------------------------------------------------------------------
BROKER NAME Account No. Security No. of Shares AMOUNT
AND ADDRESS (include CUSIP,
if available)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Name of Reporting Person (Print): _________________________________
Signature of Reporting Person: _________________________________
Date of Submission _________________________________
NOTE: REPORT MUST BE FILED WITHIN TEN DAYS OF THE END OF THE CALENDAR
QUARTER TO WHICH THE REPORT RELATES.
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Integrity Policy
<PAGE>
A-4: Certification to Trust Board
[NAME OF FIRM EMPLOYEE]
---------------------
The undersigned hereby certifies that the Integrity Policy adopted by Hirtle
Callaghan & Co., Inc. pursuant to Rule 17j-1 under the Investment Company Act of
1940 and Rule 204-2(a)(12) under the Investment Advisers Act, as currently in
effect is reasonably necessary to prevent Access Persons from violating such
Policy and the required provisions of Rule 17j-1 under the Investment Company
Act of 1940, as amended.
---------------------------------- ---------------------
[Designated Principal] Date
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Integrity Policy
<PAGE>
Appendix B-1: Firm Employees Identified as "Access Persons"
STANDARD FOR IDENTIFYING FIRM EMPLOYEES WHO ARE
"ACCESS PERSONS" UNDER THIS POLICY.
-----------------------------------
A. All directors and officers of the Firm.
As of March 1, 2000, the Firm"s officer and directors were:
--------------------------------------------------------------------------------
Name Position with the Firm Position with the Trust
--------------------------------------------------------------------------------
Jonathan J. Hirtle Director and President Director
--------------------------------------------------------------------------------
Donald E. Callaghan Director, Executive Vice Director and President
President, Treasurer and
Secretary
--------------------------------------------------------------------------------
Robert J. Zion Principal, Assistant Vice-President and
Secretary Treasurer
--------------------------------------------------------------------------------
B. Any Firm Employee4 in connection with his or her regular functions or
duties,
1) makes or participates in the making of recommendations regarding
the purchase or sale of Covered Securities, or obtains
information regarding the purchase or sale of Covered Securities
by a Portfolio of the Trust, or
2) whose functions relate to the making of any recommendations with
respect to the purchases or sales of securities by any Portfolio
of the Trust.
ANALYSIS: The Firm does not provide traditional portfolio management
services to its clients and, in general, does not make recommendations
with respect to the purchase and sale of individual securities or the
selection of brokers and dealers through which securities transactions
are effected on behalf of the Firm"s clients. Instead, the Firm
formulates asset allocation recommendations,5 identifies investment
firms ("Specialist Managers") that specialize in the asset class or
investment strategy selected, negotiates with such firms to assure
that client assets placed with the firm will be managed on a basis
that is cost-effective for the client and monitors investments made by
such firms to assure that the investment objectives, policies and
other guidelines applicable to client accounts (including the Trust)
are followed. These investment related functions are handled by the
Firm"s Investment Committee but do not do not involve making
recommendations about the purchase or sale of Covered Securities. The
Firm has determined, however, that each individual who is a regular
member of the , individuals who are members of the Investment
Committee will be treated as "Access Persons" for purposes of this
Policy.
In addition, day-to-day monitoring and supervision of the Specialist
Managers are handled by the Firm"s officers. These officers and their
assistants are the only Firm Employees who, in the ordinary course of
their duties may obtain information about the purchase or sale of
Covered Securities by any Portfolio of the Trust.
-------------------
4 Under Rule 17j-1, certain officers and/or employees of any company that
controlled the Firm would also be deemed "Access Persons." Because the Firm is
controlled solely by Jonathan J. Hirtle and Donald E. Callaghan, this provision
is inapplicable.
5 "Asset allocation" in this context refers to the selection of broad investment
strategies such as value versus growth, international versus domestic, equity
versus debt. The Firm"s Investment Committee does not consider or make
recommendations relating to investment in individual securities or even industry
sectors. 6 Under Rule 17j-1, certain officers and/or employees of any company
that controlled the Firm would also be deemed "Access Persons." Because the Firm
is controlled solely by Jonathan J. Hirtle and Donald E. Callaghan, this
provision is inapplicable.
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Integrity Policy
<PAGE>
Securities by any Portfolio of the Trust.
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Any natural person in a control relationship to the Firm who obtains information
concerning recommendations made to the Trust with regard to the purchase or sale
of Covered Securities by the any Portfolio of the Trust.
ANALYSIS: there are no such persons other than the Firm"s officers and
directors.
Hirtle Callaghan & Co., Inc.
By: __________________________
Date: ________________________
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Integrity Policy
<PAGE>
Appendix B-2: Firm Employee/Access Person Certification
FROM: [NAME OF FIRM EMPLOYEE]
---------------------
The undersigned hereby certifies that he/she is has received a copy of and
understands the Integrity Policy adopted by Hirtle Callaghan & Co., Inc., and in
particular is aware of the following:
1) The interest of the Firm"s clients are paramount; avoid even the appearance
of acting other than in the bests interest of a client.
2) Keep all matters relating to the Firm or its clients strictly confidential.
3) Firm Employees may NOT participate in any IPO except under extraordinary
circumstances and then only with the prior written approval of the Firm;
Firm Employees may not facilitate such participation by any client of the
Firm.
4) Purchases of any privately placed security must be approved by the Firm
before the acquisition.
5) Firm Employees are forbidden from trading, either personally or on behalf
of others, on material inside information ("insider trading") and from
communicating or disseminating material inside information to others.
Information is "inside information" if it is not generally known to the
marketplace. Information is considered "material" if is likely to be
considered important by a reasonable investor in making an investment
decision.
6) EVERY Firm Employee must submit to the Firm a quarterly report on
transactions involving a Covered Security effected in any Personal
Securities Account or Related Account during the preceding quarter.
7) EVERY Firm Employee must submit to Firm a list of all Personal Securities
Accounts and Related Accounts in which any Firm Employee has a Beneficial
Ownership Interest.
8) Each Firm Employee who is an ACCESS PERSON must submit to the Firm an
initial statement of his or her holdings of Covered Securities.
9) Each Firm Employee who is an ACCESS PERSON must submit to the Firm an
annual statement of his or her holdings of Covered Securities.
10) Every Firm Employee will be required annually to certify that he or she has
complied with those reporting requirements to which he or she is subject
under this Policy.
[CHECK AND INITIAL ONLY IF APPLICABLE]
------------------------------------
THE UNDERSIGNED FURTHER ACKNOWLEDGES THAT HE/SHE HAS BEEN DEEMED AN "ACCESS
PERSON" UNDER THIS POLICY AND HAS COMPLIED WITH EACH STANDARD AND REPORTING
REQUIREMENT TO WHICH HE OR SHE IS SUBJECT.
Signature of Firm Employee: ____________________________ Date: ____________
Print Name: ____________________________
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Integrity Policy
<PAGE>
Appendix C: Definitions
ACCESS PERSON means:
(i) All officers and directors of the Firm;
(ii) Any Firm Employee6 in connection with his or her regular
functions or duties makes or participates in the making of
recommendations regarding the purchase or sale of Covered
Securities, or obtains information regarding the purchase or sale
of Covered Securities by a Portfolio of the Trust, or whose
functions relate to the making of any recommendations with
respect to the purchases or sales of securities by any Portfolio
of the Trust; and
(iii)Any natural person in a control relationship to the Firm who
obtains information concerning recommendations made to the Trust
with regard to the purchase or sale of Covered Securities by the
any Portfolio of the Trust.
PERSONAL SECURITIES ACCOUNT means any securities or brokerage account of any
Firm Employee.
RELATED ACCOUNT means any securities account in which a Firm Employee has a
Beneficial Ownership Interest.
BENEFICIAL OWNERSHIP INTEREST of a security is defined under Rule 16a-1 (a)(2)
of the Securities Exchange Act of 1934, which provides that a Firm Employee
should consider himself/herself the beneficial owner of securities held by
his/her spouse, his/her minor children, a relative who shares his/her home, or
other persons, directly or indirectly, if by reason of any contract,
understanding, relationship, agreement or other arrangement, he/she obtains from
such securities benefits substantially equivalent to those of ownership. He/she
should also consider himself/herself the beneficial owner of securities if
he/she can vest or revest title in himself/herself now or in the future.
For purposes of the Code, you will be deemed to have a beneficial interest in a
security under the following circumstances:
o securities you own, no matter how they are registered, and
including securities held for you by others (for example, by a
custodian or broker, or by a relative, executor or administrator)
or that you have pledged to another (as security for a loan, for
example);
o securities held by a trust of which you are a beneficiary (except
that, if your interest is a remainder interest and you do not
have or participate in investment control of trust assets, you
will not be deemed to have a beneficial interest in securities
held by the trust);
o securities held by you as trustee or co-trustee, where either you
or any member of your immediate family (i.e., spouse, children or
descendants, stepchildren, parents and their ancestors, and
stepparents, in each case treating a legal adoption as blood
relationship) has a beneficial interest (using these rules) in
the trust.
o securities held by a trust of which you are the settlor, if you
have the power to revoke the trust without obtaining the consent
of all the beneficiaries and have or participate in investment
control;
o securities held by any partnership in which you are a general
partner, to the extent of your interest in partnership capital or
profits;
o securities held by a personal holding company controlled by you
alone or jointly with others;
Page 20
Integrity Policy
<PAGE>
o securities held by (i) your spouse, unless legally separated, or
you and your spouse jointly, or (ii) your minor children or any
immediate family member of you or your spouse (including an adult
relative), directly or through a trust, who is sharing your home,
even if the securities were not received from you and the income
from the securities is not actually used for the maintenance of
your household; or
o securities you have the right to acquire (for example, through
the exercise of a derivative security), even if the right is not
presently exercisable, or securities as to which, through any
other type of arrangement, you obtain benefits substantially
equivalent to those of ownership.
You will NOT be deemed to have beneficial ownership of securities in the
following situations:
o securities held by a limited partnership in which you do not have
a controlling interest and do not have or share investment
control over the partnership's portfolio; and
o securities held by a foundation of which you are a trustee and
donor, provided that the beneficiaries are exclusively charitable
and you have no right to revoke the gift.
These examples are not exclusive. There are other circumstances in which you may
be deemed to have a beneficial interest in a security. Any questions about
whether you have a beneficial interest should be directed to the Designated
Principal.
COVERED SECURITY means a security defined in section 2(a)(36) of the Act [15
U.S.C. 80(a)(36)], except that it does not include:
(i) Direct obligations of the Government of the United States;
(ii) Bankers' acceptances, bank certificates of deposit, commercial
paper and high-quality short-term debt instruments, including
repurchase agreements; and
(iii) Shares issued by mutual funds.
Page 21
Integrity Policy
